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What changed in ASP Isotopes Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ASP Isotopes Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+1094 added−400 removedSource: 10-K (2026-04-10) vs 10-K (2024-12-31)

Top changes in ASP Isotopes Inc.'s 2025 10-K

1094 paragraphs added · 400 removed · 306 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

91 edited+153 added−30 removed115 unchanged
Biggest changeSMRs are viewed as being cheaper, safer, and more versatile than traditional large-scale nuclear reactors, and development of the new technology is receiving considerable funding from the U.S. Department of Energy, as well as from the governments of other countries. There is currently no commercial production of HALEU in the United States.
Biggest changeWe anticipate a future demand for HALEU for the new generation of HALEU-fueled SMRs and advanced reactor designs that are now under development for commercial and government uses. SMRs are viewed as being cheaper, safer, and more versatile than traditional large-scale nuclear reactors, and development of the new technology is receiving considerable funding from the U.S.
During the last century, a number of different methods have been developed to separate and enrich isotopes. The current separation or 9 enrichment processes are based either on the atomic weight of the isotope, small differences in chemical reaction rates produced by different atomic weights or are based on properties not directly connected to atomic weight such as nuclear resonances.
During the last century, a number of different methods have been developed to separate and enrich isotopes. The current separation or enrichment processes are based either on the atomic weight of the isotope, small differences in chemical reaction rates produced by different atomic weights or are based on properties not directly connected to atomic weight such as nuclear resonances.
In September 2023, we entered into a Memorandum of Understanding (MOU) with the same customer to separate Deuterium and Tritium currently stored at nuclear sites within Canada. The timing and commercial implications of this MOU are subject to future agreement between the parties. ASP Technology for Silicon-28 Enrichment Si-28 is a stable isotope of silicon.
In September 2023, we entered into a Memorandum of Understanding with the same customer to separate Deuterium and Tritium currently stored at nuclear sites within Canada. The timing and commercial implications of this Memorandum of Understanding are subject to future agreement between the parties. ASP Technology for Silicon-28 Enrichment Si-28 is a stable isotope of silicon.
Note the following: • α is the ratio of the tails and product stream abundance ratios. 12 • Y, X(θ,Y) and α(Y) describe the stage’s behaviour with regards to Zinc, while MY(Y) and MX(Y) defines its behaviour with regards to the carrier gas. • P, the stage’s power usage, depends on the ASP separator, but also on factors such as compressor efficiency, friction losses etc.
Note the following: • α is the ratio of the tails and product stream abundance ratios. • Y, X(θ,Y) and α(Y) describe the stage’s behaviour with regards to Zinc, while MY(Y) and MX(Y) defines its behaviour with regards to the carrier gas. • P, the stage’s power usage, depends on the ASP separator, but also on factors such as compressor efficiency, friction losses etc.
As the advanced reactor market develops, HALEU may be converted to uranium oxide, metal, chloride or fluoride salts, or other forms and loaded into a variety of fuel assembly types optimized for the specific reactor design. 16 • Nuclear Power Plant . The fuel assemblies are loaded into nuclear reactors to create energy from a controlled chain reaction.
As the advanced reactor market develops, HALEU may be converted to uranium oxide, metal, chloride or fluoride salts, or other forms and loaded into a variety of fuel assembly types optimized for the specific reactor design. • Nuclear Power Plant . The fuel assemblies are loaded into nuclear reactors to create energy from a controlled chain reaction.
Furthermore, U.S. economic sanctions forbid U.S. persons from circumventing direct U.S. restrictions or from facilitating transactions by non-U.S. persons if 20 those activities are forbidden to U.S. persons. Penalties for violating provisions such as these can include significant civil and criminal fines, imprisonment and loss of tax credits or export privileges.
Furthermore, U.S. economic sanctions forbid U.S. persons from circumventing direct U.S. restrictions or from facilitating transactions by non-U.S. persons if those activities are forbidden to U.S. persons. Penalties for violating provisions such as these can include significant civil and criminal fines, imprisonment and loss of tax credits or export privileges.
OFAC also administers U.S. sanctions against a lengthy list of entities and individuals, wherever they may be located, that the United States considers to be closely associated with these sanctioned countries or that are considered terrorists or traffickers in either narcotics or weapons of mass destruction.
OFAC also administers U.S. sanctions against a lengthy list of entities and 25 individuals, wherever they may be located, that the United States considers to be closely associated with these sanctioned countries or that are considered terrorists or traffickers in either narcotics or weapons of mass destruction.
SMRs will require a different grade of enriched Uranium Many advanced reactors, including the majority of the Advanced Reactor Demonstration Program awardees, will require HALEU, and fuel forms very different from those manufactured for the current Light Water Reactors (LWRs). For example, the current generation of LWRs uses fuel enriched to less than 5% uranium-235.
SMRs will require a different grade of enriched Uranium Many advanced reactors, including the majority of the Advanced Reactor Demonstration Program awardees, will require HALEU, and fuel forms very different from those manufactured for the current Light Water Reactors (LWRs). For example, the current generation of LWRs uses fuel enriched to less than 5% U-235.
In the U.S., the infrastructure for the front-end of the fuel cycle for the utilization of low enriched uranium up to 5% U-235 is well defined. The U.S. has mining, conversion, enrichment, fabrication, and transportation capability. However, the infrastructure for 17 producing and utilizing HALEU, in particular enrichments above 10%, is not established in the U.S.
In the U.S., the infrastructure for the front-end of the fuel cycle for the utilization of low enriched uranium up to 5% U-235 is well defined. The U.S. has mining, conversion, enrichment, fabrication, and transportation capability. However, the infrastructure for producing and utilizing HALEU, in particular enrichments above 10%, is not established in the U.S.
After the atom is ionized it can be removed from the sample by applying an electric field. This method is often abbreviated as AVLIS (atomic vapor laser isotope separation). This method has only recently been developed as laser technology has improved, and is currently not used extensively.
After the atom is ionized it can be removed 15 from the sample by applying an electric field. This method is often abbreviated as AVLIS (atomic vapor laser isotope separation). This method has only recently been developed as laser technology has improved, and is currently not used extensively.
ASP Technology In Use The scientists at Klydon had constructed two ASP plants for the enrichment of oxygen-18 and silicon-28 in Pretoria, South Africa, which were commissioned in October 2015 and July 2018, respectively. We believe the success of the enrichment of oxygen-18 and silicon-28 has demonstrated the efficacy and commercial scalability of the ASP technology.
ASP Technology In Use The scientists at Klydon had constructed two ASP plants for the enrichment of oxygen-18 and Si-28 in Pretoria, South Africa, which were commissioned in October 2015 and July 2018, respectively. We believe the success of the enrichment of oxygen-18 and silicon-28 has demonstrated the efficacy and commercial scalability of the ASP technology.
Diode Pumped Solid State Green Lasers (DPSSGLs) with ~3GHz line width in multi-mode operation are used to pump the dye lasers. The temporal delays between the pulses from the three lasers were arranged to ensure their sequential arrival in the interaction region with delay of several ns.
Diode Pumped Solid State Green Lasers with ~3GHz line width in multi-mode operation are used to pump the dye lasers. The temporal delays between the pulses from the three lasers were arranged to ensure their sequential arrival in the interaction region with delay of several ns.
The mining and conversion infrastructure are common to all enrichment levels. In 2020, the DOE selected two companies for awards under the Advanced Reactor Demonstration Program (ARDP) Pathway 1: Advanced Reactor Demonstrations. Both reactor designs require HALEU and can be operational in about seven years.
The mining and conversion infrastructure are common to all enrichment levels. 22 In 2020, the DOE selected two companies for awards under the Advanced Reactor Demonstration Program (ARDP) Pathway 1: Advanced Reactor Demonstrations. Both reactor designs require HALEU and can be operational in about seven years.
In June 2023, we entered into a multi-year supply agreement with a Canadian Customer for the supply of Carbon-14, which will be produced from our facility that was completed in March 2023. The customer agreed to supply carbon-14 in the form of carbon-dioxide gas as feedstock.
In June 2023, we entered into a multi-year supply agreement with a Canadian Customer for the supply of C-14, which will be produced from our facility that was completed in March 2023. The customer agreed to supply C-14 in the form of carbon dioxide gas as feedstock.
Regulatory Environment We are subject to a variety of laws and regulations, including but not limited to those of the United States and South Africa, that impose regulatory systems that govern many aspects of our operations, including our research and development activities involving the enrichment of isotopes in South Africa.
Regulatory Environment We are subject to a variety of laws and regulations, including but not limited to those of the United States and South Africa, that impose regulatory systems that govern many aspects of our operations, including our research and development activities 24 involving the enrichment of isotopes in South Africa.
In addition, these jurisdictions impose trade controls requirements that restrict trade to comply with applicable export controls and economic sanctions laws and requirements, and legal requirements that are intended to curtail bribery and corruption. 19 There are a number of regulators and treaties that govern and control our business and industry.
In addition, these jurisdictions impose trade controls requirements that restrict trade to comply with applicable export controls and economic sanctions laws and requirements, and legal requirements that are intended to curtail bribery and corruption. There are a number of regulators and treaties that govern and control our business and industry.
Nuclear power plants generate approximately 20% of U.S. electricity and 10% of the world’s electricity. • Used Fuel Storage . After the nuclear fuel has been in a reactor for several years, its efficiency is reduced and the assembly is removed from the reactor’s core.
Nuclear power plants generate approximately 20% of U.S. electricity and 10% of the world’s electricity. 21 • Used Fuel Storage . After the nuclear fuel has been in a reactor for several years, its efficiency is reduced and the assembly is removed from the reactor’s core.
The characteristics of interest are: • α(Y): the separation factor between the tails and product streams. • MY(Y): the molar mass of the tails stream. • MX(Y): the molar mass of the product stream. • P(Y): the stage’s power usage. • X(θ,Y): the flow of Zinc in the product stream, where θ = Y/(X+Y) is the cut defined in terms of isotope flows.
The characteristics of interest are: • α(Y): the separation factor between the tails and product streams. • MY(Y): the molar mass of the tails stream. • MX(Y): the molar mass of the product stream. 17 • P(Y): the stage’s power usage. • X(θ,Y): the flow of Zinc in the product stream, where θ = Y/(X+Y) is the cut defined in terms of isotope flows.
In addition, we are considering the future development of the ASP technology for the separation of Zinc-68 and Xenon-129/136 for potential use in the healthcare end market, Germanium 70/72/74 for potential use in the semiconductor end market, and Chlorine -37 for potential use in the nuclear energy end market.
We are considering the future development of the ASP technology for the separation of Zinc-68 and Xenon-129/136 for potential use in the healthcare end market, Germanium 70/72/74 for potential use in the semiconductor end market, and Chlorine -37 for potential use in the nuclear energy end market.
Unlike traditional centrifuges, which are suited to enriching gases with a high molecular mass, ASP Technology is highly suited to of enriching gases with a low molecular mass such as silane (SiH4), a gaseous compound that contains silicon.
Unlike traditional centrifuges, which are suited to enriching gases with a high molecular mass, ASP technology is highly suited to enriching gases with a low molecular mass such as silane (SiH4), a gaseous compound that contains silicon.
PET images generally have a higher contrast and spatial resolution than do SPECT images. However, PET equipment is more expensive and therefore not as widely available as SPECT equipment. Additionally, most PET tracers have short half-lives (e.g., nitrogen-13 (N-13): 10 minutes, carbon-11 (C-11): 20 minutes, and F-18: 110 minutes), so they must be produced close to their point of use.
PET images generally have a higher contrast and spatial resolution than do SPECT images. However, PET equipment is more expensive and therefore not as widely available as SPECT equipment. Additionally, most PET tracers have short half-lives (e.g., Nitrogen-13: 10 minutes, Carbon-11: 20 minutes, and F-18: 110 minutes), so they must be produced close to their point of use.
Selected isotopes of Silicon Selected isotopes of Molybdenum Selected isotopes of Uranium Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance 22 14 8 22.036 29 ms 91 42 49 90.912 15.49 min 225 92 133 225.029 62 ms 23 14 9 23.025 42.3 ms 92 42 50 91.907 Stable 14.65% 226 92 134 226.029 269 ms 24 14 10 24.012 140 ms 93 42 51 92.907 4000 y 227 92 135 227.031 1.1 m 25 14 11 25.004 220 ms 94 42 52 93.905 Stable 9.19% 228 92 136 228.031 9.1 m 26 14 12 25.992 2.245 s 95 42 53 94.906 Stable 15.87% 229 92 137 229.034 57.8 m 27 14 13 26.987 4.15 s 96 42 54 95.905 Stable 16.67% 230 92 138 230.034 20.23 d 28 14 14 27.977 Stable 92.22% 97 42 55 96.906 Stable 9.58% 231 92 139 231.036 4.2 d 29 14 15 28.977 Stable 4.69% 98 42 56 97.905 Stable 24.29% 232 92 140 232.037 68.9 y 30 14 16 29.974 Stable 3.09% 99 42 57 98.908 2.75 d 233 92 141 233.04 1.592 e5 y Trace 31 14 17 30.975 157.36 min 100 42 58 99.907 Stable 9.74% 234 92 142 234.041 2.455 e5 y Trace 32 14 18 31.974 153 y trace 101 42 59 100.910 14.61 m 235 92 143 235.044 7.038 e8 y 0.72% 33 14 19 32.978 6.18 s 102 42 60 101.910 11.3 m 236 92 144 236.046 2.342 e7 y Trace 34 14 20 33.979 2.77 s 103 42 61 102.913 67.5 s 237 92 145 237.049 6.752 d Trace 35 14 21 34.985 780 ms 104 42 62 103.914 60 s 238 92 146 238.051 4.468 e9 y 99.27% 36 14 22 35.987 450 ms 105 42 63 104.917 35.6 s 239 92 147 239.054 23.45 m 37 14 23 36.993 90 ms 106 42 64 105.918 8.73 s 240 92 148 240.057 14.1 h Trace 38 14 24 37.996 90 ms 107 42 65 106.922 3.5 s 242 92 150 242.063 16.8 m Methods of Separation and Enrichment of Isotopes Isotope enrichment is the process of concentrating specific isotopes of a chemical element by removing other isotopes.
The standard atomic weight of natural uranium is 238.02891 with 99.27% of naturally occurring uranium being the isotope with an atomic mass of 238. 14 Selected isotopes of Silicon Selected isotopes of Molybdenum Selected isotopes of Uranium Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance Nuclide Protons Neutrons Isotopic Mass Half Life Natural abundance 22 14 8 22.036 29 ms 91 42 49 90.912 15.49 min 225 92 133 225.029 62 ms 23 14 9 23.025 42.3 ms 92 42 50 91.907 Stable 14.65% 226 92 134 226.029 269 ms 24 14 10 24.012 140 ms 93 42 51 92.907 4000 y 227 92 135 227.031 1.1 m 25 14 11 25.004 220 ms 94 42 52 93.905 Stable 9.19% 228 92 136 228.031 9.1 m 26 14 12 25.992 2.245 s 95 42 53 94.906 Stable 15.87% 229 92 137 229.034 57.8 m 27 14 13 26.987 4.15 s 96 42 54 95.905 Stable 16.67% 230 92 138 230.034 20.23 d 28 14 14 27.977 Stable 92.22% 97 42 55 96.906 Stable 9.58% 231 92 139 231.036 4.2 d 29 14 15 28.977 Stable 4.69% 98 42 56 97.905 Stable 24.29% 232 92 140 232.037 68.9 y 30 14 16 29.974 Stable 3.09% 99 42 57 98.908 2.75 d 233 92 141 233.04 1.592 e5 y Trace 31 14 17 30.975 157.36 min 100 42 58 99.907 Stable 9.74% 234 92 142 234.041 2.455 e5 y Trace 32 14 18 31.974 153 y trace 101 42 59 100.910 14.61 m 235 92 143 235.044 7.038 e8 y 0.72% 33 14 19 32.978 6.18 s 102 42 60 101.910 11.3 m 236 92 144 236.046 2.342 e7 y Trace 34 14 20 33.979 2.77 s 103 42 61 102.913 67.5 s 237 92 145 237.049 6.752 d Trace 35 14 21 34.985 780 ms 104 42 62 103.914 60 s 238 92 146 238.051 4.468 e9 y 99.27% 36 14 22 35.987 450 ms 105 42 63 104.917 35.6 s 239 92 147 239.054 23.45 m 37 14 23 36.993 90 ms 106 42 64 105.918 8.73 s 240 92 148 240.057 14.1 h Trace 38 14 24 37.996 90 ms 107 42 65 106.922 3.5 s 242 92 150 242.063 16.8 m Methods of Separation and Enrichment of Isotopes Isotope enrichment is the process of concentrating specific isotopes of a chemical element by removing other isotopes.
Quantum Enrichment Technology Isotopes of every element have unique spectroscopic “signatures” defined by the electromagnetic radiation or “light” absorbed by their atoms from electron transitions. QE separates two isotopes by taking advantage of the slight differences in the transition energy between two isotopes. This method is described as a “quantum mechanics” method.
QE Technology Isotopes of every element have unique spectroscopic “signatures” defined by the electromagnetic radiation or “light” absorbed by their atoms from electron transitions. QE separates two isotopes by taking advantage of the slight differences in the transition energy between two isotopes. This method is described as a “quantum mechanics” method.
Quantum Enrichment Technology for Uranium Enrichment We believe our Quantum Enrichment technology is capable of enriching Uranium, which we may be able to commercialize as a nuclear fuel component for use in the new generation of HALEU-fueled small modular reactors that are now under development for commercial and government uses.
QE Technology for Uranium Enrichment We believe our QE technology is capable of enriching Uranium, which we may be able to commercialize as a nuclear fuel component for use in the new generation of HALEU-fueled small modular reactors that are now under development for commercial and government uses.
We estimate that the capital cost of constructing a Quantum Enrichment technology plant for uranium enrichment is approximately 75% cheaper than that of a traditional gas centrifuge enrichment facility. Our manufacturing plants are modular, so our construction time is likely faster and more flexible than competing technologies.
We estimate that the capital cost of constructing a QE technology plant for uranium enrichment is approximately 75% cheaper than that of a traditional gas centrifuge enrichment facility. Our manufacturing plants are modular, so our construction time is likely faster and more flexible than competing technologies.
This is problematic as the lutetium administered to the patient should preferably only contain the ‘useful’ Lu-177. If it contains largely ‘useless’ Lu-176, the effectiveness of the treatment will diminish. The indirect method, where ytterbium-176 is irradiated, does not generate this extra isotope.
This is problematic as the lutetium administered to the patient should preferably only contain the ‘useful’ Lu-177. If it contains largely ‘useless’ Lu-176, the effectiveness of the treatment will diminish. The indirect method, where Yb-176 is irradiated, does not generate this extra isotope.
The World is Transitioning to Newer Smaller Reactors As the world transitions to a decarbonized electric grid, society is gradually decreasing its reliance on fossil fuels and increasing its reliance on “clean energy”. There appears to be bipartisan support for the growth of nuclear energy.
The World is Transitioning to Newer Smaller Reactors As the world transitions to a decarbonized electric grid, society is gradually decreasing its reliance on fossil fuels and increasing its reliance on “clean energy.” There appears to be bipartisan support for the growth of nuclear energy.
Our Strategy Commence commercial production at each of our enrichment facilities in Pretoria, South Africa. We commenced commercial production of enriched isotopes at our ASP enrichment facilities located in Pretoria, South Africa during the first quarter of 2025. Our first ASP enrichment facility is designed to enrich light isotopes, such as Carbon-14.
Our Strategy Commence commercial production at each of our enrichment facilities in Pretoria, South Africa. We commenced commercial production of enriched isotopes at our ASP enrichment facilities located in Pretoria, South Africa during the first quarter of 2025. Our first ASP enrichment facility is designed to enrich light isotopes, such as C-14.
Insertion in the reactor and reactor operations will occur in a later year. • The material needs that are less than 1 MTU/year are for irradiation samples, lead test rods and lead test fuel assemblies. • The material needs represent a few scenarios o The deployment of an advanced fuel design for the existing fleet of light-water reactors. o The deployment of multiple reactors of the same design that will not require refueling for many years. o The deployment of reactors that have annual refueling requirements. • These reactors include a range of sizes from a few Megawatt electric to 100s of Megawatt electric. • The data above does not include utilities that are considering enrichment between 5% and 10%. 18 Quantum Enrichment Technology is ideally suited to the production of HALEU We believe that we are in a very different position to many of the entrenched domestic and international enrichers.
Insertion in the reactor and reactor operations will occur in a later year. • The material needs that are less than 1 MTU/year are for irradiation samples, lead test rods and lead test fuel assemblies. • The material needs represent a few scenarios o The deployment of an advanced fuel design for the existing fleet of light-water reactors. o The deployment of multiple reactors of the same design that will not require refueling for many years. o The deployment of reactors that have annual refueling requirements. • These reactors include a range of sizes from a few Megawatt electric to 100s of Megawatt electric. • The data above does not include utilities that are considering enrichment between 5% and 10%. 23 QE Technology is ideally suited to the production of HALEU We believe that we are in a very different position compared to many of the entrenched domestic and international enrichers.
Quantum computers are expected to be thousands or millions of times more powerful than the most advanced of today’s conventional computers, opening new frontiers and opportunities in many industries, including medicine, artificial intelligence, cybersecurity, global logistics and global financial systems. We have entered into two purchase agreements for highly enriched Silicon-28. The first is with a U.S. semiconductor company.
Quantum computers are expected to be thousands or millions of times more powerful than the most advanced of today’s conventional computers, opening new frontiers and opportunities in many industries, including medicine, artificial intelligence, cybersecurity, global logistics and global financial systems. We have entered into three purchase agreements for highly enriched Si-28. The first is with a U.S. semiconductor company.
The Lu-177 is produced in a matrix of ytterbium, which is separated from the lutetium by a chemical process after irradiation. Therefore, it leads to Lu-177 no carrier added. In the indirect production route, Lu-177 differs from the target material Yb-176 and can be isolated chemically in no carrier added (“n.c.a.”) form.
The Lu-177 is produced in a matrix of ytterbium, which is separated from the lutetium by a chemical process after irradiation. Therefore, it leads to Lu-177 no carrier added. In the indirect production route, Lu-177 differs from the target material Yb-176 and can be isolated chemically in no carrier added form.
In its natural state, uranium is principally comprised of two isotopes: uranium-235 (“U-235”) and uranium-238 (“U-238”). The concentration of U-235 in natural uranium is only 0.711% by weight. Most commercial nuclear power reactors require Low Enriched Uranium (“LEU”) fuel which has a U-235 concentration greater than natural uranium and up to 5% by weight.
In its natural state, uranium is principally comprised of two isotopes: U-235 and U-238. The concentration of U-235 in natural uranium is only 0.711% by weight. Most commercial nuclear power reactors require Low Enriched Uranium (“LEU”) fuel which has a U-235 concentration greater than natural uranium and up to 5% by weight.
In the laser isotope separation (LIS) process, atoms of the target isotope in vapor stream get ionized after interaction with a tuned laser beam. Ionized atoms are separated from the main vapor stream by electrostatic field.
In the laser isotope separation process, atoms of the target isotope in 18 vapor stream get ionized after interaction with a tuned laser beam. Ionized atoms are separated from the main vapor stream by electrostatic field.
This resemblance is used in chemical and biological research, in a technique called carbon labelling: carbon-14 atoms can be used to replace nonradioactive carbon, in order to trace chemical and biochemical reactions involving carbon atoms from any given organic compound. Carbon-14 could be obtained from waste by-products in certain nuclear reactors.
This resemblance is used in chemical and biological research, in a technique called carbon labeling: C-14 atoms can be used to replace nonradioactive carbon, in order to trace chemical and biochemical reactions involving carbon atoms from any given organic compound. C-14 could be obtained from waste by-products in certain nuclear reactors.
The advantages of ASP technology are as follows: • No moving parts, with low capital and operating costs in comparison to alternatives. • Compact in size and weight. • Easily scaled to industrial level with number of separation devices added in parallel. • The separation process occurs inside a closed cylindrical container and is a volume technology, i.e., the process efficiency is not affected by poisoning of surface contaminates as is the case for surface separation processes. • ASP operates very efficiently at molecular masses below 100 atomic mass units, unlike other separation processes which are more efficient at higher masses, which ASP can achieve equally well or to a superior degree. • ASP easily separates hydrogen gas from other gas components, e.g., harvesting hydrogen gas from carbon monoxide and carbon dioxide and altering the ratio of syngas mixture. • With the right material choice ASP can handle even the most corrosive gases. • ASP can separate any isotopes that have a gaseous or volatile chemical compound. • Most of the subsystems are procured from off-the-shelf components. • An ASP plant can be constructed in any country that adheres to the International Atomic Energy Agency (IAEA) protocols for the protection of dual use technology. 11 ASP Plant Configuration The figure below shows a schematic of an ASP cascade in operation.
The advantages of ASP technology are as follows: • No moving parts, with low capital and operating costs in comparison to alternatives. • Compact in size and weight. • Easily scaled to industrial level with number of separation devices added in parallel. • The separation process occurs inside a closed cylindrical container and is a volume technology, i.e., the process efficiency is not affected by poisoning of surface contaminates as is the case for surface separation processes. • ASP operates very efficiently at molecular masses below 100 atomic mass units, unlike other separation processes which are more efficient at higher masses, which ASP can achieve equally well or to a superior degree. • ASP easily separates hydrogen gas from other gas components, e.g., harvesting hydrogen gas from carbon monoxide and carbon dioxide and altering the ratio of syngas mixture. • With the right material choice ASP can handle even the most corrosive gases. 16 • ASP can separate any isotopes that have a gaseous or volatile chemical compound. • Most of the subsystems are procured from off-the-shelf components. • An ASP plant can be constructed in any country that adheres to the International Atomic Energy Agency (“IAEA”) protocols for the protection of dual use technology.
It has two primordial isotopes, uranium-238 and uranium-235, which have long half-lives and are found in appreciable quantity in the Earth’s crust. The decay product, uranium-234 is also found. Other isotopes such as uranium-233 have been produced in breeder reactors.
It has two primordial isotopes, uranium-238 (“U-238”) and U-235, which have long half-lives and are found in appreciable quantity in the Earth’s crust. The decay product, uranium-234 is also found. Other isotopes such as uranium-233 have been produced in breeder reactors.
We believe Quantum Enrichment technology is superior to AVLIS with optimized spectroscopy utilization and superior laser beam shaping. The key advantages include: • high selectivity, • suitability for vaporized metals, • relatively low capital cost, and • modular design which limits scalability risk.
We believe QE technology is superior to AVLIS with optimized spectroscopy utilization and superior laser beam shaping. The key advantages include: • high selectivity, • suitability for vaporized metals, • relatively low capital cost, and • modular design which limits scalability risk.
Representatives from the South African Council for the Non-Proliferation of Weapons of Mass Destruction regularly inspect our facility and conduct tests to monitor the activities that are taking place at our facilities.
Representatives from the South African Council for the Non-Proliferation of Weapons of Mass Destruction regularly inspect our isotope enrichment facility and conduct tests to monitor the activities that are taking place at our isotope enrichment and production facilities.
We are also considering the future development of QE technology for the separation of Nickel-64, Gadolinium-160, Ytterbium-171, Lithium 6 and Lithium7. We are currently pursuing an initiative to apply our enrichment technologies to the enrichment of Uranium-235 (“U-235”) in South Africa.
We are also considering the future development of QE technology for the separation of Nickel-64, Gadolinium-160, Ytterbium-171, Lithium-6 and Lithium-7. QLE is currently pursuing an initiative to apply our enrichment technologies to the enrichment of Uranium-235 (“U-235”) in South Africa.
Each stage in the cascade is operated in one of two configurations: (1) A net backward flow of the isotope: Xi > Yi. These stages are referred to as “product”, situated in the so-called “product cascade section”, and their flows are marked with an “H” subscript.
Each stage in the cascade is operated in one of two configurations: (1) A net backward flow of the isotope: Xi > Yi. These stages are referred to as “product,” situated in the so-called “product cascade section,” and their flows are marked with an “H” subscript.
This segment is focused on research and development of technologies and methods used to separate high-value, low-volume isotopes (such as C-14, Mo-100 and Si-28) for highly specialized target end markets other than advanced nuclear fuels, including pharmaceuticals and agrochemicals, nuclear medical imaging and semiconductors, as well as services related to these isotopes, and this segment includes PET Labs.
This segment is focused on research and development of technologies and methods used to separate high-value, low-volume isotopes (such as C-14, Si-28 and Yb-176) for highly specialized target end markets other than advanced nuclear fuels, including pharmaceuticals and agrochemicals, nuclear medical imaging and semiconductors, as well as services related to these isotopes, and this segment includes PET Labs. 10 • Construction Services.
The half-life also allows for transport over longer distances and on-site preparation of pharmaceuticals. 15 Lu-177 can be produced in two ways, either directly by irradiation of lutetium-176 (“Lu-176”) or indirectly by irradiation of ytterbium-176 (“Yb-176”).
The half-life also allows for transport over longer distances and on-site preparation of pharmaceuticals. 20 Lu-177 can be produced in two ways, either directly by irradiation of lutetium-176 (“Lu-176”) or indirectly by irradiation of Yb-176.
This camera technology is used to obtain two-dimensional (“2D”) images; 3D SPECT images are computer generated from many 2D images recorded at different angles. 14 Positron Emission Tomography (PET) generates 3D images of tissues and organs using tracers that emit positrons (i.e., positive electrons): for example, fluorine-18 (F-18).
This camera technology is used to obtain two-dimensional (“2D”) images; 3D SPECT images are computer generated from many 2D images recorded at different angles. 19 Positron Emission Tomography (“PET”) generates 3D images of tissues and organs using tracers that emit positrons (i.e., positive electrons): for example, fluorine-18 (“F-18”).
Under the terms of a Share Purchase Agreement, dated October 30, 2023, we acquired 51% of the issued share capital of PET Labs Pharmaceuticals Proprietary Limited, a company incorporated in the Republic of South Africa (“PET Labs”). PET Labs is a South African radiopharmaceutical operations company, dedicated to nuclear medicine and the science of radiopharmaceutical 7 production.
Under the terms of a Share Purchase Agreement, dated October 30, 2023, we acquired 51% of the issued share capital of PET Labs, a company incorporated in the Republic of South Africa. PET Labs is a South African radiopharmaceutical operations company, dedicated to nuclear medicine and the science of radiopharmaceutical production.
We are currently in discussions with nuclear regulatory authorities in multiple countries, including the UK Atomic Energy Authority, UK Office of Nuclear Regulation (ONR), Nuclear Energy Corporation of South Africa (NECSA), the South African Department of Mineral Resources and Energy (DMRE), United States Department of Energy (DOE) and the United States Nuclear Regulatory Commission (NRC), regarding the construction of a nuclear fuel plant in these countries.
We are currently in discussions with nuclear regulatory 11 authorities in multiple countries, including the UK Atomic Energy Authority, UK Office of Nuclear Regulation (UK ONR), Necsa, the DMRE, United States Department of Energy (DOE) and the United States Nuclear Regulatory Commission (NRC), regarding the construction of a nuclear fuel plant in these countries.
The table below represents management’s estimated comparison of the Quantum Enrichment technology with a traditional gas centrifuge.
The table below represents management’s estimated comparison of the QE technology with a traditional gas centrifuge.
It is quite damaging, but only deposits its energy within a short range, decreasing collateral damaging effects to normal tissues. It has a half-life of 6.7 days and is compatible with various targeting agents, ranging from short peptides to large biomolecules.
Lu-177 is a medium energy beta emitter (Eβ = 0.149 keV). It is quite damaging, but only deposits its energy within a short range, decreasing collateral damaging effects to normal tissues. It has a half-life of 6.7 days and is compatible with various targeting agents, ranging from short peptides to large biomolecules.
We plan to begin research and development for the enrichment of uranium to demonstrate our capability to produce HALEU using Quantum Enrichment technology. We anticipate a future demand for HALEU for the new generation of HALEU-fueled small modular reactors ("SMRs") and advanced reactor designs that are now under development for commercial and government uses.
Demonstrate the capability to produce HALEU using our enrichment technologies and meet anticipated demand for the new generation of HALEU-fueled small modular reactors and advanced reactor designs that are now under development for commercial and government uses. We plan to begin research and development for the enrichment of uranium to demonstrate our capability to produce HALEU using QE technology.
The Treaty on the Non-Proliferation of Nuclear Weapons, commonly known as the Non-Proliferation Treaty or NPT, is an international treaty whose objective is to prevent the spread of nuclear weapons and weapons technology, to promote cooperation in the peaceful uses of nuclear energy, and to further the goal of achieving nuclear disarmament and general and complete disarmament.
The NPT is an international treaty whose objective is to prevent the spread of nuclear weapons and weapons technology, to promote cooperation in the peaceful uses of nuclear energy, and to further the goal of achieving nuclear disarmament and general and complete disarmament.
We believe that the U-235 we may produce using quantum enrichment technology may be commercialized as a nuclear fuel component for use in the new generation of high-assay low-enriched uranium (HALEU)-fueled small modular reactors that are now under development for commercial and government uses.
We believe that the U-235 QLE may produce has the potential to be commercialized as a nuclear fuel component for use in the new generation of high-assay low-enriched uranium (“HALEU”)-fueled small modular reactors that are now under development for commercial and government uses.
Quantum Enrichment Technology Plant Gas Centrifuge Separation mechanism Enhanced resonant multiphoton ionization Differential diffusion Capital Cost per plant >$800 million Energy use (kWh) per SWU 50-240 Construction time 2-3 years 2-3 years Levelized cost per SWU* $140 * for enrichment from 0.71% U235 to 5% U235 We are in the process of commissioning and commencing commercial production at our Ytterbium-176 enrichment facility using the Quantum Enrichment technology in Pretoria, South Africa.
QE Technology Plant Gas Centrifuge Separation mechanism Enhanced resonant multiphoton ionization Differential diffusion Capital Cost per plant >$800 million Energy use (kWh) per SWU 50-240 Construction time 2-3 years 2-3 years Levelized cost per SWU* $140 * for enrichment from 0.71% U235 to 5% U235 We have completed the commissioning phase and producing commercial samples at our Yb-176 enrichment facility using the QE technology in Pretoria, South Africa.
We expect our first three enrichment facilities to generate commercial product during 2025. In addition, we have started planning additional isotope enrichment plants both in South Africa and in other jurisdictions, including Iceland and the United States. We believe the C-14 we may produce using the ASP technology could be used in the development of new pharmaceuticals and agrochemicals.
In addition, we have started planning additional isotope enrichment plants both in South Africa and in other jurisdictions, including Iceland and the United States. We believe the C-14 we may produce using the ASP technology could be used in the development of new pharmaceuticals and agrochemicals.
Importantly, subject to licensure, we believe we can produce commercial quantities of HALEU by 2027 to meet the anticipated demand from the advanced reactors currently in development. We believe that we can supply HALEU at a price lower than the HALEU currently imported from international enrichers and considerably lower than any potential domestic supply that may evolve.
Importantly, subject to licensure, we believe we can produce quantities of HALEU by 2027 for fuel testing and evaluation by developers of SMRs and other advanced reactors currently in development. We believe that we can supply HALEU at a price lower than the HALEU currently imported from international enrichers and considerably lower than any potential domestic supply that may evolve.
The IAEA was established as an autonomous organization on July 29, 1957. Though established independently of the United Nations through its own international treaty, the IAEA Statute, the IAEA reports to both the United Nations General Assembly and Security Council. The IAEA statute currently has 173 member states, including South Africa.
Though established independently of the United Nations through its own international treaty, the IAEA Statute, the IAEA reports to both the United Nations General Assembly and Security Council. The IAEA statute currently has 173 member states, including South Africa.
Employees As of December 31, 2024, we employed 136 people on a full-time basis. Of the total employees, 14 employees are in research and development, 63 employees are in engineering, construction and manufacturing, 32 employees are in plant operations and 27 employees are in general management. None of our employees are subject to collective bargaining agreements.
Employees As of December 31, 2025, we employed 271 people on a full-time basis. Of the total employees, 21 employees are in research and development, 122 employees are in engineering, construction and manufacturing, 54 employees are in plant operations and 74 employees are in general management. None of our employees are subject to collective bargaining agreements.
Historically, Russia has been the sole supplier of C-14, which is used as a tracer in the development of new pharmaceuticals and agrochemicals. The supply chain has been inherently fragile with inconsistent service.
Historically, Russia has been the sole supplier of C-14, which is used as a tracer in the development of new pharmaceuticals and agrochemicals. The supply chain has been inherently fragile with inconsistent service. We have received an initial supply of feedstock from our customer and have started the enrichment of C-14.
Our proprietary technologies, the Aerodynamic Separation Process (“ASP technology”) and Quantum Enrichment 4 technology (“QE technology”), are designed to enable the production of isotopes used in several industries. Our initial focus is on the production and commercialization of enriched Carbon-14 (“C-14”), Silicon-28 (“Si-28”) and Ytterbium-176 (“Yb-176”).
Our proprietary enrichment technologies, the Aerodynamic Separation Process (“ASP technology”) and Quantum Enrichment technology (“QE technology”), are designed to enable the production of isotopes for a range of industrial and advanced technology applications. Our initial focus with respect to our isotope enrichment platform is on the production and commercialization of enriched Carbon-14 (“C-14”), Silicon-28 (“Si-28”) and Ytterbium-176 (“Yb-176”).
We have completed the commissioning phase and are commencing commercial production at our Carbon-14 enrichment facility and our “multi-isotope” enrichment plant, which has its initial production run designated for enriched Silicon-28. We anticipate shipping the first commercial batches of enriched Carbon-14 in mid-2025 and enriched Silicon-28 during the second quarter of 2025.
We have completed the commissioning phase and are commencing commercial production at our C-14 enrichment facility and our “multi-isotope” enrichment plant, which has its initial production run designated for enriched Si-28. We are targeting initial commercial shipments of enriched C-14 mid-2026 and initial commercial shipments of enriched Si-28 during the second quarter of 2026.
Separative work units(“SWU”) is a standard unit of measurement that represents the effort required to transform a given amount of natural uranium into two components: enriched uranium having a higher percentage of U-235 and depleted uranium having a lower percentage of U-235. The SWU contained in LEU is calculated using an industry standard formula based on the physics of enrichment.
Separative work units (“SWU”) is a standard unit of measurement that represents the effort required to transform a given amount of natural uranium into two components: enriched uranium having a higher percentage of U-235 and depleted uranium having a lower percentage of U-235.
The second ASP enrichment facility, which is substantially larger than the first, should have the potential to enrich kilogram quantities of relatively heavier isotopes, including but not limited to Silicon-28 and Molybdenum-100. We anticipate shipping the first commercial batches of enriched Carbon-14 in mid-2025 and enriched Silicon-28 during the second quarter of 2025.
The second ASP enrichment facility, which is substantially larger than the first, should have the potential to enrich kilogram quantities of relatively heavier isotopes, including but not limited to Si-28 and Mo-100. We are targeting initial commercial shipments of enriched C-14 in mid-2026 and initial commercial shipments of enriched Si-28 during the second quarter of 2026.
The cascade consists of several enrichment stages, connected in a 1-up-1-down cascade configuration. The stages can be grouped into segments.
ASP Plant Configuration The figure below shows a schematic of an ASP cascade in operation. The cascade consists of several enrichment stages, connected in a 1-up-1-down cascade configuration. The stages can be grouped into segments.
A thickness monitor reading gives average arrival rate of atomic vapor in terms of thickness per unit time (A/sec). At the heart of laser-based isotope enrichment lies a proficient multi-step isotope selective photoionization scheme giving optimum selectivity and product yield. Yb has two valence electrons and very few transitions originating from its ground level. Its ionization potential is 6.254eV.
At the heart of laser-based isotope enrichment lies a proficient multi-step isotope selective photoionization scheme giving optimum selectivity and product yield. Ytterbium has two valence electrons and very few transitions originating from its ground level. Its ionization potential is 6.254eV.
Many of our computer systems are not connected to the external internet and confidential information is secured at a controlled location. Some of our future isotopes may be regulated by healthcare regulators such as the FDA in the USA, Health Canada in Canada, the European Medicines Agency in Europe and similar regulators in other countries.
Many of our computer systems are not connected to the external internet and confidential information is secured at a controlled location. Some of our future isotopes may be regulated by healthcare regulators such as the U.S.
We intend to progress our uranium enrichment initiative first in South Africa. In November 2024, we entered into a Memorandum of Understanding ("MOU") with The South African Nuclear Energy Corporation (Necsa) to collaborate on the research, development and ultimately the commercial production of advanced nuclear fuels.
In November 2024, we entered into a Memorandum of Understanding ("MOU") with Necsa to collaborate on the research, development and ultimately the commercial production of advanced nuclear fuels.
The second is with a global industrial gas company. Quantum Enrichment Technology for Ytterbium-176 Enrichment Ytterbium-176 (“Yb-176”) is a stable isotope of ytterbium, that is commonly used to produce Lutetium-177 (“Lu-177”). Lu-177 is a medical isotope used in targeted radionuclide therapy for treating neuroendocrine tumors and prostate cancer. Lu-177 is a medium energy beta emitter (Eβ = 0.149 keV).
The second is with a global industrial gas company. The third is with a large U.S. buyer. QE Technology for Ytterbium-176 Enrichment Yb-176 is a stable isotope of ytterbium, that is commonly used to produce Lutetium-177 (“Lu-177”). Lu-177 is a medical isotope used in targeted radionuclide therapy for treating neuroendocrine tumors and prostate cancer.
Many of the control systems, compressors, lasers and hardware used in a uranium enrichment facility would be similar to parts used in this ytterbium-176 enrichment facility. We expect the construction of a Uranium Enrichment facility would take approximately 30 months and the production volume would gradually ramp up to the final capacity of 20 metric tons per year.
We expect the construction of a Uranium Enrichment facility would take approximately 30 months and the production volume would gradually ramp up to the final capacity of 20 metric tons per year.
In addition to isotopes found in nature or nuclear reactors, many isotopes with far shorter half-lives have been produced, ranging from U-214 to U-242 (with the exception of U-220 and U-241). The standard atomic weight of natural uranium is 238.02891 with 99.27% of naturally occurring uranium being the isotope with an atomic mass of 238.
In addition to isotopes found in nature or nuclear reactors, many isotopes with far shorter half-lives have been produced, ranging from U-214 to U-242 (with the exception of U-220 and U-241).
In June 2023, we entered into a tolling agreement with a Canadian customer for the entire capacity of our C-14 production facility. In April and June 2024, we entered into purchase orders with a US semiconductor company and a global industrial gas company for the supply of highly enriched silicon-28.
In April and June 2024, we entered into purchase orders with a US semiconductor company and a global industrial gas company for the supply of highly enriched Si-28.
Enriched Ytterbium-176 can be irradiated to produce Lutetium-177, which has been identified for use in oncology, particularly in targeted radionuclide therapy ("TRT"). TRT is used in the treatment of various types of cancers, including neuroendocrine tumors, prostate cancer, and bone metastases, among others. There are numerous ongoing clinical trials studying Lutetium-177 PSMA-617 in patients with metastatic castration-resistant prostate cancer.
Other electronic gasses that can likely be enriched using ASP technology include disilane and germane. Enriched Yb-176 can be irradiated to produce Lutetium-177, which has been identified for use in oncology, particularly in targeted radionuclide therapy ("TRT"). TRT is used in the treatment of various types of cancers, including neuroendocrine tumors, prostate cancer, and bone metastases, among others.
We intend to expand PET Labs’ existing operations by adding two new cyclotrons to its service footprint, enabling the company to properly expand its other revenue generation mediums, which is anticipated to drive free cash flow to the company. Our Strengths ASP technology initially developed by Klydon and further developed by ASP Isotopes Inc..
We intend to expand PET Labs’ existing operations by adding two new cyclotrons to its service footprint, enabling the company to properly expand its other revenue generation mediums, which is anticipated to drive free cash flow to the company. 12 Develop world class helium reserves at Virginia Gas Project.
The isotope material becomes separated in the radial dimension as a result of the spin speed of the isotope material reaching several hundred meters per second. An axial mass flow component in each tube feeds isotope material to the respective ends of the separator where the collection of the portions of isotope material is accomplished.
An axial mass flow component in each tube feeds isotope material to the respective ends of the separator where the collection of the portions of isotope material is accomplished.
We are currently conducting a feasibility study with respect to constructing an enrichment facility in South Africa, the U.S. and the United Kingdom.
Department of Energy, as well as from the governments of other countries. There is currently no commercial production of HALEU in the United States. We are currently conducting a feasibility study with respect to constructing an enrichment facility in South Africa, the U.S. and the United Kingdom.
In our Quantum Enrichment facility, a resistive heating system has been designed to evaporate Ytterbium by sublimation at temperature in the range of 500 oC to 700 oC to provide adequate Yb vapor atoms for laser interaction. 13 During the process, the vapor jet comes out from the source to reach sonic speed at the exit plane, then it expands supersonically into vacuum.
In our Quantum Enrichment facility, a resistive heating system has been designed to evaporate Ytterbium by sublimation at temperature in the range of 500 o C to 700 o C to provide adequate Ytterbium vapor atoms for laser interaction.
We consider our relationship with our employees to be good. Facilities We lease five facilities in Pretoria, South Africa for production, research and development and offices. One lease is under automatic monthly extensions and the other four leases have terms that expire between February 28, 2026 and December 31, 2030.
We consider our relationship with our employees to be good. Facilities Our headquarters is located in leased offices in Dallas, Texas. We lease facilities in Pretoria, South Africa and Hong Kong for production, research and development and offices. One leases have terms that expire between September 30, 2026 and January 31, 2056.
The original technology was highly energy consuming and was not able to compete on an economic basis with other methods of isotope separation. The innovative development of the ASP technology over the past two decades has culminated in a more advanced separation device that we believe can compete on a commercial scale with other methods of isotope separation.
The innovative development of the ASP technology over the past two decades has culminated in a more advanced separation device that we believe can compete on a commercial scale with other methods of isotope separation. The ASP separation device separates both gas species and isotopes in a volatile state via an approximate flow pattern as shown below.
The two principal ones that control and regulate the manufacturing of isotopes at our isotope enrichment facility in South Africa are the IAEA and the Nuclear Non-Proliferation Treaty (NPT). The IAEA is an international organization that seeks to promote the peaceful use of nuclear energy, and to inhibit its use for any military purpose, including nuclear weapons.
The two principal ones that control and regulate the manufacturing of isotopes at our isotope enrichment facility in South Africa are the IAEA and the Nuclear Non-Proliferation Treaty (Treaty on Non-Proliferation of Nuclear Weapons) (“NPT").
In addition, we have a 51% ownership stake in PET Labs Pharmaceuticals Proprietary Limited (PET Labs), a South African radiopharmaceutical operations company focused on the production of fluorinated radioisotopes and active pharmaceutical ingredients, through which we entered the downstream medical isotope production and distribution market. 5 Our corporate structure and ownership of our subsidiaries is set forth in the chart below: Our Segments As of December 31, 2023, we managed our operations as a single segment, specialist isotopes and related services.
PET Labs. We have a 51% ownership stake in PET Labs, a South African radiopharmaceutical operations company focused on the production of fluorinated radioisotopes and active pharmaceutical ingredients, through which we entered the downstream medical isotope production and distribution market.
The heavier isotopes sink and the lighter isotopes rise, where they are easily collected. 10 The Aerodynamic Separation Process ("ASP") Technology ASP technology is proprietary technology originally licensed from Klydon which succeeds earlier work, first detailed in the scientific media in the mid-1970s, relating to an industrial scale enrichment plant for uranium that was constructed utilizing the so-called “stationary-wall centrifuge”.
The ASP Technology ASP technology is proprietary technology originally licensed from Klydon which succeeds earlier work, first detailed in the scientific media in the mid-1970s, relating to an industrial scale enrichment plant for uranium that was constructed utilizing the so-called “stationary-wall centrifuge.” The original technology was highly energy consuming and was not able to compete on an economic basis with other methods of isotope separation.
In September 2023, we formed a new subsidiary, Quantum Leap Energy LLC, which also has a subsidiary in the United Kingdom (Quantum Leap Energy Ltd), to focus on the development and commercialization of advanced nuclear fuels such as HALEU and Lithium-6. ASP Isotopes UK Ltd is the owner of our technology.
In September 2023, we formed QLE, which also has subsidiaries in the United Kingdom (Quantum Leap Energy Limited) and South Africa (Quantum Leap Energy (Pty) Limited), to focus on the development and commercialization of advanced nuclear fuels, such as HALEU and Lithium-6. QLE’s direct wholly owned subsidiary Quantum Leap Energy Limited (“QLE UK”), has its operations in the United Kingdom.
We have obtained all necessary licenses within South Africa to proceed with the commercial development of this product. Continue identifying potential offtake customers and strategic partners for our enriched isotopes. We have significant interest from potential offtake customers for the enriched isotopes that we intend to produce.
There are numerous ongoing clinical trials studying Lutetium-177 PSMA-617 in patients with metastatic castration-resistant prostate cancer. We believe we have obtained all necessary licenses within South Africa to proceed with the commercial development of this product. Continue identifying potential offtake customers and strategic partners for our enriched isotopes.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese risks include, but are not limited to, the following: • We have incurred significant net losses since inception, and we expect to continue to incur significant net losses for the foreseeable future. • We have a limited operating history, which may make it difficult to evaluate our prospects and likelihood of success. • Our current business is tied directly to the nuclear medicine and quantum computing industries and depends on our ability to successfully introduce our medical and other specialty isotopes to changing technology and a changing medical practice landscape. • Our business is dependent on our ability to recognize the anticipated benefits of acquisitions, including our acquisition of assets of Molybdos (Pty) Limited in the “business rescue” auction, the assets and intellectual property we acquired from Klydon Proprietary Ltd, and our investment in PET Labs Pharmaceuticals; • We currently have no sales attributable to isotopes, but we expect to be heavily dependent on a few large customers to generate a majority of our revenues from sales of our future isotopes.
Biggest changeThese risks include, but are not limited to, the following: Risks Related to Our Limited Operating History, Financial Position and Need for Additional Capital • We have incurred significant net losses since inception, and we expect to continue to incur significant net losses for the foreseeable future. • We also have a limited operating history, which may make it difficult to evaluate our prospects and likelihood of success. • Our business is dependent on our ability to recognize the anticipated benefits of acquisitions. • We currently have no sales attributable to enriched isotopes, but we expect to be heavily dependent on a few large customers to generate a majority of our revenues. • We will require substantial additional capital to finance our operations, which may not be available on acceptable terms, or at all.
Additionally, as a result of severely diminished liquidity and credit availability, increased interest rates, inflationary pressures, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability, the global credit and financial markets have experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability.
Additionally, as a result of increased interest rates, inflationary pressures, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability, the global credit and financial markets have experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability.
To date, we have relied exclusively on trade secrets and other intellectual property laws, non-disclosure agreements with our respective employees, consultants, vendors, potential customers and other relevant persons and other measures to protect our intellectual property, and intend to continue to rely on these and other means.
To date, we have relied exclusively on trade secrets and other intellectual property laws, non-disclosure agreements with our respective employees, consultants, vendors, potential customers and other relevant persons and other measures to protect our intellectual property, and intend to continue to rely on these and other means.
Prior to our IPO in November of 2022, there was no public market for shares of our Common Stock. Although our Common Stock is listed on the Nasdaq Capital Market (Nasdaq), only a limited trading market for our shares has developed, and an active market may never develop or if developed be sustained in the future.
Prior to our IPO in November of 2022, there was no public market for shares of our Common Stock. Although our Common Stock is listed on the Nasdaq Capital Market, only a limited trading market for our shares has developed, and an active market may never develop or if developed be sustained in the future.
Among other things, our amended and restated certificate of incorporation and amended and restated bylaws: • permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate (including the right to approve an acquisition or other change in our control); • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that our board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66-2/3% of the voting power of all of our then-outstanding shares of the capital stock entitled to vote generally in the election of directors, voting together as a single class; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide our board of directors into three classes; • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice; • do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • provide that special meetings of our stockholders may be called only by the chair of our board of directors, our Chief Executive Officer or by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and • provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for the following types of actions or proceedings under state, statutory and common law: (i) any derivative action or proceeding brought on our behalf; (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; (iii) any action asserting a claim pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws; (iv) any action as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (v) any action governed by the internal affairs doctrine, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants; provided these provisions of our amended and restated certificate of incorporation and amended and restated bylaws will not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction; and provided that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended (Securities Act), including all causes of action asserted against any defendant to such complaint.
Among other things, our amended and restated certificate of incorporation and amended and restated bylaws: • permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate (including the right to approve an acquisition or other change in our control); • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that our board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66-2/3% of the voting power of all of our then-outstanding shares of the capital stock entitled to vote generally in the election of directors, voting together as a single class; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide our board of directors into three classes; 57 • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice; • do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • provide that special meetings of our stockholders may be called only by the chair of our board of directors, our Chief Executive Officer or by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and • provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for the following types of actions or proceedings under state, statutory and common law: (i) any derivative action or proceeding brought on our behalf; (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; (iii) any action asserting a claim pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws; (iv) any action as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (v) any action governed by the internal affairs doctrine, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants; provided these provisions of our amended and restated certificate of incorporation and amended and restated bylaws will not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction; and provided that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended (Securities Act), including all causes of action asserted against any defendant to such complaint.
Research and development collaborations are subject to numerous risks, which may include the following: • collaborators have significant discretion in determining the efforts and resources that they will apply to a collaboration and may not commit sufficient efforts and resources or may misapply those efforts and resources; • collaborators may not pursue development and commercialization of future isotopes or may elect not to continue or renew development or commercialization programs; • collaborators may delay, provide insufficient resources to, or modify or stop development activities for future isotopes; 33 • collaborators could develop or acquire products outside of the collaboration that compete directly or indirectly with our future isotopes; • collaborators may not properly maintain or defend our intellectual property rights or may use our intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liability; • disputes may arise between us and a collaborator that cause the delay or termination of the research, development or commercialization of our future isotopes, or that result in costly litigation or arbitration that diverts management attention and resources; • collaborations may be terminated and, if terminated, may result in a need for additional capital and personnel to pursue further development or commercialization of the applicable future isotopes; and • collaborators may own or co-own intellectual property covering our products that results from our collaborating with them, and in such cases, we may not have the exclusive right to commercialize such intellectual property.
Research and development collaborations are subject to numerous risks, which may include the following: • collaborators have significant discretion in determining the efforts and resources that they will apply to a collaboration and may not commit sufficient efforts and resources or may misapply those efforts and resources; • collaborators may not pursue development and commercialization of future isotopes or may elect not to continue or renew development or commercialization programs; • collaborators may delay, provide insufficient resources to, or modify or stop development activities for future isotopes; • collaborators could develop or acquire products outside of the collaboration that compete directly or indirectly with our future isotopes; • collaborators may not properly maintain or defend our intellectual property rights or may use our intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liability; • disputes may arise between us and a collaborator that cause the delay or termination of the research, development or commercialization of our future isotopes, or that result in costly litigation or arbitration that diverts management attention and resources; • collaborations may be terminated and, if terminated, may result in a need for additional capital and personnel to pursue further development or commercialization of the applicable future isotopes; and • collaborators may own or co-own intellectual property covering our products that results from our collaborating with them, and in such cases, we may not have the exclusive right to commercialize such intellectual property.
In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Annual Report on Form 10-K, these factors include: • adverse results or delays in our development activities; • adverse regulatory decisions, including failure to receive regulatory approval for our future isotopes; • changes in laws or regulations applicable to our future isotopes, including but not limited to requirements for approvals; • any changes to our relationship with any manufacturers, suppliers, licensors, future collaborators or other strategic partners; • our inability to obtain adequate product supply for any future isotope or inability to do so at acceptable prices; • our inability to establish collaborations if needed; • our failure to commercialize our future isotopes; • additions or departures of key scientific or management personnel; • unanticipated serious safety concerns related to the use of our future isotopes; • introduction of new products or services offered by us or our competitors; • announcements of significant acquisitions, strategic partnerships, joint ventures, or capital commitments by us or our competitors; • our ability to effectively manage our growth; • actual or anticipated variations in quarterly operating results; • our cash position; • our failure to meet the estimates and projections of the investment community or that we may otherwise provide to the public; • publication of research reports about us or our industry or positive or negative recommendations or withdrawal of research coverage by securities analysts; • changes in the market valuations of similar companies; • overall performance of the equity markets; 42 • issuances of debt or equity securities; • sales of our Common Stock by us or our stockholders in the future or the perception that such sales may occur; • trading volume of our Common Stock; • changes in accounting practices; • ineffectiveness of our internal controls; • disputes or other developments relating to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies; • significant lawsuits, including patent or stockholder litigation; • general political and economic conditions, including military conflict or the effects of pandemics; and • other events or factors, many of which are beyond our control.
In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Annual Report on Form 10-K, these factors include: • adverse results or delays in our development activities; • adverse regulatory decisions, including failure to receive regulatory approval for our future isotopes; 54 • changes in laws or regulations applicable to our future isotopes, including but not limited to requirements for approvals; • any changes to our relationship with any manufacturers, suppliers, licensors, future collaborators or other strategic partners; • our inability to obtain adequate product supply for any future isotope or inability to do so at acceptable prices; • our inability to establish collaborations if needed; • our failure to commercialize our future isotopes; • additions or departures of key scientific or management personnel; • unanticipated serious safety concerns related to the use of our future isotopes; • introduction of new products or services offered by us or our competitors; • announcements of significant acquisitions, strategic partnerships, joint ventures, or capital commitments by us or our competitors; • our ability to effectively manage our growth; • actual or anticipated variations in quarterly operating results; • our cash position; • our failure to meet the estimates and projections of the investment community or that we may otherwise provide to the public; • publication of research reports about us or our industry or positive or negative recommendations or withdrawal of research coverage by securities analysts; • changes in the market valuations of similar companies; • overall performance of the equity markets; • issuances of debt or equity securities; • sales of our Common Stock by us or our stockholders in the future or the perception that such sales may occur; • trading volume of our Common Stock; • changes in accounting practices; • ineffectiveness of our internal controls; • disputes or other developments relating to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies; • significant lawsuits, including patent or stockholder litigation; • general political and economic conditions, including military conflict or the effects of pandemics; and • other events or factors, many of which are beyond our control.
Risks inherent in international operations include the following: • fluctuations in foreign currency exchange rates may affect product demand and may adversely affect the profitability in U.S. dollars of products and services we provide in international markets where payment for our products and services is made in the local currency; • transportation and other shipping costs may increase, or transportation may be inhibited; • increased cost or decreased availability of raw materials; • changes in foreign laws and tax rates or U.S. laws and tax rates with respect to foreign income may unexpectedly increase the rate at which our income is taxed, impose new and additional taxes on remittances, repatriation or other payments by subsidiaries, or cause the loss of previously recorded tax benefits; • foreign countries in which we do business may adopt other restrictions on foreign trade or investment, including currency exchange controls; • trade sanctions by or against these countries could result in our losing access to customers and suppliers in those countries; • unexpected adverse changes in foreign laws or regulatory requirements may occur; • our agreements with counterparties in foreign countries may be difficult for us to enforce and related receivables may be difficult for us to collect; • compliance with the variety of foreign laws and regulations may be unduly burdensome; 40 • compliance with anti-bribery and anti-corruption laws (such as the Foreign Corrupt Practices Act) as well as anti-money- laundering laws may be costly; • unexpected adverse changes in export duties, quotas and tariffs and difficulties in obtaining export licenses may occur; • general economic conditions in the countries in which we operate could have an adverse effect on our earnings from operations in those countries; • our foreign operations may experience staffing difficulties and labor disputes; • termination or substantial modification of international trade agreements may adversely affect our access to raw materials and to markets for our products outside the U.S.; • foreign governments may nationalize or expropriate private enterprises; • increased sovereign risk (such as default by or deterioration in the economies and creditworthiness of local governments) may occur; and • political or economic repercussions from terrorist activities, including the possibility of hyperinflationary conditions and political instability, may occur in certain countries in which we do business.
Risks inherent in international operations include the following: • fluctuations in foreign currency exchange rates may affect product demand and may adversely affect the profitability in U.S. dollars of products and services we provide in international markets where payment for our products and services is made in the local currency; • transportation and other shipping costs may increase, or transportation may be inhibited; • increased cost or decreased availability of raw materials; • changes in foreign laws and tax rates or U.S. laws and tax rates with respect to foreign income may unexpectedly increase the rate at which our income is taxed, impose new and additional taxes on remittances, repatriation or other payments by subsidiaries, or cause the loss of previously recorded tax benefits; • foreign countries in which we do business may adopt other restrictions on foreign trade or investment, including currency exchange controls; • trade sanctions by or against these countries could result in our losing access to customers and suppliers in those countries; • unexpected adverse changes in foreign laws or regulatory requirements may occur; • our agreements with counterparties in foreign countries may be difficult for us to enforce and related receivables may be difficult for us to collect; • compliance with the variety of foreign laws and regulations may be unduly burdensome; • compliance with anti-bribery and anti-corruption laws (such as the Foreign Corrupt Practices Act) as well as anti-money- laundering laws may be costly; • unexpected adverse changes in export duties, quotas and tariffs and difficulties in obtaining export licenses may occur; • general economic conditions in the countries in which we operate could have an adverse effect on our earnings from operations in those countries; • our foreign operations may experience staffing difficulties and labor disputes; • termination or substantial modification of international trade agreements may adversely affect our access to raw materials and to markets for our products outside the U.S.; 51 • foreign governments may nationalize or expropriate private enterprises; • increased sovereign risk (such as default by or deterioration in the economies and creditworthiness of local governments) may occur; and • political or economic repercussions from terrorist activities, including the possibility of hyperinflationary conditions and political instability, may occur in certain countries in which we do business.
Our amended and restated certificate of incorporation provides that, subject to the court’s having personal jurisdiction over the indispensable parties named as defendants, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for the following types of actions or proceedings: • any derivative action or proceeding brought on our behalf; • any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; • any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or bylaws; • any action as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and • any action asserting a claim that is governed by the internal affairs doctrine.
Our amended and restated certificate of incorporation provides that, subject to the court’s having personal jurisdiction over the indispensable parties named as defendants, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for the following types of actions or proceedings: • any derivative action or proceeding brought on our behalf; • any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; 58 • any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or bylaws; • any action as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and • any action asserting a claim that is governed by the internal affairs doctrine.
These transactions can entail numerous operational and financial risks, including exposure to unknown liabilities, disruption of our business and diversion of our management’s time and attention in order to manage a collaboration or develop acquired products or technologies, incurrence of substantial debt or dilutive issuances of equity securities to pay transaction consideration or costs, higher than expected collaboration, acquisition or integration costs, write-downs of assets or goodwill or impairment charges, increased amortization expenses, difficulty and cost in facilitating the collaboration or combining the operations and personnel of any acquired business, impairment of relationships with key suppliers, manufacturers or customers of any acquired business due to changes in management and ownership and the inability to retain key employees of any acquired business.
These transactions can entail numerous operational and financial risks, including exposure to unknown liabilities, disruption of our business and diversion of our management’s time and attention in order to manage a collaboration or develop acquired products or technologies, incurrence of substantial debt or dilutive issuances of equity securities to pay transaction consideration or costs, higher than expected collaboration, acquisition or integration costs, write-downs of assets or goodwill or impairment charges, increased amortization 43 expenses, difficulty and cost in facilitating the collaboration or combining the operations and personnel of any acquired business, impairment of relationships with key suppliers, manufacturers or customers of any acquired business due to changes in management and ownership and the inability to retain key employees of any acquired business.
If, for any reason, we should fail to maintain compliance with these listing standards and Nasdaq should delist our securities from trading on its exchange and we are unable to obtain listing on another national securities exchange, a reduction in some or all of the following may occur, each of which could have a material adverse effect on our shareholders: • the liquidity of our Common Stock; • the market price of our Common Stock; • our ability to obtain financing for the continuation of our operations; 46 • the number of investors that will consider investing in our Common Stock; • the number of market makers in our Common Stock; • the availability of information concerning the trading prices and volume of our Common Stock; and • the number of broker-dealers willing to execute trades in shares of our Common Stock.
If, for any reason, we should fail to maintain compliance with these listing standards and Nasdaq should delist our securities from trading on its exchange and we are unable to obtain listing on another national securities exchange, a reduction in some or all of the following may occur, each of which could have a material adverse effect on our shareholders: • the liquidity of our Common Stock; • the market price of our Common Stock; • our ability to obtain financing for the continuation of our operations; • the number of investors that will consider investing in our Common Stock; • the number of market makers in our Common Stock; • the availability of information concerning the trading prices and volume of our Common Stock; and • the number of broker-dealers willing to execute trades in shares of our Common Stock.
However, we cannot predict: • if and when any patents will issue; • the degree and scope of protection any issued patents will afford us against competitors, including whether third parties will find ways to invalidate or otherwise circumvent our patents; • whether others will apply for or obtain patents claiming aspects similar to those covered by our patents and patent applications; • whether we will need to initiate litigation or administrative proceedings to defend our patent rights, which may be costly whether we win or lose; or • whether the patent applications that we own or in-license will result in issued patents with claims that cover our future isotopes or uses thereof in the United States or in foreign countries.
However, we cannot predict: • if and when any patents will issue; • the degree and scope of protection any issued patents will afford us against competitors, including whether third parties will find ways to invalidate or otherwise circumvent our patents; • whether others will apply for or obtain patents claiming aspects similar to those covered by our patents and patent applications; • whether we will need to initiate litigation or administrative proceedings to defend our patent rights, which may be costly whether we win or lose; or 44 • whether the patent applications that we own or in-license will result in issued patents with claims that cover our future isotopes or uses thereof in the United States or in foreign countries.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any isotopes that we may produce; • loss of revenue; • substantial monetary awards to patients; • significant time and costs to defend the related litigation; • a diversion of management’s time and our resources; • initiation of investigations by regulators; • the inability to commercialize any isotopes that we may produce; • injury to our reputation and significant negative media attention; and 30 • a decline in our share price.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any isotopes that we may produce; • loss of revenue; • substantial monetary awards to patients; • significant time and costs to defend the related litigation; • a diversion of management’s time and our resources; • initiation of investigations by regulators; • the inability to commercialize any isotopes that we may produce; • injury to our reputation and significant negative media attention; and • a decline in our share price.
Issuers, like us, whose common stock has historically had limited trading history or volumes and/or have been susceptible to relatively high volatility levels can be vulnerable to such short seller publications. In November 2024, a short seller report was published about the Company, followed by a decrease in the price of our publicly traded securities.
Issuers, like us, whose common stock has historically had limited trading history or volumes and/or have been susceptible to relatively high volatility levels can be vulnerable to such short seller publications. In November 2024, a short seller report was published about us, followed by a decrease in the price of our publicly traded securities.
We have no prior experience as a company in the marketing, sale and distribution of isotopes and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and 29 incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.
We have no prior experience as a company in the marketing, sale and distribution of isotopes and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.
This will require us to be successful in a range of challenging 23 activities, including completing research and development activities relating to our ASP technology, obtaining applicable regulatory approval for future isotopes, if any, and manufacturing, marketing and selling any future isotopes (assuming receipt of applicable regulatory approvals). We are only in the preliminary stages of most of these activities.
This will require us to be successful in a range of challenging activities, including completing research and development activities relating to our ASP technology, obtaining applicable regulatory approval for future isotopes, if any, and manufacturing, marketing and selling any future isotopes (assuming receipt of applicable regulatory approvals). We are only in the preliminary stages of most of these activities.
Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products. We may not be able to enter into collaborations or hire consultants or external service providers to assist us in sales, marketing and distribution functions on acceptable financial terms, or at all.
Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products. We may not be able to enter into collaborations or hire consultants or external service providers to assist us in sales, marketing and distribution functions 35 on acceptable financial terms, or at all.
If we do not have sufficient funds, we may not be able to further develop our future isotopes or bring them to market and generate product revenue. 34 We may be dependent on intellectual property licensed or sublicensed to us from, or for which development was funded or otherwise assisted by, government agencies, for development of our technology and future isotopes.
If we do not have sufficient funds, we may not be able to further develop our future isotopes or bring them to market and generate product revenue. We may be dependent on intellectual property licensed or sublicensed to us from, or for which development was funded or otherwise assisted by, government agencies, for development of our technology and future isotopes.
We cannot guarantee that we have entered into such agreements with each party that may have or has had access to our trade secrets or proprietary technology and processes. Although we use reasonable efforts to protect our trade secrets, our employees, consultants, outside scientific advisors, 37 contractors, and collaborators might intentionally or inadvertently disclose our trade secret information to competitors.
We cannot guarantee that we have entered into such agreements with each party that may have or has had access to our trade secrets or proprietary technology and processes. Although we use reasonable efforts to protect our trade secrets, our employees, consultants, outside scientific advisors, contractors, and collaborators might intentionally or inadvertently disclose our trade secret information to competitors.
In the event we scale our business by hiring additional personnel and entering into contracts with third parties, the risks associated with breaches of non-disclosure agreements, confidentiality 32 agreements and other agreements pertaining to our technology and proprietary information will increase, and such breaches could have an adverse effect on our business and competitive position.
In the event we scale our business by hiring additional personnel and entering into contracts with third parties, the risks associated with breaches of non-disclosure agreements, confidentiality agreements and other agreements pertaining to our technology and proprietary information will increase, and such breaches could have an adverse effect on our business and competitive position.
Our future financial performance, our ability to commercialize future isotopes, develop a scalable infrastructure and compete effectively will depend, in part, on our ability to effectively manage any future growth. Our employees, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
Our future financial performance, 49 our ability to commercialize future isotopes, develop a scalable infrastructure and compete effectively will depend, in part, on our ability to effectively manage any future growth. Our employees, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
We cannot assure you that licenses will be available on acceptable terms, if at all. Furthermore, because of the potential for significant damage awards, which are not necessarily predictable, it is not unusual to find even arguably unmeritorious claims resulting in large settlements.
We cannot assure you that licenses will be available on acceptable terms, if at all. Furthermore, because of the potential for significant 42 damage awards, which are not necessarily predictable, it is not unusual to find even arguably unmeritorious claims resulting in large settlements.
Significant disruptions of our, our third-party vendors’ and/or our business partners’ information technology systems or other similar data security incidents could adversely affect our business operations and/or result in the loss, misappropriation, and/or unauthorized access, use or disclosure of, or the prevention of access to, sensitive information, which could result in financial, legal, 39 regulatory, business and reputational harm to us.
Significant disruptions of our, our third-party vendors’ and/or our business partners’ information technology systems or other similar data security incidents could adversely affect our business operations and/or result in the loss, misappropriation, and/or unauthorized access, use or disclosure of, or the prevention of access to, sensitive information, which could result in financial, legal, regulatory, business and reputational harm to us.
Further, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) was enacted. There are significant corporate governance and executive compensation-related provisions in the Dodd-Frank Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access.
Further, in July 2010, the 59 Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) was enacted. There are significant corporate governance and executive compensation-related provisions in the Dodd-Frank Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access.
Our research and development of isotope enrichment is dedicated not only to producing enriched isotopes for use in nuclear medical diagnostic procedures and concentrating uranium in the isotope uranium-235 for use in nuclear energy, but also to safeguarding any information with broad, dual-use potential that could be inappropriately applied.
Our research and development of isotope enrichment is dedicated not only to producing enriched isotopes for use in nuclear medical diagnostic procedures and concentrating uranium in the isotope U-235 for use in nuclear energy, but also to safeguarding any information with broad, dual-use potential that could be inappropriately applied.
In October 2023, we entered into a Share Purchase Agreement with Nucleonics Imaging Proprietary Limited, a company incorporated in South Africa, to purchase 51% of the ordinary shares (the “initial shares”) in Nucleonics’ wholly-owned subsidiary, PET Labs Pharmaceuticals Proprietary Limited, a company incorporated in South Africa and dedicated to nuclear medicine and the science of radiopharmaceutical production.
In October 2023, we entered into a Share Purchase Agreement with Nucleonics Imaging Proprietary Limited, a company incorporated in South Africa, to purchase 51% of the ordinary shares (the “initial shares”) in Nucleonics’ wholly-owned subsidiary, PET Labs, a company incorporated in South Africa and dedicated to nuclear medicine and the science of radiopharmaceutical production.
We expect that we will need significant additional capital in the future to continue our planned operations, including development activities, commercialization efforts if we are able to obtain marketing approval of future isotopes, research and 43 development activities, and costs associated with operating a public company.
We expect that we will need significant additional capital in the future to continue our planned operations, including development activities, commercialization efforts if we are able to obtain marketing approval of future isotopes, research and development activities, and costs associated with operating a public company.
Any product liability insurance coverage that we obtain and maintain may not be adequate to cover all liabilities that we may incur. We anticipate that we will need to increase our insurance coverage each time we commence a clinical trial and if we successfully commercialize any isotopes. Insurance coverage is increasingly expensive.
Any product liability insurance coverage that we obtain and maintain may not be adequate to cover all liabilities that we may incur. We anticipate that we will need to increase our insurance coverage each time we commence a clinical trial and if we 36 successfully commercialize any isotopes. Insurance coverage is increasingly expensive.
In addition, we will need to attract, retain and motivate highly qualified additional management and scientific personnel. If we are not able to retain our management and to attract, on acceptable terms, additional qualified personnel necessary for the continued development of our business, we may not be able to sustain our operations or grow.
In addition, we will need to attract, retain and motivate highly qualified additional management and scientific and technical personnel. If we are not able to retain our management and to attract, on acceptable terms, additional qualified personnel necessary for the continued development of our business, we may not be able to sustain our operations or grow.
Until we protect our intellectual property through patent, trademarks and registered copyrights, we may not be able to protect our intellectual property and trade secrets or prevent others from independently developing substantially equivalent proprietary information and techniques or from otherwise gaining access to our intellectual property or trade secrets.
Until we protect our intellectual property through patent, trademarks and registered copyrights, we may not be able to protect our intellectual property and trade secrets or prevent others from independently developing substantially equivalent proprietary information and techniques or from 41 otherwise gaining access to our intellectual property or trade secrets.
In the event of a delisting, we can provide no assurance that any action taken by us to restore compliance with listing requirements would allow our Common Stock to become listed again, stabilize the market price or improve the liquidity of our Common Stock, prevent our Common Stock from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with the listing requirements of Nasdaq. 48 If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
In the event of a delisting, we can provide no assurance that any action taken by us to restore compliance with listing requirements would allow our Common Stock to become listed again, stabilize the market price or improve the liquidity of our Common Stock, prevent our Common Stock from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with the listing requirements of Nasdaq. 61 If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
If the isotopes that we may produce using our ASP technology gains market acceptance and our customers receive regulatory approval for the isotopes they produce, we must build a marketing and sales organization with technical expertise and supporting distribution capabilities to commercialize such product in the markets that we target, which will be expensive and time-consuming, or collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems.
If the isotopes that we may produce using our ASP technology gain market acceptance and our customers receive regulatory approval for the isotopes they produce, we must build a marketing and sales organization with technical expertise and supporting distribution capabilities to commercialize such product in the markets that we target, which will be expensive and time-consuming, or collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems.
In addition, we cannot assure you that we will be able to obtain, on a timely basis or at all, any additional licenses, approvals and permits that may be required to execute on our strategy and develop our company’s business, including any such licenses, approvals and permits that may be required to introduce isotopes produced using ASP technology into the market and to begin the enrichment of uranium to demonstrate our capability to produce HALEU using the Quantum Enrichment technology.
In addition, we cannot assure you that we will be able to obtain, on a timely basis or at all, any additional licenses, approvals and permits that may be required to execute on our strategy and develop our company’s business, including any such licenses, approvals and permits that may be required to introduce isotopes produced using ASP technology into the market and to begin the enrichment of uranium to demonstrate our capability to produce HALEU using the QE technology.
In July 2022, we acquired assets comprising a dormant Silicon-28 aerodynamic separation processing plant from Klydon located in Pretoria, South Africa for ZAR 6,000,000 (which at the then current exchange rate was approximately $364,000). In addition, in April 2023, we perfected our interest under the Acknowledgement of Debt Agreement, under which we acquired specific intellectual property from Klydon.
In July 2022, we acquired assets comprising a dormant Si-28 aerodynamic separation processing plant from Klydon located in Pretoria, South Africa for ZAR 6,000,000 (which at the then-current exchange rate was approximately $364,000). In addition, in April 2023, we perfected our interest under the Acknowledgement of Debt Agreement, under which we acquired specific intellectual property from Klydon.
We also plan to begin researching the enrichment of uranium, which is a chemical element we believe may have application in the clean, efficient and carbon-free energy industry, using Quantum Enrichment technology. Quantum Enrichment technology has never been used to produce isotopes at a commercial scale and the research that has been conducted using this technique has never been published.
We also plan to begin researching the enrichment of uranium, which is a chemical element we believe may have application in the clean, efficient and carbon-free energy industry, using QE technology. QE technology has never been used to produce isotopes at a commercial scale and the research that has been conducted using this technique has never been published.
If we are unable to raise additional capital when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts, or grant rights to develop and market our future isotopes (assuming receipt of applicable regulatory approvals for our future isotopes) that we would otherwise develop and market ourselves.
If we are unable to raise additional capital when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts, or grant rights to develop and market our future isotopes (assuming receipt of applicable regulatory approvals for our future isotopes), LNG and helium that we would otherwise develop and market ourselves.
We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, services agreements, consulting agreements or other similar agreements with our advisors, employees, third-party contractors and consultants prior to beginning research or disclosing proprietary information.
We seek to protect our proprietary enrichment technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, services agreements, consulting agreements or other similar agreements with our advisors, employees, third-party contractors and consultants prior to beginning research or disclosing proprietary 46 information.
We expect to continue to incur significant losses for the foreseeable future, and we expect these losses to increase as we: • continue to invest in our research and development activities; • seek applicable regulatory approvals for any future isotopes that we may successfully develop; • experience any delays or encounter any issues with any of the above, including but not limited to failed research and development activities, safety issues, or other regulatory challenges; • hire additional engineering and production personnel and build our internal resources, including those related to audit, patent, other legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums and investor and public relations costs; • obtain, expand, maintain, enforce and protect our intellectual property portfolio; • establish a sales, marketing and distribution infrastructure and establish manufacturing capabilities, whether alone or with third parties, to commercialize future isotopes (assuming receipt of applicable regulatory approvals), if any; and • operate as a public company.
We expect to continue to incur significant losses for the foreseeable future, and we expect these losses to increase as we: • continue to invest in our research and development activities; • continue to develop Phase 2 of the Virginia Gas Project; • seek applicable regulatory approvals for any future isotopes that we may successfully develop; • experience any delays or encounter any issues with any of the above, including but not limited to failed research and development activities, safety issues, or other regulatory challenges; • hire additional engineering and production personnel and build our internal resources, including those related to audit, patent, other legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums and investor and public relations costs; • obtain, expand, maintain, enforce and protect our intellectual property portfolio; 29 • establish a sales, marketing and distribution infrastructure and establish manufacturing capabilities, whether alone or with third parties, to commercialize future isotopes (assuming receipt of applicable regulatory approvals), if any; and • operate as a public company.
We do not know whether an active, liquid and orderly trading market will develop for our Common Stock or what the market price of our Common Stock will be and as a result it may be difficult for you to sell your shares of our Common Stock.
We do not know whether an active, liquid and orderly trading market will be sustained for our Common Stock or what the market price of our Common Stock will be and as a result it may be difficult for you to sell your shares of our Common Stock.
We also plan to research the production of enriched uranium using Quantum Enrichment technology to meet the future needs of developers of U.S. advanced reactor technologies requiring HALEU. Our projections of the potential markets are based on estimates that have been derived from a variety of sources, including scientific literature and market research, and which may prove to be incorrect.
We also plan to research the production of enriched uranium using QE technology to meet the future needs of developers of U.S. advanced reactor technologies requiring HALEU. Our projections of the potential markets are based on estimates that have been derived from a variety of sources, including scientific literature and market research, and which may prove to be incorrect.
If the patent applications we hold or have in-licensed with respect to our development programs fail to issue, if their breadth or strength of protection is threatened, or if they fail to provide meaningful exclusivity for the ASP technology or the Quantum Enrichment technology, it could dissuade companies from collaborating with us, and threaten our ability to commercialize, isotopes produced using the ASP technology or the Quantum Enrichment technology.
If the patent applications we hold or have in-licensed with respect to our development programs fail to issue, if their breadth or strength of protection is threatened, or if they fail to provide meaningful exclusivity for the ASP technology or the QE technology, it could dissuade companies from collaborating with us, and threaten our ability to commercialize, isotopes produced using the ASP technology or the QE technology.
Our future prospects are tied directly to the end markets that use our isotopes including the diagnostic medical imaging industry and depend on our ability to successfully introduce our isotopes and adapt to a changing technology and medical practice landscape.
Certain of our future prospects are tied directly to the end markets that use our isotopes including the diagnostic medical imaging industry and depend on our ability to successfully introduce our isotopes and adapt to a changing technology and medical practice landscape.
Regulatory approval for production and distribution of radiopharmaceuticals used for medical imaging and therapeutic treatments may involve a lengthy and expensive process with an uncertain outcome. Currently, the sale or use of many stable isotopes is not regulated by a healthcare regulator, such as the FDA, European Medicines Agency (EMA) or comparable foreign regulatory authorities.
Regulatory approval for production and distribution of radiopharmaceuticals used for medical imaging and therapeutic treatments may involve a lengthy and expensive process with an uncertain outcome. Currently, the sale or use of many stable isotopes is not regulated by a healthcare regulator, such as the FDA, EMA or comparable foreign regulatory authorities.
Our Common Stock was listed on the Nasdaq Stock Exchange on November 10, 2022. Prior to listing, we were a privately-held company, we were not required to evaluate our internal control over financial reporting in a manner that meets the standards of publicly traded companies required by Section 404(a) of the Sarbanes-Oxley Act, or Section 404.
Our Common Stock was listed on the Nasdaq Capital Market on November 10, 2022. Prior to listing, we were a privately-held company, we were not required to evaluate our internal control over financial reporting in a manner that meets the standards of publicly traded companies required by Section 404(a) of the Sarbanes-Oxley Act, or Section 404.
Because we expect sales of isotopes that we may produce using the ASP technology (assuming receipt of applicable regulatory approvals for commercial sale) to generate substantially all of our revenues for the foreseeable future, the failure of these isotopes that we may produce using the ASP technology (assuming receipt of applicable regulatory approvals for commercial sale) to find market acceptance would harm our business and could require us to seek additional financing.
Because we expect sales of isotopes that we may produce using the ASP technology (assuming receipt of applicable regulatory approvals for commercial sale) to generate significant revenues for the foreseeable future, the failure of these isotopes that we may produce using the ASP technology (assuming receipt of applicable regulatory approvals for commercial sale) to find market acceptance would harm our business and could require us to seek additional financing.
Our success and competitiveness depend, in significant part, on our ability to protect our intellectual property rights, including the ASP technology and the Quantum Enrichment technology and certain other practices, tools, technologies and technical expertise we utilize in designing, developing, implementing and maintaining processes used in the development of our future isotopes.
Our success and competitiveness depend, in significant part, on our ability to protect our intellectual property rights, including the ASP technology and the QE technology and certain other practices, tools, technologies and technical expertise we utilize in designing, developing, implementing and maintaining processes used in the development of our future isotopes.
Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets. We could be subject to securities class action litigation.
Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets. We have been and could be in the future subject to securities class action litigation.
Any such outcome could have a negative effect on our business. Even if we obtain patents covering the ASP technology or the Quantum Enrichment technology or our methods, we may still be barred from making, using and selling such technology or methods because of the patent rights of others.
Any such outcome could have a negative effect on our business. Even if we obtain patents covering the ASP technology or the QE technology or our methods, we may still be barred from making, using and selling such technology or methods because of the patent rights of others.
Furthermore, we will be subject to rules and regulations related to anti-bribery and anti-trust prohibitions of the U.S. and other countries, as well as export controls and economic embargoes, violations of which may carry substantial penalties.
Furthermore, we will be subject to rules and regulations related to anti-bribery, anti-corruption, anti-money-laundering and anti-trust prohibitions of the U.S. and other countries, as well as export controls and economic embargoes, violations of which may carry substantial penalties.
We depend upon a limited number of third-party suppliers for certain components required to construct the centrifuges and other equipment for the enrichment plants that are being constructed in South Africa. To date, we have been able to obtain the required components for our centrifuges without any significant delays or interruptions, except for certain delays related to COVID-19.
We depend upon a limited number of third-party suppliers for certain components required to construct the centrifuges and other equipment for the enrichment plants that are being constructed in South Africa. To date, we have been able to obtain the required components for our centrifuges without any significant delays or interruptions.
If we are unable to protect our intellectual property and proprietary rights, we may be unable to prevent competitors from using our own inventions and intellectual property to compete against us, and our business may be harmed. Our ASP technology and Quantum Enrichment technology may be found to infringe third-party intellectual property rights.
If we are unable to protect our intellectual property and proprietary rights, we may be unable to prevent competitors from using our own inventions and intellectual property to compete against us, and our business may be harmed. Our ASP technology and QE technology may be found to infringe third-party intellectual property rights.
Even if patents are successfully issued and even if such patents cover the ASP technology and the Quantum Enrichment technology, third parties may challenge their scope, validity, or enforceability, which may result in such patents being narrowed, invalidated, or held unenforceable.
Even if patents are successfully issued and even if such patents cover the ASP technology and the QE technology, third parties may challenge their scope, validity, or enforceability, which may result in such patents being narrowed, invalidated, or held unenforceable.
In addition to the extraction of sensitive information, such attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. In addition, the prevalent use of mobile devices increases the risk of data security incidents.
In addition to the extraction of sensitive information, such attacks could include the deployment of harmful malware, computer viruses, unauthorized access, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. In addition, the prevalent use of mobile devices increases the risk of data security incidents.
If we are unable to continue to attract, retain and motivate high-quality personnel and consultants to accomplish our business objectives, the rate and success at which we can develop future isotopes and our business will be limited, and we may experience constraints on our development objectives.
If we are unable to continue to attract, retain and motivate high-quality personnel and consultants to accomplish our business objectives, the rate and success at which we can develop future isotopes, the Virginia Gas Project and our other business will be limited, and we may experience constraints on our development objectives.
In addition, 4,951,535 shares of Common Stock that are either subject to outstanding options or reserved for future issuance under our employee benefit plans will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, and Rule 144 and Rule 701 under the Securities Act.
In addition, 4,108,036 shares of Common Stock that are either subject to outstanding options or reserved for future issuance under our employee benefit plans will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, and Rule 144 under the Securities Act.
Any successful opposition to these patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any future isotopes using the ASP technology or the Quantum Enrichment technology.
Any successful opposition to these patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any future isotopes using the ASP technology or the QE technology.
Even if the products that we or our customers may produce using the ASP technology receives regulatory approval, it may fail to achieve market acceptance by radiopharmacies, hospitals, clinics or others in the medical community necessary for commercial success.
Even if the products that we or our customers may produce using the ASP technology receive regulatory approval, they may fail to achieve market acceptance by radiopharmacies, hospitals, clinics or others in the medical community necessary for commercial success.
We will have to be successful in a range of challenging activities, including completing research and development activities relating to our ASP technology, obtaining applicable regulatory approval for future isotopes, if any, and manufacturing, marketing and selling any future isotopes (assuming receipt of applicable regulatory approvals). We are only in the preliminary stages of most of these activities.
We will have to be successful in a range of challenging activities, including completing research and development activities relating to our enrichment technologies, obtaining applicable regulatory approval for future isotopes, if any, and manufacturing, marketing and selling any future isotopes (assuming receipt of applicable regulatory approvals). We are only in the preliminary 32 stages of most of these activities.
The Company maintains cash balances at many financial institutions in multiple geographies. While the majority of cash balances are currently held in USD at U.S. financial institutions, our cash balances at those institutions may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000 per depositor, per insured bank for each account ownership category.
We maintain cash balances at many financial institutions in multiple geographies. While the majority of cash balances are currently held in USD at U.S. financial institutions, our cash balances at those institutions may exceed the Federal Deposit Insurance Corporation insurance limit of $250,000 per depositor, per insured bank for each account ownership category.
The success of the company will depend in large part on the success of our management in integrating the acquired assets into the company.
Our success will depend in large part on the success of our management in integrating the acquired assets into our operations.
However, we expect to rely on a limited number of customers to purchase any isotopes that we produce using the ASP technology or quantum enrichment under long-term contracts. Our future key customers may stop ordering our isotopes at any time or may become bankrupt or otherwise unable to pay.
However, we expect to rely on a limited number of customers to purchase any isotopes that we produce using the ASP or QE technologies under long-term contracts. Our future key customers may stop ordering our isotopes at any time or may become bankrupt or otherwise unable to pay.
It is therefore in the short seller’s interest for the price of the stock to decline. At any time, short sellers may publish, or arrange for the publication of, their opinions or characterizations of the Company that may cause negative market reactions and declines in the price of the Company’s common 41 stock.
It is therefore in the short seller’s interest for the price of the stock to decline. At any time, short sellers may publish, or arrange for the publication of, their opinions or characterizations of us that may cause negative market reactions and declines in the price of our common stock.
Risks Related to the Development and Commercialization of Our Future Isotopes We are continuing our research and development efforts for isotopes using the ASP technology and the Quantum Enrichment technology.
Risks Related to the Development and Commercialization of Our Future Isotopes • We are continuing our research and development efforts for isotopes using the ASP technology and the QE technology.
We have not yet demonstrated an ability to overcome many of the risks and uncertainties frequently encountered by companies in the medical, technology and energy industries, including an ability to obtain applicable regulatory approvals, manufacture any isotopes at commercial scale, or conduct sales and marketing activities necessary for successful isotope commercialization.
We have not yet demonstrated the ability to produce commercial quantities of enriched isotopes using the ASP technology or QE technology nor an ability to overcome many of the risks and uncertainties frequently encountered by companies in the medical, technology and energy industries, including an ability to obtain applicable regulatory approvals, manufacture any isotopes at commercial scale, or conduct sales and marketing activities necessary for successful isotope commercialization.
We may not be able to attract or retain qualified personnel in the future due to the intense competition for qualified personnel among biotechnology, pharmaceutical and other businesses.
We may not be able to attract or retain qualified personnel in the future due to the intense competition for qualified personnel among biotechnology, pharmaceutical and other businesses, including energy infrastructure projects.
However, we have not opted out of this provision. 45 These and other provisions in our certificate of incorporation and bylaws, as amended, and Delaware law could make it more difficult for stockholders or potential acquirors to obtain control of our board of directors or initiate actions that are opposed by our then-current board of directors, including delay or impede a merger, tender offer or proxy contest involving our company.
These and other provisions in our certificate of incorporation and bylaws, as amended, and Delaware law could make it more difficult for stockholders or potential acquirors to obtain control of our board of directors or initiate actions that are opposed by our then-current board of directors, including delay or impede a merger, tender offer or proxy contest involving our company.
Additionally, we do not currently maintain “key person” life insurance on the lives of our executives or any of our employees. 38 We will need to expand our organization, and we may experience difficulties in managing this growth, which could disrupt our operations. As of December 31, 2024, we employed 136 people, 127 of whom are located in South Africa.
Additionally, we do not currently maintain “key person” life insurance on the lives of our executives or any of our employees. We will need to expand our organization, and we may experience difficulties in managing this growth, which could disrupt our operations. As of December 31, 2025, we employed 271 people full-time, 189 of whom are located in South Africa.
Any additional capital raising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our future isotopes (assuming receipt of applicable regulatory approvals).
Any additional capital raising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our future isotopes (assuming receipt of applicable regulatory approvals) and Phase 2 of the Virginia Gas Project.
Therefore, patent applications covering our platform technologies and methods could have been filed by others without our knowledge. Additionally, pending claims in patent applications which have been published can, subject to certain limitations, be later amended in a manner that could cover our platform technologies. These patent applications may have priority over patent applications filed by us.
Additionally, pending claims in patent applications which have been published can, subject to certain limitations, be later amended in a manner that could cover our platform technologies. These patent applications may have priority over patent applications filed by us.
As a result, we are not profitable and have incurred losses since our inception in September 2021. For the years ended December 31, 2024 and 2023, we reported a net loss of $32.4 million and $16.3 million, respectively. As of December 31, 2024, we had an accumulated deficit of $56.2 million.
As a result, we are not profitable and have incurred losses since our inception in September 2021. For the years ended December 31, 2025 and 2024, we reported a net loss of $159.8 million and $32.4 million, respectively. As of December 31, 2025, we had an accumulated deficit of $231.3 million.
We are subject to a wide variety of laws and regulations relating to various aspects of our business, including with respect to the development of the ASP technology and our future isotopes, employment and labor, health care, tax, privacy and data security, health and safety, and environmental issues.
We are subject to a wide variety of laws and regulations relating to various aspects of our business, including with respect to the development of the ASP technology and our future isotopes, development of the Virigina Gas Project and related LNG and Helium extraction and sales, employment and labor, health care, tax, privacy and data security, health and safety, and environmental issues.
If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline. 49 Item 1B. Unresolved Staff Comments None.
If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.
A Delaware corporation may opt out of this provision by express provision in its original certificate of incorporation or by amendment to its certificate of incorporation or bylaws approved by its stockholders.
A Delaware corporation may opt out of this provision by express provision in its original certificate of incorporation or by amendment to its certificate of incorporation or bylaws approved by its stockholders. However, we have not opted out of this provision.
As we pursue additional research and development activities related to our ASP technology and seek applicable regulatory approval of our any future isotopes, and otherwise to support our continuing operations, we will require substantial additional capital to support our business operations.
As we pursue additional research and development activities related to our ASP technology and seek applicable regulatory approval of any future isotopes, and otherwise to support our continuing operations, including the development of Phase 2 of the Virginia Gas Project, we will require substantial additional capital to support our business operations.
However, many products that are produced from stable isotopes in a radio pharmacy, such as Mo-99, Tc-99, Lu-177 and Ga 68 are regulated by healthcare regulators. Our future customers who may use our stable isotopes to produce radiopharmaceuticals will likely require regulatory approval for their products.
However, many products that are produced from stable isotopes in a radiopharmacy, such as Mo-99, Tc-99, Lu-177 and Ga-68 are regulated by healthcare regulators. Our future customers who may use our stable isotopes to produce radiopharmaceuticals will likely require regulatory approval for their products. The regulatory approval of products is not standardized between different regions.
If we or our third-party collaborators, consultants, contractors, suppliers, or service providers were to suffer an attack or breach, for example, that resulted in the unauthorized access to or use or disclosure of personal or health information, we may have to notify consumers, partners, collaborators, government authorities, and the media, and may be subject to investigations, civil penalties, administrative and enforcement actions, and litigation, any of which could harm our business and reputation.
If we or our third-party collaborators, consultants, contractors, suppliers, or service providers were to suffer an attack or breach, for example, that resulted in the unauthorized access to or use or disclosure of personal or health information, we may have to notify consumers, partners, collaborators, government authorities, and the media, and may be subject to investigations, civil penalties, administrative and enforcement actions, and litigation, any of which could harm our business and reputation. 50 There is no way of knowing with certainty whether we have experienced any data security incidents that have not been discovered.
We expect our expenses to increase substantially in connection with our ongoing and planned activities, particularly as we continue our research and development activities, seek applicable regulatory approvals for any future isotopes that we may successfully develop, and expand our organization by hiring additional personnel.
We expect our expenses to increase substantially in connection with our ongoing and planned activities, particularly as we continue our research and development activities, seek applicable regulatory approvals for any future isotopes that we may successfully develop, expand our organization by hiring additional personnel, continue to integrate acquired assets into our company and continue the development of Phase 2 of the Virginia Gas Project.
Although the Company currently believes that the financial institutions with whom it does business, will be able to fulfill their commitments to the Company, there is no assurance that those institutions will be able to continue to do so.
Although we currently believe that the financial institutions with whom we do business will be able to fulfill their commitments to us, there is no assurance that those 31 institutions will be able to continue to do so.
Our future isotopes and other proprietary technologies we may develop may infringe existing or future patents owned by third parties. We may in the future become party to, or be threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our future isotopes and technology, including interference proceedings, post-grant review and inter partes review before the USPTO.
We may in the future become party to, or be threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our future isotopes and technology, including interference proceedings, post-grant review and inter partes review before the USPTO.
As a result, we do not have the full benefit of patent or copyright laws to prevent others from replicating the ASP technology and Quantum Enrichment technology. We have not yet protected our intellectual property rights through patents or formal copyright registration, and we currently have no patent applications pending.
Risks Related to Our Intellectual Property Our intellectual property is not protected through patents or formal copyright registration. As a result, we do not have the full benefit of patent or copyright laws to prevent others from replicating the ASP technology and QE technology.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThis space is used for production activities. 50 We believe that our current facilities are sufficient to meet our current and near-term needs and that, should it be needed, suitable additional space will be available.
Biggest changeItem 2. Properties As of December 31, 2025, we are party to several facility leases in South Africa and Hong Kong for office, manufacturing and laboratory space. We believe that our current facilities are sufficient to meet our current and near-term needs and that, should it be needed, suitable additional space will be available.
Removed
Item 2. Properties As of December 31, 2024, we lease five facilities in Pretoria, South Africa for office, production and laboratory space. One lease commenced in October 2021 with the initial term set to expire in December 2030. This space is used for office, production and laboratory activities.
Added
Please also see the section captioned “Facilities” in Part I, Item 1 above.
Removed
The second lease commenced in April 2023 with the initial term expired in March 2024. Effective February 1, 2024, this lease was amended such that the new term begins on February 1, 2024 and expires in February 2026. The Company plans to remain in this space under the monthly renewal terms of the agreement.
Removed
This space is used for production and laboratory activities. The third lease commenced in November 2023 with the initial term set to expire in October 2026. This space is used for laboratory activities.
Removed
The fourth lease commenced with our acquisition of PET Labs Pharmaceuticals in October 2023 and has an initial term set to expire in March 2026 with automatic monthly extensions thereafter. This space is used for office and production activities.
Removed
The fifth lease commenced with our acquisition of PET Labs Pharmaceuticals in October 2023 and had an initial term which expired in December 2023 with automatic monthly extensions thereafter. The Company plans to remain in this space under the monthly renewal terms of the agreement.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe complaint seeks unspecified compensatory damages, attorney’s fees and costs. Defendants intend to vigorously defend against the Securities Class Action; however, we cannot be certain of the outcome and, if decided adversely to us, our business and financial condition may be adversely affected.
Biggest changeThe Company cannot be certain of the outcome of the Securities Class Action and, if decided adversely to us, our business and financial condition may be adversely affected.
The results of any current or future claims or proceedings cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and litigation costs, diversion of management resources, reputational harm and other factors. Item 4. Mine Safety Disclosures Not applicable. PART II
The results of any current or future claims or proceedings cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and litigation costs, diversion of management resources, reputational harm and other factors. Please also see the section captioned “Legal Proceedings” in Part I, Item 1 above. Item 4.
Added
The complaint seeks unspecified compensatory damages, attorney’s fees and costs. On May 2, 2025, the Court appointed Mark Leone (“Leone”) as lead plaintiff and directed the Clerk of court to amend the caption to substitute Leone for Alexander Corredor as plaintiff.
Added
On May 2, 2025, the Court also appointed lead counsel and set deadlines for filing an amended consolidated class action complaint and briefing schedules for a motion to dismiss, if any, and class certification.
Added
On May 27, 2025, Leone and two additional named plaintiffs (“Plaintiffs”) filed the amended class action complaint 79 (“Amended Complaint”), that asserts the same causes of action and seeks the same relief as the initial complaint and is based upon substantially similar factual allegations as the initial complaint.
Added
On June 27, 2025, Defendants filed a motion to dismiss the Amended Complaint. Also on June 27, 2025, Plaintiffs filed a motion for class certification. On December 4, 2025, the Court denied in part Defendants’ motion to dismiss and granted Plaintiffs’ motion for class certification.
Added
On April 3, 2026, following a mediation in which the parties reached an agreement-in-principle to resolve all claims in the Securities Class Action, subject to the Court’s approval, the parties filed a Joint Stipulation agreeing to stay the Securities Class Action (the “Stipulation”).
Added
The Stipulation requires the parties to file a stipulation of settlement and for the Plaintiffs to file a motion for preliminary approval of the stipulation of settlement within 60 days of the Court’s approval of the Stipulation. On April 6, 2026, the Court approved the Stipulation.
Added
On January 30, 2026, a purported stockholder of the Company filed a derivative action against certain members of the Company’s board of directors in the United States District Court for the Northern District of Texas asserting claims for, among others, breach of fiduciary duty, violation of § 14(a) of the Securities Exchange Act of 1934 and a claim for contribution pursuant to § 21D thereof (Jenis v.
Added
Mann, et al., Case No. 3:26-cv-251 (N.D. Tex.)) (the “Jenis Action”). The Company is named as a Nominal Defendant.
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On March 2, 2026, a different purported stockholder of the Company filed a derivative action against certain members of the Company’s board of directors in the United States District Court for the Southern District of New York asserting claims for, among others, breach of fiduciary duty, violations of §§ 14(a) and 20(a) of the Securities Exchange Act of 1934, and a claim for contribution pursuant to § 21D thereof (Stewart v.
Added
Mann, et al., Case No. 1:26-cv-1712 (S.D.N.Y.)) (the “Stewart Action”) (together with the Jenis Action, the “Derivative Actions”)). The Company is named as a Nominal Defendant. The Derivative Actions arise out of similar allegations as those made in the Securities Class Action.
Added
The plaintiffs in the Derivative Actions seek unspecified damages, disgorgement of compensation, corporate governance reforms, fees, interests, and costs. The defendants have not yet responded to the complaints in the Derivative Actions. The Company cannot be certain of the outcome of the Derivative Actions and, if decided adversely to us, our business and financial condition may be adversely affected.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeStock Performance Graph As a smaller reporting company, we are not required to provide the information requested by this item pursuant to Item 201 of Regulation S-K. Unregistered Sales of Equity Securities and Use of Proceeds Unregistered sales of equity securities None. 51 Repurchases of equity securities by the issuer None.
Biggest changeSecurities Authorized for Issuance under Equity Compensation Plans For equity compensation plan information, refer to Item 12, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters of this Annual Report on Form 10-K. 80 Stock Performance Graph As a smaller reporting company, we are not required to provide the information requested by this item pursuant to Item 201 of Regulation S-K.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders of Record Our common stock is traded on the Nasdaq Global Select Market under the symbol “ASPI.” Public trading of our common stock began on November 10, 2022. Prior to that, there was no public market for our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders of Record Our common stock is traded on the Nasdaq Capital Market under the symbol “ASPI.” Public trading of our common stock began on November 10, 2022. Prior to that, there was no public market for our common stock.
As of March 21, 2025, we had 30 registered shareholders, not including those shares held in street or nominee name. Dividends We have never declared or paid a cash dividend on our capital stock. We currently intend to retain any future earnings and do not expect to pay any dividends in the foreseeable future.
As of April 3, 2026, we had 1,691 registered shareholders, not including those shares held in street or nominee name. Dividends We have never declared or paid a cash dividend on our capital stock. We currently intend to retain any future earnings and do not expect to pay any dividends in the foreseeable future.
Removed
Securities Authorized for Issuance under Equity Compensation Plans Information regarding the Securities Authorized for Issuance under our Equity Compensation Plans will be included in an amendment to this Annual Report in Form 10-K or incorporated by reference from our definitive proxy statement to be filed pursuant to Rule 14A.
Added
Unregistered Sales of Equity Securities and Use of Proceeds Unregistered sales of equity securities None. Repurchases of equity securities by the issuer None. Item 6. [Reserved] 81
Removed
Rule 10b5-1 Trading Plans During the quarter ended December 31, 2024, our directors and/or officers (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended (Exchange Act)) adopted or terminated the contracts, instructions, or written plans for the purchase or sale of our securities set forth in the table below.
Removed
Name and Title Action Adoption/ Termination Date Rule 10b5-1 (1) Non-Rule 10b5-1 (2) Total Number of Shares of Common Stock to be Sold (3) Expiration Date Paul E.
Removed
Mann (Chief Executive Officer and Executive Chairman) Adoption December 13, 2024 X — Up to 1,150,000 September 2, 2026 Robert Ainscow (Chief Operating Officer) Adoption December 13, 2024 X — Up to 275,000 September 2, 2026 (1) Contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.
Removed
(2) “Non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K under the Exchange Act. (3) Represents the maximum number of shares that may be sold pursuant to the 10b5-1 arrangement. The number of shares sold will be dependent on the satisfaction of certain conditions as set forth in the trading plan.
Removed
(4) Rule 10b5-1 trading arrangement that is intended to provide for “eligible sell-to-cover transactions” (as described in Rule 10b5-1(c)(1)(ii)(D)(3) under the Exchange Act) to satisfy tax withholding obligations arising exclusively from vesting of restricted stock awards (RSAs) or restricted stock units (RSUs).
Removed
The number of shares subject to covered RSAs or RSUs that will be sold to satisfy applicable tax withholding obligations upon vesting is not currently determinable as the number will vary based on the market price of our common stock and the extent to which vesting conditions are satisfied.
Removed
This sell-to-cover arrangement provides solely for the automatic sale of shares that would otherwise be issuable in respect of a covered RSA or RSU in an amount sufficient to satisfy the applicable withholding obligation, with the proceeds of the sale delivered to us in satisfaction of the applicable withholding obligation. Item 6. [Reserved] 52

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeSelect information from the consolidated statements of operations and comprehensive loss as of the years ended December 31, 2024 and 2023 is as follows: Revenues Net Loss Before Allocation to Noncontrolling Interest Year Ended December 31, Year Ended December 31, Segment 2024 2023 2024 2023 Specialist isotopes and related services $ 3,944,226 $ 433,026 $ (21,367,787 ) $ (16,145,339 ) Nuclear fuels 200,000 — (10,881,084 ) — Corporate — — (173,857 ) (148,787 ) $ 4,144,226 $ 433,026 $ (32,422,728 ) $ (16,294,126 ) 57 Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 The following table summarizes our results of operations for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Change Revenue $ 4,144,226 $ 433,026 $ 3,711,200 Cost of goods sold 2,544,614 294,056 2,250,558 Gross profit 1,599,612 138,970 1,460,642 Operating expenses: Research and development 3,138,978 764,581 2,374,397 Selling, general and administrative 24,814,288 15,416,388 9,397,900 Total operating expenses 27,953,266 16,180,969 11,772,297 Other (expense) income: Foreign exchange transaction gain 69,865 45,753 24,112 Change in fair value of share liability (132,273 ) (194,540 ) 62,267 Change in fair value of convertible notes payable (6,875,041 ) — (6,875,041 ) Interest income 1,238,691 9,074 1,229,617 Interest expense (258,867 ) (118,547 ) (140,320 ) Total other expense (5,957,625 ) (258,260 ) (5,699,365 ) Loss before income tax expense $ (32,311,279 ) $ (16,300,259 ) $ (16,011,020 ) Revenue and Cost of Goods Sold Effective with the acquisition of 51% of PET Labs, we have recognized revenue from the sale of nuclear medical doses for PET scanning for the two month period since the acquisition was effective on October 31, 2023 and December 31, 2023 and the year ended December 31, 2024.
Biggest changeThe following table shows total assets by segment and a reconciliation to the consolidated financial statements as of December 31, 2025 and 2024 (in thousands): December 31, 2025 2024 Segment assets: Specialist isotopes and related services $ 323,690 $ 71,771 Nuclear fuels 94,252 22,577 Construction services 80,078 — Total assets $ 498,020 $ 94,348 Select information from the consolidated statements of operations and comprehensive loss as of the years ended December 31, 2025 and 2024 is as follows (in thousands): Revenues Net Income (Loss) Before Allocation to Noncontrolling Interest Year Ended December 31, Year Ended December 31, Segment 2025 2024 2025 2024 Specialist isotopes and related services $ 5,674 $ 3,944 $ (33,259 ) $ (21,542 ) Nuclear fuels — 200 (144,125 ) (10,881 ) Construction services 18,175 — 17,541 — $ 23,849 $ 4,144 $ (159,843 ) $ (32,423 ) 89 Results of Operations Comparison of the Years Ended December 31, 2025 and 2024 The following table summarizes our results of operations for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, 2025 2024 Change Revenue $ 23,849 $ 4,144 $ 19,705 Cost of revenue 20,444 2,545 17,899 Gross profit 3,405 1,599 1,806 Operating expenses: Acquired in-process research and development 2,717 — 2,717 Research and development 12,358 3,139 9,219 Selling, general and administrative 48,238 24,814 23,424 Total operating expenses 63,313 27,953 35,360 Other (expense) income: Foreign exchange transaction gain (134 ) 70 (204 ) Change in fair value of share liability (121 ) (132 ) 11 Change in fair value of convertible notes payable (123,719 ) (6,875 ) (116,844 ) Change in fair value of investments 17,932 — 17,932 Interest income 6,790 1,238 5,552 Interest expense (575 ) (259 ) (316 ) Other income 174 — 174 Total other expense (99,653 ) (5,958 ) (93,695 ) Loss before income tax expense $ (159,561 ) $ (32,312 ) $ (127,249 ) Revenue and Cost of Revenue We have recognized revenue of PET Labs and ECNP, since its acquisition in October 2025, from the sale of nuclear medical doses for PET scanning.
In April 2024, we received approximately $5.5 million from the issuance of 3,164,557 shares of common stock upon the exercise of warrants. 54 In July 2024, we issued 13,800,000 in a public offering at a public offering price of $2.50 per share resulting in net proceeds of approximately $32.3 million after deducting underwriting discounts, commissions and offering expenses.
In April 2024, we received approximately $5.5 million from the issuance of 3,164,557 shares of common stock upon the exercise of warrants. In July 2024, we issued 13,800,000 in a public offering at a public offering price of $2.50 per share resulting in net proceeds of approximately $32.3 million after deducting underwriting discounts, commissions and offering expenses.
ASP Isotopes Guernsey Limited (the holding company for subsidiaries in the Cayman Islands, South Africa, Iceland and the United Kingdom) is focused on the development and commercialization of high-value, low-volume isotopes for highly specialized end markets (such as C-14, Mo-100, and Si-28). ASP Isotopes UK Ltd is the owner of our technology. QLE .
ASP Isotopes Guernsey Limited (the holding company for our subsidiaries in the Cayman Islands, South Africa, Iceland and the United Kingdom) is focused on the development and commercialization of high-value, low-volume isotopes for highly specialized end markets (such as C-14, Mo-100, and Si-28). ASP Isotopes UK Ltd is the owner of our technology.
Selling, General and Administrative Selling, general and administrative expenses consist primarily of personnel-related costs, which include salaries, payroll taxes, employee benefits, and other employee-related costs, including stock-based compensation, for personnel in executive, sales, finance and other administrative functions. Other significant costs include legal fees relating to corporate matters, professional fees for accounting and consulting services and facility-related costs.
Selling, General and Administrative Selling, general and administrative expenses consist primarily of personnel-related costs, which include salaries, payroll taxes, employee benefits, and other employee-related costs, including stock-based compensation expense, for personnel in executive, sales, finance and other administrative functions. Other significant costs include legal fees relating to corporate matters, professional fees for accounting and consulting services and facility-related costs.
Developing isotopes is a time-consuming, expensive and uncertain process that takes years to complete, and we may never achieve the necessary results required or obtain applicable regulatory approval for any isotopes or generate revenue from the sale of any future isotopes (assuming applicable regulatory approval is received).
Developing and commercializing isotopes is a time-consuming, expensive and uncertain process that takes years to complete, and we may never achieve the necessary results required or obtain applicable regulatory approval for any isotopes or generate revenue from the sale of any future isotopes (assuming applicable regulatory approval is received).
The regulatory landscape and supply chain for nuclear fuel production differs 53 significantly from that of medical isotopes, hence we and QLE have different business models and we believe that both companies would benefit if QLE is independently managed and financed.
The regulatory landscape and supply chain for nuclear fuel production differs significantly from that of medical isotopes, hence we and QLE have different business models and we believe that both companies would benefit if QLE is independently managed and financed.
In addition, we are considering the future development of the ASP technology for the separation of Zinc-68 and Xenon-129/136 for potential use in the healthcare end market, Germanium 70/72/74 for potential use in the semiconductor end market, and Chlorine -37 for potential use in the nuclear energy end market.
We are considering the future development of the ASP technology for the separation of Zinc-68 and Xenon-129/136 for potential use in the healthcare end market, Germanium 70/72/74 for potential use in the semiconductor end market, and Chlorine -37 for potential use in the nuclear energy end market.
Contractual Obligations and Commitments We lease our main facility in Pretoria, South Africa under a lease with a base monthly rent payment of approximately $9,000 with a term expiring on December 31, 2030.
Contractual Obligations and Commitments Leases We lease our main facility in Pretoria, South Africa under a lease with a base monthly rent payment of approximately $9,000 with a term expiring on December 31, 2030.
On October 18, 2024, we signed a term sheet with TerraPower (the “TerraPower Term Sheet”) that provides for the execution of two definitive agreements: (1) an agreement pursuant to which TerraPower will provide funding for our construction of a uranium enrichment facility capable of producing HALEU using our proprietary aerodynamic separation process technology to be located in the Republic of South Africa and (2) An agreement pursuant to which we will deliver to TerraPower the full capacity of the enrichment facility.
On October 18, 2024, we signed the TerraPower Term Sheet that provides for the execution of two definitive agreements: (1) an agreement pursuant to which TerraPower will provide funding for our construction of a uranium enrichment facility capable of producing HALEU using our proprietary aerodynamic separation process technology to be located in the Republic of South Africa and (2) An agreement pursuant to which we will deliver to TerraPower the full capacity of the enrichment facility.
Until such time as we can generate significant revenue from sales of our future isotopes or nuclear medical doses for PET scanning, if ever, we expect to finance our cash needs through public or private equity or debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements.
Until such time as we can generate significant revenue from sales of our future isotopes, nuclear medical doses for PET and SPECT scanning and sales of helium and LNG, if ever, we expect to finance our cash needs through public or private equity or debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements.
We have a 51% ownership stake in PET Labs Pharmaceuticals Proprietary Limited (PET Labs), a South African radiopharmaceutical operations company focused on the production of fluorinated radioisotopes and active pharmaceutical ingredients, through which we entered the downstream medical isotope production and distribution market.
PET Labs . We have a 51% ownership stake in PET Labs, a South African radiopharmaceutical operations company focused on the production of fluorinated radioisotopes and active pharmaceutical ingredients, through which we entered the downstream medical isotope production and distribution market.
If we raise funds through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our future isotopes, future revenue streams or research programs or may have to grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock.
If we raise funds through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our future isotopes, future helium and LNG production and sales, future revenue streams or research programs or may have to grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock.
The specialist isotopes and related services segment is focused on research and development of technologies and methods used to separate high-value, low-volume isotopes (such as C-14, Mo-100 and Si-28) for highly specialized target end markets other than advanced nuclear fuels, including pharmaceuticals and agrochemicals, nuclear medical imaging and semiconductors, as well as services related to these isotopes, and this segment includes PET Labs.
The specialist isotopes and related services segment is focused on research and development of technologies and methods used to separate high-value, low-volume isotopes (such as C-14, Si-28 and Yb-176) for highly specialized target end markets other than advanced nuclear fuels, including pharmaceuticals and agrochemicals, nuclear medical imaging and semiconductors, as well as services related to these isotopes, and this segment includes PET Labs and ECNP.
In addition, our future isotopes (assuming applicable regulatory approval is received) may not achieve commercial success. Our commercial revenues, if any, will be derived from sales of isotopes that we do not expect to be commercially available in substantial quantities until at least 2025.
In addition, our future isotopes (assuming applicable regulatory approval is received) may not achieve commercial success. Our commercial revenues, if any, will be derived from sales of isotopes that we do not expect to be commercially available in substantial quantities until at least the middle of 2026.
In connection with the anticipated spin-out, in February 2024, we entered into a number of agreements with QLE, including a License Agreement, pursuant to which QLE has licensed from us the rights to technologies and methods used to separate Uranium 235 and Lithium 6 (including but not limited to the quantum enrichment and ASP technologies) in exchange for a perpetual royalty in the amount of 10% of all future QLE revenues, and an EPC Services Framework Agreement, pursuant to which we will provide services for the engineering, procurement and construction of one or more turnkey Uranium-235 and Lithium-6 enrichment facilities in locations to be identified by QLE and owned or leased by QLE, and commissioning, start-up and test services for each such facility, subject to the receipt of all applicable regulatory approvals, permits, licenses, authorizations, registrations, certificates, consents, orders, variances and similar rights.
We entered into a number of agreements with QLE, including a License Agreement, pursuant to which QLE has licensed from us the rights to technologies and methods used to separate U-235 and Lithium-6 (including but not limited to the QE and ASP technologies) in exchange for a perpetual royalty in the amount of 10% of all future QLE revenues, and an EPC Services Framework Agreement, pursuant to which we will provide services for the engineering, procurement and construction of one or more turnkey U-235 and Lithium-6 enrichment facilities in locations to be identified by QLE and owned or leased by QLE, and commissioning, start-up and test services for each such facility, subject to the receipt of all applicable regulatory approvals, permits, licenses, authorizations, registrations, certificates, consents, orders, variances and similar rights.
In October 2024, a warrant to purchase 151,741 shares of common stock was exercised and the Company received gross proceeds of $299,688. In November 2024, we issued 2,754,250 shares of common stock at a public offering price of $6.75 per share resulting in net proceeds of approximately $17.1 million after deducting underwriting discounts, commissions and offering expenses.
In October 2024, a warrant to purchase 151,741 shares of common stock was exercised and we received gross proceeds of $0.3 million. In November 2024, we issued 2,754,250 shares of common stock at a public offering price of $6.75 per share resulting in net proceeds of approximately $17.1 million after deducting underwriting discounts, commissions and offering expenses.
We are also considering the future development of QE technology for the separation of Nickel-64, Gadolinium-160, Ytterbium-171, Lithium 6 and Lithium7. We are currently pursuing an initiative to apply our enrichment technologies to the enrichment of Uranium-235 (“U-235”) in South Africa.
We are also considering the future development of QE technology for the separation of Nickel-64, Gadolinium-160, Ytterbium-171, Lithium-6 and Lithium-7. QLE, our subsidiary, is currently pursuing an initiative to apply our enrichment technologies to the enrichment of Uranium-235 (“U-235”) in South Africa.
We also lease additional space on a short term basis in Pretoria, South Africa under a lease with a base monthly rent payment of approximately $18,000 with a term expiring on February 28, 2026 and the Company is continuing to occupy that space under the monthly extensions.
We also lease additional space on a short term basis in Pretoria, South Africa under a lease with a base monthly rent payment of approximately $18,000 with a term that expired on February 28, 2026 and we are continuing to occupy that space under the monthly extensions.
These convertible promissory notes automatically convert into common shares upon Quantum Leap Energy’s closing of an IPO or other qualifying public transaction at 80% of the share price taking into consideration a valuation cap.
These convertible promissory notes would have 86 automatically converted into common shares upon Quantum Leap Energy’s closing of an IPO or other qualifying public transaction at 80% of the share price taking into consideration a valuation cap.
The maturity date of the Convertible Promissory Notes is March 7, 2029. The Convertible Promissory Notes automatically convert into common shares upon Quantum Leap Energy’s closing of an IPO or other qualifying public transaction at 80% of the share price taking into consideration a valuation cap.
The maturity date of the Convertible Promissory Notes was March 7, 2029. The Convertible Promissory Notes would have automatically converted into common shares upon Quantum Leap Energy’s closing of an IPO or other qualifying public transaction at 80% of the share price taking into consideration a valuation cap.
These convertible notes have a stated interest rate of 6% for the first year and 8% thereafter. The maturity date of these convertible promissory notes is March 7, 2029.
These convertible notes had a stated interest rate of 6% for the first year and 8% thereafter. The maturity date of these convertible promissory notes was March 7, 2029.
We have not generated any revenue from the sale of our enriched isotopes, and our ability to generate product revenue from the sale of enriched isotopes sufficient to achieve profitability will depend on the successful development and eventual commercialization of one or more of our current or future enriched isotopes.
We have not generated any revenue from the sale of our enriched isotopes, and our ability to generate product revenue from the sale of enriched isotopes sufficient to achieve profitability on a consolidated basis will depend on the continued successful development and commercialization of our current or future enriched isotopes.
We believe that the U-235 we may produce using quantum enrichment technology may be commercialized as a nuclear fuel component for use in the new generation of high-assay low-enriched uranium (HALEU)-fueled small modular reactors that are now under development for commercial and government uses.
We believe that the U-235 QLE may produce has the potential to be commercialized as a nuclear fuel component for use in the new generation of high-assay low-enriched uranium (“HALEU”)-fueled small modular reactors that are now under development for commercial and government uses.
Our ability to generate product revenue from the sale of nuclear medical doses for PET scanning sufficient to achieve profitability will depend on the successful expansion of production capabilities and commercialization of the results of that expansion.
We recognize revenue from the sale of nuclear medical doses for PET and SPECT scanning in South Africa and the U.S. Our ability to generate product revenue from the sale of nuclear medical doses for PET and SPECT scanning sufficient to achieve profitability will depend on the successful expansion of production capabilities and commercialization of the results of that expansion.
TerraPower, LLC On April 4, 2024, we entered into an agreement with TerraPower LLC ("TerraPower") to develop a conceptual design, refined cost/schedule/financing, risk register, and term sheet for a High Assay Low Enriched Uranium (“HALEU”) facility (the “TerraPower Agreeement”). The TerraPower Agreement may be terminated for (a) breach or default, (b) our convenience or (c) TerraPower’s convenience.
Agreements with TerraPower LLC On April 4, 2024, we entered into the TerraPower Agreement with TerraPower to develop a conceptual design, refined cost/schedule/financing, risk register, and term sheet for a HALEU facility. The TerraPower Agreement may be terminated for (a) breach or default, (b) our convenience or (c) TerraPower’s convenience.
In June 2024, our wholly owned subsidiary Quantum Leap Energy received gross proceeds of $5,386,228 through this issuance of additional Convertible Promissory Notes with a stated interest rate of 6% for the first year and 8% thereafter. One of the notes totaling $108,167 was issued to the placement agent in lieu of cash issuance costs.
In June 2024, our wholly owned subsidiary QLE received gross proceeds of $5.4 million through this issuance of additional Convertible Promissory Notes with a stated interest rate of 6% for the first year and 8% thereafter. One of the notes totaling $0.1 million was issued to the placement agent in lieu of cash issuance costs.
We expect our first three enrichment facilities to generate commercial product during 2025. In addition, we have started planning additional isotope enrichment plants both in South Africa and in other jurisdictions, including Iceland and the United States. We believe the C-14 we may produce using the ASP technology could be used in the development of new pharmaceuticals and agrochemicals.
In addition, we have started planning additional isotope enrichment plants both in South Africa and in other jurisdictions, including Iceland and the United States. We believe the C-14 we may produce using the ASP technology could be used in the development of new pharmaceuticals and agrochemicals.
We also lease additional space in Pretoria, South Africa under a lease with a base monthly rent payment of approximately $2,000 with a term expiring on October 30, 2026.
We also lease additional space in Pretoria, South Africa under leases with a base monthly rent payment of approximately (i) $2,000 with a term expiring on October 30, 2026 and (ii) $3,000 with a term expiring on May 31, 2028.
Liquidity and Capital Resources Sources of Liquidity We have incurred net losses and negative cash flows from operations since our inception, and we expect to continue to incur significant and increasing net losses for the foreseeable future. We have principally financed our operations to date through the issuance of our common stock, including our IPO.
Liquidity and Capital Resources Sources of Liquidity We have incurred net losses and negative cash flows from operations since our inception, and we expect to continue to incur significant and increasing net losses for the foreseeable future.
Investing Activities Net cash used in investing activities was $11,372,399 for the year ended December 31, 2024 and was comprised of the purchases of machinery and equipment, vehicles and construction in progress.
Net cash used in investing activities was $11.4 million for the year ended December 31, 2024 and was comprised of the purchase of machinery and equipment and construction in progress.
Indirect costs include: • personnel-related costs, which include salaries, payroll taxes, employee benefits, and other employee-related costs, including stock-based compensation, for personnel engaged in research and development functions; and • facilities and other various expenses.
Direct costs include: • external research and development expenses; and • costs related to designing the development processes of isotope production. Indirect costs include: • personnel-related costs, which include salaries, payroll taxes, employee benefits, and other employee-related costs, including stock-based compensation, for personnel engaged in research and development functions; and • facilities and other various expenses.
Our proprietary technologies, the Aerodynamic Separation Process (“ASP technology”) and Quantum Enrichment technology (“QE technology”), are designed to enable the production of isotopes used in several industries. Our initial focus is on the production and commercialization of enriched Carbon-14 (“C-14”), Silicon-28 (“Si-28”) and Ytterbium-176 (“Yb-176”).
Our proprietary enrichment technologies, the Aerodynamic Separation Process (“ASP technology”) and QE technology, are designed to enable the production of isotopes for a range of industrial and advanced technology applications. Our initial focus is on the production and commercialization of enriched Carbon-14 (“C-14”), Silicon-28 (“Si-28”) and Ytterbium-176 (“Yb-176”).
PET Labs Pharmaceuticals operates in a facility in Pretoria, South Africa is under a lease with a base monthly rent payment of approximately $27,000 with a term expiring on March 30. 2026 with automatic monthly extension afterwards.
PET Labs Pharmaceuticals operates in a facility in Pretoria, South Africa is under a lease with a base monthly rent payment of approximately $27,000 with a term expiring on January 31, 2056.
In September 2023, we formed Quantum Leap Energy LLC, or “QLE,” which also has subsidiaries in the United Kingdom (Quantum Leap Energy Limited) and South Africa (Quantum Leap Energy (Pty) Limited), to focus on the development and commercialization of advanced nuclear fuels such as HALEU and Lithium-6.
In September 2023, we formed QLE, which also has subsidiaries in the United Kingdom (Quantum Leap Energy Limited) and South Africa (Quantum Leap Energy (Pty) Limited), to focus on the development and commercialization of advanced nuclear fuels, such as HALEU and Lithium-6. QLE’s direct wholly owned subsidiary QLE UK, has its operations in the United Kingdom.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of financial condition and results of operations is provided to enhance the understanding of, and should be read in conjunction with Part I, Item I, “Business” and Item 8, ‘Financial Statements and Supplementary Data.” For information on risks and uncertainties related to our business that may make past performance not indicative of future results or cause actual results to differ materially from any forward-looking statements, see “Special Note Regarding Forward-Looking Statements,” and Part I, Item 1A, ‘Risk Factors.” Overview We are a development stage advanced materials company dedicated to the development of technology and processes that, if successful, will allow for the enrichment of natural isotopes into higher concentration products, which could be used in several industries.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of financial condition and results of operations is provided to enhance the understanding of, and should be read in conjunction with Part I, Item 1, “Business” and Item 8, ‘Financial Statements and Supplementary Data.” For information on risks and uncertainties related to our business that may make past performance not indicative of future results or cause actual results to differ materially from any forward-looking statements, see “Special Note Regarding Forward-Looking Statements,” and Part I, Item 1A, ‘Risk Factors.” Overview We are an advanced materials company dedicated to the development of a differentiated isotope enrichment platform to strengthen global supply chain access to critical materials used in nuclear medicine, next-generation semiconductors, and nuclear energy.
Additionally, the process of developing isotopes is costly, and the timing of progress and expenses in these development activities is uncertain. 59 Our future capital requirements will depend on many factors, including: • the type, number, scope, progress, expansions, results, costs and timing of, our development activities for our future isotopes; • the outcome, timing and costs of regulatory review of our future isotopes; • the costs and timing of manufacturing for our future isotopes; • our efforts to enhance operational systems and hire additional personnel to satisfy our obligations as a public company, including enhanced internal controls over financial reporting; • the costs associated with hiring additional personnel and consultants as our preclinical and clinical activities increase; • the costs and timing of establishing or securing sales and marketing and distribution capabilities, whether alone or with third parties, to commercialize future isotopes for which we may obtain regulatory approval, if any; • our ability to achieve sufficient market acceptance, coverage and adequate reimbursement from third-party payors and adequate market share and revenue for any approved products; • the terms and timing of establishing and maintaining collaborations, licenses and other similar arrangements; • the costs of obtaining, expanding, maintaining and enforcing our patent and other intellectual property rights; and • costs associated with any products or technologies that we may in-license or acquire.
Our future capital requirements will depend on many factors, including: • the type, number, scope, progress, expansions, results, costs and timing of, our development activities for our future isotopes, helium and LNG; • the outcome, timing and costs of regulatory review of our future isotopes or for helium or LNG we produce during Phase 2 of the Virginia Gas Project; • the costs and timing of manufacturing for our future isotopes and of exploring for, developing or producing natural gas and helium; • our efforts to enhance operational systems and hire additional personnel to satisfy our obligations as a public company, including enhanced internal controls over financial reporting; • the costs associated with hiring additional personnel and consultants as our preclinical and clinical activities increase; • the costs and timing of establishing or securing sales and marketing and distribution capabilities, whether alone or with third parties, to commercialize future isotopes or with respect to LNG and helium we produce at the Virginia Gas Plant for which we may obtain regulatory approval, if any; • the timing of construction of Phase 2, which based on our latest cost estimate is expected to be approximately $1.16 billion (including borrowing costs and general corporate costs during construction); • the price at which we sell our LNG and liquid helium; • unforeseen plant disruptions, operational issues and the cost and availability of raw materials, including current supply chain issues, related to the Virginia Gas Project; • our ability to achieve sufficient market acceptance, coverage and adequate reimbursement from third-party payors and adequate market share and revenue for any approved products; • the terms and timing of establishing and maintaining collaborations, licenses and other similar arrangements; • the costs of obtaining, expanding, maintaining and enforcing our patent and other intellectual property rights; • the costs to list QLE as a separate public company; and • costs associated with any products or technologies that we may in-license or acquire.
Financing Activities Net cash provided by financing activities was $82,533,640 for the year ended December 31, 2024 and was comprised primarily of net proceeds of $53,091,187 from the sale and issuance of our common stock, gross proceeds of $25,936,228 from the issuance of convertible notes payable, proceeds of $5,837,663 from the issuance of common stock for a warrant exercise, contributions from noncontrolling interest in VIE of $920,336, proceeds from collection of receivable from noncontrolling interest in VIE of $706,774, partially offset by costs to issue common stock of $3,648,385, principal payments on notes payable, finance leases and bank loans of $561,176, $100,611 and $51,381, respectively, and distribution to noncontrolling interest in VIE of $97,918.
Net cash provided by financing activities was $82.5 million for the year ended December 31, 2024 and was comprised primarily of net proceeds of $53.1 million from the sale and issuance of our common stock, gross proceeds of $25.9 million from the issuance of convertible notes payable, proceeds of $5.8 million from the issuance of common stock for a warrant exercise, contributions from noncontrolling interest in VIE of $0.9 million, proceeds from collection of receivable from noncontrolling interest in VIE of $0.7 million, partially offset by costs to issue common stock of $3.6 million, principal payments on debt and finance leases and bank loans of $0.6 million and $0.1 million, respectively, and distribution to noncontrolling interest in VIE of $0.1 million.
PET Labs Pharmaceuticals also rents space at a local hospital in Pretoria, South Africa for which there was a lease with a base monthly rent payment of approximately $5,000 which expired on December 31, 2023 and is currently in automatic monthly extensions. 61 In November 2024 and 2023, the Company executed a promissory note payable with a finance company to fund its directors and officers’ insurance policy for $500,923 and $526,282, respectively.
PET Labs Pharmaceuticals also rents space at a local hospital in Pretoria, South Africa for which there was a lease with a base monthly rent payment of approximately $5,000 which expired on December 31, 2023 and is currently in automatic monthly extensions.
In July 2024, we issued 13,800,000 shares of common stock in a public offering at a public offering price of $2.50 per share resulting in net proceeds of approximately $32.3 million after deducting underwriting discounts, commissions and offering expenses.
In July 2025, we issued 7,500,000 shares of common stock at $8.00 per share in a registered direct offering resulting in net proceeds of approximately $56.3 million after deducting underwriting discounts, commissions and offering expenses.
Segment Information As of December 31, 2023, we managed our operations as a single segment, specialist isotopes and related services. Beginning in 2024, primarily as a result of the increased business activities of our subsidiary, Quantum Leap Energy LLC, we have two operating segments: (i) nuclear fuels, and (ii) specialist isotopes and related services.
Beginning in 2024, primarily as a result of increased business activities of our subsidiary, QLE, we had two operating segments: (i) nuclear fuels, and (ii) specialist isotopes and related services.
Selling, General and Administrative Expenses Selling, general and administrative expenses were $24,814,288 for the year ended December 31, 2024, compared to $15,416,388 for the year ended December 31, 2023.
Selling, General and Administrative Expenses Selling, general and administrative expenses were $48.2 million for the year ended December 31, 2025, compared to $24.8 million for the year ended December 31, 2024.
Research and Development Our research and development expenses consist primarily of direct and indirect costs incurred in connection with the development activities for our future isotopes. Direct costs include: • external research and development expenses; and • costs related to designing the development processes of isotope production.
Operating Expenses Our operating expenses consist of (i) research and development expenses and (ii) selling, general and administrative expenses. 87 Research and Development Our research and development expenses consist primarily of direct and indirect costs incurred in connection with the development activities for our future isotopes.
In addition, we enter into contracts in the normal course of business with vendors for services and products for operating purposes. These contracts do not contain any minimum purchase commitments and generally provide for termination after a notice period and, therefore, are not considered long-term contractual obligations.
Other Contractual Obligations We enter into contracts in the normal course of business for testing, manufacturing and other services and products for operating purposes. These contracts do not contain any minimum purchase commitments and are cancelable by us upon prior notice.
These increased costs will include increased expenses related to audit, legal, regulatory and tax-related 56 services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums and investor and public relations costs associated with operating as a public company.
These increased costs will include increased expenses related to audit, legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums and investor and public relations costs associated with operating as a public company. 88 Segment Information Beginning in 2024, primarily as a result of increased business activities of our subsidiary, QLE, we had two operating segments: (i) nuclear fuels, and (ii) specialist isotopes and related services.
During 2024, the Company entered into several loans to purchase motor vehicles and certain equipment totaling $2,020,511. These loans are secured by the underlying assets included in property and equipment. Refer to Note 6 (Notes Payable) to our consolidated financial statements included in Part II, Item 8. for information regarding interest rates and maturities.
These loans are secured by the underlying assets included in property and equipment. Refer to Note 9 (Debt) to our consolidated financial statements included in Part II, Item 8 for information regarding interest rates and maturities, as well as information regarding Skyline’s debt obligations and QLE’s convertible notes.
Financings On November 15, 2022, we completed an IPO of our common stock and issued and sold 1,250,000 shares of common stock at a public offering price of $4.00 per share, resulting in net proceeds of $3.8 million after deducting underwriting discounts and commissions and offering expenses.
In July 2025, we issued 7,500,000 shares of common stock at $8.00 per share in a registered direct offering resulting in net proceeds of approximately $56.3 million after deducting underwriting discounts, commissions and offering expenses.
Under the terms of the Share Purchase Agreement pursuant to which we acquired the shares in PET Labs, we agreed to pay a total of $2,000,000 for the shares in two installments. The first installment of $500,000 was paid in November 2023. In January 2024, we paid $264,750 towards the balance due.
Under the terms of the Share Purchase Agreement pursuant to which we acquired the shares in PET Labs, we agreed to pay a total of $2.0 million for the shares in two installments, which has been paid in full as of December 2025.
Actual results may differ from these estimates. Critical accounting estimates are those estimates that involve a significant level of estimation uncertainty and could have a material impact on our financial condition or results of operations.
Critical accounting estimates are those estimates that involve a significant level of estimation uncertainty and could have a material impact on our financial condition or results of operations. Refer to Note 2 (Basis of Presentation and Summary of Significant Accounting Policies) to our consolidated financial statements included in Part II, Item 8 for a summary of significant accounting policies
Other Income and Expense Other expense for the year ended December 31, 2024 was $5,957,625, which includes a $6,875,041 change in the fair value of the convertible notes, a $132,273 change in the fair value of the share liability related to the shares issuable to a placement agent, $1,238,691 in interest income earned on our cash and cash equivalents and interest expense of $258,867.
Other expense for the year ended December 31, 2024 was $6.0 million, which includes an expense of $6.9 million due to the change in the fair value of convertible notes, a $0.1 million change in the fair value of the share liability related to the shares issuable to consultants and interest expense of $0.3 million, partially offset by interest income of $1.2 million.
Future Funding Requirements Based on our current operating plan, we estimate that our existing cash and cash equivalents will be sufficient to fund our operating expenses and capital expenditure requirements through at least the next 12 months from the date the financial statements are issued.
Renergen’s outstanding debt funding may also materially affect our liquidity. 92 Future Funding Requirements Based on our current operating plan, we estimate that our existing cash and cash equivalents, proceeds from short-term investments, cash flow from operations, the IDC Debt Funding, the SBSA Loan, the DFC Credit Facility and the conditionally approved senior secured debt facilities expected to be funded by the DFC and the Standard Bank of South Africa, will be sufficient to fund our operating expenses and capital expenditure requirements through at least the next 12 months from the date the financial statements are issued and beyond.
Components of Results of Operations Revenue Effective with the acquisition of 51% of PET Labs Pharmaceuticals, the Company recognizes revenue from the sale of nuclear medical doses for PET scanning.
Components of Results of Operations Revenue Effective with the acquisition of 51% of PET Labs and 100% of ECNP, we recognize revenue from the sale of nuclear medical doses for PET scanning. Effective with the acquisition of 79% of the voting interest of Skyline, we recognize revenue from performing construction services, including roads and drainage.
Critical Accounting Policies and Significant Judgments and Estimates Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP. In preparing these financial statements, management is required to make estimates and assumptions that affect the reported amount of revenues, expenses, assets, liabilities and the disclosure of contingent liabilities.
The carrying amount of the debentures outstanding at December 31, 2025 was $7.0 million. Critical Accounting Policies and Significant Judgments and Estimates Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP.
For the year ended December 31, 2024, $200,000 has been recognized as collaboration revenue in the consolidated statements of operations and comprehensive loss. Other Commercial Agreements Below is a summary of the key terms of our other commercial agreements. Lease for Molybdenum Processing Plant.
For the year ended December 31, 2024, $0.2 million has been recognized as collaboration revenue in the consolidated statements of operations and comprehensive loss. No collaboration revenue was recognized for the year ended December 31, 2025.
In addition, we have recognized the related cost of goods sold, operating expenses and other income and expenses of PET Labs for the same periods.
With the acquisition of Skyline in August 2025, we also recognized revenue from performing construction services, including roads and drainage In addition, we have recognized the related cost of revenue, operating expenses and other income and expenses of PET Labs, ECNP and Skyline for the periods presented.
These convertible promissory notes automatically convert into common shares upon Quantum Leap Energy’s closing of an IPO or other qualified public transaction at 80% of the share price taking into consideration a valuation cap. On April 9, 2024, the Company received approximately $5.5 million from the issuance of 3,164,557 shares of common stock upon the exercise of warrants.
The 2025 Notes automatically convert into common shares upon QLE’s closing of an IPO or other qualifying public transaction at 80% of the share price taking into consideration a valuation cap.
Although no assurance can be given, we plan to spin-out QLE as a separate public company and list the shares of QLE on a U.S. national exchange and distribute a portion of QLE’s common equity to ASPI’s stockholders as of a to-be-determined future record date, in each case subject to obtaining applicable approvals and consents and complying with applicable rules and regulations and public market trading and listing requirements.
We plan to effect the separation through a listing of QLE in a transaction that results in QLE existing as a separate public company with shares listed on a U.S. national securities exchange and a portion of QLE’s common equity being distributed to our stockholders as of a to-be-determined future record date.
The overall increase of $2,374,397 was primarily due to the following: • an increase in personnel-related costs of $676,433 is mainly due to the increase in headcount and related costs; • an increase in consulting and professional fees of $655,895 due to increased outsourced development activity for new specialty isotopes; • an increase in facility and depreciation expenses of $519,297 due to an increase in space dedicated to development; and • an increase in other expenses of $522,772 primarily related to repairs and maintenance and other general research and development expenses.
The overall increase of $23.4 million was primarily due to the following: • an increase in personnel-related costs of $12.4 million primarily due to the increase in headcount, salaries and related costs; • an increase in professional fees of $7.0 million primarily due to corporate development activity and consulting costs related to new general ledger system; • an increase in facility and depreciation expenses of $0.4 million due to an increase in space dedicated to development, noncapitalized expenses and repairs and maintenance; • an increase in employee travel and related expenses of $0.9 million ; and • an increase in other selling, general and administrative expenses of $4.0 million.
In November 2024, we issued an additional 2,754,250 shares of common stock in a public offering at a public offering price of $6.75 per share resulting in net proceeds of approximately $17.1 million after deducting underwriting discounts, commissions and offering expenses. As of December 31, 2024, we had cash of $61.9 million.
In June 2025, we issued 7,518,797 shares of common stock at $6.65 per share in a registered direct offering resulting in net proceeds of approximately $46.8 million after deducting underwriting discounts, commissions and offering expenses.
The nuclear fuels segment is focused on research and development of technologies and methods used to produce high-assay low-enriched uranium (HALEU) and Lithium-6 for the advanced nuclear fuels target end market.
Beginning in August 2025, primarily as a result of the acquisition of Skyline, we have three operating segments: (i) nuclear fuels, (ii) specialist isotopes and related services, and (iii) construction services. The nuclear fuels segment is focused on research and development of technologies and methods used to produce HALEU and Lithium-6 for the advanced nuclear fuels target end market.
The remaining balance of $1,235,250 is due upon demand any time after October 31, 2024, and is expected to be paid in 2025. Beginning in 2024, primarily as a result of the increased business activities of QLE, we have two operating segments: (i) nuclear fuels, and (ii) specialist isotopes and related services.
Beginning in August 2025, primarily as a result of the acquisition of Skyline, we have three operating segments: (i) nuclear fuels, (ii) specialist isotopes and related services, and (iii) construction services. QLE .
The financial information is regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources. Our CODM is our chief executive officer. We manage assets on a total company basis, not by operating segment, as the assets are shared or commingled.
The construction services segment is focused on performing public civil engineering, including roads and drainage, to its customers in Hong Kong. This segment includes Skyline. The financial information is regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources. Our CODM is our chief executive officer.
Other expense for the year ended December 31, 2023 was $258,260, which includes a $194,540 change in the fair value of the share liability related to the shares issuable to a placement agent and other consultants and interest expense of $118,547.
Other Income (Expense) Other expense for the year ended December 31, 2025 was $99.7 million, which includes an expense of $123.7 million due to the change in the fair value of convertible notes, a change in the fair value of the share liability related to the shares issuable to consultants of $0.1 million, interest expense of $0.6 million and a foreign exchange transaction loss of $0.1 million, partially offset by interest income of $6.8 million, a change in the fair value of our investments of $17.9 million and other income of $0.2 million.
Net cash used in operating activities was $5,412,392 for the year ended December 31, 2023 and was primarily due to our net loss of $16,294,126, adjusted for stock-based compensation expense of $8,743,799, amortization of right-of-use asset of $104,528, issuance of common stock to consultants with a fair value of $669,700, change in fair value of share liability of $194,540, and a $1,159,728 change in our operating assets and liabilities.
Net cash used in operating activities was $16.7 million for the year ended December 31, 2024 and was primarily due to our net loss of $32.4 million, adjusted for stock-based compensation expense of $8.6 million, non-cash issuance costs for the convertible notes payable of $0.6 million, amortization of right-of-use asset of $0.5 million, depreciation and amortization expense of $0.5 million, issuance of common stock to consultants with a fair value of $1.3 million, change in fair values for the convertible notes payable of $6.9 million and a change in fair value of share liability of $0.1 million, partially offset by a $2.6 million change in our operating assets and liabilities. 94 Investing Activities Net cash used in investing activities was $110.8 million for the year ended December 31, 2025 and was comprised of cash paid for a note receivable of $30.0 million, purchase of short-term investments of $47.7 million, purchase of the IsoBio investment of $5.0 million, purchase of ECNP of $2.0 million, purchase of Skyline investments of $23.0 million and the purchases of machinery and equipment, vehicles and construction in progress of $9.6 million, partially offset by cash provided by the acquisition of Skyline of $6.5 million.
If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market our future isotopes even if we would otherwise prefer to develop and market such isotopes ourselves. 60 Cash Flows The following table summarizes our sources and uses of cash for each of the periods presented: Year Ended December 31, 2024 2023 Net cash provided by (used in): Operating activities $ (16,695,365 ) $ (5,412,392 ) Investing activities (11,372,399 ) (2,453,191 ) Financing activities 82,533,640 13,385,491 Net increase (decrease) in cash and cash equivalents $ 54,465,876 $ 5,519,908 Operating Activities Net cash used in operating activities was $16,695,365 for the year ended December 31, 2024 and was primarily due to our net loss of $32.4 million, adjusted for stock-based compensation expense of $8,561,404, non-cash issuance costs for the convertible notes payable of $621,915, amortization of right-of-use asset of $473,202, depreciation expense of $471,421, issuance of common stock to consultants with a fair value of $1,314,200, change in fair values for the convertible notes payable of $6,875,041 and change in fair value of share liability of $132,273, partially offset by a $2,622,890 change in our operating assets and liabilities.
Cash Flows The following table summarizes our sources and uses of cash for each of the periods presented (in thousands): Year Ended December 31, 2025 2024 Net cash provided by (used in): Operating activities $ (37,780 ) $ (16,696 ) Investing activities (110,794 ) (11,372 ) Financing activities 371,600 82,534 Net increase (decrease) in cash and cash equivalents $ 223,026 $ 54,466 Operating Activities Net cash used in operating activities was $37.8 million for the year ended December 31, 2025 and was primarily due to our net loss of $159.8 million, adjusted for stock-based compensation expense of $16.0 million, non cash IPR&D of $2.6 million, noncash interest on the note receivable of $2.0 million, amortization of right-of-use lease assets of $0.7 million, depreciation and amortization expense of $1.9 million, issuance of common stock to consultants with a fair value of $0.7 million, change in fair values for the convertible notes payable of $123.7 million, change in fair values of investments of $17.9 million and a change in fair value of share liability of $0.1 million, partially offset by a $3.6 million change in our operating assets and liabilities.
Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Change Personnel-related costs $ 1,171,467 $ 495,034 $ 676,433 Consulting and professional 655,895 — 655,895 Facility and depreciation expenses 766,960 247,663 519,297 Other expenses 544,656 21,884 522,772 Total research and development expenses $ 3,138,978 $ 764,581 $ 2,374,397 Research and development expenses were $3,138,978 for the year ended December 31, 2024, compared to $764,581 for the year ended December 31, 2023.
Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, 2025 2024 Change Personnel-related costs $ 4,921 $ 1,171 $ 3,750 Manufacturing engineering 1,925 — 1,925 Consulting and professional 1,488 656 832 Facility and depreciation expenses 3,569 767 2,802 Other expenses 455 545 (90 ) Total research and development expenses $ 12,358 $ 3,139 $ 9,219 90 Research and development expenses were $12.4 million for the year ended December 31, 2025, compared to $3.1 million for the year ended December 31, 2024.
In addition, in November 2024, we entered into a memorandum of understanding with The South African Nuclear Energy Corporation (Necsa), a South African state-owned company responsible for undertaking and promoting research and development in the field of nuclear energy and radiation sciences, to collaborate on the research, development and ultimately the commercial production of advanced nuclear fuels.
In addition, QLE’s South African subsidiary has entered into a Pre-Implementation Services Contract Agreement (“Services Contract”) with The South African Nuclear Energy Corporation (“Necsa”), a South African state-owned company responsible for undertaking and promoting research and development in the field of nuclear energy and radiation sciences, pursuant to which Necsa has agreed to provide to QLE’s South African subsidiary certain facilities, infrastructure, utilities and services related to the siting, design, construction, commission and operation of an enrichment facility on the Necsa site in Pelindaba.
Therefore, the chief operating decision maker does not regularly review any asset information by operating segment and, accordingly, asset information is not reported on a segment basis.
Prior to the acquisition of Skyline, we managed assets on a total company basis, not by operating segment, as the assets were shared or commingled. After the acquisition of Skyline, the CODM regularly reviews any asset information by operating segment and, accordingly, asset information is reported on a segment basis.
In furtherance of our uranium enrichment initiative, in October 2024, we entered into a term sheet with TerraPower, LLC which contemplates the parties entering into definitive agreements pursuant to which TerraPower would provide funding for the construction of a HALEU production facility and agree to purchase all HALEU produced at the facility over a 10-year period after the planned completion of the facility in 2027.
In furtherance of our uranium enrichment initiative in South Africa, we have entered into certain definitive agreements with TerraPower, LLC (“TerraPower”), including a term loan subject to conditions to support construction of a new uranium enrichment facility at Pelindaba, South Africa and supply agreements for the future supply of HALEU to TerraPower, as a customer.
Cost of Goods Sold Cost of goods sold associated with the sale of nuclear medical doses for PET scanning consist of labor, delivery and materials. 55 Operating Expenses Our operating expenses consist of (i) research and development expenses and (ii) selling, general and administrative expenses.
Cost of Revenue Cost of revenue associated with the sale of nuclear medical doses for PET scanning consist of labor, delivery and materials. Cost of revenue associated with performing construction services is primarily comprised of subcontracting costs, staff costs and materials costs, which are expensed as incurred.
In March and June 2024, the Company’s wholly owned subsidiary Quantum Leap Energy received gross proceeds of $20,550,000 and $5,386,228, respectively, through the issuance of convertible promissory notes with a stated interest rate of 6% for the first year and 8% thereafter. The maturity date of these convertible promissory notes is March 7, 2029.
In November 2025, QLE received gross proceeds of $72.2 million through the issuance of convertible promissory notes with a stated interest rate of 8% (the “2025 Notes”). The maturity date of the 2025 Notes is November 19, 2030.
We have completed the commissioning phase and are commencing commercial production at our C-14and Si-28 enrichment facilities in Pretoria, South Africa. We are in the process of commissioning and commencing commercial production at our Yb-176 enrichment facility in Pretoria, South Africa. Our C-14 and Si-28 enrichment facilities utilize the ASP technology and our Yb-176 enrichment facility utilizes QE technology.
We commenced commercial production of enriched isotopes at both of our ASP enrichment facilities located in Pretoria, South Africa during the first half of 2025. Our first ASP enrichment facility is designed to enrich light isotopes, such as C-14 and C-12.
Payments due upon cancellation consist only of payments for services provided and expenses incurred up to the date of cancellation. Off-balance Sheet Arrangements We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.
These contracts do not contain any minimum purchase commitments and generally provide for termination after a notice period and, therefore, are not considered long-term contractual obligations. Payments due upon cancellation consist only of payments for services provided and expenses incurred up to the date of cancellation.
Removed
We anticipate shipping the first commercial batches of enriched Carbon-14 in mid-2025 and enriched Silicon-28 during the second quarter of 2025. We expect to commence commercial production of Ytterbium-176 during the second quarter of 2025.
Added
The second ASP enrichment facility, which is substantially larger than the first, should have the potential to enrich kilogram quantities of relatively heavier isotopes, including but not limited to Si-28. We are targeting initial commercial shipments of enriched C-14 in mid-2026. We are targeting initial commercial shipments of enriched Si-28 during the second quarter of 2026.
Removed
Subject to the receipt of funding and all required permits and licenses to begin enrichment of U-235 in South Africa, it is anticipated that the research, development and ultimate construction of a HALEU production facility will take place at South Africa’s main nuclear research center at Pelindaba in Pretoria. Our Subsidiaries We operate principally through our subsidiaries.
Added
We have also completed the commissioning phase and are producing commercial samples of highly enriched Yb-176 at our third enrichment facility, a QE technology facility, which is our first laser-based enrichment plant. We are targeting initial commercial shipments of Yb-176 in mid-2026 or the third quarter of 2026.
Removed
In addition, in February 2024, we assigned to QLE certain existing memoranda of understanding with U.S.-based small modular reactor companies for the use of Quantum Enrichment for the production of High-Assay Low Enriched Uranium (HALEU).
Added
In the period since our inception to date, we have not applied our enrichment technologies to the enrichment of U-235, nor received permission or regulatory approval to conduct testing of our enrichment technologies on U-235, except for the activities contemplated by the Services Contract with Necsa.
Removed
The MOUs provide for substantial financial support for the development of HALEU production facilities that should be capable of supplying metric ton quantities of HALEU by 2027. PET Labs .
Added
Our expectation that QLE’s initiative to apply our enrichment technologies to the enrichment of U-235 could be successful is based upon research conducted by certain of our scientists prior to joining the company, as well as the demonstrated effectiveness of QE technology on Yb-176. QLE acquired a controlling interest in Skyline in August 2025.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

6 edited+14 added−2 removed1 unchanged
Biggest changeTo date, foreign currency transaction gains and losses have not been material to our financial statements, and we have not had a formal hedging program with respect to foreign currency. We believe a hypothetical 100 basis point increase or decrease in exchange rates during the period presented would not have had a material impact on our financial results.
Biggest changeWe believe a hypothetical 100 basis point increase or decrease in exchange rates during the period presented would not have had a material impact on our financial results. Commodity Price Risk Commodity price risk arises from the effect on current and future earnings due to fluctuations in commodity prices, in particular the price of LNG and helium.
This results in a minimal exposure to interest rate risk with respect to debt. We believe a hypothetical 100 basis point increase or decrease in interest rates during the period presented would not have had a material impact on our financial results.
We believe a hypothetical 100 basis point increase or decrease in interest rates during the period presented would not have had a material impact on our financial results.
Two customers, Customer A and Customer B, represent approximately 28% ($200,000) and 20% ($144,590), respectively, of consolidated accounts receivable as of December 31, 2024. Although the Company is directly affected by the financial condition of its customers, management does not believe significant credit risks exist at December 31, 2024.
Four customers represent approximately 28% ($5.0 million), 23% ($4.1 million), 18% ($3.2 million) and 13% ($2.3 million), respectively, of consolidated accounts receivable as of December 31, 2025. Although we are directly affected by the financial condition of its customers, management does not believe significant credit risks exist at December 31, 2025.
Generally, we do not require collateral or other securities to support its accounts receivable. Major Customer Revenues from one customer of our specialist isotopes and related services segment represent approximately 14% or $592,000 our consolidated revenues. for the year ended December 31, 2024. For year ended December 31, 2023, there were no customers that represented more than 10% of revenues.
Generally, we do not require collateral or other securities to support its accounts receivable. Major Customers Revenues from two customers in our construction services segment represent approximately 32.2% ($7.7 million) and 13.7% ($3.3 million), respectively, of our consolidated revenues for the year ended December 31, 2025.
Effects of Inflation Inflation generally affects us by increasing our cost of labor and research and development costs. We do not believe that inflation and changing prices had a significant impact on our results of operations for the period presented herein. Credit Risk We are potentially subject to concentrations of credit risk in our accounts receivable.
We do not believe that inflation and changing prices had a significant impact on our results of operations for the period presented herein.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk We are exposed to interest rate risk related to our outstanding debt. As of December 31, 2024 and 2023, our cash and cash equivalents consists of cash in readily available checking and interest bearing accounts. We do not hold any short-term investments.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk We are exposed to interest rate risk primarily through our holdings of cash, cash equivalents and outstanding debt obligations. Changes in interest rates may affect the interest income earned on our investment portfolio as well as the interest expense associated with our variable‑rate borrowings.
Removed
As a result, the fair value of our portfolio is relatively insensitive to interest rate changes. As of December 31, 2024 and 2023, we had $2,380,396 and 470,396, respectively, of notes payable bank outstanding primarily related to loans for motor vehicles and equipment in South Africa and financing of Directors and Officers’ insurance premiums.
Added
Our cash and cash equivalents are held in the United States and in various foreign jurisdictions. Our short-term investments are held in the U.S. These balances are invested primarily in high‑quality, highly liquid instruments, including money market funds, commercial paper, U.S. Treasury securities, and investment‑grade corporate securities.
Removed
We expect to maintain this relationship with the customer. 63
Added
Because these instruments generally have short maturities, the fair value of our portfolio is relatively insensitive to changes in interest rates. However, declines in market interest rates would reduce the interest income we earn on new investments or reinvestments of maturing securities.
Added
We believe a hypothetical 100 basis point increase or decrease in interest rates during the period presented would not have had a material impact on our financial results. We have debt obligations in both the United States and certain foreign countries. Our debt consists of a combination of fixed‑rate and variable‑rate instruments.
Added
Additionally, interest rate risk arises from Renergen’s IDC borrowings, which incur interest at a variable rate, though Renergen’s DFC borrowings incur interest at a fixed rate. Interest rate changes affect the fair value of our fixed‑rate debt but do not impact the associated cash interest payments.
Added
For our variable‑rate debt, changes in market interest rates directly affect the interest expense we incur. Fluctuations in market interest rates may negatively affect our financial condition and results of operations. We are exposed to floating interest rate on floating rate bank borrowings and bank overdrafts. We have not used any derivative financial instruments to manage the interest rate exposure.
Added
For example, sales of Renergen’s LNG are priced in South African rand. Appreciation of the rand against the U.S. dollar would result in our revenues, operating margins and dollar debt to decrease. Conversely, should the rand depreciate against the U.S. dollar, revenues, operating margins, and dollar debt would increase.
Added
Additionally, international commodity prices are quoted in U.S. dollars, which exposes our revenue cash flows to foreign exchange variances. To date, foreign currency transaction gains and losses have not been material to our financial statements, and we have not had a formal hedging program with respect to foreign currency.
Added
Most of these prices are determined in U.S. dollars and are internationally determined in the open market. We regularly measure exposure to commodity price risk by stress-testing our forecasted financial position to changes in LNG and helium prices.
Added
We do not actively hedge future commodity prices against price fluctuations; however, with the commencement of operations at the Virginia Gas Project, the Company may consider options available to hedge commodity price risk exposure associated with LNG and helium reserves. At December 31, 2025, our exposure to commodity price risk was not material.
Added
Liquidity Risk We are also exposed to liquidity risk, which is the risk that we will be unable to provide sufficient capital resources and liquidity to meet our commitments and business needs. Liquidity risk is controlled by the application of financial position analysis 98 and monitoring procedures.
Added
When necessary, we will turn to other financial institutions and related parties to obtain short-term funding to cover any liquidity shortage. Effects of Inflation Inflation generally affects us by increasing our cost of labor and research and development costs.
Added
However, we are undertaking a significant capital project, the completion of Phase 1 and the development and initiation of Phase 2 of the Virginia Gas Project, and as a result of inflation, the cost of materials and price of labor incurred with the development and expansion of Phase 1 will likely not be comparable to the cost of materials and price of labor as we develop Phase 2.
Added
Credit Risk Credit risk represents the risk that we will suffer a financial loss due to the other party of a financial instrument not discharging its obligation. We are potentially subject to concentrations of credit risk in our accounts receivable.
Added
There was one customer in our specialist isotopes and related services segment that represented 14% ($0.6 million) of our consolidated revenues for the year ended December 31, 2024. We expect to maintain these relationships with our customers. 99

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