NMTC 10-K & 10-Q changes, risk factors and insider trading

Potential complications from our technologies that are currently unknown may come to light.

Based on our industry experience and the experience of the physicians that use products similar to our cortical strip /grid electrode system, depth electrode system, RF probes and RF generator ablation system technology may result in the following complications:

post-operative hemorrhage, infection, brain inflammation, brain tissue necrosis, inability to accurately localize the epileptogenic focus (the area of the cerebral cortex responsible for causing epileptic seizures), neurologic deficit (abnormal function of a body area due to weaker function of the brain, spinal cord, muscles or nerves, such as abnormal reflexes, inability to speak and decreased sensation) and extra axial fluid collections (fluid that occurs in the brain after surgery).

temporary motor deficit, post-operative pain, skin burns hemorrhage, infection.

for Trigeminal nerve ablation, masseter weakness, paresthesias, diplopia, keratitis, corneal reflex impairment, anesthesia dolorosa, and vasomotor rhinorrhea.

If these or unanticipated complications or side-effects result from the use of our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology, our product development may be delayed, we may not be able to obtain regulatory clearance or approval for certain products, we could be subject to liability and, even for cleared/approved products, our technology would not be widely adopted. We cannot assure you that use, even for a limited time, would not result in unanticipated complications, even after the device is removed.

Undetected errors or defects in our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technologies under development or future versions thereof could harm our reputation, decrease the market acceptance of cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or expose us to product liability claims adversely affecting our financial condition and results of operations or liquidity.

Our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technologies may contain undetected errors or defects. As a result, we may be subject to warranty and liability claims for damages related to errors or defects in such products. A material liability claim or other occurrence that harms our reputation or decreases market acceptance of our cortical strip/grid electrode and depth electrode technology could harm our business and operating results. This risk exists even if a device is cleared or approved for commercial sale and manufactured in facilities licensed and regulated by the FDA or an applicable foreign regulatory authority. Our products are designed to affect, and any future products will be designed to affect, important bodily functions and processes. Any side effects, manufacturing defects, misuse or abuse associated with our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or future versions thereof could result in patient injury or death. The medical device industry has historically been subject to extensive litigation over product liability claims, and we cannot offer any assurance that we will not face product liability lawsuits. Our clinical and commercial product liability insurance coverage may not be sufficient to cover claims that may be made against us. In addition, we may not be able to maintain insurance coverage at a reasonable cost, or in sufficient amounts or scope, to protect us against losses. Any claims against us, regardless of their merit, could severely harm our financial condition, strain our management team and other resources, and adversely impact or eliminate the prospects for commercialization of the product candidate, or sale of the product, which that is the subject of any such claim.

The sale and use of our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or future versions thereof could lead to the filing of product liability claims if someone were to allege that our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or one of our products contained a design or manufacturing defect. A product liability claim could result in substantial damages and be costly and time consuming to defend, either of which could materially harm our business or financial condition. Product liability claims may be brought against us by patients, healthcare providers or others selling or otherwise coming into contact with our products, among others. If we cannot successfully defend ourselves against product liability claims, we will incur substantial liabilities and reputational harm. In addition, regardless of merit or eventual outcome, product liability claims may result in:

Product liability lawsuits and claims, safety alerts or product recalls, with or without merit, could cause us to incur substantial costs, delay our product development efforts, place a significant strain on our financial resources, divert the attention of management from our core business, harm our reputation, increase our product liability insurance rates, once we obtain such insurance, or prevent us from securing such insurance coverage in the future and adversely affect our ability to attract and retain customers, if approved, any of which could harm our business, financial condition and operating results.

We currently maintain commercial product liability insurance with an aggregate limit of $5,000,000. We cannot be assured that such insurance would adequately protect our assets from the financial impact of defending a product liability claim because these policies typically have substantial deductibles. Product liability claims in excess of applicable insurance coverage would negatively impact our business, financial condition and operating results. Insurance coverage varies in cost and can be difficult to obtain, and we cannot guarantee that we will be able to obtain insurance coverage in the future on terms acceptable to us or at all.

For example, we inadvertently have not submitted certain required information to CMS under these regulations. Though we intend to promptly report the omission to CMS and ensure all required information is submitted on time going forward, we cannot fully predict whether the missing submissions will result in adverse consequences or regulatory scrutiny. Any federal, state or foreign regulatory review to which we may become subject, regardless of the outcome, could be costly and time-consuming.

On November 4, 2025, we received a letter from Nasdaq notifying us that we have been granted a 180-day extension, until May 4, 2026, to regain compliance with the Minimum Bid Price Requirement. We will continue to monitor the closing bid price of our common stock and seek to regain compliance with the Minimum Bid Price Requirement within the extension period. If we do not regain compliance with the Minimum Bid Price Requirement within the extension period, Nasdaq will provide written notification to us that our common stock will be subject to delisting, at which time we may appeal Nasdaq’s delisting determination to a Nasdaq Hearing Panel. There can be no assurance that, if we do need to appeal a Nasdaq delisting determination to the Nasdaq Hearings Panel, that such appeal would be successful.

Our management has identified certain internal control deficiencies, which management believes constitute a material weakness. Our failure to establish and maintain an effective system of internal controls could result in material misstatements of our financial statements or cause us to fail to meet our reporting obligations or fail to prevent fraud in which case, our stockholders could lose confidence in our financial reporting, which would harm our business and could negatively impact the price of our common stock.

We review and update our internal controls, disclosure controls and procedures, and corporate governance policies as our Company continues to evolve. In addition, we are required to comply with the internal control evaluation and certification requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“SOX”) and management is required to report annually on our internal control over financial reporting. Our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of SOX until the date we are no longer a “smaller reporting company” as defined by applicable SEC rules.

Our management’s evaluation of the effectiveness of our internal controls over financial reporting as of September 30, 2025 concluded that our controls were not effective, due to a material weakness resulting from an ineffective overall control environment. The material weakness stems primarily from our small size and includes the inability to maintain appropriate segregation of duties.

Such shortcomings could have an adverse effect on our business and financial results. Any system of internal controls, however well designed and operated, is based in part on certain assumptions and can provide only reasonable, not absolute, assurances that the objectives of the system are met. Any failure or circumvention of the controls and procedures or failure to comply with regulation concerning control and procedures could have a material effect on our business, results of operation and financial condition. Any of these events could result in an adverse reaction in the financial marketplace due to a loss of investor confidence in the reliability of our financial statements, which ultimately could negatively affect the market price of our shares, increase the volatility of our stock price and adversely affect our ability to raise additional funding. The effect of these events could also make it more difficult for us to attract and retain qualified persons to serve on our Board and as executive officers.

Subject to limitations on liquidity, the Company is planning to take steps to remediate this material weakness. However, we cannot assure you that any of the measures we implement to remedy any such deficiencies will effectively mitigate or remedy such deficiencies.

We are a medical technology company focused on (i) diagnostic, ablation and deep brain stimulation technology for brain related conditions such as epilepsy and Parkinson’s disease; (ii) ablation and stimulation for pain management throughout the body; and (iii) drug delivery including diagnostic and stimulation capabilities.

510(k) Clearance for Trigeminal Facial Pain

On August 15, 2025 we received FDA 510(k) clearance to market its OneRF® Trigeminal Nerve Ablation System for use in procedures to create radiofrequency lesions for the treatment of pain, or for lesioning nerve tissue for functional neurosurgical procedures.

On April 4, 2025, we entered into an underwriting agreement with Ladenburg Thalmann & Co. Inc. as underwriter ( “Ladenburg”), relating to the issuance and sale of 16,000,000 shares of the Company’s common stock, at a price to the public of $0.50 per share (the “April 2025 Financing”). In addition, under the terms of the underwriting agreement, we granted Ladenburg an option, exercisable for 45 days, to purchase up to an additional 2,400,000 shares of common stock on the same terms as the offering, which was exercised in full. Net proceeds to the Company were approximately $8.2 million.

Zimmer Amended and Restated Distribution Agreement

On October 25, 2024, we entered into the Zimmer Amended and Restated Distribution Agreement (the “Amendment”) with Zimmer, Inc. (“Zimmer”) pursuant to which we granted Zimmer the exclusive right and license to distribute our OneRF Ablation System for an upfront payment of $3.0 million, with eligibility for an additional $1.0 million payment from Zimmer upon achievement of certain specified net sales milestones.

We previously entered into an Exclusive Development and Distribution Agreement dated July 20, 2020 with Zimmer, related to the Evo Cortical and Evo sEEG products, which was subsequently amended pursuant to the terms and conditions of a letter agreement dated January 6, 2021, a Second Amendment to Exclusive Development and Distribution Agreement dated June 28, 2022, and a Third Amendment to Exclusive Development and Distribution Agreement dated August 2, 2022 (collectively, the “EDDA”).The EDDAs executed prior to the Amendment granted Zimmer exclusive global rights to distribute the Evo Cortical and Evo sEEG products. In addition, under the prior EDDAs, we agreed to collaborate with respect to development activities through a joint development committee composed of an equal number of representatives of Zimmer and the Company.

Under the Amendment, Zimmer paid us $3.0 million for an exclusive RF Distribution License (the “RF Distribution License” and “License”) for commercialization of the OneRF Ablation System in the brain. In addition, we are eligible to receive a future milestone payment of $1.0 million upon reaching a one-time sales volume threshold. We do not anticipate receiving this milestone payment.

The revised term under the Amendment (the “Term”) began on the effective date and will remain in effect until October 31, 2034. Upon the expiration of the Term, it may be renewed upon the mutual written of the Parties. The Zimmer Amended and Restated Exclusive Development and Distribution Agreement may be terminated before the expiration of the Term only by the Parties in accordance with certain terms under the Amendment. In addition, the license rights granted to Zimmer under this Amendment shall be exclusive (i) from the original effective date until September 30, 2032 for the Evo Cortical and Evo sEEG products; and (ii) from the effective date until October 31, 2034 for the OneRF Ablation System.

Our product revenue was derived from the sale of our Evo Cortical, Evo sEEG, and OneRF Ablation System, which have each received FDA 510(k) clearance.

License Revenue

The Company determined that the RF Distribution License granted under the Zimmer Amended and Restated Distribution Agreement represented functional intellectual property given Zimmer’s access to the underlying intellectual property associated with the OneRF Ablation System. As such, the revenue related to the license was recognized at the point in time in which the license/know-how was delivered to Zimmer which occurred in October 2024. Revenue recognized under the Amendment during the year ended September 30, 2025 was $3.0 million. For further discussion about the determination of license revenue, product revenue and cost of product revenue, and for a discussion of milestones and royalty payments under the Zimmer Amended and Restated Distribution Agreement, see “—Liquidity and Capital Resources—Liquidity Outlook” below and see “Note 7 — Zimmer Distribution Agreement and Other Product Revenue” included in our financial statements included in Item 8 — Financial Statements and Supplementary Data” in this Report.

Selling, General and Administrative

Selling, general and administrative expenses consist primarily of personnel-related costs including stock-based compensation for personnel in functions not directly associated with research and development activities. Other significant costs include legal and litigation costs relating to corporate matters, intellectual property costs, professional fees for consultants assisting with financial and administrative matters, and sales and marketing in connection with the commercial sale of our Evo Cortical, Evo sEEG, and OneRF Ablation Systems. We anticipate that our selling, general and administrative expenses will increase in the future to support our continued research and development activities, further commercialization of our technology, and the increased costs of operating as a public company.

Research and Development

Research and development expenses consist of expenses incurred in performing research and development activities in developing our technology. Research and development expenses include compensation and benefits for research and development employees including stock-based compensation, overhead expenses, laboratory supplies, clinical trial and related clinical manufacturing expenses, costs related to regulatory operations, fees paid to consultants and other outside expenses. Research and development costs are expensed as incurred and costs incurred by third parties are expensed as the contracted work is performed.

The net change in the fair value line item is attributed to the warrant liability while outstanding.

Financing costs consists of the amortization of the deferred issuance costs and other lending and issuance costs in connection with the debt facility and at-the market offering facility (both described below).

Other Income

Other income primarily consists of interest income related to our cash and cash equivalents,

Comparison of the Fiscal Years Ended September 30, 2025 and 2024

The following table sets forth our results of operations for the fiscal years ended September 30, 2025 and 2024.

Product revenue was $9.1 million during the year ended September 30, 2025 with a gross profit and gross profit percentage of $5.1 million and 56.5%, respectively. Product revenue was $3.5 million during the year ended September 30, 2024 with a gross profit and gross profit percentage of $1.1 million and 31.3%, respectively. The increase in gross profit percentage during the current period was largely due to the higher margin OneRF Ablation System being sold in the current period under the Amendment with Zimmer. Product revenue consisted primarily of sales of the OneRF Ablation System to Zimmer during the year ended September 30, 2025 while revenue consisted of Evo Cortical, Evo sEEG, and OneRF Ablation System sales during the prior year period. The cost of product revenue consisted of the manufacturing and materials costs incurred by our third-party contract manufacturers in connection with our Evo Cortical, Evo sEEG, and OneRF Ablation System. In addition, cost of product revenue included royalty fees incurred of approximately $150,000 and $157,000 in connection with our license agreements during the years ended September 30, 2025 and 2024, respectively.

License revenue was $3.0 million for the year ended September 30, 2025 which related to the distribution license granted to Zimmer for the OneRF Ablation System in October 2024. No license revenue was generated from the Zimmer Amended and Restated Development Agreement during the year ended September 30, 2024.

Selling, general and administrative expenses were $7.4 million and $7.9 million for the years ended September 30, 2025 and 2024, respectively. The $0.5 million decrease period over period was primarily due to a decrease in both legal fees in the amount of $0.4 million and investor relations related expense of $0.6 million, offset in part by increases in payroll related costs of approximately $0.1 million, non-legal professional fees of $0.2 million, marketing and sales costs of $0.1 million and other operating cost increases of $0.1 million on a net basis.

You should carefully consider the risks described below, as well as general economic and business risks and the other information in this Quarterly Report and our Annual Report on Form 10-K for the fiscal year ended September 30, 2025. The occurrence of any of the events or circumstances described below or other adverse events could have a material adverse effect on our business, results of operations and financial condition and could cause the trading price of our common stock to decline. Additional risks or uncertainties not presently known to us or that we currently deem immaterial may also harm our business.

Risks Related to Our Business

We have incurred significant operating losses since inception and cannot assure you that we will ever achieve or sustain profitability.

We have incurred losses since inception, and as of June 30, 2026, we had an accumulated deficit of $84.4 million primarily as a result of expenses incurred in connection with our operations and from our research and development programs. We expect to continue to incur significant expenses and increasing operating costs resulting in net losses for the foreseeable future, and management has raised substantial doubt about our ability to continue as a going concern. Substantial doubt about the Company’s ability to continue as a going concern existed as of and for the fiscal year ended September 30, 2025, and, based on management’s assessment, substantial doubt continued to exist as of June 30, 2026. To date, we have financed our operations primarily through debt and equity financings, and our primary activities have been limited to, and our limited resources have been dedicated to, performing business and financial planning, raising capital, recruiting personnel, negotiating with business partners and the licensors of our intellectual property, securing regulatory clearances for our products, managing third party supplier and distributor relationships, and conducting research and development activities.

We have never been profitable and do not expect to be profitable in the foreseeable future. We expect our expenses to continue to increase as we pursue our objectives. The extent of our future operating losses and the timing of profitability are highly uncertain, and we expect to continue incurring significant expenses and operating losses over the next several years. Our prior losses have had, and will continue to have, an adverse effect on our stockholders’ equity and working capital. Any additional operating losses may have an adverse effect on our stockholders’ equity, and we cannot assure you that we will ever be able to achieve profitability. Even if we achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would depress the value of our Company and could impair our ability to raise capital, expand our business, maintain our development efforts, obtain regulatory approvals or continue our operations.

We have a limited operating history, making it difficult for you to evaluate our business and your investment.

We are an early-stage medical technology company which continues to develop and commercialize comprehensive neuromodulation sEEG monitoring, ablation, and stimulation solutions to diagnose and treat patients with epilepsy, Parkinson’s disease, dystonia, essential tremors, facial pain, chronic back pain and other related neurological disorders. Our operations are subject to all of the risks inherent in the establishment of a new business enterprise, including but not limited to the absence of an operating history, limited sales of commercialized products, insufficient capital, expected substantial and continual losses for the foreseeable future, limited experience in dealing with regulatory issues, lack of manufacturing and marketing experience, need to rely on third parties for the development and commercialization of our proposed products, a competitive environment characterized by well-established and well-capitalized competitors and reliance on key personnel.

From our inception through June 30, 2026, we have generated limited revenue from the commercial sales of our products. Because we have generated limited revenues from commercialization, our operations to date have been principally financed through public and private offerings of our Common Stock and convertible debt and exercises of options and warrants.

Investors are subject to all the risks incident to the creation and development of a new business and each investor should be prepared to withstand a complete loss of his, her or its investment. Furthermore, the accompanying financial statements have been prepared assuming that we will continue as a going concern. However, the factors included above raise substantial doubt about our ability to continue as a going concern. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Our Company has limited experience in medical device development and may not be able to successfully develop any device or therapy. Our ability to become profitable depends primarily on: our ability to further develop our technology, our successful completion of all necessary pre-clinical testing and clinical trials on such technology, our ability to obtain clearance or approval for such technology and successfully commercialize such technology, our ongoing research and development efforts, the timing and cost of clinical trials, our ability to identify personnel with the necessary skill sets or enter into favorable alliances with third-parties who can provide substantial capabilities in clinical development, regulatory affairs, sales, marketing and distribution and our ability to obtain and maintain necessary intellectual property rights to such technology. Our limited experience in medical device development may make it more difficult for us to complete these tasks.

Even if we successfully develop and market such technology, we may not generate sufficient or sustainable revenue to achieve or sustain profitability, which could cause us to cease operations and cause you to lose all of your investment.

Zimmer has exclusive global rights to distribute our Evo Cortical, Evo sEEG, and OneRF Ablation System in the brain. We are reliant on Zimmer to drive the commercialization and sales of these products. Zimmer’s failure to timely commercialize these products, or to achieve certain milestones, would have a material adverse effect on our business and operating results.

The Company granted Zimmer an exclusive global right to distribute our Evo Cortical, Evo sEEG, and OneRF Ablation System in the brain. We are reliant on Zimmer to drive the commercialization and sales of these products until 2034 under the Zimmer Amended and Restated Distribution Agreement for the exclusive distribution, marketing and sales license provided to Zimmer. The collaboration with Zimmer may not be successful due to several factors, including the following:

Any of the foregoing could adversely impact the likelihood and timing of any payments or product revenue we are eligible to receive under the Zimmer Amended and Restated Distribution Agreement. If Zimmer does not perform its obligations under the Zimmer Amended and Restated Distribution Agreement, sales would be substantially delayed and could result in a material adverse effect on our business, results of operations and prospects and would likely cause our stock price to decline.

Our business and operating results are subject to the inventory management decisions of our distributor

We are subject to risks relating to the inventory management decisions and operational and sourcing practices of Zimmer, as the distributor of our Evo Cortical, Evo sEEG, and OneRF Ablation System in the brain. Zimmer carries inventories of our products as part of their ongoing operations and currently they are purchasing inventory of our OneRF Ablation System based on contractual minimum purchase requirements in the Zimmer Agreement, which may not reflect their assessments of end-customer demand. This may result in higher than needed inventory levels. We are currently working on shelf-life extension of our OneRF Ablation System, which could also create higher inventory levels at Zimmer. If Zimmer’s inventory levels are higher than it desires, Zimmer may postpone product purchases from us, which could cause our sales to be lower than planned and have a materially negative impact on our working capital goals as well as our operating results.

An inability to obtain adequate supply of components and raw material products has had and could continue to have a material adverse effect on our business, financial condition and results of operations.

We have recently experienced delays in the availability of certain components and raw materials, which have not been available to us on a timely basis. These delays have resulted in backorders of certain of our products, which have delayed or prevented us from fulfilling customer orders on a timely basis. We are dependent on third-party manufacturers for the medical products that we develop, and we have limited control over the ability of our suppliers and manufacturers to deliver components and raw materials on schedule. If these supply delays continue, we may continue to experience backorders, delayed sales, and increased costs, any of which could have a material adverse impact on our business, financial condition and results of operations.

Our ability to continue our operations requires that we raise additional capital and our operations could be curtailed if we are unable to obtain the additional funding as or when needed.

Our independent registered public accounting firm included an explanatory paragraph in the report on our financial statements as of and for the years ended September 30, 2025 and 2024, respectively, noting the existence of substantial doubt about our ability to continue as a going concern. The Company has incurred losses since inception, negative cash flows from operations, and an accumulated deficit of $84.4 million as of June 30, 2026. To date, the Company’s revenues have not been sufficient to cover its full operating costs, and as such, it has been dependent on funding operations through the issuance of debt and sale of equity securities. At June 30, 2026, we had cash and cash equivalents in the aggregate of approximately $2.0 million. Our existing cash, cash equivalents and short-term investments will not be sufficient to fund our operating expenses. To continue to fund operations, we will need to secure additional funding. We may obtain additional financing in the future through the issuance of our Common Stock, through other equity or debt financings or through collaborations or partnerships with other companies. We may not be able to raise additional capital on terms acceptable to us, or at all.

We may be adversely affected by the effects of inflation.

Inflation has the potential to adversely affect our business, results of operations, financial position and liquidity by increasing our overall cost structure, particularly if we are unable to achieve commensurate increases in the prices we charge our customers. The existence of inflation in the economy has the potential to result in higher interest rates and capital costs, supply shortages, increased costs of labor and other similar effects. As a result of inflation, we may experience increases in the costs of labor, materials, and other inputs, such as engineering consultants. Although we may take measures to mitigate the impact of this inflation, if these measures are not effective our business, results of operations, financial position and liquidity could be materially adversely affected. Even if such measures are effective, there could be a difference between the timing of when these beneficial actions impact our results of operations and when the cost inflation is incurred.

We will need to raise substantial additional funds in the future, and these funds may not be available on acceptable terms or at all. A failure to obtain this necessary capital when needed could force us to delay, limit, scale back or cease some or all operations.

The continued growth of our business, including the development, regulatory approval and commercialization of our technology, will significantly increase our expenses going forward. As a result, we will be required to seek substantial additional funds in the future. Our future capital requirements will depend on many factors, including:

As a result of these and other factors, we do not know whether and the extent to which we may be required to raise additional capital. We may in the future seek additional capital from public or private offerings of our capital stock, borrowings under credit lines or other sources.

We may not be able to raise additional capital on terms acceptable to us, or at all. Any failure to raise additional capital could compromise our ability to execute on our business plan, and we may be forced to liquidate our assets. In such a scenario, the values we receive for our assets in liquidation or dissolution could be significantly lower than the values reflected in our financial statements.

If we issue additional equity or debt securities to raise additional funds, our existing stockholders may experience dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders. In addition, if we raise additional funds through collaborations, licensing, joint ventures, strategic alliances, partnership arrangements or other similar arrangements, it may be necessary to relinquish valuable rights to our potential future products or proprietary technologies or grant licenses on terms that are not favorable to us.

We depend on a limited number of third-party suppliers for the components of our technology, and the loss of any of these suppliers, or their inability to provide us with an adequate supply of materials, could harm our business.

We use a limited number of third-party suppliers of components for our products. Depending on a limited number of suppliers exposes us to risks, including limited control over pricing, availability, quality and delivery schedules. We may not have long term supply agreements with our suppliers and, in many cases, we may make our purchases on a purchase order basis. Our ability to purchase adequate quantities of components or our products may be limited and we may not be able to convince suppliers to make components and products available to us. Additionally, our suppliers may encounter problems that limit their ability to supply components or manufacture products for us, including financial difficulties, damage to their manufacturing equipment or facilities, product discontinuations, or complications due to worldwide economic and social instability. As a result, there is a risk that certain components could be discontinued and no longer available to us. We may be required to make significant “last time” purchases of component inventory that is being discontinued by the supplier to ensure supply continuity. If we fail to obtain sufficient quantities of high quality components to meet demand for our products in a timely manner or on terms acceptable to us, we would have to seek alternative sources of supply. Because of factors such as the proprietary nature of our products, our quality control standards and regulatory requirements, we may not be able to quickly engage additional or replacement suppliers for some of our critical components. Failure of any supplier to deliver components at the level our business requires could disrupt the manufacturing of our products and, if approved, limit our ability to meet our sales commitments, which could harm our reputation and adversely affect our business.

We may not procure volumes sufficient to receive favorable pricing, which could impact our gross margins if we are unable to pass along price differences to our customers. Recent global economic cost inflation trends could unfavorably impact pricing from our suppliers.

Furthermore, vandalism, terrorism or a natural or other disaster, such as an earthquake, fire or flood, could damage or destroy equipment, our inventory of component supplies or finished products, cause substantial delays in development or our operations, result in the loss of key information, and cause us to incur additional expenses. We maintain liability insurance and property casualty insurance, but it may not be adequate to fully cover our losses in any particular case. In addition, regardless of the level of insurance coverage, damage to our or our suppliers’ facilities could harm our business, financial condition and operating results.

We may also have difficulty obtaining similar components from other suppliers that are acceptable to the FDA or other regulatory agencies, and the failure of any supplier to comply with strictly enforced regulatory requirements could expose us to regulatory action including warning letters, product recalls, and termination of distribution, product seizures or civil penalties. It could also require us to cease using the components, seek alternative components or technologies and modify our products to incorporate alternative components or technologies, which could result in a requirement to seek additional regulatory approvals. Any disruption of this nature or increased expenses could harm our development, approval or commercialization efforts and adversely affect our operating results.

We have four products which have each received 510(k) clearance from the FDA. If we are unable to successfully develop and receive regulatory clearance/approval for our other products under development, or if we experience significant delays in doing so, our business will be harmed.

Four of our products have received 510(k) clearance from the FDA: our Evo® Cortical, Evo® sEEG Electrode, OneRF® Ablation System, and OneRF® TN Ablation System. None of our other products have received clearance or approval for commercial sale. Our ability to generate revenue from our developed products, if any, will depend heavily on their successful development and regulatory approval for commercialization.

For our current products under development clinical studies in humans may be required, which is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome. A failure of one or more clinical trials can occur at any stage of testing. Further, the outcomes of completed clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. Clinical data is often susceptible to varying interpretations and analyses, and many companies that have believed their products performed satisfactorily in clinical trials have nonetheless failed to obtain marketing clearance or approval. We have limited resources to complete the expensive process of medical device development, pre-clinical testing and clinical trials, putting us at a disadvantage, particularly compared to some of our larger and established competitors, and we may not have sufficient resources to commercialize our products under development in a timely fashion, if ever.

We may experience numerous unforeseen events during or as a result of clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our products, including:

If we are required to conduct additional clinical trials or other testing of our technology under development beyond those that we contemplate, if we are unable to successfully complete clinical trials, if the results of these trials or tests are not favorable or if there are safety concerns, we may:

Our development costs will also increase if we experience delays in testing or marketing clearance/approvals. We do not know whether any of our clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all. Significant clinical trial delays also could allow our competitors to bring innovative products to market before we do and impair our ability to successfully commercialize our products.

Even if we obtain regulatory clearance and/or approval for all of our products, we will remain subject to extensive regulatory scrutiny and compliance obligations.

Both before and after a product is commercially released, we will have ongoing responsibilities under FDA regulations. We will also be subject to periodic inspections by the FDA and comparable foreign authorities to determine compliance with regulatory requirements, such as the QSR, of the FDA, medical device reporting regulations and regulations regarding notification, corrections, and recalls. These inspections can result in observations or reports, warning letters or other similar notices or forms of enforcement action. If the FDA concludes that we are not in compliance with applicable laws or regulations, or that any of our products are ineffective or pose an unreasonable health risk, it could ban these products, suspend or cancel our marketing authorizations, impose “stop-sale” and “stop-import” orders, detain or seize adulterated or misbranded products, order a recall, repair, replacement, correction or refund of such products, or require us to notify health providers and others that the products present unreasonable risks of substantial harm to the public health. Discovery of previously unknown problems with our product’s design or manufacture may result in restrictions on use, restrictions placed on us or our suppliers, or withdrawal of an existing regulatory clearance. The FDA may also impose operating restrictions, enjoin and restrain certain violations of applicable law pertaining to medical devices, assess civil or criminal penalties against our officers, employees or us, or recommend criminal prosecution of our Company. Adverse regulatory action may restrict us from effectively marketing and selling our products. In addition, negative publicity and product liability claims resulting from any adverse regulatory action could have a material adverse effect on our business, financial condition, and operating results.

In addition, even though we have obtained FDA clearance to market four of our products, and even if we obtain the proper regulatory approval or clearance to market any additional products under development, the FDA has the power to require us to conduct post-market surveillance studies. These studies are designed to identify adverse events, device malfunctions or complaints from patients implanted with the device during a specified period after the commencement of commercial use in the U.S. The FDA may also require us to conduct post-approval studies to further monitor the safety and/or effectiveness of our products under development if approved. Failure to conduct required surveillance or studies in a timely manner could result in the revocation of the approved PMA product that is subject to such a requirement and could also result in the recall or withdrawal of the product, which would prevent us from generating sales from that product in the United States.

Potential complications from our technologies that are currently unknown may come to light.

Based on our industry experience and the experience of the physicians that use products similar to our products may result in the following complications:

If these or unanticipated complications or side-effects result from the use of our products, our product development may be delayed, we may not be able to obtain regulatory clearance or approval for new products, we could be subject to liability and, even for cleared/approved products, our technology would not be widely adopted. We cannot assure you that use, even for a limited time, would not result in unanticipated complications, even after the device is removed.

Undetected errors or defects in our technologies under development or future versions thereof could harm our reputation, decrease the market acceptance of our technology or expose us to product liability claims adversely affecting our financial condition and results of operations or liquidity.

Our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technologies may contain undetected errors or defects. As a result, we may be subject to warranty and liability claims for damages related to errors or defects in such products. A material liability claim or other occurrence that harms our reputation or decreases market acceptance of our cortical strip/grid electrode and depth electrode technology could harm our business and operating results. This risk exists even if a device is cleared or approved for commercial sale and manufactured in facilities licensed and regulated by the FDA or an applicable foreign regulatory authority. Our products are designed to affect, and any future products will be designed to affect, important bodily functions and processes. Any side effects, manufacturing defects, misuse or abuse associated with our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or future versions thereof could result in patient injury or death. The medical device industry has historically been subject to extensive litigation over product liability claims, and we cannot offer any assurance that we will not face product liability lawsuits. Our clinical and commercial product liability insurance coverage may not be sufficient to cover claims that may be made against us. In addition, we may not be able to maintain insurance coverage at a reasonable cost, or in sufficient amounts or scope, to protect us against losses. Any claims against us, regardless of their merit, could severely harm our financial condition, strain our management team and other resources, and adversely impact or eliminate the prospects for commercialization of the product candidate, or sale of the product, which is the subject of any such claim.

The sale and use of our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or future versions thereof could lead to the filing of product liability claims if someone were to allege that our cortical strip/grid electrode system, depth electrode system, RF probes and RF generator ablation system technology or one of our products contained a design or manufacturing defect. A product liability claim could result in substantial damages and be costly and time consuming to defend, either of which could materially harm our business or financial condition. Product liability claims may be brought against us by patients, healthcare providers or others selling or otherwise coming into contact with our products, among others. If we cannot successfully defend ourselves against product liability claims, we will incur substantial liabilities and reputational harm. In addition, regardless of merit or eventual outcome, product liability claims may result in:

Product liability lawsuits and claims, safety alerts or product recalls, with or without merit, could cause us to incur substantial costs, delay our product development efforts, place a significant strain on our financial resources, divert the attention of management from our core business, harm our reputation, increase our product liability insurance rates, once we obtain such insurance, or prevent us from securing such insurance coverage in the future and adversely affect our ability to attract and retain customers, if approved, any of which could harm our business, financial condition and operating results.

We currently maintain commercial product liability insurance with an aggregate limit of $5,000,000. We cannot be assured that such insurance would adequately protect our assets from the financial impact of defending a product liability claim because these policies typically have substantial deductibles. Product liability claims in excess of applicable insurance coverage would negatively impact our business, financial condition and operating results. Insurance coverage varies in cost and can be difficult to obtain, and we cannot guarantee that we will be able to obtain insurance coverage in the future on terms acceptable to us or at all.

We may not be successful in commercializing our technology.

We anticipate that we will derive nearly all of our revenue from the sales of our cortical strip, grid electrode and depth electrode technology or future versions thereof.

Moreover, we expect the revenue opportunity for additional uses of our technology to be greater than the technology and uses that have currently been cleared by the FDA, and so we believe our ability to generate significant revenue in the future will be dependent upon the receipt of additional FDA clearances.

Our future revenue will be dependent, in part, upon the size of the markets in which we gain regulatory approval, the accepted price for the product, the ability to obtain coverage and reimbursement, and whether we own the commercial rights for that territory. If the number of people we target is not as significant as we estimate or the treatment population is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenue from sales of such products, even if approved.

The success of any products that we develop will depend on several factors, including:

The continuing development and commercialization of our products depends upon us maintaining strong relationships with academic and healthcare institutions and professionals.

If we fail to maintain our strong working relationships with healthcare and academic institutions and their professionals, many of our products may not be developed and marketed in line with the needs and expectations of the professionals who use and support our products, which could cause a decline in our earnings and profitability. The development, marketing and sales of many of our products depends on our maintaining working relationships with healthcare institutions and professionals. We rely on these professionals to provide us with considerable knowledge and experience regarding the development, marketing and sale of our products. If we are unable to maintain strong relationships with these institutions and professionals, the development and marketing of our products could suffer, which could have a material adverse effect on our business, results of operations, financial condition, and cash flows.

Our success depends on our ability to continue to develop, commercialize and gain market acceptance for our products and technology.

Our current business strategy is highly dependent on developing and commercially launching our products and technology and achieving and maintaining market acceptance. In order for us to sell cortical strip, grid electrode and depth electrode technology to people with epilepsy, Parkinson’s disease, dystonia, essential tremors, chronic back pain and other related neurological disorders, we must convince them, their caregivers and healthcare providers that our technology offers meaningful advantages over existing solutions for neuromodulation, cEEG and sEEG recording, ablation, and stimulation. Key challenges include overcoming physician preference for established competitive products and demonstrating superior clinical outcomes. Several factors could negatively impact market acceptance, including: failure to gain support from key opinion leaders, insufficient clinical evidence supporting our technology’s benefits, perceived risks associated with the technology, introduction of competitive products, adverse clinical trial results, loss of regulatory approvals, or adverse publicity. Healthcare providers typically adopt new technologies slowly due to liability concerns and reimbursement uncertainties. Additionally, hospital purchases of our RF Generator require capital expenditure approvals, typically involving value analysis committees, budget cycles, and multiple administrative and clinical stakeholders. These processes commonly take six to eighteen months or longer and may be delayed or abandoned due to hospital budget constraints, competing capital priorities, staffing shortages, or macroeconomic conditions.

In addition, people with such medical conditions, their caregivers or healthcare providers may perceive our products and technology to be more complicated or less effective than current technology, and people may be unwilling to change their current regimens. Moreover, we believe that healthcare providers tend to be slow to change their medical treatment practices because of perceived liability risks arising from the use of new products and the uncertainty of third-party reimbursement. Accordingly, healthcare providers may not recommend our cortical strip, grid electrode and depth electrode technology until, if ever, there is sufficient evidence to convince them to alter the treatment methods they typically recommend, such as receiving recommendations from prominent healthcare providers or other key opinion leaders in the community.

If we fail to convince patients, caregivers, and healthcare providers of our technology’s benefits or cannot achieve widespread market acceptance, our sales potential and strategic objectives would be compromised, adversely affecting our business, financial condition, and operating results.

Financing costs

We did not incur any financing costs during the three months ended June 30, 2026. Financing costs during the three months ended June 30, 2025 consisted of the costs associated with the at-the market offering facility (described further below) in the amount of $9,000.