Exyn Technologies, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Exyn Technologies, Inc. (“Exyn” or the “Company”) was incorporated in the State of Delaware on May 12, 2014. The Company is a pioneer in fully adaptive and cognitive mission-level autonomous robotics and artificial intelligence. The Level 4B autonomy platform allows aerial and ground robotic systems to navigate safely and efficiently in complex, GPS-denied environments. Its full-stack solution enables flexible deployment of single or multi-robot fleets that can intelligently navigate and dynamically adapt to challenging environments in real time.

As of June 30, 2026, Exyn hadtwo wholly owned subsidiaries:

Unless otherwise indicated, references to “Exyn” or the “Company” herein collectively refer to Exyn Technologies, Inc. and its subsidiaries.

On May 15, 2026, the Company effected a 1-for-25 reverse stock split of the Company’s issued and outstanding shares of common stock and preferred stock. All common share amounts, preferred share amounts, per share amounts, exercise prices, conversion ratios and other share-related information presented in these condensed consolidated financial statements and accompanying notes have been retroactively adjusted to reflect the reverse stock split for all periods presented.

On May 18, 2026, the Company completed its initial public offering (“IPO”) of 2,500,000 units, with each unit consisting ofone share of common stock andone warrant to purchaseone share of common stock, at a public offering price of $7.75 per unit, which resulted in gross proceeds of approximately $19.4 million, before deducting underwriting discounts and commissions and offering expenses. The Company’s common stock and warrants began trading on the Nasdaq Capital Market on May 15, 2026.

Basis of Presentation. The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete financial statements as certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These condensed consolidated financial statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments) necessary to fairly present the results of the interim periods. The results of operations for three and six months ended and cash flows for the six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ended December 31, 2026 or any other future period. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Registration Statement on Form S-1/A (File No. 333-294453) filed with the SEC on May 11, 2026 and declared effective by the SEC on May 14, 2026 (the “IPO Registration Statement”).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

*Use of Estimates.*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 revenues and expenses during the reporting period. Actual results could differ from these estimates. The Company’s significant estimates used in these consolidated financial statements include, but are not limited to, revenue recognition, fair value of stock-based compensation, fair value of SAFE instruments, warrants, and the determination of the economic useful life of depreciable property and equipment. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates.

Cash and Cash Equivalents. The Company considers all highly liquid, short-term investments with original maturities of three months or less when purchased to be cash equivalents.

Accounts Receivable. Accounts receivable are carried at their contractual amounts, less an estimated allowance for credit losses. Credit is granted in the normal course of business without collateral. The typical payment term is 30 days. Management estimates the allowance for credit losses using a loss-rate approach based on historical loss information, adjusted for management’s expectations about current and future economic conditions, as the basis to determine expected credit losses. Management exercises significant judgment in determining expected credit losses. Key inputs include macroeconomic factors, industry trends, the creditworthiness of counterparties, historical experience, the financial conditions of the customers, and the amount and age of past due accounts. Management believes that the composition of receivables at June 30, 2026 is consistent with historical conditions as credit terms and practices and the client base has not changed significantly. Receivables are considered past due if full payment is not received by the contractual due date. Past due accounts are generally written off against the allowance for credit losses only after all collection attempts have been exhausted. The allowance for credit losses was $248,326 and $203,960 as of June 30, 2026 and December 31, 2025, respectively. There wasone customer for each period who represented in the aggregate 10% and 12% of total accounts receivable as of June 30, 2026 and December 31, 2025, respectively.

Inventories. Inventory is recorded at the lower of cost or net realizable value on an average cost basis. The Company reduces the carrying value of inventories for those items that are potentially excess, obsolete, or slow moving based on a review of recent sales trends and expected future demand.

Property and Equipment. Property and equipment are stated at cost, net of accumulated depreciation and amortization, which is recorded commencing at the in-service date using the straight-line method over the estimated useful lives of the assets, as follows:3 to 5 years for lab, office and computer equipment,5 to 7 years for furniture and fixtures,10 to 15 years for building improvements, and 5 years for software. When fixed assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the statements of comprehensive loss for the respective period. Minor additions and repairs are expensed in the period incurred. Major additions and repairs which extend the useful life of existing assets are capitalized and depreciated using the straight-line method over their remaining estimated useful lives.

*Deferred revenue.*The Company classifies amounts billed to customers for which the related services or performance obligations have not yet been satisfied as deferred revenue, which represents contract liabilities under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606. These amounts are recorded as a contract liability until the Company fulfills its obligations under the contract.

Deferred revenue activity as of June 30, 2026 is summarized as follows:

All deferred revenue outstanding as of June 30, 2026 is expected to be recognized within the following twelve months. Because the Company’s contracts have an original expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14 and does not disclose information about remaining performance obligations.

*Contingent Liabilities.*The Company, from time to time, may be involved in certain legal proceedings. Based upon consultation with outside counsel handling its defense in these matters and the Company’s analysis of potential outcomes, if the Company determines that a loss arising from such matters is probable and can be reasonably estimated, an estimate of the contingent liability is recorded in its consolidated financial statements. If only a range of estimated loss can be determined, an amount within the range that, based on estimates, assumptions and judgments, reflects the most likely outcome, is recorded as a contingent liability in the consolidated financial statements. In situations where none of the estimates within the estimated range is a better estimate of probable loss than any other amount, the Company records the low end of the range. Any such accrual would be charged to expense in the appropriate period. Litigation expenses for these types of contingencies are recognized in the period in which the litigation services were provided.

Stock-based Payments. The Company accounts for stock-based compensation under the provisions of FASB ASC 718, “Compensation - Stock Compensation”, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. The fair value of restricted stock awards is estimated by the market price of the Company’s common stock at the date of grant. Restricted stock awards are being amortized to expense over the shorter of the requisite service period or the actual vesting period. The Company estimates the fair value of option and warrant awards on the date of grant using the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the shorter of the requisite service period or the actual vesting period, using the straight-line method. In June 2018, the FASB issued Accounting Standard Update (“ASU”) No. 2018-07, Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee stock-based Payment Accounting (the “2018 Update”). The amendments in the 2018 Update expand the scope of Topic 718 to include stock-based payment transactions for acquiring goods and services from non-employees. Prior to the 2018 Update, Topic 718 applied only to share- based transactions to employees. Consistent with the accounting requirement for employee stock-based payment awards, nonemployee stock-based payment awards within the scope of Topic 718 are measured at grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. The Company has elected to account for forfeiture of stock-based awards as they occur.

*Warrants.*The Company classifies a warrant to purchase shares of its common stock as equity on its consolidated balance sheets as this warrant is a free-standing financial instrument that is indexed to the Company’s own stock and meets the criteria for equity classification. Each warrant is initially recorded within equity at the date of grant, net of issuance costs, and is not subsequently re-measured. Changes in the fair value of the warrant are not recognized after the initial measurement. The warrants will remain classified in equity until they are exercised or expire.

*Revenue Recognition.*In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, the Company recognizes revenue when it satisfies performance obligations, by transferring promised goods or services to customers, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for fulfilling those performance obligations. The Company’s primary revenue streams include sales of aerial robotic systems and related software solutions, service revenue and subscription revenue generated through the Company’s installment program.

Product Sales

Beginning in August 2024, revenue for product sales is recognized upon shipment, which is the point in time when control of the product transfers to the customer. Prior to August 2024, revenue was recognized upon customer receipt.

Subscription Revenue Installment Program

The Company offers customers an installment-based subscription program under which a drone is delivered to the customer at the outset, and the customer pays fixed monthly subscription fees usually over a 24-month term. Customers may cancel the arrangement at any time by providing 90 days’ notice and returning the drone at the end of the notice period. Because the customer may cancel the arrangement prior to completing the 24-month term, the Company does not have an unconditional right to the remaining consideration at the time of delivery.

Under ASC 606, the Company has determined that the installment program represents a series of monthly performance obligations to provide the customer with access to and use of the drone for as long as the customer continues to participate in the program. Revenue is recognized monthly, as invoices are issued and the Company’s right to consideration for each installment becomes unconditional. A trade receivable is recorded only for amounts invoiced. The total monthly subscription fees over the 24-month period equal the cash selling price of the drone. The Company evaluated whether the installment program includes a significant financing component and concluded that it does not, as the absence of interest represents a sales incentive.

Service Revenue

Service revenue is recognized over time as the related services are performed, based on the nature of the underlying service arrangement.

Remaining Performance Obligations

As of June 30, 2026 and December 31, 2025, deferred revenue totaled $227,348 and $348,538 respectively, representing amounts billed in advance for which performance obligations have not yet been satisfied.

Concentration

Revenue fromone customer accounted for 13% of the Company’s revenue during the three months ended June 30, 2026. Revenue fromone customer accounted for 17% of the Company’s revenue during the three months ended June 30, 2025. Revenue fromone customer accounted for 15% of the Company’s revenue during the six months ended June 30, 2026. Revenue fromtwo customers accounted for 32% of the Company’s revenue during the six months ended June 30, 2025.

Cost of Revenues. Cost of revenues includes materials, wages, freight charges, depreciation and inspection costs.

Comprehensive income (loss). The Company follows Accounting Standards Codification ASC 220 in reporting comprehensive income. Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Other comprehensive income is limited to foreign currency translation adjustments. Therefore, total comprehensive income (loss) includes net income (loss) and foreign currency translation adjustments.

*Foreign Currency Transactions and Translation.*Exyn’s functional currency is the United States Dollar (“USD”) and Exyn Latam’s functional currency is the Chilean Peso (“CLP”).

For the purpose of presenting these consolidated financial statements the reporting currency is USD. The Company’s assets and liabilities are expressed in USD at the exchange rate on the balance sheet date, equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period. The resulting translation adjustments are reported under accumulated other comprehensive income in the stockholders’ equity section of the balance sheets.

Transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the date of the transaction.

Exchange rate used for the translation are as follows:

*Earnings Per Share.*The Company follows ASC 260 when reporting Earnings Per Share (“EPS”) resulting in the presentation of basic and diluted earnings per share. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted-average number of vested common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted-average number of vested common shares outstanding, plus the effect of potentially dilutive common stock equivalents, if any. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

For the three and six months ended June 30, 2026 and 2025, the Company had net losses and therefore all potentially dilutive securities were excluded from the diluted EPS calculation, as their inclusion would have been anti-dilutive.

For the three and six months ended June 30, 2026 and 2025, the Company excluded the following common stock equivalents from its calculation of diluted EPS, as their effect would have been anti-dilutive.

During the three and six months ended June 30, 2025, the Company issued $1,500,000 of Simple Agreements for Future Equity (“SAFEs”), which were contingently convertible into preferred stock upon the occurrence of specified events (e.g., an equity financing or liquidity event). For the three and six months ended June 30, 2026, all outstanding SAFEs and preferred shares had converted into common stock in connection with the closing of the Company’s IPO. Accordingly, these instruments have been excluded from the common stock equivalents table for the three and six months ended June 30, 2026.

Deferred Financing Costs. Deferred financing costs include debt discounts and debt issuance costs related to a recognized debt liability and are presented in the balance sheet as a direct deduction from the carrying value of the debt liability. Amortization of deferred financing costs are included as a component of interest expense. Deferred financing costs are amortized using the straight-line method over the term of the recognized debt liability which approximates the effective interest method.

*Income Taxes.*The Company accounts for income taxes under the provisions of the FASB ASC Topic 740 “Income Taxes”. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the consolidated financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts (“temporary differences”) at enacted tax rates in effect for the years in which the temporary differences are expected to reverse. The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s consolidated financial statements as of June 30, 2026 and December 31, 2025. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date. The Company’s policy is to classify assessments, if any, for tax related interest as interest expense and penalties as general and administrative expenses in the consolidated statements of comprehensive income. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress.

Fair Value Measurements. The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

Level 1 — quoted prices in active markets for identical assets or liabilities

Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)

There wereno SAFE Liabilities outstanding as of June 30, 2026.

The following tables show the fair value measurements used by level as of December 31, 2025:

The carrying amounts of the Company’s financial instruments, such as cash, accounts receivable, accounts payable and other current liabilities approximate fair values due to the short-term nature of these instruments The estimated fair value of the Company’s long-term debt approximates the carrying value of these instruments, due to the interest rates on this debt approximating current market interest rates.

During the year ended December 31, 2025, the Company issued SAFEs, with gross proceeds totaling $4,700,000. The Company did not issue any additional SAFEs in the six months ended June 30, 2026.

Measurement

As there are no quoted prices or observable market inputs available for these instruments, the SAFEs are classified within Level 3 of the fair value hierarchy. The Company engaged a third-party valuation specialist to assist in the estimation of fair value at each reporting date using a Probability-Weighted Expected Return Method to probability-weight discrete outcomes (including equity financing, liquidity event, termination, and dissolution) and an Option Pricing Model to value the option-like conversion features within the applicable scenarios.

The following table summarizes the changes in SAFE liabilities as of June 30, 2026:

As a Level 3 fair value measurement, the estimated fair value of the SAFE liabilities is sensitive to changes in significant unobservable inputs, including the assumed probability and timing of future equity financings and liquidity events, the Company’s implied equity value, volatility, and the discount rate. Changes in these inputs may increase or decrease the estimated fair value depending on their effect on the probability-weighted expected payoff to SAFE holders. For example, a decrease in the discount rate generally increases the estimated fair value; however, changes in event probabilities or volatility may have different directional effects depending on the contractual terms and modeled outcomes.

*Concentration of Credit Risks.*Financial instruments that potentially subject the Company to concentrations of credit risk are cash equivalents and accounts receivable. Cash and cash equivalents are invested in deposits with certain financial institutions and may, at times, exceed federally insured limits. The Company has not experienced any significant losses on its deposits of cash and cash equivalents. In regard to trade receivables, the Company performs ongoing evaluations of its customers’ financial condition as well as general economic conditions and, generally, requires no collateral from its customers.

Leases. The Company leases certain facilities and office space. Lease assets and lease liabilities are recognized at the commencement of an arrangement where it is determined at inception that a lease exists. Lease assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. These assets and liabilities are initially recognized based on the present value of lease payments over the lease term calculated using an incremental borrowing rate generally applicable to the location of the lease asset, unless the implicit rate is readily determinable. Lease assets also include any upfront lease payments made and exclude lease incentives. Lease terms include options to extend or terminate the lease when it is reasonably certain that those options will be exercised. The Company has operating lease arrangements with lease and non-lease components. The non-lease components in these arrangements are not significant when compared to the lease components. For all operating leases, the Company accounts for the lease and non-lease components as a single component in the calculation of the lease asset and corresponding liability.

Variable lease payments are generally expensed as incurred. Leases with an initial term of 12 months or less are not recorded on the balance sheet, and the expense for these short-term leases is recognized on a straight-line basis over the lease term. The depreciable life of lease assets and leasehold improvements is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Recent Accounting Pronouncements Not Yet Adopted. In November 2024, the FASB issued ASU No. 2024-03,* Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses*(ASU 2024-03). The new guidance requires disaggregated information about certain income statement expense line items on an annual and interim basis. This guidance will be effective for annual periods beginning the year ended December 31, 2027 and for interim periods thereafter. The new standard permits early adoption and can be applied prospectively or retrospectively. The Company is evaluating the impact of this ASU on its consolidated financial statements disclosures.

*Segment Reporting.*The Company uses “the management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. The Company’s chief operating decision maker (“CODM”) is the Interim Chief Executive Officer (“CEO”) of the Company, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. The Company’s primary revenue stream includes the sale of aerial robotic systems and related software solutions that enable data collection, mapping, and inspection. Based on the CODM’s evaluation and internal reporting, the Company hasone reportable segment: Aerial Robotic Systems.

3. GOING CONCERN

The condensed consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for 12 months from the date the condensed consolidated financial statements were available to be issued. The Company has negative cash flows from operations and net losses for the three and six months ended June 30, 2026 and further losses are anticipated in the development of its business. These factors raise substantial doubts about the Company’s ability to continue as a going concern for a period of 12 months from the date the consolidated financial statements were available to be issued.

As of June 30, 2026, the Company had $7,835,535 in cash and cash equivalents. The Company expects that its current cash and cash equivalents, approximately $4,485,103 as of August 19, 2026, will not be sufficient to support its projected operating requirements for the next 12 months from the date the condensed consolidated financial statements became available.

The Company expects to need additional capital in order to increase revenues above current levels, and is actively pursuing additional funding through various sources, including potential debt, equity or other capital-raising alternatives, to meet its future operating and capital needs. Any additional equity financing, if available, may not be on favorable terms and would likely be significantly dilutive to the Company’s current stockholders, and debt financing, if available, may involve restrictive covenants. Management has concluded that substantial doubt is not alleviated by its plans. The Company’s ability to access capital when needed is not assured and, if not achieved on a timely basis, will likely have a materially adverse effect on its business, financial condition and results of operations. The financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

4. ACCOUNTS RECEIVABLE

Accounts receivable consists of the following as of June 30, 2026 and December 31, 2025:

5. INVENTORIES

Inventories, net consists of the following as of June 30, 2026 and December 31, 2025:

During the three months ended June 30, 2026 and 2025 the Company recorded an inventory write-off of $4,400 and $16,093, respectively. During the six months ended June 30, 2026 and 2025 the Company recorded inventory write-offs of $8,570 and $101,250, respectively. The inventory write-offs reduced inventories and were recognized in cost of revenues. The write-off primarily related to inventory items with no usage or movement during the preceding 12 months, for which management determined there was no expected future use or recoverable value.

6. PREPAID EXPENSES AND OTHER CURRENT ASSETS

Other current assets consist of the following as of June 30, 2026 and December 31, 2025:

7. PROPERTY AND EQUIPMENT, NET

Property and equipment consist of the following as of June 30, 2026 and December 31, 2025:

Depreciation expense was $69,793 and $82,539 for the three months ended June 30, 2026 and 2025, respectively. Depreciation expense was $139,522 and $170,468 for the six months ended June 30, 2026 and 2025, respectively.

8. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following as of June 30, 2026 and December 31, 2025:

9. SAFE LIABILITIES

In April 2025, the Company issued SAFEs for gross proceeds of $1,500,000. The SAFEs bear no interest and were scheduled to expire and terminate on March 1, 2026 if no conversion event had occurred by that date. On March 9, 2026, the Company and the SAFE holder executed an amendment extending the expiration date to June 30, 2026. No other terms of the SAFE were modified.

In August and December 2025, the Company issued SAFEs for aggregate gross proceeds of $3,200,000. The August 2025 SAFE bears no interest and was scheduled to expire and terminate on March 1, 2026 if no conversion event had occurred by that date. On March 9, 2026, the Company and the SAFE holder executed an amendment extending the expiration date of the August 2025 SAFE to June 30, 2026. No other terms of the August 2025 SAFE were modified. The December 2025 SAFEs, which were amended on April 1, 2026, bear no interest and are scheduled to expire and terminate on May 30, 2026 if no conversion event has occurred by that date.

Concurrently with the closing of its IPO of its stock on May 18, 2026, the April, August and December 2025 SAFEs automatically converted into the number of shares of the series of preferred stock issued in such financing determined by dividing the investment amount by the lower of (i)74% of the price per share paid by other investors in the financing (a 26% discount) or (ii) the price per share implied by a $90,000,000 pre-money valuation cap for the April 2025 SAFE and $125,000,000 pre-money valuation cap for the August and December 2025 SAFEs. The SAFEs converted to 819,528 shares of common stock.

The SAFEs also contained customary provisions for mandatory conversion upon a qualified equity event, liquidity event, or dissolution event prior to the expiration date. Repayment of the SAFEs in an amount equal to the purchase amount would have been required upon a dissolution event. The investor could have also opted for repayment upon termination of the agreement.

The Company’s SAFEs were classified as liabilities, as they failed equity classification per ASC 815-40 due to the possibility that repayment of the purchase amount may be required or may be elected upon dissolution of the Company or termination of the agreement. In addition, the conversion features provided for a variable number of shares based on the lower of a discount to the price per share in a future financing or a valuation cap, and therefore the instruments do not qualify for equity classification under ASC 815-40. The SAFEs were re-measured to fair value at each reporting date, with changes in fair value recognized in earnings. See Note 2, Summary of Significant Accounting Policies — Fair Value Measurements, for additional detail regarding the Company’s fair value hierarchy classification and the valuation techniques and significant unobservable inputs used to measure the SAFE liabilities.

10. NOTES PAYABLE

Principal due under notes payable was as follows as of June 30, 2026 and December 31, 2025:

For the three months ended June 30, 2026 and 2025, the Company recognized total interest expense of approximately $446,179 and $87,844, respectively, of which $64,566 and $6,927 related to the accretion of the debt discount on the notes payable. For the six months ended June 30, 2026 and 2025, the Company recognized total interest expense of approximately $782,333 and $169,167, respectively, of which $86,280 and $16,063 related to the accretion of the debt discount on the notes payable.

Western Alliance Bank Term Loan

On September 27, 2023, the Company entered into a Loan and Security Agreement (“LSA”) with Western Alliance Bank (San José, California), pursuant to which the Company obtained a term loan of up to $5,000,000 (the “WAB Loan”), consisting of a Term A Advance of $3,500,000 and a Term B Advance of up to $1,500,000 upon achievement of certain revenue milestones. The loan matures on September 27, 2027, and bears interest at a floating rate equal to the greater of 8.25% or the Bank’s Prime Rate. The interest rate as of December 31, 2025 was 8.61%. Interest-only payments were due through September 10, 2025, followed by equal monthly principal and interest installments commencing October 10, 2025.

On November 19, 2025, the Company entered into an amendment to the Loan and Security Agreement extending the interest-only period through March 10, 2026, with equal monthly principal and interest installments commencing April 10, 2026. As amended, Tranche B was eliminated from the LSA, resulting in a maximum term loan of up to $3,500,000.

On December 23, 2025, the Company entered into a forbearance and amendment agreement whereby the maturity date changed from September 27, 2027 to April 28, 2026. Due to this agreement, the loan was reclassified as a current liability. This agreement also extended the interest-only period through April 10, 2026, with all unpaid principal and accrued interest due on the maturity date.

On April 28, 2026, the maturity date was extended to May 1, 2026. On April 30, 2026, the maturity date was further extended to May 6, 2026. On May 6, 2026, the maturity date was extended again to June 12, 2026.

Upon the closing of the Company’s IPO on May 18, 2026, the Company used a portion of the net proceeds from the offering to repay the outstanding balance of the WAB Loan in full. Accordingly, no amounts remained outstanding under the facility as of June 30, 2026. The Company recognized interest expense of $72,188 and $103,469, based on an effective interest rate of 8.36%, for the three and six months ended June 30, 2026, respectively. The Company recognized interest expense of $73,792 and $145,979, for the three and six months ended June 30, 2025, respectively.

Western Alliance Warrants

In connection with the LSA, the Company issued warrants to Western Alliance Bank to purchase 197,551 shares of the Company’s common stock at an exercise price of $0.35 per share. The warrants were recorded at a fair value of $55,330 using the Black-Scholes option pricing model and were recognized as debt issuance costs. These costs were amortized using the effective interest method over the term of the related debt. As the underlying debt was repaid during the three and six months ended June 30, 2026, any remaining unamortized debt issuance costs were fully amortized upon extinguishment of the debt.

HSBC Standby Letter of Credit

On May 30, 2025, HSBC Bank (acting through its Chennai branch) issued an irrevocable standby letter of credit (No. SDNBGE890972) in favor of Exyn Technologies Inc. for a maximum amount of USD $3,500,000. The standby letter of credit was issued at the request of NeoLync Electronics Pvt Ltd (India) in support of banking facilities granted to NeoLync Electronics Pvt Ltd (India) by HSBC.

The standby letter of credit has a fixed expiry date of November 14, 2025, is governed by International Standby Practices (ISP98), allows partial drawings, and has been assigned to Western Alliance Bank as security for the Company’s senior credit facility. As of the date of this report, no amounts have been drawn under the standby letter of credit. The standby letter of credit was renewed in November 2025, with an expiration date of May 13, 2026.

The standby letter of credit was further renewed in May 2026, with an expiration date of June 30, 2026. Upon the closing of the Company’s IPO on May 18, 2026, the WAB loan was repaid using a portion of the net proceeds from the offering, and the related standby letter of credit was terminated. Accordingly, the standby letter of credit wasno longer outstanding as of June 30, 2026.

NeoLync Senior Convertible Promissory Note

On May 20, 2025, the Company issued a $1,500,000 Senior Convertible Promissory Note to NeoLync Holdings Ltd (as amended, the “Note”). The Note had an original maturity date of November 20, 2025 which was extended to June 30, 2026 pursuant to certain amendments to the Note. The Note bore interest at 12% per annum and was secured by a first-priority lien on substantially all assets of the Company (subject only to the existing WAB Loan). The Note provided for (i) a 300% liquidation preference, (ii) automatic conversion into common equity upon a Public Company Event (as defined in the Note) at 135% of the then-public trading price, and (iii) cash repayment at maturity if no Public Company Event occurs. Concurrently with the closing of the Company’s IPO on May 18, 2026, the Note converted into 160,239 shares of common stock at a value of $1,672,484, including $172,500 of accrued interest.

NeoLync Holdings, Inc. Term Loan

On December 23, 2025, the Company signed a term loan with NeoLync Holdings, Inc. for $1,500,000. Initial cash proceeds of $500,000 were received on December 26, 2025, with the remainder being received in January 2026. The loan matures on December 23, 2026, bears interest at 12% per annum with principal and interest repayable over twelve monthly installments, resulting in interest expense of $92,088 and $114,588 for the three and six months ended June 30, 2026, respectively, andno interest expense for the three and six months ended June 30, 2025. The term loan had an outstanding principal balance of $1,500,000 as of June 30, 2026. Including accrued interest of $187,792, the total amount outstanding under the term loan was $1,687,792 as of June 30, 2026. There wasno outstanding balance under the term loan as of June 30, 2025.

Maximcash Solutions LLC Loan

On December 26, 2025, Maximcash Solutions LLC (“Maximcash”) issued a loan to Exyn Technologies Inc. for $600,000 (the “Maximcash Loan Agreement”). The loan matures on December 26, 2026, bears interest at 38.5% per annum with principal and interest repayable over twelve monthly installments, with the first 3 months being interest only.

On May 18, 2026, the Company used proceeds from its IPO to repay in full the outstanding loan with Maximcash Solutions LLC in the amount of $621,314, having recognized interest expense of $57,020 and $134,686, based on an effective interest rate of 38.50%, for the three and six months ended June 30, 2026, respectively.

On May 21, 2026, the Company issued 15,484 shares of its common stock to Maximcash as equity kicker shares. The shares had an aggregate fair value of $77,420, based on a fair value of $5.00 per share. The fair value of the equity kicker shares was recognized as other expense, with a corresponding increase to additional paid-in capital.

On June 17, 2026, the Company issued an additional 8,516 shares of its common stock and 6,000 shares of its common stock to Maximcash as equity kicker shares. The 14,516 shares had an aggregate fair value of $92,031, based on a fair value of $6.34 per share. The fair value of the equity kicker shares was recognized as other expense, with a corresponding increase to additional paid-in capital.

NCH Ventures LLC Convertible Promissory Note

On March 13, 2026, the Company issued a $750,000 convertible promissory note to NCH Ventures LLC. The note matures March 13, 2028, bears interest at 8% per annum, with all interest accruing daily on the basis of a 365-day year. This note is an unsecured convertible promissory note and is subordinated to the Company’s obligations owed to Western Alliance Bank. Concurrently with the closing of the Company’s IPO on May 18, 2026, the Note converted into 132,001 shares of common stock at a value of $761,519 including $11,532 of accrued interest.

Evergreen Capital Management, LLC Convertible Promissory Notes

On April 30, 2026, and May 6, 2026, the Company issued senior secured convertible promissory notes to Evergreen Capital Management, LLC (“Evergreen”) with an aggregate principal amount of approximately $1.2 million (reflecting a 15% original issue discount), warrants and 50,000 kicker shares in exchange for $1,000,000 in cash proceeds. The notes bore interest at 10% per annum. The warrants and kicker shares issued were allocated values of $354,509 and $188,506, respectively, which was initially recorded as a debt discount.

On May 8, 2026, the Company and Evergreen amended the senior secured convertible promissory notes to mandatorily convert upon an IPO, in exchange for warrants and 50,000 kicker shares. This represented a modification and extinguishment of the original notes, resulting in approximately $679,514 in debt modification expense being recorded to write-off the debt discount on the notes. The warrants and kicker shares were determined to have fair values of $193,939 and $412,500, respectively and were recorded as a discount to the face value of the notes.

The senior secured convertible notes automatically converted to 152,224 shares of common stock concurrent with the IPO.

Pursuant to that certain Confidential Side Letter Agreement dated May 18, 2026, between the Company and Evergreen (the “Evergreen Side Letter”), the Company agreed to pay a total installment amount of $1,417,165 in equal installments on June 17, 2026, July 17, 2026, and August 16, 2026, as well as granted an additional 100,000 kicker shares. As a result, the Company recorded $1,917,165 in debt settlement expense related to the Evergreen Side Letter as the 100,000 kicker shares had a fair value of $5.00. The first installment was paid by the Company on June 17, 2026. The remaining $944,776 is recorded in accrued expenses and other current liabilities.

11. INCOME TAXES

The Company’s income tax provision for the interim period was determined using an estimated annual effective tax rate, adjusted for discrete items recognized during the period, if any. The effective tax rate for the three and six months ended June 30, 2026 and 2025 was 0%, which differed from the U.S. federal statutory rate primarily due to the impact of the valuation allowance maintained against the Company’s deferred tax assets.

Management evaluates the realizability of deferred tax assets on a quarterly basis and continues to maintain a full valuation allowance against all of its deferred tax assets as of June 30, 2026. There were no material changes in the Company’s assessment of the realizability of its deferred tax assets during the three and six months ended June 30, 2026.

As of June 30, 2026, the Company hadno unrecognized tax benefits. The Company recognizes interest and penalties related to uncertain tax positions as a component of income tax expense. No interest or penalties were recognized during the three and six months ended June 30, 2026.

There were no material changes to the Company’s uncertain tax positions, valuation allowance, or other income tax matters from those disclosed in the notes to the audited financial statements for the year ended December 31, 2025 included in the IPO Registration Statement.

12. STOCKHOLDERS’ EQUITY

Common Stock

As of June 30, 2026, the Company is authorized to issue 50,000,000 shares of common stock, par value $0.0001 per share. Holders of common stock are entitled toone vote for each share held. The holders of common stock are entitled to receive dividends, when and if declared by the Board of Directors, subject to the preferential rights of preferred stockholders. As of June 30, 2026 and December 31, 2025, there were 7,953,957 and 1,322,500 shares of common stock issued and outstanding, respectively.

On May 18, 2026, the Company closed the IPO, in which 2,500,000 units were issued, with each unit consisting ofone share of common stock andone warrant to purchaseone share of common stock (see below, Warrants, for additional detail), at a price of $7.75 per unit, for aggregate gross proceeds of $19,375,000. The Company received net proceeds of $17,650,000 after deducting underwriting discounts and commissions of $1,725,000. The Company also incurred additional offering costs of $2,304,707 related to the offering.

Preferred Stock

As of June 30, 2026, pursuant to the Company’s amended and restated certificate of incorporation, the Company is authorized to issue 10,000,000 shares of preferred stock, par value $0.0001 per share with the rights, preferences and privileges of each series designated by the Board of Directors. No shares of preferred stock were issued and outstanding as of June 30, 2026. During the six months ended June 30, 2026, holders exercised warrants for 1,614,603 shares of preferred stock. Concurrently with the closing of the Company’s IPO on May 18, 2026, all outstanding shares of preferred stock automatically converted into 2,637,484 shares of common stock.

Employee Incentive Stock Option Plan

The Company maintains equity incentive plans under which stock-based awards may be granted to employees, directors and consultants. Effective May 15, 2026, the Company adopted the 2026 Equity Incentive Plan (the “2026 Plan”), which authorizes the issuance of up to 770,746 shares of common stock, subject to annual automatic increases beginning January 1, 2027 as provided in the 2026 Plan. Upon the effectiveness of the 2026 Plan, no additional awards may be granted under the Company’s 2015 Equity Compensation Plan or 2025 Equity Compensation Plan (collectively, the “Prior Plans”); however, awards outstanding under the Prior Plans remain outstanding and continue to be governed by their respective terms. Stock options generally vest over four years and expireten years from the grant date.

The following table summarizes stock option activity as of June 30, 2026:

As of June 30, 2026, there was $44,517 of total unrecognized stock-based compensation expense related to nonvested options which is expected to be recognized over a remaining weighted-average vesting period of 1.6 years.

Stock-based compensation expense of $197,785 and $201,734 was recognized for the three months ended June 30, 2026 and 2025, respectively, to the vesting of stock options. Stock-based compensation expense of $397,594 and $403,468 was recognized for the six months ended June 30, 2026 and 2025, respectively, to the vesting of stock options.

Warrants

The following table summarizes stock warrant activity for the six months ended June 30, 2026.

During the six months ended June 30, 2026, the Company issued an aggregate of 2,859,950 warrants to purchase shares of the Company’s common stock.

The Company issued an aggregate of 286,527 warrants to certain investors with an exercise price of $7.75 per share. The warrants are immediately exercisable, have a contractual term offive years and expire on May 19, 2031. The Company concluded that the warrants meet the criteria for equity classification.

In connection with the Company’s IPO, the Company issued an aggregate of 73,423 warrants to the underwriter and certain of its representatives as compensation for underwriting services. The underwriter warrants have an exercise price of $9.69 per share, are immediately exercisable, have a contractual term offive years and expire on May 16, 2031. The aggregate fair value of the underwriter warrants at issuance was $351,696, which was determined using the Black-Scholes option-pricing model. The significant assumptions used in the valuation included an expected term offive years, expected volatility of 79%, a risk-free interest rate of 3.9% and an expected dividend yield of 0%. The Company concluded that the underwriter warrants meet the criteria for equity classification. The fair value of the underwriter warrants were accounted for as an equity issuance cost associated with the IPO and recorded as a reduction of additional paid-in capital.

In connection with the Company’s IPO, the Company issued 2,500,000 units, with each unit consisting ofone share of common stock andone warrant to purchaseone share of common stock. The warrants have an exercise price of $9.69 per share, are immediately exercisable, have a contractual term offive years and expire on May 16, 2031. The Company concluded that the warrants meet the criteria for equity classification.

The decrease in outstanding warrants during the six months ended June 30, 2026 was primarily attributable to the exercise of 64,584 warrants (equivalent to 1,614,603 warrants prior to the Company’s 1-for-25 reverse stock split) into 1,614,603 shares of Series A-4 Preferred Stock during the three months ended March 31, 2026.

13. LEASES

The Company has operating leases for office space and equipment. Lease terms generally range from 3 to 5 years, and certain leases include options to extend or terminate which are considered in determining the lease term when reasonably certain to be exercised.

The components of lease expense were as follows for the three and six months ended June 30, 2026 and 2025:

The Company does not have any finance leases, short-term leases, or variable lease payment arrangements.

The components of operating lease assets and liabilities as of June 30, 2026 and December 31, 2025 were as follows:

The weighted-average remaining lease term and weighted-average discount rate as of June 30, 2026 and December 31, 2025 were as follows:

Future minimum lease payments under non-cancelable operating leases as of June 30, 2026 are as follows:

14. COMMITMENTS AND CONTINGENCIES

Litigation and Claims

From time to time, the Company is subject to claims, litigation, investigations, and other legal proceedings arising in the ordinary course of business. The Company records a liability for loss contingencies when it is both probable that a liability has been incurred and the amount can be reasonably estimated. As of June 30, 2026, no loss contingencies have been accrued because no matters meet both of these criteria or the amounts involved are not material.

Management has evaluated all known and potential matters and believes that the ultimate resolution of any currently pending proceedings, either individually or in the aggregate, will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows. However, the outcome of legal proceedings is inherently uncertain, and adverse resolutions could occur. An unfavorable outcome in one or more matters could materially affect the Company’s operating results or cash flows in the period in which it is resolved.

Other Commitments

Other than standard operating leases and purchase commitments entered into in the ordinary course of business, the Company has no material off-balance-sheet arrangements or long-term commitments as of June 30, 2026.

15. SEGMENT REPORTING

The Company operates as a single operating and reportable segment. The Company’s Chief Operating Decision Maker (“CODM”) has been identified as the Chairman and Chief Executive Officer, who reviews the consolidated operating results, including net revenues, cost of revenues, gross profit, and selling, general and administrative expenses, and net income (loss) to make decisions about resource allocation, including investments in personnel, marketing, and technology and product development, and to assess performance. The CODM does not evaluate performance or allocate resources at a disaggregated level below the consolidated entity.

The Company’s revenue is derived principally from the sale of aerial robotic systems, service revenue and subscription revenue. The significant expense categories the CODM reviews regularly are personnel expenses, contractor expenses, and legal and professional expenses. See below for the summary of expenses reviewed for the three and six months ended June 30, 2026 and 2025.

Because the Company manages its business, allocates resources, and evaluates performance on a consolidated basis, the accompanying consolidated financial statements reflect the operations ofone segment. The CODM regularly reviews total revenues and gross profit to assess financial performance and allocate resources. These measures are consistent with the amounts presented in the consolidated statements of operations.

Segment information available with respect to the reportable business segment for the three and six months ended June 30, 2026 and 2025 was as follows:

16. SUBSEQUENT EVENTS

On July 17, 2026, the Company made the second of three installment payments in the amount of $472,388 to Evergreen Capital Management, LLC pursuant to the Evergreen Side Letter described in Note 10, in connection with Evergreen’s agreement to forbear from declaring an event of default under the Senior Secured Convertible Promissory Notes. The Company’s third and final installment payment of $472,388 is due on August 16, 2026.

On August 3, 2026, the Board of Directors approved a stock option grant to the Company’s Chief Executive Officer to purchase 109,000 shares of common stock and stock option grants to each of the Company’sfour non-employee directors to purchase 23,000 shares of common stock, under the Company’s 2026 Equity Incentive Plan. These grants are not reflected in the Company’s stock-based compensation expense, options outstanding, or related disclosures for the three and six months ended June 30, 2026.

Investigation of Former Chief Executive Officer

In August 2026, the Audit Committee of the Board of Directors completed an investigation regarding certain personal expenses incurred by the Company’s former Chief Executive Officer using a Company-issued credit card that had been recorded as business expenses in the Company’s financial records. The investigation identified approximately $286,000 in aggregate personal expenses incurred over multiple periods, including periods subsequent to June 30, 2026.

The Company determined that the amounts identified did not represent expenses incurred in the ordinary course of the Company’s operations and has classified the applicable amounts within other expense in the accompanying condensed statements of operations. Other expense for the three and six months ended June 30, 2026 includes approximately $24,000 and $32,000, respectively, related to such expenses, compared with approximately $14,000 and $44,000, respectively, for the three and six months ended June 30, 2025. The Company determined that the amounts identified were not material, individually or in the aggregate, to any previously issued financial statements.

The Company has demanded repayment from its former Chief Executive Officer of the personal expenses identified by the investigation. As of June 30, 2026, the Company has not recognized a receivable for any amounts sought to be recovered.