VTAK

Special Note Regarding Forward Looking Statements This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are subject to risks and uncertainties. Forward-looking statements are often identified by the use of words such as, but not limited to, “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “will,” “plan,” “project,” “seek,” “should,” “target,” “will,” “would,” and similar expressions or variations intended to identify forward-looking statements. All statements, other than statements of historical facts, regarding management’s expectations, beliefs, goals, plans or Catheter Precision’s prospects should be considered forward-looking statements. Readers are cautioned that actual results may differ materially from projections or estimates due to a variety of important factors, and readers are directed to the Risk Factors identified in Catheter Precision’s filings with the SEC, including its most recent Annual Report on Form 10-K, copies of which are available free of charge at the SEC’s website at www.sec.gov or upon request from Catheter Precision. Catheter Precision may not actually achieve the goals or plans described in its forward-looking statements, and such forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Investors should not place undue reliance on these statements. Catheter Precision assumes no obligation and does not intend to update these forward-looking statements, except as required by law. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. Actual outcomes or results may differ from anticipated results, sometimes materially. Factors that could cause actual results to differ include, but are not limited to: the ability of the combined company to achieve the identified synergies; the ability to integrate the FLYTE business into Catheter Precision and realize the anticipated strategic benefits of the transaction within the expected time-frames or at all; that such integration may be more difficult, time-consuming or costly than expected; that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers or suppliers) may be greater than expected following the closing of the transaction; the retention of certain key employees of FLYTE; the expected benefits and success of FLYTE’s business model; general economic conditions that are less favorable than expected; geopolitical developments and additional changes in international trade policies and relations, including tariffs; and the ability of our products and product candidates to compete effectively against current and future competitors. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including, but not limited to, those described in Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2025, as well as those described below. To the extent that any risk factor set forth below is inconsistent with or expands upon a risk factor set forth in the 10‑K, the risk factor described below supersedes the prior disclosure. These risks include, but are not limited to, that: if we pursue a strategic transaction, such as FLYTE acquisition, it may change the primary focus of our business, and our management team could be diverted from pursuing our present core business and from obtaining regulatory approval for our products in development; we will be unable to develop the assets acquired by KardioNav and Cardionomix unless we are able to obtain additional financing in sufficient amounts to fund our current business, any future businesses we may enter into and to fund our products in development, which financing may not be available on acceptable terms or at all, and could require significant changes in our management and business focus; the results of anticipated trials may not turn out as we currently expect and future trials may not occur on the time tables we expect or may be more costly than anticipated, or may be abandoned due to lack of financing or changes in our business focus; we will be required to raise additional funds to finance our operations and continue as a going concern, and we may not be able to do so when necessary, and/or the terms of any financings may not be advantageous to us or could require changes to governance or operations, and we may require additional funds sooner than our current expectations and we may be required to significantly dilute our existing stockholders in order to raise sufficient operating funds assuming that we are able to raise funds at all, which is uncertain; our stockholder equity is near the minimum level prescribed by the NYSE American and if we are unable to maintain minimum listing requirements, we are liable to be delisted from the NYSE American; our common stock may be subject to extreme market volatility and trading patterns and may experience rapid and substantial increases or decreases unrelated to our operating performance or prospects, or macro or industry fundamentals, which could occur for a number of reasons including but not limited to analyst recommendations, changes in our industry or the overall markets, significant acquisitions or other strategic transactions by or involving us or our subsidiaries, among other reasons; our operating business has a history of losses, is expected to incur additional losses, and may never achieve profitability; our past performance may not be a reliable indicator of future performance, including but not limited to in the event of a strategic transaction; historical trends should not be used to anticipate results or trends in future periods; our ability to increase our at-the-market offering availability in the future is subject to obtaining necessary approvals, certifications, legal opinions and accounting comfort letters, and there is no guaranty that we can do so successfully; we have previously identified material weaknesses in our internal control over financial reporting and, if these or other material weaknesses occur again, they could adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner; compliance with Sarbanes-Oxley Act Section 404 could have a material adverse impact on our business; we will not be able to reach profitability unless we are able to achieve our product expansion and growth goals or engage in a strategic transaction which realigns our business focus; our VIVO launch plans require significant investment in infrastructure and sales representatives; our research and development and commercialization efforts may depend on entering into agreements with corporate collaborators; we have entered into joint marketing agreements with respect to our products, and may enter into additional joint marketing agreements, that will reduce our revenues from product sales; royalty agreements with respect to LockeT, the surgical vessel closing pressure device, will reduce any future profits from this product; if we experience significant disruptions in our information technology systems, our business may be adversely affected; litigation and other legal proceedings may adversely affect our business; if we make acquisitions or divestitures, we could encounter difficulties that harm our business, and entering into a strategic transaction could materially alter our business model and focus; failure to attract and retain sufficient qualified personnel could also impede our growth; our revenues may depend on our customers’ receipt of adequate reimbursement from private insurers and government sponsored healthcare programs; we may be unable to compete successfully with companies in our highly competitive industry, many of whom have substantially greater resources than we do; our future operating results depend upon our ability to obtain components in sufficient quantities on commercially reasonable terms or according to schedules, prices, quality and volumes that are acceptable to us, and suppliers may fail to deliver components, or we may be unable to manage these components effectively or obtain these components on such terms; if hospitals, physicians and patients do not accept our current and future products or if the market for indications for which any product candidate is approved is smaller than expected, we may be unable to generate significant operating revenue, if any; a variety of risks associated with marketing our products internationally could materially adversely affect our business; the impact of the military conflicts in Ukraine and Israel, and the actions that have been and could be taken by other countries, including new and stricter sanctions and actions taken in response to such sanctions, have affected, and may continue to affect, our business and results of operations, including our supply chain; if the third parties on which we rely for the conduct of our clinical trials and results do not perform our clinical trial activities in accordance with good clinical practices and related regulatory requirements, we may be unable to obtain regulatory approval for or commercialize our product candidates; we may be adversely affected by product liability claims, unfavorable court decisions or legal settlements; our ability to use our net operating loss carryforwards may be limited; we are subject to pervasive and continuing regulation by the FDA and other regulatory agencies; our products may be subject to additional recalls, revocations or suspensions after receiving FDA or foreign approval or clearance, which could divert managerial and financial resources, harm our reputation, and adversely affect our business; changes in trade policies among the United States (“U.S.”) and other countries, in particular the imposition of new or higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products; increased tariffs or the imposition of other barriers to international trade could have a material adverse effect on our revenues and operating results; product clearances and approvals can often be denied or significantly delayed, although we have obtained regulatory clearance for our VIVO and LockeT products in the U.S. and certain non-U.S. jurisdictions; our current business plans for our current operating business include expanding uses for our products, which if implemented would require additional clearances; even after clearance is obtained, our products remain subject to extensive regulatory scrutiny; reductions in staffing and funding at FDA and other federal agencies could cause delays in the development and approval of our products; our business may be adversely affected by changes and uncertainty in the health care industry including health care public‑policy developments; if we or our suppliers fail to comply with the FDA’s Quality System Regulation, or QSR, or any applicable state equivalent, our operations could be interrupted, and our potential product sales and operating results could suffer; if any of our products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be required to report under applicable medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions; healthcare reform initiatives and other administrative and legislative proposals may adversely affect our business, financial condition, results of operations and cash flows in our key markets; if we are unable to obtain and maintain patent protection for our products, our competitors could develop and commercialize products and technology similar or identical to ours, and our ability to successfully commercialize our existing products and any products we may develop, and our technology may be adversely affected; and any short-term sale may produce proceeds that are less than the market or stated value of such assets and less than the proceeds that could have been obtained if they were liquidated in the ordinary course of business. If we enter into a strategic transaction, such as a merger or acquisition, we may become subject to additional risks in addition to those described above, which risks would be identified and disclosed in conjunction with consummating any such transaction. There is no guarantee that we will be able to identify and enter into any such strategic transaction. 60 Table of Contents The forward-looking statements in this report and identified above reflect our beliefs and views with respect to future events and are based on estimates and assumptions as of the date of this Quarterly Report and are subject to risks and uncertainties including those described in the cautionary statements above. Given these risks and uncertainties, you should not place undue reliance on the forward-looking statements. We qualify all of the forward-looking statements in this Quarterly Report by these cautionary statements. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in any forward-looking statements, whether as a result of new information, future events or otherwise. This Quarterly Report also contains estimates, projections and other information concerning our industry, our business, and the markets for certain diseases, including data regarding the estimated size of those markets. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data, and similar sources. References to “we”, “us”, “our”, "Catheter" and “the Company” refer to Catheter Precision, Inc. Overview Catheter Precision, Inc. was incorporated in California on September 4, 2002, and reincorporated in Delaware in July 2018. Catheter was initially formed to develop, commercialize, and market its advanced excimer laser-based platform for use in the treatment of vascular and dermatological immune-mediated inflammatory diseases. On January 9, 2023, we merged with the former Catheter Precision, Inc. ("Old Catheter”), a privately held Delaware corporation (the "Merger”), which became our wholly owned subsidiary. Our activities primarily relate to Old Catheter’s historical business, which comprises the design, manufacture and sale of new and innovative medical technologies focused in the field of cardiac electrophysiology ("EP"). On February 6 2026, we entered into an Acquisition Purchase Agreement with SEG Jets LLC ("SEG Jets"), whereby we agreed to acquire 19.98% of the issued and outstanding shares of common stock of Fly Flyte, Inc. ("FLYTE") held by SEG Jets in exchange for 5,250 shares of Series D Convertible Preferred Stock, par value of $0.0001 per share and stated value of $1,000 per share, for an aggregate stated value of $5.3 million. On March 9, 2026, we entered into a Securities Purchase Agreement with Creatd, Inc. ("Creatd"), whereby we acquired the remaining 80.02% of the issued and outstanding shares of common stock of FLYTE and all of FLYTE’s wholly owned consolidated subsidiaries, which included 100% equity ownership interest in Ponderosa Air, LLC ("Ponderosa"). As consideration for the acquired equity interests in FLYTE and Ponderosa, we agreed to pay $11.6 million as follows: (A) cash consideration of $0.8 million due at closing, (B) promissory note with a principal amount of $5.0 million, and (C) 5,778 shares of Series D Convertible Preferred Stock for an aggregate stated value of $5.8 million. As a result of these transactions, we now own 100% of the issued and outstanding common stock of FLYTE and its wholly owned consolidated subsidiaries. FLYTE and all of its wholly owned consolidated subsidiaries operate as a single business. Following the acquisition of FLYTE, we now operate in two reportable segments: (i) cardiac electrophysiology and (ii) private aviation charter services. Cardiac Electrophysiology Segment One of our two primary products is the VIVO System, which is a non-invasive imaging system that offers 3D cardiac mapping to help with localizing the sites of origin of idiopathic ventricular arrhythmias in patients with structurally normal hearts prior to EP procedures. VIVO has FDA clearance and is also available in Europe as a Class 1 device. To date, VIVO has been utilized in more than 2,000 procedures in the U.S. and EU by over 30 physicians, with no reported device-related complications. Catheter Precision has one full time employee in Europe and sales are conducted through distributors in most countries. Our second product is LockeT ("LockeT”), which is a suture retention device indicated for wound healing by distributing suture tension over a larger area in the patient in conjunction with a figure of eight suture closure. LockeT is intended to temporarily secure sutures and aid clinicians in locating and removing sutures efficiently. LockeT is a sterile Class I product that was registered with the FDA in the U.S. LockeT has been commercially available since 2024 in the US, received CE Mark in April 2025 and is currently available in 16 countries. Both products have a number of granted patents and patents pending in the US and Worldwide. 61 Table of Contents Private Aviation Segment Through our wholly owned subsidiary, we operate a private aviation platform supported by a mobile application that facilitates access to private air travel at competitive price points. We offer regional and long-range private jet charter services throughout the United States through a combination of leased aircraft and third-party operator relationships. Customers book flights directly or place bids on available empty-leg flights in real time. We are also developing a local and regional air-taxi service intended to expand access to private aviation for middle-market travelers by offering shorter-distance flights at lower price points relative to traditional charter services and have begun the regulatory approval process to operate in Canada, Mexico and the Caribbean. Business Strategy Our business strategy is to become a leading medical device company in the field of cardiac electrophysiology. We are dedicated to developing and delivering electrophysiology products to provide patients, hospitals, and physicians with novel technologies and solutions to improve the lives of patients with cardiac arrhythmias. We aim to establish VIVO as an integral tool used by cardiac electrophysiologists during ablation treatment of ventricular arrhythmias by reducing procedure time, patient complications and increasing procedural success. However, to attract capital to fund our operating losses while we pursue this strategy, we have also adopted a holding company structure within which we house and operate our FLYTE private aviation charter business, which has the potential to quickly grow into a profitable subsidiary. FLYTE is a technology-enabled regional air mobility company operating a growing fleet of Cirrus Vision Jets. Focused on high frequency, short haul markets, FLYTE provides a faster, safer, and more efficient alternative to commercial and existing private charter air travel. Flight operations are conducted through FLYTE’s wholly owned subsidiary, Ponderosa Air, LLC, an FAA certified Part 135 air carrier. With certified aircraft, active revenue generating operations, and scalable fleet expansion underway, FLYTE is seeking to build a disciplined, asset-backed aviation infrastructure designed to serve underserved regional markets. Recent Developments February and March 2026 Private Placement On February 6, 2026, we entered into a Securities Purchase Agreement (the "February 2026 SPA") with certain accredited investors for a private placement financing and issued an aggregate of (i) 392,608 shares of our common stock, par value $0.0001 per share, at a per share purchase price of $1.43 and (ii) 1,617 shares of newly designated Series C-1 Convertible Preferred Stock par value $0.0001 per share and a stated value of $1,000 per share, for gross proceeds of $2.2 million before deducting direct and incremental offering expenses of $0.2 million. The investors agreed to purchase newly designated Series C-2 and Series C-3 Convertible Preferred Stock, par value $0.0001 per share and stated values of $1,000 per share, under additional closings for aggregate gross proceeds of $1.6 million (the "Second Tranche" and "Third Tranche"). On March 9, 2026, we entered into an additional Securities Purchase Agreement (the “March 2026 SPA”) with certain accredited investors for a private placement financing pursuant to which the investors agreed to purchase 1,853 shares of Series C-1 Convertible Preferred Stock for aggregate gross proceeds of $1.9 million before deducting $0.1 million in issuance costs. The investors agreed to purchase newly designated Series C-2 and Series C-3 Convertible Preferred Stock under additional closings for aggregate gross proceeds of $1.9 million (the "Second Tranche" and "Third Tranche"). Pursuant to the February and March 2026 SPAs, the additional closings are subject to certain closing conditions, including stockholder approval to issue shares of common stock in excess of 19.99% of our issued and outstanding shares of common stock and to effect a reverse stock split ("Stockholder Approval”) and, solely with respect to the closing of the Series C-3 Convertible Preferred Stock, declaration of the effectiveness of the Registration Statement filed for the resale of the common stock underlying the Series C-1, C-2, and C-3 Convertible Preferred Stock. The investors also have the right, but not the obligation, to purchase up to an aggregate of $39.2 million of Series C-4 Convertible Preferred Stock (collectively with the Series C-1, Series C-2, and Series C-3 Convertible Preferred Stock, the “Series C Convertible Preferred Stock”), par value $0.0001 per share and stated value of $1,000 per share, in one or more closings (the "Fourth Tranche"). Subject to certain limitations described below, the Series C-1 Convertible Preferred Stock was convertible into shares of our common stock at the option of the holder at an initial conversion price of $1.43 per share, subject to adjustment in certain circumstances as set forth in the Certificate of Designations. Following the date that the registration statement filed pursuant to the related registration rights agreement is first declared effective by the Securities and Exchange Commission (the “Effective Date”) and the Stockholder Approval Date, the conversion price is reduced to the lower of (i) the conversion price in effect immediately prior to the Effective Date and (ii) 80% of the Applicable Price on such date. In each case, the conversion price is subject to a floor price of $0.35, unless waived by us in our sole discretion. In the event of a stock dividend, reverse stock split, stock combination, reclassification or similar event affecting our common stock, the conversion price shall be adjusted based on the number of shares of common stock outstanding immediately before and after such event. The conversion of the Series C-1 Convertible Preferred Stock is subject to stockholder approval and certain beneficial ownership limitations. Prior to the Stockholder Approval Date, the Series C-1 Convertible Preferred Stock may only be converted into shares of common stock up to the maximum amount permitted under applicable exchange rules. The initial conversion price of the Series C-1 Convertible Preferred Stock was automatically lowered to $0.883 per share on April 15, 2025, the Stockholder Approval Date, and to $0.632 on July 10, 2026, the Effective Date, in accordance with the terms and conditions set forth in the Certificate of Designation. See Note 13, Equity Offerings and Note 14, Preferred Stock in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information on the Series C Convertible Preferred Stock issued in connection with the February and March 2026 SPAs. Modification of Existing Warrants and Series B Convertible Preferred Stock On February 6, 2026, the Company agreed to lower the exercise price of existing warrants and the conversion price of the Series B Convertible Preferred Stock to $1.78 per share as consideration for exercising the existing warrants and converting the Series B Convertible Preferred Stock, resulting in aggregate proceeds of $0.4 million. On June 23, 2026, the Company agreed to further lower the conversion price of the Series B Convertible Preferred Stock to $1.43. This led to the conversion of 1,311 shares of Series B Convertible Preferred Stock into 916,998 shares of common stock through June 30, 2026. On July 29, 2026 the Company entered into a letter agreement with the holders of the Series B Convertible Preferred Stock to repurchase the remaining 321 shares of Series B Convertible Preferred Stock for a total of $321 thousand. The repurchase was finalized on July 30, 2026 and the outstanding Series B Convertible Preferred Stock was cancelled. See Note 13, Equity Offerings and Note 20, Subsequent Events in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information on the February 2026 Letter Agreement. FLYTE Acquisition As discussed above, we own 100% of the issued and outstanding common stock of FLYTE common stock and 100% of the membership interests of Ponderosa as of March 9, 2026. FLYTE is a technology-powered, private air transportation company. Founded in August 2018, FLYTE’s mission is to make private air travel a passenger-first, more inclusive and accessible mode of transportation, made possible through properly applied technology, use of more conveniently located existing infrastructure and operational efficiencies. FLYTE provides two distinct air travel services: Flyte Hops and Luxe. Flyte Hops operates short-haul charter routes using its own fleet of leased Cirrus Vision jets flown by pilots that are full-time employees of Flyte. Flyte manages marketing, customer booking, flight scheduling, and pricing, collects payment, purchases jet fuel, files the flight plan, uses its own aircraft flown by its own pilots to fly the customers, and maintains all necessary FAA certifications. Flyte Luxe matches passengers seeking airplanes larger than the Cirrus Vision or with longer range with appropriate 3rd party aircraft and crews, providing private aviation coordination and bespoke travel experiences. We believe FLYTE is positioned to compete with operators focused on the emerging urban air mobility (“UAM”), regional air mobility (“RAM”) and advanced air mobility (“AAM”) markets, each of which is likely to consist primarily of short-range electric-powered aircraft using short take-off and vertical take-off and landing technology. The financial results of FLYTE are included in our unaudited condensed consolidated financial statements from March 10, 2026 through March 31, 2026. As a result, the consolidated results of operations for the three and six months ended June 30, 2026 reflect a full quarter and approximately four months of contribution from FLYTE, respectively. The comparative consolidated results of operations for the three and six months ended June 30, 2025 do not include any results of FLYTE. Investors are cautioned that period-over-period comparisons of our consolidated results of operations are not directly comparable as a result of the Acquisition. Additional information regarding the FLYTE acquisition is set forth in our Current Report on Form 8-K filed with the SEC on February 6, 2026 and March 9, 2026 and in Note 3 of the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Trends and Uncertainties Relating to FLYTE Unpredictable changes in economic conditions, including the effects of inflation, elevated interest rates, slowing or contracting gross domestic product, geopolitical instability, changes in international trade policy (including the imposition or escalation of tariffs), increased governmental intervention, and other macroeconomic factors, may adversely affect our general business strategy. Persistent or renewed inflationary pressure generally affects us by increasing our cost of labor, our cost of materials and components used in the manufacture of our products, and, with respect to FLYTE, our cost of aviation fuel and our cost of access to third-party aircraft operator capacity. Declining general economic, business or industry conditions, inflation, or a recession may have a material adverse effect on our future results of operations, liquidity and financial condition. We have also observed a continuing trend of higher third-party aircraft operator costs in the private aviation market, which could impact FLYTE’s short-term and long-term margins and profitability. FLYTE continues to rely on third-party aircraft operators to generate substantially all of the revenue of its charter brokerage business. As a result, we face the risk that any of these third-party aircraft operators may not fulfill their contracts and deliver their services on a timely basis, or at all. The ability of any third-party aircraft operator to effectively satisfy our requirements could also be impacted by the operator’s financial difficulty or damage to its operations caused by fire, terrorist attack, natural disaster, public health emergency, or other events. In addition, due to aircraft supply constraints that have persisted across the private aviation industry, we may be required to pay more for capacity with our third-party aircraft operators to service customer flights. The failure of any third-party aircraft operator to perform to our expectations could result in delayed or cancelled flights or service credits, and could harm portions of our business. In addition, our results of operations for periods following the FLYTE acquisition will reflect, among other things, the amortization of acquired intangible assets, the depreciation of acquired property and equipment at stepped-up fair values, the valuation of the preferred stock issued as part of the consideration for the FLYTE acquisition, and integration-related costs. These items did not affect our results of operations in periods preceding the FLYTE acquisition, and as a result, period-over-period comparisons of our results of operations may not be directly comparable. See “Results of Operations” and “Liquidity and Capital Resources” below. Supply Chain and Pilot Availability Relating to FLYTE The execution of FLYTE’s business strategy is dependent on, among other things, the availability of aviation fuel at acceptable prices and our ability to hire and retain qualified pilots to support our air-taxi service and to support the third-party aircraft operators that fly under our charter brokerage arrangements. The supply of qualified pilots to the airline and private aviation industries has remained constrained, and demand for pilots may continue to outpace supply for the foreseeable future. Continued periods of significant disruption in the supply of aviation fuel, sustained increases in fuel prices, or difficulty in attracting and retaining qualified pilots could have a significant negative impact on our operating results, liquidity and financial condition. Environmental Relating to FLYTE FLYTE is subject to increasingly rigorous federal, state, local and foreign laws and regulations relating to the protection of the environment and noise, including those relating to emissions to the air, discharges to surface and subsurface waters, safe drinking water, and the use, management, disposal and release of, and exposure to, hazardous substances, oils and waste materials. FLYTE may be subject to new laws and regulations that may have a material adverse effect on its operations. In addition, U.S. airport authorities continue to explore ways to limit de-icing fluid discharges. Any such existing, future, new or potential laws and regulations, including any future regulation of greenhouse gas emissions from aviation activities, could have a material adverse impact on our business, results of operations and financial condition. Issuance of Series D Convertible Preferred Stock On April 20, 2026, in connection with the Company’s acquisition of FLYTE, we issued 5,250 and 5,778 shares of our newly designated Series D Convertible Preferred Stock to SEG Jets and Creatd, respectively. Subject to certain limitations described below, the Series D Preferred Stock are convertible into shares of our common stock at the option of a holder at an initial conversion price of $1.1038 per share, subject to adjustment in certain circumstances as set forth in the Certificate of Designations. Following the date on which the registration statement filed pursuant to the related registration rights agreement is first declared effective by the Securities and Exchange Commission (the "Effective Date”), the conversion price shall be reduced to equal the lower of (i) the conversion price in effect immediately prior to the Effective Date and (ii) the Applicable Price on the Effective Date. In each case, the conversion price is subject to a floor price of $0.35, unless waived by us in our sole discretion. In the event of a stock dividend, reverse stock split, stock combination, reclassification or similar event affecting our common stock, the conversion price shall be adjusted based on the number of shares of common stock outstanding immediately before and after such event. The conversion of the Series D Convertible Preferred Stock is also subject to stockholder approval and certain beneficial ownership limitations. Prior to the Stockholder Approval Date, the Series D Convertible Preferred Stock may only be converted into shares of common stock up to the maximum amount permitted under applicable exchange rules. The initial conversion price of the Series D Convertible Preferred Stock was automatically lowered to $0.79 per share on July 10, 2026, the Effective Date, in accordance with the terms and conditions set forth in the Certificate of Designation. See Note 14, Preferred Stock in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information over the Series D Convertible Preferred Stock issued in connection with the FLYTE acquisition. Issuance of Series C-2, C-3 and C-4 Convertible Preferred Stock On April 21, 2026, pursuant to the February and March 2026 SPAs, we issued an aggregate of 3,470 shares of our newly designated Series C-2 Convertible Preferred Stock for aggregate gross proceeds of $3.5 million, and net proceeds of approximately $3.2 million after deducting transaction costs of approximately $0.3 million. The Series C-2 Convertible Preferred Stock was convertible into shares of our common stock at the option of the holder at an initial conversion price of $0.883 per share. Except for the initial conversion price and the automatic reduction in conversion price upon the Stockholder Approval Date, the Series C-2 Convertible Preferred Stock has the same conversion features as the Series C-1 Convertible Preferred Stock discussed above. Accordingly, the initial conversion price for the Series C-2 Convertible Preferred Stock was automatically lowered to $0.632 per share on July 10, 2026, the Effective Date, in accordance with the terms and conditions set forth in the Certificate of Designation. On July 15, 2026, pursuant to the February and March 2026 SPAs, we issued an aggregate of 3,470 shares of our newly designated Series C-3 Convertible Preferred Stock for aggregate gross proceeds of $3.5 million. In connection with the issuance, we incurred direct offering costs of approximately $267 thousand. The Series C-3 Convertible Preferred Stock is convertible into shares of the Company’s common stock at the option of the holder at an initial conversion price of $0.632 per share. On July 30, 2026, pursuant to the March 2026 SPAs, we issued an aggregate of 2,821 shares of the Company’s newly designated Series C-4 Convertible Preferred Stock for aggregate gross proceeds of $2.8 million. In connection with the issuance, we incurred direct offering costs of approximately $193 thousand. The Series C-4 Convertible Preferred Stock is convertible into shares of the Company’s common stock at the option of the holder at an initial conversion price of $0.035 per share. Except for the initial conversion price and the automatic reduction in conversion price upon Stockholder Approval Date and Effective Date, the Series C-3 and Series C-4 Convertible Preferred Stock have the same conversion features as the Series C-1 Convertible Preferred Stock discussed above. See Note 14, Preferred Stock and Note 20, Subsequent Events in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information on the Series C Convertible Preferred Stock issued in connection with the February and March 2026 SPAs. Settlement of Convertible Notes Payable On June 22, 2026, we early settled the convertible notes payable with an outstanding balance of $0.3 million by paying $0.4 million in cash. The Company recognized a loss on debt extinguishment of $0.1 million in the condensed consolidated statements of operations included elsewhere in this Quarterly Report. See Note 9, Notes Payable in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information. Bridge Notes From January 12 through June 5, 2026, the Company issued several short-term promissory notes with an aggregate principal of $2.8 million (collectively, the “Bridge Notes”), of which $0.4 million was issued to FatBoy Capital, LP, a related party. The Bridge Notes bear interest at 12% per annum, had original maturity dates ranging from February 10 through July 5, 2026, and are prepayable at any time without penalty or premium. Amounts not paid when due bear interest at 18% per annum. The $480 thousand Bridge Note issued to SEG Opportunity Fund, LLC on May 18, 2026 matured on June 18, 2026 and remained outstanding as of June 30, 2026. Accordingly, the note was in default and accrued interest at the default rate of 18% per annum following its maturity. No other Bridge Notes were in default as of June 30, 2026. See Note 9, Notes Payable in the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information. Components of our Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025 Product Revenues Our current activities primarily relate to the design, manufacture and sale of new and innovative medical technologies in the field of cardiac electrophysiology and private aviation charter services. Our two primary products under the cardiac electrophysiology segment are (i) the VIVO System and (ii) the LockeT device. 62 Table of Contents The VIVO System provides 3D cardiac mapping to aid with localizing the sites of origin of idiopathic ventricular arrhythmias in patients with structurally normal hearts prior to electrophysiology studies. Customers also have the option to purchase software upgrades in advance at contract inception. We invoice the customer for VIVO System and related software upgrade services after physical possession and control of VIVO System has been transferred. Subsequent renewals for software upgrade services are invoiced at inception of the renewed term. The timing of payment for the corresponding invoices depends on the credit terms identified in each contract. We recognize revenues for VIVO System at the point in time that the product is delivered to the customer. We recognize revenues for software upgrade services evenly over time over the term of the contract. We did not recognize any revenues for software upgrade services for the three and six months ended June 30, 2026 and 2025. LockeT is a suture retention device indicated for wound healing by distributing suture tension over a larger area in the patient in conjunction with a figure of eight suture closure. We recognize sales of LockeT at the point in time that the product is delivered to the customer. We are a business that has operations within and outside of the United States. During the three and six months ended June 30, 2026, approximately 22% and 30% of our product sales were derived from customers outside of the United States, respectively. During the three and six months ended June 30, 2025, approximately 18% and 13% of our product sales were derived from customers outside of the United States, respectively. Service Revenues We generate service revenue through two primary private aviation charter services, (i) Hops and (ii) Luxe. Hops refers to short-haul private flights operated directly by us under its Part 135 certificate. These flights are conducted on aircraft managed by us and typically service high-demand regional routes throughout the New York Metro Area, Long Island, New England and the Eastern seaboard, to any destination within 400 nautical miles of the Company’s base in Farmingdale, New York. For Hops arrangements, we act as the principal because we control the specified flight service before it is transferred to the customer, are primarily responsible for operating and fulfilling the flight, and have discretion in establishing pricing. Accordingly, Hops revenue is presented on a gross basis. We recognize revenue upon completion of each flight and includes base charter rates, repositioning fees, and ancillary charges. Customer payments received in advance are recorded as deferred revenue until the related flight is completed. Luxe is the operated under our brokerage division, offering clients access to on-demand charters through a vetted network of third-party operators. We recognize revenue when control of the promised service is transferred to our customer, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We utilized registered independent third-party aircraft operators in the performance of all of our flights in 2025. We evaluate whether there is a promise to transfer services to the customer, as the principal, or to arrange for services to be provided by another party, as the agent, using a control model. Based on this evaluation, it was determined that we act as the agent within Luxe revenue arrangements, because the third-party aircraft operator is primarily responsible for operating and fulfilling the flight, and we do not control the underlying flight service before it is provided to the customer. Accordingly, Luxe revenue is presented on a net basis, representing the net amount retained by us after amounts payable to the third-party aircraft operator. The nature of the flight services we provide to customers is similar regardless of which third-party aircraft operators is involved. We direct third-party aircraft operators to provide an aircraft to a customer. Based on evaluation of the control model, it was determined that we act as the principal rather than the agent within all revenue arrangements, as we have the authority to direct the key components of the service on behalf of the customer regardless of which third-party is used. Service revenue is earned and recognized as revenue at the point in time in which the service is provided. We generally does not issue refunds for flights unless there is a failure to meet its service obligations. For roundtrip flights, revenue is recognized upon arrival at the destination for each flight. During the three and six months ended June 30, 2026, 100% of our service revenue was derived from customers inside of the United States. The Company did not recognize any service revenue during the three and six months ended June 30, 2025. Cost of revenues Cost of product revenues consists primarily of component costs, labor costs, and manufacturing overhead incurred to produce our products and support production. Cost of service revenues consists of primarily labor costs, fuel costs and landing fees related to our Hops aviation charter services. Selling, general and administrative expenses Selling, general and administrative (“SG&A”) expenses consist of employee-related costs, including salaries, benefits and stock-based compensation expenses. Other SG&A expenses include amortization of intangible assets, depreciation of fixed assets, professional services fees, including legal, audit and tax fees, insurance fees, general corporate expenses and facility-related expenses. Research and development expenses Research and development (“R&D”) expenses are expensed as incurred and include research grants paid to other parties, product development, costs of clinical studies to support new products and product enhancements, including expanded indications, supplies used for internal R&D and clinical activities, and costs for outside consultants who assist with technology development and clinical affairs. Acquired in-process research and development expenses Assets that are acquired in an asset acquisition for use in research and development activities that have an alternative future use are capitalized as IPR&D. Acquired IPR&D that has no alternative future use as of the acquisition date is recognized as research and development expense as of the acquisition date. Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025 The following table sets forth the results of the Company's operations for the periods presented (in thousands): For the Three Months Ended June 30, 2026 For the Six Months Ended June 30, 2026 2025 Change 2026 2025 Change Revenues: Product revenue $ 270 $ 212 $ 58 $ 518 $ 355 $ 163 Service revenue, net 749 — 749 933 — 933 Total revenues 1,019 212 807 1,451 355 1,096 Cost of revenues: Cost of product revenue 22 14 8 53 25 28 Cost of service revenue 899 — 899 910 — 910 Total cost of revenues 921 14 907 963 25 938 Selling, general and administrative expenses 3,911 2,881 1,030 6,470 6,366 104 Research and development expenses 142 155 (13 ) 291 258 33 Acquired in-process research and development expenses — 1,848 (1,848 ) — 1,967 (1,967 ) Change in fair value of royalties payable due to related parties — (1,667 ) 1,667 — (2,830 ) 2,830 Change in fair value of minority equity interest — — - (2,302 ) — (2,302 ) Change in fair value of deferred consideration 318 — 318 3,195 — 3,195 Loss on debt extinguishment (105 ) — (105 ) (105 ) — (105 ) Unrealized gains and losses, net 378 — 378 378 — 378 Other expense, net (1) (254 ) (55 ) (199 ) (376 ) (86 ) (290 ) Income tax benefit (312 ) (950 ) 638 (487 ) (1,674 ) 1,187 (1) Constitutes the operating activities within other income (expense), net in the condensed consolidated statements of operations, except for the change in fair value of royalties payable due to related parties, change in fair value of minority equity interest, change in fair value of deferred consideration, loss on debt extinguishment and unrealized gains and losses, net that are presented separately in the table above. 63 Table of Contents Revenues The increase in product revenue of approximately $58 thousand for the three months ended June 30, 2026 as compared to the corresponding period in the prior year was due to an increase of $75 thousand in LockeT sales, partially offset by a $17 thousand decrease in VIVO System sales due to fewer customers. The increase in product revenue of approximately $163 thousand for the six months ended June 30, 2026 as compared to the corresponding period in the prior year was due to an increase of $121 thousand and $42 thousand in LockeT and VIVO System sales, respectively. The increase in LockeT sales is primarily the result of additional domestic customers as well as an increase in international sales. The increase in VIVO System sales was primarily due to growth in international sales resulting from expanded sales efforts. The increase in service revenue of approximately $749 thousand and $933 thousand for the three and six months ended June 30, 2026 respectively, as compared to the corresponding periods in the prior year was due to the acquisition of FLYTE during the period, which contributed to an additional revenue stream from the private aviation charter services Cost of revenues The increase in cost of revenues of approximately $1.0 million and $1.1 million for the three and six months ended June 30, 2026, as compared to the corresponding periods in the prior year was primarily due to an increase in cost of service revenues of $1.0 million and $1.1 million associated with the increase in private charter aviation services, respectively. Selling, general and administrative expenses The increase in selling, general and administrative expenses of approximately $0.9 million for the three months ended June 30, 2026 as compared to the corresponding period in the prior year primarily relates to an increase of $0.8 million in professional fees, such as accounting, audit, and legal fees, and $0.1 million in investor relations and SEC fees incurred in connection with the FLYTE acquisition as well as other transactions completed in the period, such as the February and March 2026 SPAs. In addition, there was an increase of $0.2 million in advertising and marketing expenses related to the newly acquired private charter aviation services. The increase in selling, general and administrative expenses was partially offset by a decrease of $0.4 million in salaries and benefits due to a reduction in overall head count and a restructuring of sales compensation. The decrease in selling, general and administrative expenses of approximately $0.1 million for the six months ended June 30, 2026 as compared to the corresponding period in the prior year was due to a decrease of $0.9 million in salaries and benefits due to a reduction in overall headcount and a restructuring of sales compensation. The decrease is partially offset by an increase of $0.7 million in professional fees incurred in connection with the FLYTE acquisition and other transactions completed in the period and an increase of $0.2 million in advertising and marketing expenses related to the newly acquired private charter aviation services. Research and development expenses The decrease in research and development expenses of approximately $13 thousand for the three months ended June 30, 2026, as compared to the corresponding period in the prior year, was primarily due to a decrease in research grants partially offset by an increase in professional fees that related to third-party consulting for VIVO software upgrades and the development of a system that interfaces with implanted cardiac devices to enable improved pre-ablation mapping and more precise localization of arrhythmogenic tissue. The increase in research and development expenses of approximately $33 thousand for the six months ended June 30, 2026, as compared to the corresponding period in the prior year, was primarily due to an increase in professional fees of $92 thousand related to third-party consulting for VIVO software upgrades and the development of a system that interfaces with implanted cardiac devices to enable improved pre-ablation mapping and more precise localization of arrhythmogenic tissue, partially offset by a decrease of $66 thousands in research grants. 64 Table of Contents Acquired in-process research and development expenses We did not incur any acquired in-process research and development expenses during the three and six months ended June 30, 2026. The decrease in acquired in-process research and development expenses of approximately $1.9 million and $2.0 million for the three and six months ended June 30, 2026, respectively, as compared the corresponding periods in the prior year primarily relates to the two asset acquisitions completed in 2025. On January 24, 2025, we acquired 100% of the membership interests of Perikard, LLC, which was accounted for as an asset acquisition consisting primarily of a single patent for pericardial access technology. The patent was determined to be IPR&D with no alternative future use, and accordingly, we recognized $0.1 million as acquired in-process research and development in the condensed consolidated statements of operations for the three months ended March 31, 2025. On May 5, 2025, we acquired certain assets primarily related to Cardionomic’s CPNS System, which were deemed to be IPR&D assets with no alternative future use. Accordingly, we recognized $1.9 million, consisting of $0.3 million in stock consideration, $1.3 million in note payable, and $0.3 million in direct transaction costs, as acquired in-process research and development in the condensed consolidated statements of operations for the three and six months ended June 30, 2025. Change in fair value of royalties payable due to related parties At each reporting period, the fair value of the royalties payable due to related parties is calculated using the discounted cash flow method. During the six months ended June 30, 2026 , we did not record a change in fair value of royalties payable due to related parties as there was no triggering event. As a result, the change in fair value of royalties payable due to related parties decreased approximately by $1.7 million and $2.8 million for the three and six months ended June 30, 2026 respectively, as compared to the corresponding period in the prior year. Change in fair value of minority equity interest The decrease of $2.3 million during the six months ended June 30, 2026 represents the change in fair value of our initial minority equity interest of 19.98% in FLYTE from $5.2 million as of February 6, 2026 to $2.9 million as of March 9, 2026, the date we acquired a controlling equity interest in FLYTE. The fair value of the investment was determined based on the implied transaction value of FLYTE, which was derived from the purchase price paid to acquire the remaining 80.02% interest in FLYTE. Change in fair value of deferred consideration At each reporting period, the fair value of the deferred consideration payable incurred for our controlling equity interest in FLYTE is remeasured. The increase of $0.3 million and $3.2 million in the change in fair value of deferred consideration for the three and six months ended June 30, 2026, respectively, as compared to the corresponding periods in the prior year, is due to the remeasurement and gain recorded in each respective period. Loss on debt extinguishment In June 22, 2026, we prepaid the outstanding balance of the convertible notes payable of $0.3 million by paying $0.4 million in cash. As a result, we recognized a loss on debt extinguishment of $0.1 million for the three and six months ended June 30, 2026 Unrealized gains and losses, net In June 2026, we invested $1.0 million in shares of common stock of Volato Group, Inc. and flyExclusive, Inc., which had an estimated fair value of $1.5 million on the day of settlement. We recognized gains of approximately $458 thousand on the day of settlement, which was subsequently partially offset by $0.1 million in unrealized and realized losses for the three and six months ended June 30, 2026 We did not have any similar investments in the three and six months ended June 30, 2025. Other expenses, net The increase in other income expense, net of $199 thousand and $290 thousand for the three and six months ended June 30, 2026 respectively, as compared to the corresponding periods in the prior year, primarily relates to an increase in interest expense of $139 thousand incurred in connection with the note payable issued by Cardionomix on May 5, 2025, the short-term note payables issued by KardioNav on July 11, 2025, and the assumed notes in relation to the FLYTE Acquisition as well as an increase in fair value of the deferred stock issuance payable of $46 thousand. On June 28, 2026, we received advanced proceeds of $0.6 million from an investor in exchange for the future issuance of the Series C-3 Convertible Preferred Stock pursuant to the February and March 2026 SPAs. The advanced proceeds were recorded as a deferred stock issuance payable that was subject to remeasurement as of June 30, 2026. We did not incur interest expense on the above notes nor any changes in fair value of the deferred stock issuance payable for the three and six months ended June 30, 2026. Income tax benefit The decrease in income tax benefit of approximately $0.6 million and $1.2 million for the three and six months ended June 30, 2026, as compared to the corresponding periods in the prior year primarily relates to changes in the estimated amount of net operating losses that are not subject to limitations under Section 382 of the Internal Revenue Code. Liquidity and capital resources As of June 30, 2026, we had cash and cash equivalents of $0.6 million and an accumulated deficit of $314.5 million. For the six months ended June 30, 2026, net cash used in operating activities was $5.7 million. We have incurred recurring net losses from operations and negative cash flows from operating activities since inception. In February and March 2026, we raised gross proceeds of $3.8 million in connection with the February and March 2026 SPAs. We also raised gross proceeds of $0.4 million through the induced exercise of certain existing warrants and conversion of the Series B Convertible Preferred Stock. In April 2026, we raised gross proceeds of $3.5 million in connection with the Second Tranche of the February 2026 and March 2026 SPAs. In addition, in July 2026, we raised gross proceeds of $3.5 million in connection with the Third Tranche of the February and March 2026 SPAs and $2.8 million in connection with the Fourth Tranche of the March 2026 SPA. As a result of the FLYTE Acquisition, we paid $0.8 million in cash at closing to Creatd and issued a promissory note with a principal amount of $5.0 million and an interest rate of 0% per annum to Creatd. In addition, during the six-month period ended June 30, 2026, we also issued several Bridge Notes with an aggregate principal balance of approximately $2.8 million and interest rates of 12% per annum. We settled $0.6 million of the Bridge Notes, such that $2.2 million of the Bridge Notes remain outstanding as of June 30, 2026. We used some of the proceeds from the Bridge Notes to settle the convertible notes payable for $0.4 million and recorded a loss on debt extinguishment of $0.1 million for the three and six months ended June 30, 2026. We further invested $1.0 million in shares of common stock of Volato Group, Inc. and flyExclusive, Inc., which are publicly traded on the NYSE and had a value of $1.1 million as of June 30, 2026. 65 Table of Contents We expect operating losses and negative cash flows to continue for the foreseeable future unless our sales and gross profit increase sufficiently to cover our operating expenses. We expect our current operating expenses to remain relatively fixed for the near term, absent entering into a transformative strategic transaction. We believe that our cash on hand of $2.1 million as of August 11, 2026 will not be sufficient to fund our current operations. Further, we have outstanding short-term notes that will become due and payable within the next twelve months, including the May Bridge Notes that are past due as of June 30, 2026 and the June Bridge Notes that are due in July 2026, the notes payable of variable interest entities due to related parties that are due in July 2026, the notes payable issued to Creatd with monthly installment payments due through December 2026, and Assumed Notes acquired in the Flyte Acquisition that are past due. We estimate that we will require additional capital over the next twelve months to: ● Support the operations and growth of our private aviation segment, including aircraft lease payments, maintenance, and working capital needs; ● Fund ongoing operations of our cardiac electrophysiology segment efforts for our VIVO and LockeT products while it remains part of our business; ● Meet debt service obligations; and ● Address general corporate purposes and working capital requirements. As noted above, as of June 30, 2026, we have debt obligations due within the next twelve months. If we are unable to refinance or extend these obligations prior to maturity, we will be required to repay them from cash on hand or from proceeds of additional financing, which may not be available on acceptable terms or at all. Because expected revenues are not adequate to fund our planned expenditures and anticipated operating costs and liabilities beyond such point, we are currently evaluating potential means of raising cash, as described below, to fund our operations and to pay our debts as they come due. If we are unable to do so, we will be required to reduce our spending to align with expected revenue levels and cash reserves, although there can be no guarantee that we will be successful in doing so. If we are unable to do so, we will be required to suspend a portion or all of our operations and/or potentially seek relief from our creditors. We may not be able to secure financing in a timely manner or on favorable terms, if at all. Due to the challenging economic environment, we have explored and continue to explore a wide variety of possible capital-raising and strategic transactions, including but not limited to private equity offerings, registered issuances, credit facilities, and convertible debt, as well as other innovative and specialty finance strategies or business combination. There is no guarantee that we will succeed in securing the financing or other strategic transaction needed to sustain our company or that any such transaction will be on our preferred terms. Management plans to address our liquidity needs include actively pursuing multiple strategies to obtain the capital necessary to continue operations, including equity financing, debt financing, and strategic transactions. We have engaged a financial advisor to assist in evaluating these alternatives. However, there can be no assurance that any strategic transaction will be successfully completed, and any such transaction may not occur on terms favorable to us or our stockholders. As a result of these factors, we have concluded that there is substantial doubt about the Company’s ability to continue as a going concern for a period of one year after the date the condensed consolidated financial statements for the quarter ended June 30, 2026 are issued. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result should we be unable to continue as a going concern and the outcome of this uncertainty. Cash Flows for the Six Months Ended June 30, 2026 and 2025 (in thousands) For the Six Months Ended June 30, 2026 2025 Net cash provided by (used in): Operating activities $ (5,657 ) $ (4,601 ) Investing activities (2,152 ) (23 ) Financing activities 8,364 2,589 Net change in cash and cash equivalents $ 555 $ (2,035 ) Net cash used in operating activities During the six months ended June 30, 2026, net cash used in operating activities of $5.7 million primarily related to the net loss of $5.0 million, a decrease in change in fair value of deferred consideration of $3.2 million, an increase in change in fair value of minority equity interest of $2.3 million, and a decrease in operating assets and liabilities of $0.6 million. This was partially offset by non-cash adjustments related to depreciation and amortization of $0.8 million. During the six months ended June 30, 2025, net cash used in operating activities of $4.6 million primarily related to the net loss of $9.5 million. This was partially offset by non-cash adjustments related change in fair value of royalties payable due to related parties of $2.8 million, acquired in-process research and development of $2.0 million, and depreciation and amortization of $1.0 million. 66 Table of Contents Net cash used in investing activities During the six months ended June 30, 2026, net cash used in investing activities of $2.2 million primarily related to the FLYTE acquisition of $1.2 million and the purchase of $1.0 million of marketable securities from Volato. During the six months ended June 30, 2025, net cash used in investing activities of $23 thousand consisted of purchases of property and equipment of $17 thousand, and purchases of acquired in-process research and development of $6 thousand. Net cash provided by financing activities During the six months ended June 30, 2026, net cash provided by financing activities of $8.4 million consisted of net proceeds from issuance of common stock and other equity-classified contracts of $6.9 million, proceeds from notes payable of $2.8 million, proceeds from deferred stock issuance payable of $0.6 million, and proceeds from the exercise of warrants of $0.4 million, partially offset by $2.4 million in payments on notes payable. During the six months ended June 30, 2025, net cash provided by financing activities of $2.6 million primarily consisted of proceeds from issuance of common stock and other equity-classified contracts of $2.7 million, partially offset by $0.1 million in payments on notes payable. Off-balance sheet arrangements We have not engaged in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, as a part of our ongoing business. Accordingly, we did not have any off-balance sheet arrangements during any of the periods presented. The Company’s Critical Accounting Estimates The information set forth below relates to our critical accounting policies and estimates. Critical accounting estimates are those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition and results of operations. Our estimates are based on current facts, historical experience and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Accordingly, a different financial presentation could result depending on the judgments, estimates or assumptions that are used. However, we do not believe that actual results will deviate materially from our estimates related to our accounting policies described below but, because application of these accounting policies involves the exercise of judgment and the use of assumptions as to future uncertainties, actual results could differ materially from these estimates. Therefore, we consider an understanding of the variability and judgment required in making these estimates and assumptions to be critical in fully understanding and evaluating our reported financial results. The discussion and analysis of our financial position and results of operations is based on our condensed consolidated financial statements included elsewhere in this Quarterly Report, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions for the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We regularly evaluate estimates and assumptions related to asset acquisitions, including the provisions for legal contingencies, income taxes, deferred income tax asset valuation allowances, royalties payable due to related parties, share based compensation, evaluation of impairment of long-lived assets, valuation of long-lived assets and their associated estimated useful lives, and revenues. In addition, we regularly evaluate estimates and assumptions related to business combinations, including the determination of the purchase price and related allocations to the fair value of assets acquired and liabilities assumed, provisions for legal contingencies, income taxes, deferred income tax asset valuation allowances, valuation of warranties liabilities, royalties payable due to related parties, share based compensation, evaluation of impairment of long-lived assets and goodwill, valuation of long-lived assets and their associated estimated useful lives, and revenues. Our estimates are based on current facts, historical experience and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and any such differences may be material. 67 Table of Contents We believe the following discussion addresses our most critical accounting policies, which are those that are most important to our financial condition and results of operations and require our most difficult, subjective and complex judgments. Accounting for long-lived assets - estimated useful lives Intangible assets acquired from business combinations are initially measured at their estimated fair values and are then amortized on a straight-line basis over their estimated useful lives. Management evaluates whether events or circumstances have occurred that indicate the remaining useful life or carrying value of the amortizing intangible assets should be revised and adjusted, if necessary. Accounting for impairment of long-lived assets We periodically review our long-lived assets for impairment whenever events or changes in circumstances indicate that such assets might be impaired and the carrying value of the long-lived assets may not be recoverable. If events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable and the expected undiscounted future cash flows attributable to the asset are less than the carrying amount of the asset, an impairment loss equal to the excess of the assets carrying value over its fair value is recorded in our condensed consolidated statements of operations at that date. 68 Table of Contents Royalties payable We are obligated to pay royalties related to the sales of LockeT and AMIGO System under various royalty agreements executed by Old Catheter. We recognize a liability for royalty fees incurred and payable based on actual sales of products under current portion of royalties payable due to related parties in the condensed consolidated balance sheets. We recognize a liability for future, estimated royalty payments at fair value under current portion of royalties payable due to related parties and royalties payable due to related parties in the condensed consolidated balance sheets if it is payable within the next 12 months and under royalties payable due to related parties in the condensed consolidated balance sheets if it is payable 12 months after the balance sheet date. The royalties payable due to related parties are remeasured at each reporting period. Changes in fair value of royalties payable due to related parties are recorded on the condensed consolidated statements of operations in the period in which they occur. The fair value measurement of royalties payable due to related parties includes significant unobservable inputs that are not supported by any market data. Royalties payable due to related parties equal the present value of estimated future royalty payments. We apply an internally developed, revenue adjusted discount rate (“RADR”) to discount back the forecasted royalty payments. The RADR is based on the Company’s weighted average cost of capital (“WACC”) adjusted for the product revenue’s risk profile. The risk-free rate used to determine the cost of equity for the RADR is adjusted to be commensurate with the term of the royalty agreements. Furthermore, the Beta and Risk Premium used to determine the cost of equity are also adjusted to reflect the product revenue's volatility. All other inputs for the RADR and our WACC are the same. The RADR was 19.5% as of June 30, 2026 and December 31, 2025. Convertible notes payable We elected to measure the Convertible Notes Payable using the fair value option under ASC Topic 825. The fair value of the Convertible Notes Payable is remeasured at each reporting date using a probability weighted expected return model ("PWER model”). The PWER model values the convertible notes payable based on the discounted cash flows of three potential settlement outcomes: (i) the convertible notes payable will be converted into and settled in shares of common stock, (ii) the convertible notes payable’s principal and accrued interest will be paid in cash, and (iii) a dissolution scenario wherein the investor receives a partial payment based on a recovery rate. The conversion outcome incorporates a Monte Carlo simulation to estimate our common stock price at the expected conversion date and the number of shares issuable based on the variable conversion price. Aside from the probability of the three potential settlement outcomes, the fair value measurement incorporates several significant unobservable inputs, including the recovery rate, implied equity volatility, expected term assumptions, simulated conversion price, and credit-risk adjusted discount rate. The convertible notes payable were fully settled and paid off as of June 30, 2026. Goodwill and Other Intangible Assets We use the acquisition method of accounting, in accordance with ASC Topic 805, “Business Combinations” ("ASC Topic 805") to allocate costs of acquired businesses to the assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition. The excess costs of acquired businesses over the fair values of the assets acquired and liabilities assumed are recognized as goodwill. The valuations of the acquired assets and liabilities will impact the determination of future operating results. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, revenue growth rates and earnings before interest, taxes, depreciation and amortization, margins, discount rates, customer attrition rates, royalty rates, asset lives and market multiples, among other items. We determine the fair values of intangible assets acquired generally in consultation with third-party valuation advisors. Any fair value adjustments to the assets and liabilities are recognized and the results of operations of the acquired business are included in our condensed consolidated financial statements from the effective date of the acquisition. New Accounting Pronouncements See Note 2 in the condensed consolidated financial statements included elsewhere in this Quarterly Report for a description of new accounting pronouncements, including the expected dates of adoption and estimated effects on our results of operations, financial position, and cash flows as applicable. 69 Table of Contents