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DE 98-0551945 3350 Virginia Street Suite 200 Miami FL 33133 800 583-2652 Common Stock, par value $0.0001 per share WRAP NASDAQ Yes Yes Non-accelerated Filer true false false 56003638 4781000 3468000 3378000 2787000 4308000 4971000 729000 194000 13196000 11420000 89000 123000 426000 2175000 1603000 1572000 25000 128000 15339000 15418000 764000 620000 310000 407000 98000 62000 378000 408000 91000 320000 1641000 1817000 7000 14000 345000 2097000 352000 2111000 1993000 3928000 5000000 5000000 0.0001 0.0001 11707 11707 12707 12707 0 0 200000000 200000000 0.0001 0.0001 55857933 55857933 51733217 51733217 5000 5000 10000 10000 0.0001 0.0001 8107 8107 8207 8207 0 0 4500 4500 0.0001 0.0001 3600 3600 4500 4500 0 0 136868000 127804000 -123527000 -116319000 13346000 11490000 15339000 15418000 1747000 50000 2630000 359000 305000 962000 533000 1419000 2052000 1012000 3163000 1778000 507000 525000 927000 695000 1545000 487000 2236000 1083000 3644000 3181000 8999000 7266000 152000 162000 257000 594000 3796000 3343000 9256000 7860000 -2251000 -2856000 -7020000 -6777000 2000 2000 3000 3000 0 871000 0 -3158000 0 0 227000 0 -8000 -2000 -7000 -2000 -6000 -871000 223000 3159000 -2257000 -3727000 -6797000 -3618000 162000 164000 411000 328000 -2419000 -3891000 -7208000 -3946000 -0.04 -0.04 -0.07 -0.07 -0.13 -0.13 -0.07 -0.07 55731095 55731095 50609509 50609509 54871126 54871126 49439838 49439838 -2257000 -3727000 -6797000 -3618000 -2257000 -3727000 -6797000 -3618000 51733217 5000 8207 0 4500 0 127804000 -116319000 11490000 0 0 0 2384000 0 2384000 462656 0 0 0 249000 -249000 0 72888 0 0 0 0 0 0 668965 0 -100 0 -900 0 0 0 0 2500000 0 0 0 5000000 0 5000000 68966 0 0 0 100000 0 100000 0 0 0 0 -4540000 -4540000 55506692 5000 8107 0 3600 0 135537000 -121108000 14434000 0 0 0 1019000 0 1019000 96775 0 0 0 150000 0 150000 162836 0 0 0 162000 -162000 0 91630 0 0 0 0 0 0 0 0 0 0 -2257000 -2257000 55857933 5000 8107 0 3600 0 136868000 -123527000 13346000 47101631 5000 8207 0 0 105326000 -105081000 250000 0 0 0 1665000 0 1665000 113205 0 0 0 164000 -164000 0 63199 0 0 0 0 0 0 3216666 0 0 0 543000 0 543000 0 0 0 0 109000 109000 50494701 5000 8207 0 0 107698000 -105136000 2567000 0 0 0 770000 0 770000 139431 0 0 0 164000 -164000 0 94403 0 0 0 0 0 0 0 0 0 12151000 0 12151000 0 0 0 0 -3727000 -3727000 50728535 5000 8207 0 0 120783000 -109027000 11761000 -6797000 -3618000 111000 304000 3403000 2435000 150000 0 31000 2000 227000 0 0 -3158000 75000 -199000 76000 60000 73000 187000 667000 453000 -590000 -79000 535000 156000 144000 -34000 -80000 197000 -36000 0 -123000 -523000 -5000 -10000 -37000 -180000 -103000 -58000 -3679000 -5009000 11000 8000 97000 145000 -108000 -153000 5000000 0 100000 0 0 5729000 5100000 5729000 1313000 567000 3468000 3610000 4781000 4177000 0 12159000 -411000 -328000 411000 328000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>1. <span>ORGANIZATION, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT DEVELOPMENTS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Organization and Business Description</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Wrap Technologies, Inc., a Delaware corporation (the “Company”, “we”, “us”, and “our”), is a publicly traded company with its common stock, par value $0.0001 per share (“Common Stock”), listed on the Nasdaq Capital Market (“Nasdaq”) under the trading symbol “WRAP.” The Company is a developer and supplier of public safety technologies, products, and training services for law enforcement and security personnel. The Company’s principal product is the BolaWrap® 150, a handheld remote restraint device sold together with recurring consumable cassettes and related accessories. The Company also offers technology-enabled services, including Wrap Reality, a virtual reality training simulator, WrapTactics™, a subscription-based digital training platform, WrapVision™, a body-worn camera and digital evidence management solution, and managed services and policy support. As described under Recent Developments, the Company is developing WrapShield™, an integrated detection, orchestration, and response architecture for public safety and security applications, together with additional non-lethal response products that remain in development. The principal markets for the Company's proprietary products and services are in North and South America, Europe, the Middle East, Africa and Asia.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Basis of Presentation</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company’s unaudited interim condensed consolidated financial statements included herein have been prepared in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X and the rules and regulations of the Securities and Exchange Commission (“<i>SEC</i>”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“<i>U.S. GAAP</i>”) have been condensed or omitted pursuant to such rules and regulations. In management’s opinion, the accompanying financial statements reflect adjustments necessary to present fairly the financial position, results of operations, and cash flows for those periods indicated, and contain adequate disclosure to make the information presented not misleading. Adjustments included herein are of a normal, recurring nature unless otherwise disclosed in the footnotes. The condensed consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (the “<i>Annual Report</i>”), as filed with the SEC on March 26, 2026. The accompanying unaudited condensed consolidated balance sheet as of June 30, 2026 has been derived from the audited consolidated balance sheet as of December 31, 2025, contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Results of operations for interim periods are not necessarily indicative of the results of operations for a full year.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Principles of Consolidation</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company has <span title="Number of wholly-owned subsidiaries">three</span> wholly owned subsidiaries, Wrap Reality, Inc., that sells a virtual reality (“<i>VR</i>”) training system primarily targeting law enforcement agencies, Intrensic, LLC (“Intrensic”), specializing in Body Worn Camera and Digital Evidence Management solutions and Wrap Federal, LLC, formed to support federal government clients in federal agencies. The condensed consolidated financial statements include the accounts of these subsidiaries after elimination of intercompany transactions and accounts.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Segment and Related Information</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company operates as a <span style="-sec-ix-hidden: hidden-fact-2"><span style="-sec-ix-hidden: hidden-fact-3">single</span></span> operating and reportable segment. The Company's Chief Operating Decision Maker is its Chief Executive Officer, who manages operations for purposes of allocating resources on a consolidated basis.</p><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Use of Estimates</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could materially differ from those estimates.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">  </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Revenue Recognition</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company recognizes revenue under ASC Topic 606 - Revenue from Contracts with Customers (“ASC 606”). Revenue is recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to receive. The Company's revenues consist of product sales (BolaWrap devices, cassettes, and accessories) and technology-enabled services (software subscriptions, body-worn cameras, managed services, policy support, training, and shipping). </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p></div><div> <p style="font: bold 10pt &quot;Times New Roman&quot;; margin-top: 0pt; margin-bottom: 0pt;">Warrants</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt;">As of June 30, 2026, all outstanding warrants (Series A Warrants, PIPE Warrants, Series B Warrants, and February 2026 Common Warrants each defined herein) are classified within permanent equity (additional paid-in capital) following amendments executed on June 30, 2025 that enabled equity classification under ASC 815-40 as discussed further in Note 8. These warrants are not subject to subsequent fair value remeasurement and no warrant liability is recorded as of June 30, 2026 or December 31, 2025.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt;">  </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Loss per Share</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on the Company’s Series A Convertible Preferred Stock ("Series A Preferred Stock"), by the weighted average number of shares outstanding during the reported period.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In computing diluted EPS, the Company adjusts the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A and Series B Convertible Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A and Series B Convertible Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. The Company adjusts the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A and Series B Convertible Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total <span style="background-color: rgb(255, 255, 255);">of 11,077,429 shares and <span title="Antidilutive securities excluded from computation of earnings per share, amount">7,856,142</span> sh</span>ares of Common Stock were outstanding as of June 30, 2026 and 2025, respectively. These securities are not included in the computation of diluted net loss per share of Common Stock for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Reclassifications</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no effect on previously reported net loss, total assets, total liabilities, stockholders’ equity, or cash flows.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">   </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Recently Issued Accounting Guidance Not Yet Effective</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In November 2024, the FASB issued ASU 2024-03, which requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact of ASU 2024-03 on its financial statements.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Organization and Business Description</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Wrap Technologies, Inc., a Delaware corporation (the “Company”, “we”, “us”, and “our”), is a publicly traded company with its common stock, par value $0.0001 per share (“Common Stock”), listed on the Nasdaq Capital Market (“Nasdaq”) under the trading symbol “WRAP.” The Company is a developer and supplier of public safety technologies, products, and training services for law enforcement and security personnel. The Company’s principal product is the BolaWrap® 150, a handheld remote restraint device sold together with recurring consumable cassettes and related accessories. The Company also offers technology-enabled services, including Wrap Reality, a virtual reality training simulator, WrapTactics™, a subscription-based digital training platform, WrapVision™, a body-worn camera and digital evidence management solution, and managed services and policy support. As described under Recent Developments, the Company is developing WrapShield™, an integrated detection, orchestration, and response architecture for public safety and security applications, together with additional non-lethal response products that remain in development. The principal markets for the Company's proprietary products and services are in North and South America, Europe, the Middle East, Africa and Asia.</p> 0.0001 0.0001 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Basis of Presentation</b></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company’s unaudited interim condensed consolidated financial statements included herein have been prepared in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X and the rules and regulations of the Securities and Exchange Commission (“<i>SEC</i>”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“<i>U.S. GAAP</i>”) have been condensed or omitted pursuant to such rules and regulations. In management’s opinion, the accompanying financial statements reflect adjustments necessary to present fairly the financial position, results of operations, and cash flows for those periods indicated, and contain adequate disclosure to make the information presented not misleading. Adjustments included herein are of a normal, recurring nature unless otherwise disclosed in the footnotes. The condensed consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (the “<i>Annual Report</i>”), as filed with the SEC on March 26, 2026. The accompanying unaudited condensed consolidated balance sheet as of June 30, 2026 has been derived from the audited consolidated balance sheet as of December 31, 2025, contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Results of operations for interim periods are not necessarily indicative of the results of operations for a full year.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Principles of Consolidation</b></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company has <span title="Number of wholly-owned subsidiaries">three</span> wholly owned subsidiaries, Wrap Reality, Inc., that sells a virtual reality (“<i>VR</i>”) training system primarily targeting law enforcement agencies, Intrensic, LLC (“Intrensic”), specializing in Body Worn Camera and Digital Evidence Management solutions and Wrap Federal, LLC, formed to support federal government clients in federal agencies. The condensed consolidated financial statements include the accounts of these subsidiaries after elimination of intercompany transactions and accounts.</p> 3 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Segment and Related Information</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company operates as a <span style="-sec-ix-hidden: hidden-fact-2"><span style="-sec-ix-hidden: hidden-fact-3">single</span></span> operating and reportable segment. The Company's Chief Operating Decision Maker is its Chief Executive Officer, who manages operations for purposes of allocating resources on a consolidated basis.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Use of Estimates</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could materially differ from those estimates.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Revenue Recognition</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company recognizes revenue under ASC Topic 606 - Revenue from Contracts with Customers (“ASC 606”). Revenue is recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to receive. The Company's revenues consist of product sales (BolaWrap devices, cassettes, and accessories) and technology-enabled services (software subscriptions, body-worn cameras, managed services, policy support, training, and shipping). </p> <p style="font: bold 10pt &quot;Times New Roman&quot;; margin-top: 0pt; margin-bottom: 0pt;">Warrants</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt;">As of June 30, 2026, all outstanding warrants (Series A Warrants, PIPE Warrants, Series B Warrants, and February 2026 Common Warrants each defined herein) are classified within permanent equity (additional paid-in capital) following amendments executed on June 30, 2025 that enabled equity classification under ASC 815-40 as discussed further in Note 8. These warrants are not subject to subsequent fair value remeasurement and no warrant liability is recorded as of June 30, 2026 or December 31, 2025.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Loss per Share</b></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on the Company’s Series A Convertible Preferred Stock ("Series A Preferred Stock"), by the weighted average number of shares outstanding during the reported period.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In computing diluted EPS, the Company adjusts the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A and Series B Convertible Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A and Series B Convertible Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. The Company adjusts the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A and Series B Convertible Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total <span style="background-color: rgb(255, 255, 255);">of 11,077,429 shares and <span title="Antidilutive securities excluded from computation of earnings per share, amount">7,856,142</span> sh</span>ares of Common Stock were outstanding as of June 30, 2026 and 2025, respectively. These securities are not included in the computation of diluted net loss per share of Common Stock for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company.</p> 11077429 7856142 <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Reclassifications</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no effect on previously reported net loss, total assets, total liabilities, stockholders’ equity, or cash flows.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Recently Issued Accounting Guidance Not Yet Effective</b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In November 2024, the FASB issued ASU 2024-03, which requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact of ASU 2024-03 on its financial statements.</p> <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>2. <span>REVENUE AND PRODUCT COSTS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Revenues consist of product sales and technology-enabled services. Product sales include BolaWrap devices, cassettes, and accessories. Technology-enabled services include software subscriptions, body-worn cameras, managed services, policy and training support, and shipping revenue.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The table below details the activity in our contract liabilities during the six months ended June 30, 2026.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="display: none">SCHEDULE OF CONTRACT LIABILITIES</span></p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td> </td><td style="width: 1%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C3"> </td><td style="width: 9%;"></td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C3"> </td><td style="width: 1%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E3"> </td><td style="width: 9%;"></td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E3"> </td></tr><tr style="white-space : nowrap; "><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C4"> </td><td style="width: 9%; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center;">Customer Deposits</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E4"> </td><td style="width: 9%; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center;">Deferred Revenue</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E4"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Balance at January 1, 2026</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C6">$</td><td style="width: 9%; text-align: right;">62</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C6"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E6">$</td><td style="width: 9%; text-align: right;">422</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E6"> </td></tr><tr><td style="padding-left: 10px;">Additions, net</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C7"> </td><td style="width: 9%; text-align: right;">65</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E7"> </td><td style="width: 9%; text-align: right;">409</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td style="padding-left: 10px;">Transfer to revenue</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C8"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(29</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C8">) </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E8"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(446</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E8">) </td></tr><tr><td>Balance at June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C9">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">98</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C9"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E9">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">385</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> </td><td> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C10"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C10"> </td><td> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E10"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E10"> </td></tr><tr><td>Current portion</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C11">$</td><td style="width: 9%; text-align: right;">98</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E11">$</td><td style="width: 9%; text-align: right;">378</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Long-term portion</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C12">$</td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E12">$</td><td style="width: 9%; text-align: right;">7</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E12"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, the Company’s deferred revenue of $385 consisted of $8 related to BolaWrap extended warranties and services, $27 related to WRAP Ready, $323 related to Intrensic extended warranties and services, $15 related to VR, $4 related to training and $8 related to Wrap Tactics. </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The table below details the activity in our contract liabilities during the six months ended June 30, 2026.</p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td> </td><td style="width: 1%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C3"> </td><td style="width: 9%;"></td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C3"> </td><td style="width: 1%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E3"> </td><td style="width: 9%;"></td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E3"> </td></tr><tr style="white-space : nowrap; "><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C4"> </td><td style="width: 9%; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center;">Customer Deposits</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E4"> </td><td style="width: 9%; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center;">Deferred Revenue</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E4"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Balance at January 1, 2026</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C6">$</td><td style="width: 9%; text-align: right;">62</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C6"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E6">$</td><td style="width: 9%; text-align: right;">422</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E6"> </td></tr><tr><td style="padding-left: 10px;">Additions, net</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C7"> </td><td style="width: 9%; text-align: right;">65</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E7"> </td><td style="width: 9%; text-align: right;">409</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td style="padding-left: 10px;">Transfer to revenue</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C8"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(29</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C8">) </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E8"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(446</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E8">) </td></tr><tr><td>Balance at June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C9">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">98</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - C9"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E9">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">385</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 2 Revenues Product Costs - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> </td><td> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C10"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - C10"> </td><td> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E10"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 2 Revenues Product Costs - E10"> </td></tr><tr><td>Current portion</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C11">$</td><td style="width: 9%; text-align: right;">98</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E11">$</td><td style="width: 9%; text-align: right;">378</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Long-term portion</td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C12">$</td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - C12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E12">$</td><td style="width: 9%; text-align: right;">7</td><td style="width: 1%; text-align: left;" title="FN 2 Revenues Product Costs - E12"> </td></tr></table> 62000 422000 65000 409000 -29000 -446000 98000 385000 98000 378000 0 7000 385000 8000 27000 323000 15000 4000 8000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>3. <span>FINANCIAL INSTRUMENTS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Assets and liabilities recorded at fair value on a recurring basis in the Condensed Consolidated Balance Sheets and assets and liabilities measured at fair value on a non-recurring basis or disclosed at fair value, are categorized based upon the level of judgment associated with inputs used to measure their fair values. The accounting guidance for fair value provides a framework for measuring fair value and requires certain disclosures about how fair value is determined. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance also establishes a three-level valuation hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based upon whether such inputs are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions made by the reporting entity. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Level 1</i>-Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><i> </i></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Level 2</i>-Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Level 3</i>-Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table shows the Company’s short-term investments by significant investment category as of June 30, 2026, and December 31, 2025.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td colspan="15" style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold;">As of June 30, 2026</td></tr><tr><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Adjusted Cost</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Unrealized Gains</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Unrealized Losses</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Market Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H4"> </td></tr><tr><td></td><td style="width: 1%;" title="FN 3 Financial Instruments - B6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - B6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - D6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - D6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - F6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - F6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - H6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - H6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Level 1:</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H7"> </td></tr><tr><td>Money Market Funds</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total financial assets</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td colspan="15" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">As of December 31, 2025</td></tr><tr><td></td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Adjusted Cost</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Unrealized Gains</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Unrealized Losses</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H12"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Market Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Level 1:</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H13"> </td></tr><tr><td>Money Market Funds</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total financial assets</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14"> </td></tr></table> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026 and December 31, 2025, the Company has no warrant liabilities. All outstanding warrants are classified within permanent equity following amendments completed on June 30, 2025. Refer to Note 8 for further discussion. Other financial instruments, including accounts receivable, accounts payable, accrued liabilities and customer deposits, are carried at cost which approximates fair value due to their short-term nature. </p> </div> <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table shows the Company’s short-term investments by significant investment category as of June 30, 2026, and December 31, 2025.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td colspan="15" style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold;">As of June 30, 2026</td></tr><tr><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Adjusted Cost</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Unrealized Gains</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Unrealized Losses</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">Market Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H4"> </td></tr><tr><td></td><td style="width: 1%;" title="FN 3 Financial Instruments - B6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - B6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - D6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - D6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - F6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - F6"> </td><td> </td><td style="width: 1%;" title="FN 3 Financial Instruments - H6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 3 Financial Instruments - H6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Level 1:</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F7"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H7">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H7"> </td></tr><tr><td>Money Market Funds</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total financial assets</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">641</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H8"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td colspan="15" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">As of December 31, 2025</td></tr><tr><td></td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Adjusted Cost</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Unrealized Gains</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F12"> </td><td style="width: 9%; font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Unrealized Losses</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F12"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H12"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Market Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Level 1:</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H13">$</td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H13"> </td></tr><tr><td>Money Market Funds</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total financial assets</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - B14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - D14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - F14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">639</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 3 Financial Instruments - H14"> </td></tr></table> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> 641000 0 0 641000 641000 0 0 641000 639000 0 0 639000 639000 0 0 639000 0 0 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>4. <span>INVENTORIES</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Inventory is recorded at the lower of cost or net realizable value using the weighted average cost method. Inventories consisted of the following:</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> <span style="display: none">SCHEDULE OF INVENTORY</span></p> <table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr style="white-space : nowrap; "><td> </td><td style="text-align: center; font-weight: bold; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - C4"> </td><td style="text-align: center; font-weight: bold; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">December 31, 2025</td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E4"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 4 Inventory - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 4 Inventory - C5"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 4 Inventory - E5"> </td><td style="text-align: right; width: 9%;"></td><td style="text-align: right; width: 1%;" title="FN 4 Inventory - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Finished goods</td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - C6">$</td><td style="text-align: right; width: 9%;">3,174</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - C6"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - E6">$</td><td style="text-align: right; width: 9%;">3,509</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - E6"> </td></tr><tr><td>Raw materials</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - D7"> </td><td style="text-align: right; width: 9%;">1,628</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - D7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 4 Inventory - E7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor; width: 9%;">1,978</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 4 Inventory - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Reserve for obsolescence</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D8"> </td><td style="text-align: right; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(494</td><td style="text-align: left; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D8">) </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E8"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">(516</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E8">) </td></tr><tr><td>Inventories, net</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D9">$</td><td style="text-align: right; width: 9%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">4,308</td><td style="text-align: left; width: 1%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D9"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E9">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">4,971</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E9"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; text-align: justify; margin-top: 0pt; margin-bottom: 0pt;">Inventory reserve expense was $73 and $73 for the three and six months ended June 30, 2026, respectively, and $169 and $187 for the three and six months ended June 30, 2025, respectively.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><b> </b></p></div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Inventory is recorded at the lower of cost or net realizable value using the weighted average cost method. Inventories consisted of the following:</p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr style="white-space : nowrap; "><td> </td><td style="text-align: center; font-weight: bold; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - C4"> </td><td style="text-align: center; font-weight: bold; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E4"> </td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">December 31, 2025</td><td style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E4"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 4 Inventory - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 4 Inventory - C5"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 4 Inventory - E5"> </td><td style="text-align: right; width: 9%;"></td><td style="text-align: right; width: 1%;" title="FN 4 Inventory - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Finished goods</td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - C6">$</td><td style="text-align: right; width: 9%;">3,174</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - C6"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - E6">$</td><td style="text-align: right; width: 9%;">3,509</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - E6"> </td></tr><tr><td>Raw materials</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - D7"> </td><td style="text-align: right; width: 9%;">1,628</td><td style="text-align: left; width: 1%;" title="FN 4 Inventory - D7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 4 Inventory - E7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor; width: 9%;">1,978</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 4 Inventory - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Reserve for obsolescence</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D8"> </td><td style="text-align: right; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(494</td><td style="text-align: left; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D8">) </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E8"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">(516</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E8">) </td></tr><tr><td>Inventories, net</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D9">$</td><td style="text-align: right; width: 9%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">4,308</td><td style="text-align: left; width: 1%; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 4 Inventory - D9"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E9">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">4,971</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 4 Inventory - E9"> </td></tr></table> 3174000 3509000 1628000 1978000 494000 516000 4308000 4971000 73000 73000 169000 187000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>5. <span>PROPERTY AND EQUIPMENT, NET</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Property and equipment consisted of the following:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="display: none">SCHEDULE OF PROPERTY AND EQUIPMENT</span></p><table style="border-collapse: collapse; font-size: 9pt; font-family: TimesNewRoman, &quot;Times New Roman&quot;, Times, Baskerville, Georgia, serif; width: 100%"><tr style="height: 0px; font-size: 0px;"><td></td><td></td><td style="width: 1%;"> </td><td style="width: 6%;"></td><td style="width: 1%;"> </td><td></td><td style="width: 1%;"> </td><td style="width: 6%;"></td><td style="width: 1%;"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - C4"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 6%;">June 30, 2026</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - C4"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">December 31, 2025</td><td style="text-align: right; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 5 Property and Equipment, Net - J4"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - C5"> </td><td style="width: 6%;"> </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - C5"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J5"> </td><td style="text-align: right; width: 6%;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Production and lab equipment</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-spacing: 0px;" title="FN 5 Property and Equipment, Net - C6">$</td><td style="text-align: right; width: 6%; border-spacing: 0px;">391</td><td style="text-align: left; width: 1%; border-spacing: 0px;" title="FN 5 Property and Equipment, Net - C6"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 5 Property and Equipment, Net - J6">$</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor; width: 6%;">391</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 5 Property and Equipment, Net - J6"> </td></tr><tr><td>Tooling</td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; width: 6%;"> 570 </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; width: 6%;"> 570 </td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Computer equipment</td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; width: 6%;"> 194 </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; width: 6%;"> 183 </td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr><td>Furniture, fixtures and improvements</td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> 81 </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> 81 </td><td style="text-align: right; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Property and equipment, gross</td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7">$</td><td style="text-align: right; width: 6%; border-spacing: 0px;">1,236</td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - J7">$</td><td style="text-align: right; width: 6%;">1,225</td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr><td>Accumulated depreciation</td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> (1,147)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> (1,102)</td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Property and equipment, net</td><td style="text-align: right;"></td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">89</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">123</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Depreciation expense was $22 and $45 for the three and six months ended June 30, 2026, respectively, and $27 and $67 for the three and six months ended June 30, 2025, respectively.</p></div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Property and equipment consisted of the following:</p><table style="border-collapse: collapse; font-size: 9pt; font-family: TimesNewRoman, &quot;Times New Roman&quot;, Times, Baskerville, Georgia, serif; width: 100%"><tr style="height: 0px; font-size: 0px;"><td></td><td></td><td style="width: 1%;"> </td><td style="width: 6%;"></td><td style="width: 1%;"> </td><td></td><td style="width: 1%;"> </td><td style="width: 6%;"></td><td style="width: 1%;"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - C4"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 6%;">June 30, 2026</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - C4"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">December 31, 2025</td><td style="text-align: right; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 5 Property and Equipment, Net - J4"> </td></tr><tr><td></td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - C5"> </td><td style="width: 6%;"> </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - C5"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J5"> </td><td style="text-align: right; width: 6%;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Production and lab equipment</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%; border-spacing: 0px;" title="FN 5 Property and Equipment, Net - C6">$</td><td style="text-align: right; width: 6%; border-spacing: 0px;">391</td><td style="text-align: left; width: 1%; border-spacing: 0px;" title="FN 5 Property and Equipment, Net - C6"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 5 Property and Equipment, Net - J6">$</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor; width: 6%;">391</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 5 Property and Equipment, Net - J6"> </td></tr><tr><td>Tooling</td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; width: 6%;"> 570 </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; width: 6%;"> 570 </td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Computer equipment</td><td style="text-align: right;"></td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; width: 6%;"> 194 </td><td style="width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; width: 6%;"> 183 </td><td style="text-align: right; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr><td>Furniture, fixtures and improvements</td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> 81 </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> 81 </td><td style="text-align: right; width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Property and equipment, gross</td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7">$</td><td style="text-align: right; width: 6%; border-spacing: 0px;">1,236</td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - J7">$</td><td style="text-align: right; width: 6%;">1,225</td><td style="text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr><td>Accumulated depreciation</td><td style="text-align: right;"></td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> (1,147)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;"> (1,102)</td><td style="text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Property and equipment, net</td><td style="text-align: right;"></td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: left; width: 1%;" title="FN 5 Property and Equipment, Net - I7">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">89</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - I7"> </td><td style="text-align: right;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7">$</td><td style="text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 6%;">123</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 5 Property and Equipment, Net - J7"> </td></tr></table> 391000 391000 570000 570000 194000 183000 81000 81000 1236000 1225000 1147000 1102000 89000 123000 22000 45000 27000 67000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>6. <span>INTANGIBLE ASSETS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>Intangible Assets, net</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Intangible assets, net consisted of the following:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">December 31, 2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E4"> </td></tr><tr><td>Amortizable intangible assets:</td><td> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - C6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - C6"> </td><td> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - E6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - E6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Patents</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C7">$</td><td style="width: 9%; text-align: right;">1,206</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E7">$</td><td style="width: 9%; text-align: right;">1,142</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E7"> </td></tr><tr><td>Trademarks</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C8"> </td><td style="width: 9%; text-align: right;">400</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E8"> </td><td style="width: 9%; text-align: right;">367</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Purchased software and technology</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C9"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">512</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C9"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E9"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">512</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E9"> </td></tr><tr><td>Gross amortizable intangibles</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C10">$</td><td style="width: 9%; text-align: right;">2,118</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E10">$</td><td style="width: 9%; text-align: right;">2,021</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E10"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Accumulated amortization</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(936</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C11">) </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(870</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E11">) </td></tr><tr><td>Total amortizable, net</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C12">$</td><td style="width: 9%; text-align: right;">1,182</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E12">$</td><td style="width: 9%; text-align: right;">1,151</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Indefinite life assets (non-amortizable)</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C13"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">421</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E13"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">421</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E13"> </td></tr><tr><td>Total intangible assets, net</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,603</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,572</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E14"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Amortization expense was $33 and $66 for the three and six months ended June 30, 2026, respectively, and $123 and $238 for the three and six months ended June 30, 2025, respectively.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, future amortization expense is as follows:</p> </div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2026 (6 months)</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C19">$</td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">62</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C19"> </td></tr><tr><td>2027</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C20"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">123</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C20"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2028</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C21"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">123</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C21"> </td></tr><tr><td>2029</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C22"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">122</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C22"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2030</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C23"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">122</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C23"> </td></tr><tr><td>Thereafter</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C24"> </td><td style="width: 9%; text-align: right; border-bottom: 1px solid rgb(0, 0, 0); border-top: none; border-left: none; border-right: none;">630</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C24"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C25">$</td><td style="width: 9%; text-align: right; border-bottom: 3px double rgb(0, 0, 0); border-top: none; border-left: none; border-right: none;">1,182</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C25"> </td></tr></table></div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Intangible assets, net consisted of the following:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">December 31, 2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E4"> </td></tr><tr><td>Amortizable intangible assets:</td><td> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - C6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - C6"> </td><td> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - E6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 6 Intangible Rollforward - E6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Patents</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C7">$</td><td style="width: 9%; text-align: right;">1,206</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E7">$</td><td style="width: 9%; text-align: right;">1,142</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E7"> </td></tr><tr><td>Trademarks</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C8"> </td><td style="width: 9%; text-align: right;">400</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E8"> </td><td style="width: 9%; text-align: right;">367</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Purchased software and technology</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C9"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">512</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C9"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E9"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">512</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E9"> </td></tr><tr><td>Gross amortizable intangibles</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C10">$</td><td style="width: 9%; text-align: right;">2,118</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E10">$</td><td style="width: 9%; text-align: right;">2,021</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E10"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Accumulated amortization</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(936</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C11">) </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(870</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E11">) </td></tr><tr><td>Total amortizable, net</td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C12">$</td><td style="width: 9%; text-align: right;">1,182</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - C12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E12">$</td><td style="width: 9%; text-align: right;">1,151</td><td style="width: 1%; text-align: left;" title="FN 6 Intangible Rollforward - E12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Indefinite life assets (non-amortizable)</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C13"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">421</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C13"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E13"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">421</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E13"> </td></tr><tr><td>Total intangible assets, net</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,603</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - C14"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E14">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,572</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 6 Intangible Rollforward - E14"> </td></tr></table> 1206000 1142000 400000 367000 512000 512000 2118000 2021000 936000 870000 1182000 1151000 421000 421000 1603000 1572000 33000 66000 123000 238000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, future amortization expense is as follows:</p> </div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2026 (6 months)</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C19">$</td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">62</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C19"> </td></tr><tr><td>2027</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C20"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">123</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C20"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2028</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C21"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">123</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C21"> </td></tr><tr><td>2029</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C22"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">122</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C22"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2030</td><td style="text-align: right; border-width: initial; border-style: none; border-color: initial;"></td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C23"> </td><td style="width: 9%; text-align: right; border-width: initial; border-style: none; border-color: initial;">122</td><td style="text-align: left; border-width: initial; border-style: none; border-color: initial; width: 1%;" title="FN 6 Intangible Rollforward - C23"> </td></tr><tr><td>Thereafter</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C24"> </td><td style="width: 9%; text-align: right; border-bottom: 1px solid rgb(0, 0, 0); border-top: none; border-left: none; border-right: none;">630</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C24"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total</td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C25">$</td><td style="width: 9%; text-align: right; border-bottom: 3px double rgb(0, 0, 0); border-top: none; border-left: none; border-right: none;">1,182</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 6 Intangible Rollforward - C25"> </td></tr></table></div> 62000 123000 123000 122000 122000 630000 1182000 <div><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>7. <span>ACCOUNTS PAYABLE AND ACCRUED LIABILITIES</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Accrued liabilities consist of the following:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">December 31, 2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C5"> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Patent and legal costs</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C6">$</td><td style="width: 9%; text-align: right;">115</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C6"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E6">$</td><td style="width: 9%; text-align: right;">111</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E6"> </td></tr><tr><td>Accrued compensation</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C7"> </td><td style="width: 9%; text-align: right;">10</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E7"> </td><td style="width: 9%; text-align: right;">2</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Warranty costs</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C8"> </td><td style="width: 9%; text-align: right;">56</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E8"> </td><td style="width: 9%; text-align: right;">30</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E8"> </td></tr><tr><td>Royalty </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C9"> </td><td style="width: 9%; text-align: right;">99</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E9"> </td><td style="width: 9%; text-align: right;">99</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Accrued purchases</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E10"> </td><td style="width: 9%; text-align: right;">6</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E10"> </td></tr><tr><td>Taxes and other</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">30</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C11"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">159</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total accrued liabilities</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C12">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">310</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C12"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E12">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">407</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E12"> </td></tr></table> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Changes in our estimated product warranty costs were as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td colspan="7" style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C17"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 9%;">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C17"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E17"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 9%;">2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E17"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C18"> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E18"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Balance, beginning of period</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C19">$</td><td style="width: 9%; text-align: right;">30</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E19">$</td><td style="width: 9%; text-align: right;">83</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E19"> </td></tr><tr><td>Warranty settlements</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C20"> </td><td style="width: 9%; text-align: right;">(5</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C20">) </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E20"> </td><td style="width: 9%; text-align: right;">(10</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E20">) </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Warranty provision</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C21"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">31</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C21"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E21"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E21"> </td></tr><tr><td>Balance, end of period</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C22">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">56</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C22"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E22">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">75</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E22"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="display: none">SCHEDULE OF PRODUCT WARRANTY LIABILITY</span>  </p></div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Accrued liabilities consist of the following:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C4"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">December 31, 2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C5"> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Patent and legal costs</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C6">$</td><td style="width: 9%; text-align: right;">115</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C6"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E6">$</td><td style="width: 9%; text-align: right;">111</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E6"> </td></tr><tr><td>Accrued compensation</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C7"> </td><td style="width: 9%; text-align: right;">10</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E7"> </td><td style="width: 9%; text-align: right;">2</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Warranty costs</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C8"> </td><td style="width: 9%; text-align: right;">56</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E8"> </td><td style="width: 9%; text-align: right;">30</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E8"> </td></tr><tr><td>Royalty </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C9"> </td><td style="width: 9%; text-align: right;">99</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E9"> </td><td style="width: 9%; text-align: right;">99</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Accrued purchases</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E10"> </td><td style="width: 9%; text-align: right;">6</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E10"> </td></tr><tr><td>Taxes and other</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">30</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C11"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">159</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total accrued liabilities</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C12">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">310</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C12"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E12">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">407</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E12"> </td></tr></table> 115000 111000 10000 2000 56000 30000 99000 99000 0 6000 30000 159000 310000 407000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Changes in our estimated product warranty costs were as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td colspan="7" style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C17"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 9%;">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C17"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E17"> </td><td style="text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); font-weight: bold; width: 9%;">2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E17"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - C18"> </td><td> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 7 Accounts Payable and Accrued Liabilities - E18"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Balance, beginning of period</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C19">$</td><td style="width: 9%; text-align: right;">30</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E19">$</td><td style="width: 9%; text-align: right;">83</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E19"> </td></tr><tr><td>Warranty settlements</td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C20"> </td><td style="width: 9%; text-align: right;">(5</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - C20">) </td><td> </td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E20"> </td><td style="width: 9%; text-align: right;">(10</td><td style="width: 1%; text-align: left;" title="FN 7 Accounts Payable and Accrued Liabilities - E20">) </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Warranty provision</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C21"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">31</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C21"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E21"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E21"> </td></tr><tr><td>Balance, end of period</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C22">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">56</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - C22"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E22">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">75</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 7 Accounts Payable and Accrued Liabilities - E22"> </td></tr></table> 30000 83000 5000 10000 31000 2000 56000 75000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><b>8. <span>WARRANTS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">All outstanding warrants are classified within permanent equity as of June 30, 2026 and December 31, 2025. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following summarizes the Company's outstanding warrants: </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Series A Warrants</i> — On June 29, 2023, the Company issued warrants (the "Series A Warrants") to purchase up to 6,896,553 shares of Common Stock at an exercise price of $1.45 per share in connection with the Series A Preferred Stock offering. On June 30, 2025, the Company entered into an amendment agreement (the "Series A Warrant Amendment") with the Required Holders (as defined in the Series A Warrants), which resulted in reclassification of the Series A Warrants from warrant liabilities to additional paid-in capital under ASC 815-40. The amended warrants expire on January 3, 2030 (<span style="-sec-ix-hidden: hidden-fact-4">six and one-half years</span> from original issuance). </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>PIPE Warrants</i> — On February 24, 2025, the Company issued warrants (the "PIPE Warrants") to purchase up to 3,216,666 shares of Common Stock at an exercise price of $1.80 per share in connection with a private placement. On June 30, 2025, the Company entered into an amendment agreement (the "2025 Warrant Amendment") with the PIPE holders, resulting in reclassification from warrant liabilities to additional paid-in capital under ASC 815-40. The amended PIPE Warrants expire <span style="-sec-ix-hidden: hidden-fact-5">five and one-half years</span> from the original issuance date. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Series B Warrants</i> — On August 18, 2025, the Company issued warrants (the "Series B Warrants") to purchase up to 3,000,000 shares of Common Stock at an exercise price of $1.50 per share in connection with the Series B Convertible Preferred Stock, par value $0.0001 per share (the "Series B Preferred Stock") private placement. The Series B Warrants became exercisable on December 12, 2025, the date stockholder approval was obtained, and expire on December 12, 2030. The Series B Warrants are classified within permanent equity.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="background-color: rgb(255, 255, 255);"><i>February 2026 Warrants <span style="font-style: normal; letter-spacing: normal; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">—</span></i> On February 3, 2026, the Company issued pre-funded warrants (the "Pre-Funded Warrants") to purchase up to 800,000 shares of Common Stock at an exercise price of $0.0001 per share and common warrants (the "February 2026 Common Warrants") to purchase up to 2,500,000 shares of Common Stock at an exercise price of $2.30 per share in connection with a private placement. The Pre-Funded Warrants and the February 2026 Common Warrants were classified as equity within additional paid-in capital under ASC 815-40 upon issuance. The Pre-Funded Warrants expire when exercised in full, and the February 2026 Common Warrants expire on February 3, 2031, five years from the date of issuance.</span></p></div> 6896553 1.45 2030-01-03 3216666 1.8 3000000 1.5 0.0001 2030-12-12 800000 0.0001 2500000 2.3 P5Y <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>9. <span>LEASES</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company determines if an arrangement is a lease at inception. The guidance in FASB ASC Topic 842, Leases defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Operating lease right of use (“ROU”) assets and lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. The Company’s leases do not provide an implicit rate. Due to a lack of financing history or ability, the Company uses an estimate of low-grade debt rate published by the Federal Reserve Bank as its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The ROU asset includes any lease payments made and excludes lease incentives and initial direct costs incurred.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Amortization expense was $21 and $75 for the three and six months ended June 30, 2026, respectively, and $84 and $151 for the three and six months ended June 30, 2025, respectively. Operating lease expense for capitalized operating leases included in operating activities was $29 and $141 for the three and six months ended June 30, 2026, respectively, and $156 and $313 for the three and six months ended June 30, 2025, respectively.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Operating lease obligations recorded on the balance sheet at June 30, 2026 are:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 9 Lease Reconciliation with life - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 9 Lease Reconciliation with life - C5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Operating lease liability — short term</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C6">$</td><td style="width: 9%; text-align: right;">91</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C6"> </td></tr><tr><td>Operating lease liability — long term</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C7"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">345</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total operating lease liability</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">436</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C8"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> <span style="display: none">SCHEDULE OF OPERATING LEASE OBLIGATIONS</span> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Future lease payments included in the measurement of lease liabilities on the balance sheet at June 30, 2026 for future periods are as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="background-color: rgb(204, 238, 255);"><td>2026 (6 months)</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C11">$</td><td style="width: 9%; text-align: right;">60</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C11"> </td></tr><tr><td>2027</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C12"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2028</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C13"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C13"> </td></tr><tr><td>2029</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C14"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C14"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2030</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C15"> </td><td style="width: 9%; text-align: right;">90</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C15"> </td></tr><tr><td>Thereafter</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C16"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C16"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total future minimum lease payments</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C17"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">510</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C17"> </td></tr><tr><td>Less imputed interest</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C18"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(74</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C18">) </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C19">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">436</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C19"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The weighted average remaining lease term is <span title="Operating lease, weighted average remaining lease term">4.25</span> years, and the weighted average discount rate is <span title="Operating lease, weighted average discount rate, percent">7.5</span>%<b>.</b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Certain leases contain provisions for payment of real estate taxes, insurance and maintenance costs by the Company. These expenses are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company had $0 and $17 variable lease expense for the three month ended June 30, 2026 and 2025, respectively, and $0 and $31 for the six months ended June 30, 2026 and 2025, respectively. </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company had no short-term lease expenses for the three and six months ended June 30, 2026 and 2025 respectively. The Company does not have any finance leases.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">On February 13, 2026, the Company entered into a Termination and Mutual Release Agreement with the landlord of the Company's office space located at 3480 Main Highway, Suite 202, Miami, Florida 33133. Pursuant to the agreement, the office lease dated September 20, 2023 was terminated effective as of February 13, 2026, and the Company surrendered possession of the premises. The landlord agreed to refund the prorated portion of February 2026 rent attributable to the period following the termination date and to return the security deposit in accordance with the terms of the original lease. The parties exchanged mutual releases of all claims arising out of or relating to the lease, except for obligations expressly set forth in the termination agreement and any obligations that by their terms survive termination. In March 2026, the Company entered into a month-to-month service agreement for a business address located at 3350 Virginia Street, Miami, Florida 33133.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">    </p></div> 21000 75000 84000 151000 29000 141000 156000 313000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Operating lease obligations recorded on the balance sheet at June 30, 2026 are:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C4"> </td><td style="font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; width: 9%;">June 30, 2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN 9 Lease Reconciliation with life - C5"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 9 Lease Reconciliation with life - C5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Operating lease liability — short term</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C6">$</td><td style="width: 9%; text-align: right;">91</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C6"> </td></tr><tr><td>Operating lease liability — long term</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C7"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">345</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C7"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total operating lease liability</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C8">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">436</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C8"> </td></tr></table> 91000 345000 436000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Future lease payments included in the measurement of lease liabilities on the balance sheet at June 30, 2026 for future periods are as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="background-color: rgb(204, 238, 255);"><td>2026 (6 months)</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C11">$</td><td style="width: 9%; text-align: right;">60</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C11"> </td></tr><tr><td>2027</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C12"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C12"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2028</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C13"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C13"> </td></tr><tr><td>2029</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C14"> </td><td style="width: 9%; text-align: right;">120</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C14"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>2030</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C15"> </td><td style="width: 9%; text-align: right;">90</td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C15"> </td></tr><tr><td>Thereafter</td><td> </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C16"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN 9 Lease Reconciliation with life - C16"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total future minimum lease payments</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C17"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">510</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C17"> </td></tr><tr><td>Less imputed interest</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C18"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(74</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C18">) </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C19">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">436</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 9 Lease Reconciliation with life - C19"> </td></tr></table> 60000 120000 120000 120000 90000 0 510000 74000 436000 P4Y3M 0.075 0 17000 0 31000 0 0 0 0 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><b>10. <span>STOCKHOLDERS’ EQUITY</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company's authorized capital consists of 200,000,000 shares of Common Stock and 5,000,000 shares of preferred stock, par value $0.0001 per share, of which 10,000 shares are designated as Series A Convertible Preferred Stock and 4,500 shares are designated as Series B Convertible Preferred Stock. </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration:underline">Common Stock</span></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">During the three months ended June 30, 2026, the Company issued 96,775 shares of Common Stock to a vendor in settlement of a $150 invoice for investor relations services rendered. The shares were issued in full satisfaction of the amount owed, with no cash paid and no future service or vesting condition attached. The Company recorded the $150 expense within selling, general and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive loss, based on the fair value of the shares issued of $1.55 per share on the issuance date.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">  </p><p style="font: italic 10pt &quot;Times New Roman&quot;; margin-top: 0pt; margin-bottom: 0pt; text-align: justify; text-decoration: underline;">Series A Preferred Stock</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">On July 3, 2023, the Company designated and issued 10,000 shares of Series A Preferred Stock (stated value $1,000 per share) convertible into shares of Common Stock at an initial conversion price of $1.45 per share. As of June 30, 2026 and December 31, 2025, there were 8,107 and 8,207 shares outstanding, respectively. Holders are entitled to dividends of 8% per annum, payable in cash or shares of Common Stock at the Company's election. For the six months ended June 30, 2026 and 2025, the Company paid dividends of $411 and $328, respectively, in shares of Common Stock. </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span title="Preferred stock, redemption price description"> </span> </p> </div><div><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><i><span style="text-decoration:underline">Series B Preferred Stock</span></i></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">On August 18, 2025, the Company issued 4,500 shares of Series B Preferred Stock (stated value $1,000 per share) convertible up to 3,000,000 shares of Common Stock at an initial conversion price of $1.50 per share. As of June 30, 2026 and December 31, 2025, there were 3,600 and 4,500 shares outstanding, respectively. Holders are entitled to dividends when and as declared by the Board, payable in cash or shares of the Company's securities.<span style="background-color: rgb(255, 255, 255);"> No dividends were declared or paid during the six months ended June 30, 2026.</span></p></div> 200000000 5000000 0.0001 10000 4500 96775 150000 150000 1.55 10000 10000 1000 1.45 8107 8207 0.08 411000 328000 4500 4500 1000 3000000 1.5 3600 4500 0 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>11. <span>SHARE-BASED COMPENSATION</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company maintains the Wrap Technologies, Inc. 2017 Equity Incentive Plan (the "2017 Plan"), which was most recently amended on December 12, 2025 to authorize up to 20,500,000 shares of Common Stock for issuance as equity awards under the 2017 Plan.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;">As of June 30, 2026, there were 4,223,775 shares of Common Stock remaining available for grant under the 2017 Plan.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Stock Options</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table summarizes stock option activity for the six months ended June 30, 2026:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr><td> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C4"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C4"> </td><td> </td><td colspan="7" style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Weighted Average</td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I4"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Options on Common Shares</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - E5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Exercise Price</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - E5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - G5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Remaining Contractual Terms</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - G5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - I5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Aggregate Intrinsic Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - I5"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - G6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - G6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Outstanding December 31, 2025</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C7"> </td><td style="width: 9%; text-align: right;">6,449,534</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E7">$</td><td style="width: 9%; text-align: right;">2.05</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G7"> </td><td style="width: 9%; text-align: right;">8.56</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I7">$</td><td style="width: 9%; text-align: right;">3,706</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I7"> </td></tr><tr><td>Granted</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C8"> </td><td style="width: 9%; text-align: right;">4,818,500</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E8"> </td><td style="width: 9%; text-align: right;">2.12</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G8"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I8"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Exercised</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I9"> </td></tr><tr><td>Forfeited, cancelled, expired</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(1,219,917</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C10">) </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E10"> </td><td style="width: 9%; text-align: right;">2.38</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I10"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Outstanding June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">10,048,117</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C11"> </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E11"> </td><td style="width: 9%; text-align: right;">2.04</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G11"> </td><td style="width: 9%; text-align: right;">8.72</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I11"> </td><td style="width: 9%; text-align: right;">6</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I11"> </td></tr><tr><td>Exercisable June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C12"> </td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,994,159</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C12"> </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E12">$</td><td style="width: 9%; text-align: right;">2.16</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G12"> </td><td style="width: 9%; text-align: right;">8.02</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I12">$</td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I12"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div><div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026 there were 8,682,951 service-based stock options outstanding, and <span title="Number of stock options">1,365,166</span> performance-based stock options outstanding. For the performance-based options, 1,290,166 were granted in October 2023 to the Company's current Chief Executive Officer, subject to vesting based on future market capitalization targets, and 75,000 were granted to a consultant, subject to vesting upon the Company's execution of a specified customer contract.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company uses the Black-Scholes option pricing model to determine the fair value of the service-based options that have been granted. The following table summarizes the assumptions used to compute the fair value of options granted to employees and non-employees:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="display: none">SCHEDULE OF STOCK OPTION ACTIVITY, FAIR VALUE OF ASSUMPTIONS</span></p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C17"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C17"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E17"> </td><td style="text-align: center; font-weight: bold; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E17"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C18"> </td><td> </td><td style="width: 1%;" title="New N11 - E18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E18"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Expected stock price volatility</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C19"> </td><td style="width: 9%; text-align: right;">76</td><td style="width: 1%; text-align: left;" title="New N11 - C19">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E19"> </td><td style="width: 9%; text-align: right;">76</td><td style="width: 1%; text-align: left;" title="New N11 - E19">%</td></tr><tr><td>Risk-free interest rate</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C20"> </td><td style="width: 9%; text-align: right;">3.90</td><td style="width: 1%; text-align: left;" title="New N11 - C20">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E20"> </td><td style="width: 9%; text-align: right;">4.06</td><td style="width: 1%; text-align: left;" title="New N11 - E20">%</td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Expected dividend yield</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td style="width: 9%; text-align: right;">0</td><td style="width: 1%; text-align: left;" title="New N11 - C21">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td><td style="width: 9%; text-align: right;">0</td><td style="width: 1%; text-align: left;" title="New N11 - E21">%</td></tr><tr><td>Expected life of options</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td style="width: 9%; text-align: right;">5.91</td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td><td style="width: 9%; text-align: right;">6.00</td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Weighted-average fair value of options granted</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21">$</td><td style="width: 9%; text-align: right;">1.47</td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21">$</td><td style="width: 9%; text-align: right;">1.05</td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Estimated volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate each year during the expected life of awards. The Company’s estimated volatility was based on an average of the historical volatility of peer entities whose stock prices were publicly available. The Company’s calculation of estimated volatility is based on the historical stock prices of these peer entities over a period equal to the expected life of the awards. The Company uses the historical volatility of peer entities due to the lack of sufficient historical data of its stock price. The Company records forfeitures as they are incurred.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The risk-free interest rate assumption is based upon observed interest rates on zero coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the options. The dividend yield of 0% is based on the fact that the Company has never paid cash dividends and has no present intention of paying cash dividends. The Company calculates the expected life of the options using the Simplified Method for the employee stock options as the Company does not have sufficient historical exercise data.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Stock option expense was $843 and $477 for the three months ended June 30, 2026 and 2025, respectively, and $2,876 and $864 for the six months ended June 30, 2026 and 2025, respectively. </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Restricted Stock Units</span></p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The 2017 Plan provides for the grant of restricted stock units (“RSUs”). RSUs are settled in shares of the Company’s Common Stock as the RSUs vest. The following table summarizes RSU activity for the six months ended June 30, 2026:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C28"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C28"> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Weighted Average</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Service-Based RSUs</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C29"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Grant Date Fair Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E29"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - G29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Vesting Period (Years)</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - G29"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C30"> </td><td> </td><td style="width: 1%;" title="New N11 - E30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E30"> </td><td> </td><td style="width: 1%;" title="New N11 - G30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - G30"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Unvested at December 31, 2025</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C31"> </td><td style="width: 9%; text-align: right;">1,014,563</td><td style="width: 1%; text-align: left;" title="New N11 - C31"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E31">$</td><td style="width: 9%; text-align: right;">2.23</td><td style="width: 1%; text-align: left;" title="New N11 - E31"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G31"> </td><td style="width: 9%; text-align: right;">3.62</td><td style="width: 1%; text-align: left;" title="New N11 - G31"> </td></tr><tr><td>Granted service based</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C32"> </td><td style="width: 9%; text-align: right;">179,267</td><td style="width: 1%; text-align: left;" title="New N11 - C32"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E32"> </td><td style="width: 9%; text-align: right;">1.96</td><td style="width: 1%; text-align: left;" title="New N11 - E32"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G32"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="New N11 - G32"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Vested</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C33"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;">(164,518</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C33">) </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E33"> </td><td style="width: 9%; text-align: right;">1.96</td><td style="width: 1%; text-align: left;" title="New N11 - E33"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G33"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="New N11 - G33"> </td></tr><tr><td>Forfeited and cancelled</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C34"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C34"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E34"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E34"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G34"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"> - </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G34"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Unvested at June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C35"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;">1,029,312</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C35"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E35">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2.23</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E35"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G35"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">3.57</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G35"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="display: none">SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY</span> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company used the Monte Carlo Simulation Model to value at the grant date the aggregate of <span title="Restricted stock units, granted">632,911</span> market condition performance RSUs granted in January 2024 to the Company’s Chief Executive Officer. The assumptions used in the Monte Carlo Simulation were stock price on the date of grant equal to $<span title="Stock price">3.40</span>, a contract term of <span title="Contract term">10</span> years, expected volatility of <span title="Expected volatility">78</span>% and risk-free interest rate of <span title="Risk-free interest rate">4.10</span>%. Vesting is based on sustained market capitalization of $<span title="Market capital">1</span> billion, and the derived service period is <span title="Service period">4.3</span> years.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">RSU expense was $176 and $293 for the three months ended June 30, 2026 and 2025, respectively, and $527 and $1,571 for the six months ended June 30, 2026 and 2025.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Share-Based Compensation Expense</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company recorded share-based compensation for options and RSUs in its statements of operations for the relevant periods as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Three Months Ended June 30,</td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - C40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - C40"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C41"> </td><td> </td><td style="width: 1%;" title="New N11 - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E41"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Selling, general and administrative</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C42">$</td><td style="width: 9%; text-align: right;">1,019</td><td style="width: 1%; text-align: left;" title="New N11 - C42"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E42">$</td><td style="width: 9%; text-align: right;">755</td><td style="width: 1%; text-align: left;" title="New N11 - E42"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42">$</td><td style="width: 9%; text-align: right;">3,403</td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42">$</td><td style="width: 9%; text-align: right;">2,358</td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42"> </td></tr><tr><td>Research and development</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C43"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">15</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E43"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">77</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total share-based expense</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,019</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C44"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">770</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E44"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">3,403</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,435</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44"> </td></tr></table><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> <span style="display: none">SCHEDULE OF SHARE-BASED COMPENSATION FOR OPTIONS AND RESTRICTED STOCK UNITS</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, total estimated compensation cost of stock options granted and outstanding but not yet vested was $7,620 which is expected to be recognized over the weighted average period of 2.67 years.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, total estimated compensation cost of RSUs granted and outstanding but not yet vested was $<span title="Unrecognized stock-based compensation">867</span>, which is expected to be recognized over the weighted average period of 1.67 years.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> 20500000 4223775 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table summarizes stock option activity for the six months ended June 30, 2026:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr><td> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C4"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C4"> </td><td> </td><td colspan="7" style="text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Weighted Average</td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I4"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I4"> </td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Options on Common Shares</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - E5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Exercise Price</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - E5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - G5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Remaining Contractual Terms</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - G5"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - I5"> </td><td style="width: 9%; text-align: center; font-weight: bold; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); vertical-align: bottom;">Aggregate Intrinsic Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - I5"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - C6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - G6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - G6"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I6"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - I6"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Outstanding December 31, 2025</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C7"> </td><td style="width: 9%; text-align: right;">6,449,534</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E7">$</td><td style="width: 9%; text-align: right;">2.05</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G7"> </td><td style="width: 9%; text-align: right;">8.56</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I7">$</td><td style="width: 9%; text-align: right;">3,706</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I7"> </td></tr><tr><td>Granted</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C8"> </td><td style="width: 9%; text-align: right;">4,818,500</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E8"> </td><td style="width: 9%; text-align: right;">2.12</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G8"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G8"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I8"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I8"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Exercised</td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - C9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G9"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I9"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I9"> </td></tr><tr><td>Forfeited, cancelled, expired</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">(1,219,917</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C10">) </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E10"> </td><td style="width: 9%; text-align: right;">2.38</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I10"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I10"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Outstanding June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C11"> </td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">10,048,117</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C11"> </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E11"> </td><td style="width: 9%; text-align: right;">2.04</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G11"> </td><td style="width: 9%; text-align: right;">8.72</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G11"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I11"> </td><td style="width: 9%; text-align: right;">6</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I11"> </td></tr><tr><td>Exercisable June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C12"> </td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,994,159</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN11 Share-Based Compensation - C12"> </td><td style="border-width: medium; border-style: none; border-color: currentcolor;"> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E12">$</td><td style="width: 9%; text-align: right;">2.16</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - E12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G12"> </td><td style="width: 9%; text-align: right;">8.02</td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - G12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I12">$</td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="FN11 Share-Based Compensation - I12"> </td></tr></table> 6449534 2.05 P8Y6M21D 3706000 4818500 2.12 0 0 1219917 2.38 10048117 2.04 P8Y8M19D 6000 2994159 2.16 P8Y7D 0 8682951 1365166 1290166 75000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company uses the Black-Scholes option pricing model to determine the fair value of the service-based options that have been granted. The following table summarizes the assumptions used to compute the fair value of options granted to employees and non-employees:</p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C17"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C17"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E17"> </td><td style="text-align: center; font-weight: bold; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">2025</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E17"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C18"> </td><td> </td><td style="width: 1%;" title="New N11 - E18"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E18"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Expected stock price volatility</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C19"> </td><td style="width: 9%; text-align: right;">76</td><td style="width: 1%; text-align: left;" title="New N11 - C19">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E19"> </td><td style="width: 9%; text-align: right;">76</td><td style="width: 1%; text-align: left;" title="New N11 - E19">%</td></tr><tr><td>Risk-free interest rate</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C20"> </td><td style="width: 9%; text-align: right;">3.90</td><td style="width: 1%; text-align: left;" title="New N11 - C20">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E20"> </td><td style="width: 9%; text-align: right;">4.06</td><td style="width: 1%; text-align: left;" title="New N11 - E20">%</td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Expected dividend yield</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td style="width: 9%; text-align: right;">0</td><td style="width: 1%; text-align: left;" title="New N11 - C21">%</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td><td style="width: 9%; text-align: right;">0</td><td style="width: 1%; text-align: left;" title="New N11 - E21">%</td></tr><tr><td>Expected life of options</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td style="width: 9%; text-align: right;">5.91</td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td><td style="width: 9%; text-align: right;">6.00</td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Weighted-average fair value of options granted</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C21">$</td><td style="width: 9%; text-align: right;">1.47</td><td style="width: 1%; text-align: left;" title="New N11 - C21"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E21">$</td><td style="width: 9%; text-align: right;">1.05</td><td style="width: 1%; text-align: left;" title="New N11 - E21"> </td></tr></table> 0.76 0.76 0.039 0.0406 0 0 P5Y10M28D P6Y 1.47 1.05 0 843000 477000 2876000 864000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The 2017 Plan provides for the grant of restricted stock units (“RSUs”). RSUs are settled in shares of the Company’s Common Stock as the RSUs vest. The following table summarizes RSU activity for the six months ended June 30, 2026:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C28"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C28"> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Weighted Average</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Service-Based RSUs</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C29"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Grant Date Fair Value</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E29"> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - G29"> </td><td style="font-weight: bold; text-align: center; width: 9%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Vesting Period (Years)</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - G29"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C30"> </td><td> </td><td style="width: 1%;" title="New N11 - E30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E30"> </td><td> </td><td style="width: 1%;" title="New N11 - G30"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - G30"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Unvested at December 31, 2025</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C31"> </td><td style="width: 9%; text-align: right;">1,014,563</td><td style="width: 1%; text-align: left;" title="New N11 - C31"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E31">$</td><td style="width: 9%; text-align: right;">2.23</td><td style="width: 1%; text-align: left;" title="New N11 - E31"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G31"> </td><td style="width: 9%; text-align: right;">3.62</td><td style="width: 1%; text-align: left;" title="New N11 - G31"> </td></tr><tr><td>Granted service based</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C32"> </td><td style="width: 9%; text-align: right;">179,267</td><td style="width: 1%; text-align: left;" title="New N11 - C32"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E32"> </td><td style="width: 9%; text-align: right;">1.96</td><td style="width: 1%; text-align: left;" title="New N11 - E32"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G32"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="New N11 - G32"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Vested</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C33"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;">(164,518</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C33">) </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E33"> </td><td style="width: 9%; text-align: right;">1.96</td><td style="width: 1%; text-align: left;" title="New N11 - E33"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - G33"> </td><td style="width: 9%; text-align: right;"> - </td><td style="width: 1%; text-align: left;" title="New N11 - G33"> </td></tr><tr><td>Forfeited and cancelled</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C34"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C34"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E34"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E34"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G34"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"> - </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G34"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Unvested at June 30, 2026</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C35"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;">1,029,312</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor; border-image: none;" title="New N11 - C35"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E35">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2.23</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E35"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G35"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">3.57</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="New N11 - G35"> </td></tr></table> 1014563 2.23 P3Y7M13D 179267 1.96 164518 1.96 0 0 1029312 2.23 P3Y6M25D 632911 3.4 P10Y 0.78 0.041 1000000000 P4Y3M18D 176000 293000 527000 1571000 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company recorded share-based compensation for options and RSUs in its statements of operations for the relevant periods as follows:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td style="width: 1%;"></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Three Months Ended June 30,</td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - C40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - C40"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="New N11 - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E40"> </td></tr><tr><td> </td><td> </td><td style="width: 1%;" title="New N11 - C41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - C41"> </td><td> </td><td style="width: 1%;" title="New N11 - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="New N11 - E41"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN11 Share-Based Compensation - E41"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Selling, general and administrative</td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - C42">$</td><td style="width: 9%; text-align: right;">1,019</td><td style="width: 1%; text-align: left;" title="New N11 - C42"> </td><td> </td><td style="width: 1%; text-align: left;" title="New N11 - E42">$</td><td style="width: 9%; text-align: right;">755</td><td style="width: 1%; text-align: left;" title="New N11 - E42"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42">$</td><td style="width: 9%; text-align: right;">3,403</td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42"> </td><td style="text-align: right;"></td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42">$</td><td style="width: 9%; text-align: right;">2,358</td><td style="text-align: left; width: 1%;" title="FN11 Share-Based Compensation - E42"> </td></tr><tr><td>Research and development</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C43"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">15</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E43"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">77</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E43"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total share-based expense</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,019</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - C44"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">770</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="New N11 - E44"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">3,403</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,435</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN11 Share-Based Compensation - E44"> </td></tr></table> 1019000 755000 3403000 2358000 0 15000 0 77000 1019000 770000 3403000 2435000 7620000 P2Y8M1D 867000 P1Y8M1D <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>12. <span>DEFINED CONTRIBUTION PLAN</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company has a defined contribution savings plan for all eligible U.S. employees established under the provisions of Section 401(k) of the Internal Revenue Code. This plan was formed on January 1, 2022. Eligible employees may contribute a percentage of their salary subject to certain limitations. The Company’s matching contributions were $24 and $23 for the six months ended June 30, 2026 and 2025, respectively.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div> 24000 23000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>13. <span>COMMITMENTS AND CONTINGENCIES</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Purchase Commitments</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As of June 30, 2026, the Company was committed for approximately $536 for future component deliveries that are generally subject to modification or rescheduling in the normal course of business.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Indemnifications and Guarantees</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Our officers and directors are indemnified as to personal liability as provided by Delaware law and the Company’s certificate of incorporation and bylaws. The Company may also undertake indemnification obligations in the ordinary course of business related to its operations. The Company is unable to estimate with any reasonable accuracy the liability that may be incurred pursuant to any such indemnification obligations now or in the future. Because of the uncertainty surrounding these circumstances, the Company’s current or future indemnification obligations could range from immaterial to having a material adverse impact on its financial position and its ability to continue in the ordinary course of business. The Company has no liabilities recorded for such indemnities.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><span style="text-decoration: underline">Litigation</span></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company is subject to litigation and other claims in the ordinary course of business. The Company records a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed and adjusted to include the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to a particular matter. As of June 30, 2026, the Company had no provision for liability under existing litigation.</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div> 536000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>14. <span>RELATED PARTY TRANSACTIONS</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Series A Preferred Stock</i></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Scot Cohen, the Company's Executive Chairman and Chief Executive Officer, holds directly and through V4 Global LLC ("V4"), an entity he controls, shares of Series A Preferred Stock and related warrants. For the six months ended June 30, 2026, Mr. Cohen earned dividends totaling<span style="background-color: rgb(255, 255, 255);"> $151 o</span>n his Series A Preferred Stock.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Series B Preferred Stock </i></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> In the private placement of Series B Preferred Stock completed August 18, 2025, V4 purchased 1,000 shares of Series B Preferred Stock and 666,667 Series B Warrants for gross proceeds of $1,000. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>PIPE Warrants </i></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In the February 2025 private placement, V4 purchased 1,100,000 shares of Common Stock and 1,100,000 PIPE Warrants for gross proceeds of $1,980; Continuum Ventures, LLC (controlled by Jared Novick, President and Chief Operating Officer) purchased 275,000 shares of Common Stock and 275,000 PIPE Warrants for gross proceeds of $495; and Savbo Investments LLC (controlled by Marc Savas, a Board member) purchased 50,000 shares of Common Stock and 50,000 PIPE Warrants for gross proceeds of $90. In the February 2026 private placement, V4 purchased 475,000 shares of Common Stock and 475,000 February 2026 Common Warrants for gross proceeds of $950; Savbo Investments LLC purchased 25,000 shares of Common Stock and 25,000 February 2026 Common Warrants for gross proceeds of $50; and Juggernaut Management, LLC (controlled by John Shulman, a Board member) purchased 250,000 shares of Common Stock and 250,000 February 2026 Common Warrants for gross proceeds of $500.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>Strategic Investment in Frenel Imaging Ltd.</i></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">As described in Note 17, in July 2026 the Company made a strategic investment in Frenel Imaging Ltd. ("Frenel"). Scot Cohen, the Company's Executive Chairman and Chief Executive Officer, participated as an investor in the same Frenel financing, investing $100 and receiving 3,746 Series A Preferred Shares of Frenel on the same terms as the other investors in the financing. In addition, Mr. Cohen had previously invested $75 in a simple agreement for future equity of Frenel, which converted into 3,512 Series A Preferred Shares of Frenel in connection with the financing. Following these transactions, Mr. Cohen held an aggregate of 7,258 Series A Preferred Shares of Frenel</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div><div><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><i>License Agreement </i></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company is party to a royalty license with Syzygy, a company owned by Elwood G. Norris and James A. Barnes, a stockholder. Elwood G. Norris was a 5% or greater stockholder of the Company up and until July 9, 2026, upon which date he sold all of his shares of Common Stock and ceased being a stockholder of the Company. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">No payments were made during the three and six months ended June 30, 2026.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> 151000 1000 666667 1000000 1100000 1100000 1980000 275000 275000 495000 50000 50000 90000 475000 475000 950000 25000 25000 50000 250000 250000 500000 100000 3746 75000 3512 7258 0.05 0 0 <div><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b style="letter-spacing: normal; text-align: left; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;">15.<span> SEGMENT INFORMATION</span></b></p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company operates as a single operating and reportable segment in accordance with ASC 280, Segment Reporting. The Company's Chief Operating Decision Maker ("CODM") is Scot Cohen, the Company's Executive Chairman and Chief Executive Officer. The CODM reviews financial information on a consolidated basis for purposes of evaluating financial performance and allocating resources, with the primary measure of segment performance being consolidated loss from operations. Resource allocation decisions are based on consolidated operating results, cash flows, liquidity, and overall strategic priorities rather than discrete financial information at a product line, geography, or functional level. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">While the Company monitors certain operating metrics, including revenue by product line, such information is used for operational oversight and forecasting and is not used by the CODM to assess segment performance or allocate resources among components of the business. Accordingly, the Company has determined that it operates as one operating and one reportable segment. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table presents the significant expense categories and amounts for the three and six months ended June 30, 2026 and 2025.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td></tr><tr><td> </td><td colspan="7" style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; font-weight: bold;">Three Months Ended June 30,</td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - B8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - B8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - D8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - D8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - F8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - F8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - H8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - H8"> </td></tr><tr><td> </td><td style="width: 1%;" title="FN 15 Segment - B9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - B9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - D9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - D9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - F9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - F9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - H9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - H9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total revenues</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B10">$</td><td style="width: 9%; text-align: right;">2,052</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D10">$</td><td style="width: 9%; text-align: right;">1,012</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F10">$</td><td style="width: 9%; text-align: right;">3,163</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H10">$</td><td style="width: 9%; text-align: right;">1,778</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H10"> </td></tr><tr><td>Less: Significant segment expenses:</td><td style="width: 1%;" title="FN 15 Segment - B11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - B11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - D11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - D11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - F11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - F11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - H11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - H11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Cost of revenues</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B12"> </td><td style="width: 9%; text-align: right;">507</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D12"> </td><td style="width: 9%; text-align: right;">525</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F12"> </td><td style="width: 9%; text-align: right;">927</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H12"> </td><td style="width: 9%; text-align: right;">695</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H12"> </td></tr><tr><td> Research and development</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B13"> </td><td style="width: 9%; text-align: right;">152</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D13"> </td><td style="width: 9%; text-align: right;">162</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F13"> </td><td style="width: 9%; text-align: right;">257</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H13"> </td><td style="width: 9%; text-align: right;">594</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H13"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Salaries and burden</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B14"> </td><td style="width: 9%; text-align: right;">861</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D14"> </td><td style="width: 9%; text-align: right;">1,143</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F14"> </td><td style="width: 9%; text-align: right;">1,819</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H14"> </td><td style="width: 9%; text-align: right;">2,205</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H14"> </td></tr><tr><td> Share-based compensation</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B15"> </td><td style="width: 9%; text-align: right;">1,019</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D15"> </td><td style="width: 9%; text-align: right;">770</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F15"> </td><td style="width: 9%; text-align: right;">3,403</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H15"> </td><td style="width: 9%; text-align: right;">2,435</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H15"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Consulting and professional fees</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B16"> </td><td style="width: 9%; text-align: right;">863</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D16"> </td><td style="width: 9%; text-align: right;">519</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F16"> </td><td style="width: 9%; text-align: right;">1,987</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H16"> </td><td style="width: 9%; text-align: right;">1,262</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H16"> </td></tr><tr><td> Depreciation and amortization</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B17"> </td><td style="width: 9%; text-align: right;">55</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D17"> </td><td style="width: 9%; text-align: right;">149</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F17"> </td><td style="width: 9%; text-align: right;">111</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H17"> </td><td style="width: 9%; text-align: right;">304</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H17"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Other selling, general and administrative expenses (1)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">846</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">600</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">1,679</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">1,060</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H18"> </td></tr><tr><td>Total significant segment expenses</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B19"> </td><td style="width: 9%; text-align: right;">4,303</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D19"> </td><td style="width: 9%; text-align: right;">3,868</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F19"> </td><td style="width: 9%; text-align: right;">10,183</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H19"> </td><td style="width: 9%; text-align: right;">8,555</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H19"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Other segment items (2)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H20"> </td></tr><tr><td>Segment loss from operations</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(2,251</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(2,856</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(7,020</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(6,777</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H21">) </td></tr></table><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">(1) Other selling, general and administrative expenses represents the aggregate of CODM-reviewed expense categories not considered individually significant, consisting of travel and entertainment, advertising and promotion, training, occupancy and office, public company costs, and other general and administrative costs. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">(2) Other segment items consist of items not regularly reviewed by the Company's chief operating decision maker as part of the significant expense categories above and not individually significant. No such items were identified for the periods presented; other segment items reconcile to zero. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The measure of segment profit or loss reviewed by the CODM is consolidated loss from operations, which is the same measure presented in the Company's condensed consolidated statements of operations. The CODM does not review segment assets, as such information is not used in allocating resources or assessing performance. Refer to Note 16, Major Customers and Related Information, for entity-wide disclosures regarding revenue by geography and customer concentration.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> </div> 1 1 <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table presents the significant expense categories and amounts for the three and six months ended June 30, 2026 and 2025.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 1%;"> </td><td style="width: 9%;"> </td><td style="width: 1%;"> </td></tr><tr><td> </td><td colspan="7" style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); text-align: center; font-weight: bold;">Three Months Ended June 30,</td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - B8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - B8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - D8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - D8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - F8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - F8"> </td><td> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - H8"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Segment - H8"> </td></tr><tr><td> </td><td style="width: 1%;" title="FN 15 Segment - B9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - B9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - D9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - D9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - F9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - F9"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - H9"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - H9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Total revenues</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B10">$</td><td style="width: 9%; text-align: right;">2,052</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D10">$</td><td style="width: 9%; text-align: right;">1,012</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F10">$</td><td style="width: 9%; text-align: right;">3,163</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F10"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H10">$</td><td style="width: 9%; text-align: right;">1,778</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H10"> </td></tr><tr><td>Less: Significant segment expenses:</td><td style="width: 1%;" title="FN 15 Segment - B11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - B11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - D11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - D11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - F11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - F11"> </td><td> </td><td style="width: 1%;" title="FN 15 Segment - H11"> </td><td style="width: 9%;"> </td><td style="width: 1%;" title="FN 15 Segment - H11"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Cost of revenues</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B12"> </td><td style="width: 9%; text-align: right;">507</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D12"> </td><td style="width: 9%; text-align: right;">525</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F12"> </td><td style="width: 9%; text-align: right;">927</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F12"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H12"> </td><td style="width: 9%; text-align: right;">695</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H12"> </td></tr><tr><td> Research and development</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B13"> </td><td style="width: 9%; text-align: right;">152</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D13"> </td><td style="width: 9%; text-align: right;">162</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F13"> </td><td style="width: 9%; text-align: right;">257</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F13"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H13"> </td><td style="width: 9%; text-align: right;">594</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H13"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Salaries and burden</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B14"> </td><td style="width: 9%; text-align: right;">861</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D14"> </td><td style="width: 9%; text-align: right;">1,143</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F14"> </td><td style="width: 9%; text-align: right;">1,819</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F14"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H14"> </td><td style="width: 9%; text-align: right;">2,205</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H14"> </td></tr><tr><td> Share-based compensation</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B15"> </td><td style="width: 9%; text-align: right;">1,019</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D15"> </td><td style="width: 9%; text-align: right;">770</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F15"> </td><td style="width: 9%; text-align: right;">3,403</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F15"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H15"> </td><td style="width: 9%; text-align: right;">2,435</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H15"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Consulting and professional fees</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B16"> </td><td style="width: 9%; text-align: right;">863</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D16"> </td><td style="width: 9%; text-align: right;">519</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F16"> </td><td style="width: 9%; text-align: right;">1,987</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F16"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H16"> </td><td style="width: 9%; text-align: right;">1,262</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H16"> </td></tr><tr><td> Depreciation and amortization</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B17"> </td><td style="width: 9%; text-align: right;">55</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D17"> </td><td style="width: 9%; text-align: right;">149</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F17"> </td><td style="width: 9%; text-align: right;">111</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F17"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H17"> </td><td style="width: 9%; text-align: right;">304</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H17"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td> Other selling, general and administrative expenses (1)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">846</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">600</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">1,679</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F18"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H18"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">1,060</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H18"> </td></tr><tr><td>Total significant segment expenses</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B19"> </td><td style="width: 9%; text-align: right;">4,303</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - B19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D19"> </td><td style="width: 9%; text-align: right;">3,868</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - D19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F19"> </td><td style="width: 9%; text-align: right;">10,183</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - F19"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H19"> </td><td style="width: 9%; text-align: right;">8,555</td><td style="width: 1%; text-align: left;" title="FN 15 Segment - H19"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Other segment items (2)</td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F20"> </td><td> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H20"> </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;"> - </td><td style="border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H20"> </td></tr><tr><td>Segment loss from operations</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(2,251</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - B21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(2,856</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - D21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(7,020</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - F21">) </td><td> </td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H21">$</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%; text-align: right;">(6,777</td><td style="border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%; text-align: left;" title="FN 15 Segment - H21">) </td></tr></table><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">(1) Other selling, general and administrative expenses represents the aggregate of CODM-reviewed expense categories not considered individually significant, consisting of travel and entertainment, advertising and promotion, training, occupancy and office, public company costs, and other general and administrative costs. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">(2) Other segment items consist of items not regularly reviewed by the Company's chief operating decision maker as part of the significant expense categories above and not individually significant. No such items were identified for the periods presented; other segment items reconcile to zero. </p> 2052000 1012000 3163000 1778000 507000 525000 927000 695000 152000 162000 257000 594000 861000 1143000 1819000 2205000 1019000 770000 3403000 2435000 863000 519000 1987000 1262000 55000 149000 111000 304000 846000 600000 1679000 1060000 4303000 3868000 10183000 8555000 0 0 0 0 -2251000 -2856000 -7020000 -6777000 Other segment items consist of items not regularly reviewed by the Company's chief operating decision maker as part of the significant expense categories above and not individually significant. No such items were identified for the periods presented; other segment items reconcile to zero. <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt;"><b>16. <span>MAJOR CUSTOMERS AND RELATED INFORMATION</span></b></p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">For the three months ended June 30, 2026, revenue from one distributor accounted for approximately 74% of revenue with no other single customer accounting for more than 10% of total revenue. For the three months ended June 30, 2025, revenue from three customers accounted for approximately 32%, 23% and 10% of revenue, respectively, with no other single customer accounting for more than 10% of total revenue. </p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">For the six months ended June 30, 2026, revenue from one distributor accounted for approximately 62% of revenue, with no other single customer accounting for more than 10% of total revenue. For the six months ended June 30, 2025, revenue from one customer accounted for approximately 16% of revenue, with no other single customer accounting for more than 10% of total revenue.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-language-override: normal; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">At June 30, 2026, accounts receivable from one distributor accounted for 76% of net accounts receivable with no other single customer accounting for more than 10% of the accounts receivable balance. At December 31, 2025, accounts receivable from two distributors accounted for 71% and 10%, respectively of net accounts receivable and contract assets, with no other single customer accounting for more than 10% of the accounts receivable and contract assets balance.</p><p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">  </p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table summarizes revenue by geographic region. Revenue is attributed to countries based on customer’s delivery location:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td style="width: 27%;"></td><td style="width: 26%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr style="height: 0px; font-size: 0px;"><td></td><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Three Months Ended June 30,</td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td colspan="1" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - C4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - C4"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Americas</td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - C7">$</td><td style="width: 9%; text-align: right;">509</td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - E7">$</td><td style="width: 9%; text-align: right;">846</td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - E7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8">$</td><td style="width: 9%; text-align: right;">1,154</td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8">$</td><td style="width: 9%; text-align: right;">1,592</td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8"> </td></tr><tr><td>Europe, Middle East and Africa</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - C8"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">1,533</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - C8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">166</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">1,999</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">186</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Asia Pacific</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">10</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">10</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td></tr><tr><td>Total revenues</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,052</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,012</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">3,163</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,778</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td></tr></table> </div> 1 0.74 3 0.32 0.23 0.10 1 0.62 1 0.16 1 0.76 2 0.71 0.10 <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The following table summarizes revenue by geographic region. Revenue is attributed to countries based on customer’s delivery location:</p> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><table cellpadding="0" style="border-collapse: collapse; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; width: 100%; border-spacing: 0px;"><tr style="height: 0px; font-size: 0px;"><td style="width: 27%;"></td><td style="width: 26%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td></tr><tr style="height: 0px; font-size: 0px;"><td></td><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td></td><td style="width: 1%;"></td><td style="width: 9%;"></td><td style="width: 1%;"></td><td></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td><td></td><td style="width: 1%;"> </td><td style="width: 9%;"></td><td style="width: 1%;"> </td></tr><tr><td> </td><td> </td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Three Months Ended June 30,</td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td colspan="7" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">Six Months Ended June 30,</td></tr><tr><td> </td><td> </td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td colspan="1" style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="width: 1%; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"></td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - C4"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - C4"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2026</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 9%;">2025</td><td style="font-weight: bold; text-align: center; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E5"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Americas</td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - C7">$</td><td style="width: 9%; text-align: right;">509</td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - C7"> </td><td> </td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - E7">$</td><td style="width: 9%; text-align: right;">846</td><td style="width: 1%; text-align: left;" title="FN 15 Revenue by shipped to country - E7"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8">$</td><td style="width: 9%; text-align: right;">1,154</td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8">$</td><td style="width: 9%; text-align: right;">1,592</td><td style="text-align: left; width: 1%;" title="FN 15 Revenue by shipped to country - E8"> </td></tr><tr><td>Europe, Middle East and Africa</td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - C8"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">1,533</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - C8"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">166</td><td style="width: 1%; text-align: left; border-width: medium; border-style: none; border-color: currentcolor;" title="FN 15 Revenue by shipped to country - E8"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">1,999</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td><td style="width: 9%; text-align: right; border-width: medium; border-style: none; border-color: currentcolor;">186</td><td style="text-align: left; border-width: medium; border-style: none; border-color: currentcolor; width: 1%;" title="FN 15 Revenue by shipped to country - E9"> </td></tr><tr style="background-color: rgb(204, 238, 255);"><td>Asia Pacific</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">10</td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="width: 1%; text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);">10</td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="width: 9%; text-align: right; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0);"> - </td><td style="text-align: left; border-width: medium medium 1px; border-style: none none solid; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td></tr><tr><td>Total revenues</td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">2,052</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - C10"> </td><td> </td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,012</td><td style="width: 1%; text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">3,163</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td><td style="text-align: right; border-width: medium; border-style: none; border-color: currentcolor;"></td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10">$</td><td style="width: 9%; text-align: right; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0);">1,778</td><td style="text-align: left; border-width: medium medium 3px; border-style: none none double; border-color: currentcolor currentcolor rgb(0, 0, 0); width: 1%;" title="FN 15 Revenue by shipped to country - E10"> </td></tr></table> 509000 846000 1154000 1592000 1533000 166000 1999000 186000 10000 0 10000 0 2052000 1012000 3163000 1778000 <div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"><b>17. <span>SUBSEQUENT EVENTS</span></b></p></div><div> <p style="font: 10pt 'Times New Roman'; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p> <p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">The Company has evaluated subsequent events through August 11, 2026, the date on which this Quarterly Report on Form 10-Q was filed with the Securities and Exchange Commission. Other than as described below, the Company determined there are no subsequent events requiring disclosure in accordance with ASC 855. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In July 2026, the Company made a strategic investment in Frenel, an advanced-sensing company. Pursuant to the agreement, the Company purchased in a private placement 74,918 Series A Preferred Shares of Frenel at a purchase price of $26.6959 per share, for an aggregate purchase price of $2,000, of which $300 had been paid previously under an advance investment and interim limited license agreement in March 2026. The Series A Preferred Shares are convertible into ordinary shares of Frenel at the holder's option. Under the purchase agreement, the Company has the right, but not the obligation, to invest up to an additional $2,500 in Series A-2 Preferred Shares of Frenel at any time within 24 months following the initial closing, based on a pre-money valuation of $18,500 on a fully diluted basis. The Company is evaluating the appropriate accounting for its investment in Frenel, which represents an equity interest in a privately held company, and expects to complete that assessment during the third quarter of 2026. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">Additionally, the Company and Frenel entered into an exclusive distribution and license agreement under which Frenel granted the Company an exclusive license to market, sell, distribute, and integrate Frenel's proprietary polarimetric thermal imaging software within the United States, and to NATO agencies and member-state customers through U.S. Department of Defense Foreign Military Financing and Foreign Military Sales channels. The license is exclusive for an initial period of four years, subject to the Company's satisfaction of specified minimum annual commitment milestones, and converts to a non-exclusive license if those milestones are not met following applicable cure periods. The Company has agreed to pay Frenel a base price for products supplied plus a revenue share of 10% of net funds invoiced to end customers. The Company intends to use the licensed technology as part of the detection layer of its WrapShield platform. The arrangement is in an early stage, and the timing and amount of any resulting revenue are uncertain. </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;">In July 2026, ATF Ruling 2026-2 became effective, classifying the BolaWrap 150 as an instrument of restraint and determining that it is not a "firearm" under the Gun Control Act or an "any other weapon" under the National Firearms Act. The ruling supersedes prior ATF classifications of the BolaWrap 150 and addresses that product only. The ruling did not affect the Company's financial position or results of operations for the periods presented.</p><p style="font-variant-numeric: normal; font-variant-east-asian: normal; font-variant-alternates: normal; font-size-adjust: none; font-kerning: auto; font-optical-sizing: auto; font-feature-settings: normal; font-variation-settings: normal; font-variant-position: normal; font-variant-emoji: normal; font-stretch: normal; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; text-align: justify;"> </p></div> 74918 26.6959 2000000 300000 2500000 P24M 18500000 P4Y 0.10 false false false false 1 1 P6Y6M P5Y6M 0001702924 false Q2 --12-31 Other selling, general and administrative expenses represents the aggregate of CODM-reviewed expense categories not considered individually significant, consisting of travel and entertainment, advertising and promotion, training, occupancy and office, public company costs, and other general and administrative costs. Other segment items consist of items not regularly reviewed by the Company's chief operating decision maker as part of the significant expense categories above and not individually significant. No such items were identified for the periods presented; other segment items reconcile to zero.