NextPlat Corp

(a)* Evaluation of Disclosure Controls and Procedures.*Our management, with the participation of our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)), as of December 31, 2025. Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were not effective as of December 31, 2025 to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms. This conclusion was primarily due to the material weaknesses in our internal control over financial reporting described below.

(b)* Inherent Limitation on Controls.*Management, including the CEO and CFO, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and fraud. Any control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that its objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Accordingly, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to errors or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.

(c)Management’s Report on Internal Control over Financial Reporting.Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Our internal control over financial reporting includes policies and procedures that: (a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of assets; (b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and Board of Directors; and (c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. Management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2025 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in theInternal Control—Integrated Framework (2013). Based on this evaluation, management concluded that our internal control over financial reporting was not effective as of December 31, 2025 due to the material weaknesses described below.

Material Weakness in Internal Control Over Financial Reporting

A material weakness is a deficiency or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

Previously Identified Material Weakness - Inventory Valuation (Remediated)

As previously disclosed, we identified a material weakness related to controls over the valuation of inventory during 2024. This material weakness resulted from deficiencies in the design and operations of controls over net realizable value (“NRV”) assessments, including insufficient formal policies, inadequate review controls, and limitation in the accuracy and completeness of data used in valuation analyses. During the year ended December 31, 2025, we implemented enhances controls including (i) formalized policies and procedures to perform comprehensive NRV assessments for inventory at each reporting period; (ii) quarterly documented review controls performed by senior management to evaluate the accuracy and completeness of NRV calculations; and (iii) improvements to the accuracy and reliability of pricing and cost data used in NRV calculations by integrating reliable internal tracking mechanisms. Based on management’s evaluation, including the operations of these controls for a sufficient period of time, management concluded that this material weakness was remediated as of December 31, 2025.

Material Weakness - Accounting Estimate of PBM Performance Bonus Receivable (Unremediated)

As of December 31, 2025, management identified a material weakness related to the accounting for the estimation and recording of a performance-based bonus receivable recorded at December 31, 2024 in connection with incentive arrangements with pharmacy benefit managers (“PBMs”). This material weakness resulted from deficiencies in the design and operations of controls over significant accounting estimates, including the development and review of assumptions and inputs used to estimate performance-based receivables.

Material Weakness - PIPE Warrant Modification (Unremediated)

As of December 31, 2025, management identified a material weakness related to the accounting for the valuation of the modification of certain PIPE warrants. This material weakness resulted from deficiencies in the design and operation of controls over the identification, evaluation, and accounting for modifications of equity-linked financial instruments. Specifically, the Company did not maintain effective controls to ensure (i) timely identification of warrant modifications, (ii) appropriate evaluation of the accounting implications of such modifications, including the determination of whether the modification should be accounted for as an equity or liability transaction, and (iii) accurate valuation of the modified warrants using appropriate valuation techniques and assumptions. In addition, the Company lacked sufficient technical accounting expertise to appropriately evaluate complex and non-routine transactions involving equity-linked instruments.

Remediation Plans

Management is committed to improving its internal control over financial reporting and remediating the material weaknesses described above as quickly as possible. Management has outlined a remediation plan to ensure that the control deficiencies are remediated. Management will continue to evaluate the design and operating effectiveness of the controls. The material weaknesses will not be considered remediated until the controls have operated effectively for a sufficient period of time and management has completed testing to conclude that the controls are effective.

Accounting Estimate of PBM Performance Bonus Receivable

To address the material weakness related to the estimation of performance-based bonus receivables, management has initiated the following actions: (i) establishing a standardized quarterly process for estimating performance-based bonus receivables, including documented estimates retrieved timely from third-party adherence data and performance metrics and (ii) designing and implementing documented review controls performed by senior management to evaluate the reasonableness of the estimate.

PIPE Warrant Modification

To address the material weakness related to the accounting for the valuation of the modification of certain PIPE warrants, specifically the extension of expiration dates, management has initiated the following actions: (i) establishing controls to ensure timely identification of modifications to outstanding warrants, including enhanced coordination and communication protocols between finance, legal, and executive management when contractual terms are amended; (ii) implementing valuation controls requiring the preparation of detailed valuation analyses for modified warrants; (iii) engaging qualified third-party valuation specialists to assist in the valuation of warrant modifications and to support management’s accounting conclusions for complex or non-routine transactions; and (iv) designing and implementing documented review controls performed by individuals with appropriate technical expertise to evaluate classification conclusions, valuation methodologies and assumptions, and the completeness and accuracy of financial statement impacts.

This Annual Report on Form 10-K does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to rules from the SEC that permit us to provide only management’s report in this annual report.

(d)*Changes in Internal Control Over Financial Reporting.*Other than the material weaknesses and the remediation plans described above, there were no other changes in our internal control over financial reporting during our fourth fiscal quarter ended December 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.