InspireMD, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -DESCRIPTION OF BUSINESS

NOTE 2 -SIGNIFICANT ACCOUNTING POLICIES

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates using assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

As applicable to these consolidated financial statements, the most significant estimates and assumptions relate to the determination of the lease terms in operating leases.

b. Functional currency

The currency of the primary economic environment in which the operations of the Company and its subsidiaries are conducted is the U.S. dollar (“$” or “dollar”). Accordingly, the functional currency of the Company and its subsidiaries is the U.S. dollar.

The dollar figures are determined as follows: transactions and balances originally denominated in dollars are presented in their original amounts. Balances in foreign currencies are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. The resulting translation gains or losses are recorded as financial income or expense, as appropriate. For transactions reflected in the statements of operations in foreign currencies, the exchange rates at transaction dates are used. Depreciation and changes in inventories and other changes deriving from non-monetary items are based on historical exchange rates.

c. Principles of consolidation

The consolidated financial statements include the accounts of the Company and of its subsidiaries. Intercompany transactions and balances have been eliminated upon consolidation.

d. Cash and cash equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. As of December 31, 2025 and 2024, cash and cash equivalents consisted of cash, short-term deposits (up to three months from the date of deposit) and money market funds.

e. Marketable securities

Marketable securities consist of debt securities. The Company elected the fair value option to measure and recognize its investments in debt securities in accordance with ASC 825, Financial Instruments as the Company manages its portfolio and evaluates the performance on a fair value basis. Changes in fair value, realized gains and losses on sales of marketable securities, are reflected in the consolidated statements of operation as finance expense (income), net. Marketable securities are classified under current assets in the consolidated balance sheets as they represent the investment of funds available for the Company’s current operations.

f. Concentration of credit risk and allowance for doubtful accounts

Financial instruments that may potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents, marketable securities and long-term deposits, which are deposited in major financially sound institutions in the U.S, Israel and Germany, and trade accounts receivable and other receivables. The Company’s marketable securities include investments in highly-rated U.S governmental bonds. The financial institutions that hold the Company’s debt marketable securities are major financial institutions located in the United States. The Company’s trade accounts receivable are derived from revenues earned from customers from various countries. The Company performs ongoing credit evaluations of its customers’ financial condition and requires no collateral from its customers. The Company also has a credit insurance policy for some of its customers. The Company maintains the allowance for estimated losses resulting from the inability of the Company’s customers to make required payments. The allowance represents the current estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions and supportable forecasts when appropriate. The estimate is a result of the Company’s ongoing evaluation of collectability, customer creditworthiness, historical levels of credit losses, and future expectations. The allowance for expected credit losses was immaterial during the periods presented.

g. Inventory

Inventories are stated at the lower of cost (cost is determined on a “first-in, first-out” basis) or net realizable value. The Company’s inventories generally have a limited shelf life and are subject to impairment as they approach their expiration dates. The Company regularly evaluates the carrying value of its inventory and when, based on such evaluation, factors indicate that impairment has occurred, the Company impairs the inventories’ carrying value. There were no impairments or inventory allowances during the years ended December 31, 2025 and 2024.

h. Leases** **

Operating leases are included in operating lease right-of-use (“ROU”) assets. Short-term balances regarding lease liabilities are included in accounts payable and accruals - Other and long-term balances regarding lease liabilities are included in operating lease liabilities. ROU assets represent Company’s right to use an underlying asset for the lease term and lease liabilities represent obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses the incremental borrowing rate based on the information available at the lease commencement date as the rate implicit in the lease is not readily determinable. The determination of the incremental borrowing rate requires management judgment based on information available at lease commencement. The lease terms may include periods covered by options to extend the lease when it is reasonably certain that the Company will exercise such options, and periods covered by options to terminate the lease when it is reasonably certain that the Company will not exercise such options. Operating lease cost is recognized on a straight-line basis over the lease term. Lease agreements that include lease and non-lease components are accounted for as a single lease component. The Company elected the short-term lease recognition exemption for leases with a lease term of 12 months or less.

i. Property, plant and equipment

Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization. Cost includes expenditures that are directly attributable to placing an asset in the location and condition necessary for its intended use. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets: over three years for computers and other electronic equipment, and seven tofifteen years for office furniture and equipment and machinery and equipment (mainly seven years). Assets under construction or not yet placed into service are not depreciated until they are ready for their intended use. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term, or the estimated useful life of the improvements.

j. **Impairment in value of long-lived assets **

The Company tests long-lived tangible assets for impairment whenever events or circumstances present an indication of impairment. If the sum of expected future cash flows (undiscounted and without interest charges) of the long-lived assets is less than the carrying amount of such assets, an impairment would be recognized, and the assets would be written down to their estimated fair values, based on expected future discounted cash flows. There were no impairments in value of long-lived assets during the years ended December 31,2025 and 2024.

k. Revenue recognition

A contract with a customer exists only when: 1) the parties to the contract have approved it and are committed to perform their respective obligations, 2) the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“Performance Obligations”), 3) the Company can determine the transaction price for the goods or services to be transferred, 4) the contract has commercial substance and 5) it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. Revenues are recorded in the amount of consideration to which the Company expects to be entitled in exchange for Performance Obligations upon transfer of control to the customer, excluding sales taxes.

Revenue from sales of goods, including sales to distributors and direct sales to medical centers, is recognized at the point in time when control of the product transfers to the customer. Control generally transfers upon shipment or delivery of the product to the customer, depending on the contractual shipping terms, at which point the Company has a present right to payment and the customer has obtained legal title and the significant risks and rewards of ownership are obtained by the customer.

The Company recognizes the incremental costs of obtaining contracts as an expense since the amortization period of the assets that the Company otherwise would have recognized is one year or less. The costs are recorded under selling and marketing expenses. Disaggregated revenue is disclosed in Note 12.

Revenue is recognized net of sales taxes and value added taxes collected on behalf of governmental authorities.

l. Research and development costs

Research and development costs are charged to the consolidated statements of operations as incurred.

m. Share-based compensation

The Company has equity incentive plans under which the Company grants equity awards, including stock options, restricted stock and restricted stock units (“RSUs”) to employees, directors and service providers. Employee and service providers equity awards are accounted for using the grant-date fair value method. The Company determines compensation expense associated with restricted stock and RSUs based on the fair value of our common stock on the date of grant. The fair value of option awards is estimated using the Black-Scholes valuation model and expensed over the requisite service period. The Company elected to account for forfeitures as they occur.

The Company elected to recognize compensation expenses for awards to employees with only service conditions that have graded vesting schedules using the accelerated multiple option approach. The attribution for nonemployee awards is in the same manner as if the Company had paid cash for the goods or services. In addition, some of our share-based awards to service providers are performance based, i.e., the vesting of these awards depends upon achieving certain goals. The Company recognizes compensation expenses for awards with performance conditions when the company concludes that it is probable that the performance condition will be achieved.

n. Uncertain tax positions

The Company follows a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. If under the first step a tax position is assessed to be more likely than not to be sustained on audit, the second step is performed, under which the tax benefit is measured as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Such liabilities are classified as long-term, unless the liability is expected to be resolved within twelve months from the balance sheet date. The Company’s policy is to include interest related to unrecognized tax benefits within “Financial income - net”.

o. Deferred income taxes

Deferred taxes are determined utilizing the “asset and liability” method based on the estimated future tax effects of differences between the financial accounting and tax bases of assets and liabilities under the applicable tax laws, and on tax rates anticipated to be in effect when the deferred taxes are expected to be paid or realized. The Company assesses realization of deferred income tax assets and, based on all available evidence, concludes whether it is more likely than not that the net deferred income tax assets will be realized. A valuation allowance is provided for the amount of deferred income tax assets not considered to be realizable.

The Company may incur an additional tax liability in the event of intercompany dividend distributions by its subsidiaries. Such additional tax liability in respect of these foreign subsidiaries has not been provided for in these consolidated financial statements as it is the Company’s policy to permanently reinvest the subsidiaries’ earnings and to consider distributing dividends only in connection with a specific tax opportunity that may arise.

Taxes that would apply in the event of disposal of investments in a foreign subsidiary have not been taken into account in computing the deferred taxes, as it is the Company’s intention to hold, and not to realize, these investments.

p. **Advertising **

Costs related to advertising and promotion of products are charged to sales and marketing expenses as incurred. Advertising expenses were approximately $1,595 and $691 thousand for the years ended December 31, 2025, and 2024, respectively.

q. Net loss per share** **

Basic and diluted net loss per share is computed by dividing the net loss for the period by the weighted average number of shares of common stock, pre-funded warrants and fully vested restricted stock units outstanding during the period. The calculation of diluted net loss per share excludes the effect of potential dilution of share options, warrants, and unvested restricted stocks, unvested restricted stock units and Series C preferred stock as the effect is anti-dilutive. For the purpose of calculating basic net loss per share, the additional shares of common stock that are issuable upon exercise of the Pre-funded Warrants have been included since the shares are issuable for negligible consideration, as determined by the Company according to ASC 260-10-45-13, and have no vesting or other contingencies associated with them. The total number of shares of common stock related to outstanding options, warrants, unvested restricted stock, unvested restricted stock units and Series C Preferred Stock, which were excluded from the calculations of diluted loss per share were 37,498,531 and 48,681,495 for the years ended December 31, 2025 and 2024, respectively. This amount includes 5,177,186 and 4,073,966 unvested restricted stock included in the number of issued and outstanding shares as of December 31, 2025, and 2024, respectively. For the years ended December 31, 2025 and 2024 the weighted average number of common stock used in computing net loss per share - basic and diluted was as follows:

r. **Segment reporting **

The Company hasone operating and reportable segment, see note 13.

s. Fair value measurement

The Company measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer liability in an orderly transaction between market participants at the measurement date.

The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value.

t New accounting pronouncements

Recently adopted accounting pronouncements

1. In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This guidance is intended to enhance the transparency and decision-usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to disclosure regarding rate reconciliation and income taxes paid both in the U.S. and in foreign jurisdictions. ASU 2023-09 is effective for the Company’s annual reporting period beginning January 1, 2025. The Company has adopted this update on a retrospective basis. The adoption of this guidance resulted in expanded disclosures in its consolidated financial statements. (see note 10).

2. In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient when estimating credit losses on accounts receivable and contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers. Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. The ASU is effective for annual periods beginning after December 15, 2025, and interim periods within those annual reporting periods. The Company early adopted ASU 2025-05 on a prospective basis, effective January 1, 2025, and did not apply the standard in interim (quarterly) reporting periods prior to that date. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements and related disclosures.

Recently issued accounting pronouncement, not yet adopted:

1. In November 2024, the FASB issued ASU No. 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). The ASU improves the disclosures about a public business entity’s expense and provides more detailed information about the types of expenses in commonly presented expense captions. The amendments require that at each interim and annual reporting period an entity will, inter alia, disclose amounts of purchases of inventory, employee compensation, depreciation and amortization included in each relevant expense caption (such as cost of sales, G&A, S&M and research and development) as well as disclosures about selling expenses. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company’s financial statements and disclosures.

2. In December 2025, the FASB issued ASU 2025-12 “Codification Improvements” to address suggestions received from stakeholders on the Accounting Standards Codification and to make other incremental improvements to U.S. GAAP. The update represents changes to the Codification that (1) clarify, (2) correct errors, or (3) make minor improvements. The amendments make the Codification easier to understand and apply. The guidance is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements.

**NOTE 3 –FAIR VALUE MEASUREMENTS

As of December 31, 2025 and 2024, the carrying amounts of accounts payable, accounts receivable and other receivables approximate their fair values due to the short-term maturities of these instruments.

The carrying amount of the long-term deposit approximates its fair value since it is measured at its present value applying prevailing interest rates, see note 7.

The Company’s financial assets subject to fair value measurements on a recurring basis and the level of inputs used in such measurements were as follows:

The Company’s cash equivalents and marketable securities are classified within Level 1 and Level 2 because it uses quoted market prices or alternative pricing sources and models utilizing market observable inputs to determine their fair value.

The cost of marketable securities as of December 31, 2025, and 2024 is $45,091 and $15,277 thousand, respectively.

NOTE 4 -MARKETABLE SECURITIES

As of December 31, 2025, and 2024, all of the Company’s investment in marketable securities had contractual maturity of less than one year.

The following table sets forth the Company’s marketable securities for the indicated period:

The table below sets forth a summary of the changes in the fair value of the Company’s marketable securities for the years ended December 31, 2025, and 2024:

NOTE 5 -PROPERTY, PLANT AND EQUIPMENT

NOTE 6 -LIABILITY FOR EMPLOYEE RIGHTS UPON RETIREMENT AND OTHERS

Defined Contribution Plans

Under Israeli labor law, the Company’s subsidiary Israeli employees are generally entitled to severance pay upon dismissal or certain other termination events.

Pursuant to Section 14 of the Israeli Severance Compensation Act, 1963, most of the employees of the Company’s subsidiary in Israel employees are entitled to have monthly deposits, at a rate of 8.33% of their monthly salary, made in their name with insurance companies. Payments in accordance with section 14 relieve the Company from any future severance payments to these employees. The severance pay expenses for such employees were approximately $376,000 and $293,000 for the years ended December 31, 2025, and 2024, respectively.

The Company sponsors a defined contribution retirement plan for its U.S. employees under Section 401(k) of the Internal Revenue Code. The plan is structured as a Qualified Automatic Contribution Arrangement (QACA) Safe Harbor plan, which includes automatic enrollment and requires the Company to make mandatory employer contributions in accordance with IRS Safe Harbor regulations. Employer contributions under the plan were immaterial for the year ended December 31, 2025. The Company has no further obligation to fund benefits beyond these required contributions.

Postemployment Benefit Plans

The severance pay liability of the Company for the rest of its subsidiary Israeli employees not covered under Section 14 amounting to $1,082 thousand and $1,224 thousand as of December 31, 2025, and 2024, respectively, reflects the undiscounted amount of the liability and is based upon the number of years of service and the latest monthly salary. The severance pay liability is partly covered by insurance policies and by regular deposits with recognized severance payment funds. The Company may only withdraw funds previously deposited for savings in connection with the payment of severance. The severance pay expenses for such employees were approximately $126,000 and $124,000 for the years ended December 31, 2025, and 2024, respectively.

NOTE 7 –LEASE AGREEMENTS

On October 9, 2024, the Company entered into a lease agreement in Miami, Florida (the “U.S. Lease”) for the establishment of its global headquarters. The U.S. Lease provides for the phased delivery of the leased premises located in Suites 215 and 280 at 6303 Waterford District Drive, Miami, Florida 33126. Rent commencement and lease recognition occur upon the Company obtaining control of each portion of the premises, in accordance with the lease terms. The lease term extends through September 30, 2030 and includes an option to extend the lease for an additional five years. The Company has determined that the renewal option is not reasonably certain to be exercised due to operational and strategic considerations.

The Company took possession of Suite 215 on November 1, 2024, which represented the commencement date for that portion of the leased premises. On May 18, 2025, the Company took possession of Suite 280 following the landlord’s completion of construction, which represented the commencement date for Suite 280. As a result of obtaining possession of Suite 280, during the year ended December 31, 2025, the Company recognized an increase of $302 thousand in operating lease right-of-use assets and a corresponding increase of $302 thousand in operating lease liabilities.

Under the U.S. Lease, the Company paid a security deposit of $500 thousand. Provided the Company does not default under the lease, the security deposit is refundable at specified intervals throughout the lease term. The present value of the deposit as of November 1, 2024, was $422 thousand and is classified as a long-term deposit. The remaining balance was assigned to operating lease right-of-use assets.

The Company’s Israeli subsidiary leases a facility in Israel under an operating lease (the “Israeli Lease”). The Israeli Lease was amended multiple times in prior years to extend the lease term and modify the leased premises. In prior periods, management concluded that optional extension periods through December 31, 2027 were reasonably certain to be exercised and were included in the lease term for accounting purposes.

On May 28, 2025, the Company amended the Israeli Lease, extending the lease term through December 31, 2028 and leasing additional space within the facility. As a result of this amendment, the Company recognized an increase of $692 thousand in operating lease right-of-use assets and a corresponding increase of $692 thousand in operating lease liabilities.

As of December 31, 2025, the Israeli Lease remains in effect through December 31, 2028.

Operating lease cost for the years ended December 31, 2025 and 2024 was $470 thousand and $423 thousand, respectively, related to the Israeli Lease, and $251 thousand and $34 thousand, respectively, related to the U.S. Lease.

In addition to fixed lease payments under the U.S. Lease, the Company incurred variable lease costs, primarily related to utilities, maintenance, and other common area costs, totaling approximately $103 thousand for the year ended December 31, 2025.

Supplemental balance sheet information related to leases was as follows:

Maturities of lease liabilities as of December 31, 2025, are as follows:

NOTE 8 – EQUITY

The Company’s authorized share capital consists of common stock and preferred stock. The Company’s shares of common stock are listed on the Nasdaq Capital Market.

In May 2023, the Company entered into a securities purchase agreement pursuant to which it issued and sold in a private placement offering (the “May 2023 Private Placement Offering”) shares of its common stock, pre-funded warrants to purchase shares of common stock (the “May 2023 Pre-Funded Warrants”), Series H warrants to purchase shares of common stock (the “Series H Warrants”), Series I warrants to purchase shares of common stock (the “Series I Warrants”), Series J warrants to purchase shares of common stock (the “Series J Warrants”) and Series K warrants to purchase shares of common stock (the “Series K Warrants” and together with the Series H Warrants, Series I Warrants and Series J Warrants, the “May 2023 Warrants”). The May 2023 Private Placement Offering closed on May 16, 2023 and resulted in aggregate gross proceeds of approximately $42.2 million. Fees payable to the placement agent and other offering expenses amounted to approximately $4.6 million, resulting in net proceeds to the Company of approximately $37.6 million.

The May 2023 Pre-Funded Warrants are immediately exercisable at an exercise price of $0.0001 per share and will not expire until they are exercised in full. The May 2023 Warrants are immediately exercisable upon issuance at an exercise price of $1.3827 per share. The May 2023 Warrants have a term of the earlier of (i) five years from the date of issuance and (ii) (A) in the case of the Series H Warrants, 20 trading days following the Company’s public release of primary and secondary end points related to one year follow up study results from the Company’s C-Guardians pivotal trial, (B) in the case of the Series I Warrants, 20 trading days following the Company’s announcement of receipt of PMA from the FDA, for CGuard Prime (135 cm), (C) in the case of the Series J Warrants, 20 trading days following the Company’s announcement of receipt of FDA approval for SwitchGuard and CGuard Prime 80 cm and (D) in the case on the Series K Warrants, 20 trading days following the end of the fourth fiscal quarter after the fiscal quarter in which the first commercial sales of CGuard Prime in the U.S. begin. The May 2023 Warrants may be exercised on a cashless basis if there is no effective registration statement registering the shares underlying the warrants.

Following the Company’s announcement on May 28, 2024 of the one-year follow-up study results from the Company’s C-GUARDIANS pivotal trial, which constituted the applicable contractual milestone under the Series H Warrants, the Series H Warrants were exercised in full into 292,996 shares of common stock and pre-funded warrants exercisable into 12,621,090 shares of common stock. The exercise resulted in gross proceeds of approximately $17.9 million. After deduction of placement agent fees and other issuance costs of approximately $1.0 million, net proceeds to the Company amounted to approximately $16.9 million.

Following the Company’s announcement on June 24, 2025 that the FDA approved the PMA of CGuard Prime in the U.S., which constituted the applicable contractual milestone under the Series I Warrants, the Series I Warrants were exercised in full into 2,352,393 shares of common stock at an exercise price of $1.3827 per share and 10,561,685 pre-funded warrants at an exercise price of $1.3826 per pre-funded warrant. The exercise resulted in gross proceeds of approximately $17.9 million. After deduction of issuance costs of approximately $1.0 million, net proceeds to the Company amounted to approximately $16.9 million.

On July 30, 2025, the Company entered into a securities purchase agreement with investors pursuant to which it issued and sold in a private placement offering (the “August 2025 Private Placement Offering”) an aggregate of 6,791,380 shares of common stock and pre-funded warrants to purchase up to 9,764,804 shares of common stock, at an offering price of $2.42 per share and $2.4199 per pre-funded warrant (the “August 2025 Pre-Funded Warrants”). The August 2025 Private Placement Offering closed on August 1, 2025. The August 2025 Pre-Funded Warrants are immediately exercisable at an exercise price of $0.0001 per share and will not expire until exercised in full. The August 2025 Private Placement Offering resulted in gross proceeds to the Company of approximately $40.1 million. Issuance costs amounted to approximately $3.1 million.

During the years ended December 31, 2025 and 2024, the Company issued 3,381,651 and 1,728,382 shares of its common stock, respectively, in connection with the exercise of pre-funded warrants originally issued in the May 2023 Private Placement Offering and August 2025 Private Placement Offering. As of December 31, 2025, and 2024, pre-funded warrants to purchase an aggregate of 43,092,107 and 26,147,323 shares of common stock, respectively, were outstanding.

As of December 31, 2025 and 2024, there were 1,718 shares of Series C Preferred Stock outstanding, convertible into an aggregate of 7,952 shares of the Company’s common stock, with an aggregate stated value of $10,997.

On May 31, 2024, the Company entered into an at-the-market equity distribution agreement with Piper Sandler & Co., pursuant to which the Company was initially able to offer and sell shares of its common stock having an aggregate offering price of up to $17.0 million. On April 10, 2025, the Company amended the agreement to increase the aggregate offering capacity to $75.0 million, exclusive of any prior sales made under the facility. During the years ended December 31, 2025 and 2024, the Company issued 718,913 and 647,277 shares of common stock, respectively, under the at-the-market facility. Net proceeds to the Company from these issuances amounted to approximately $1.7 million and $1.6 million for the years ended December 31, 2025 and 2024, respectively, after deduction of issuance costs of $64 and $81 thousand for the years ended December 31, 2025, and 2024, respectively.

As of December 31, 2025, the Company had outstanding warrants to purchase an aggregate of 26,920,508 shares of common stock, as follows:

On February 8, 2026, a total of 1,092,344 Series G warrants expired unexercised.

2021 Equity Incentive Plan

On September 30, 2021, at the Company’s 2021 annual meeting of stockholders, the Company’s stockholders approved the 2021 Equity Incentive Plan. The Company’s 2021 Equity Incentive Plan provides for the granting of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights, and other awards, which may be granted singly, in combination, or in tandem. As of December 31, 2025, the Company had 5,098,395 shares of common stock available for future issuance under the 2021 Equity Incentive Plan. 2024 Inducement Plan

On September 30, 2024, the compensation committee of the Company’s board of directors approved the InspireMD, Inc. 2024 Inducement Plan (the “2024 Inducement Plan”) to be used exclusively for grants of equity-based awards to individuals who were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with the Company.

As of December 31, 2025, the Company had 703,315 shares of common stock available for future issuance under the 2024 Inducement Plan.

The following table summarizes information about stock options granted to employees:

The following table summarizes information about stock options granted to non-employees:

The following table summarizes information about restricted stock granted to employees and non-employees:

The following table summarizes information about RSUs granted to employees:

The following table provides additional information about all options outstanding and exercisable:

The weighted average of the remaining contractual life of total vested and exercisable options as of December 31, 2025 was 5.53 years.

The aggregate intrinsic value of the total exercisable options as of December 31, 2025 was approximately $46 thousand.

The weighted average fair value of options granted to employees was $1.96 and $2.54 for the years ended December 31, 2025 and 2024, respectively. The weighted average fair value of options granted was estimated using the Black-Scholes option-pricing model.

The weighted average fair value of options granted to consultants was $1.87 for the year ended December 31, 2024. The weighted average fair value of options granted was estimated using the Black-Scholes option-pricing model.

The weighted average fair value of restricted stock granted was $2.56 and $2.94 for the years ended December 31, 2025 and 2024, respectively.

The weighted average fair value of RSU granted was $2.76 and $3.14 for the years ended December 31, 2025 and 2024, respectively.

No stock options were exercised during the year.

The total fair value of shares vested during the year was $6,325,416.

The vesting period for outstanding stock options, restricted stock, and RSUs is typically three years, with one-third of the awards vesting annually. The options and restricted stock to directors are subject to aone-year vesting period. Additionally, some of our share-based awards to service providers are performance-based, vesting upon the achievement of specified performance criteria related to clinical or marketing activities.

The following table sets forth the assumptions that were used in determining the fair value of options granted to employees and consultants for the year December 31, 2025 and 2024:

The Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. Accordingly, as to ordinary course options granted, the expected term was determined using the simplified method, which takes into consideration the option’s contractual life and the vesting periods (for non-employees, the expected term is equal to the option’s contractual life).

The annual risk-free rates are based on the yield rates of zero-coupon non-index linked U.S. Federal Reserve treasury bonds as both the exercise price and the share price are in dollar terms. The Company’s expected volatility is derived from its historical data.

NOTE 9 –RELATED PARTIES TRANSACTIONS

On September 15, 2023, the Company’s board of directors approved the Company’s entry into a consultancy agreement (the “Consultancy Agreement”) with a member of the immediate family of the Company’s Chief Executive Officer to provide services related to certain administrative projects in connection with the Company’s expansion into the United States until a full-time employee is retained in such capacity.

Under the original terms of the Consultancy Agreement, the Company paid a fixed hourly fee of $50 for up to 20 hours per week, plus reimbursement of customary expenses.

On July 1, 2024, the audit committee of the Company’s board of directors approved an amendment to the Consultancy Agreement pursuant to which the consultant was paid a fixed hourly fee of $100 for up to 95 hours per month, in an aggregate amount not to exceed $120,000, including expenses, for the twelve-month period ending June 30, 2025.

Consulting expenses recognized for the years ended December 31, 2025 and 2024 were $56 thousand and $76 thousand, respectively.

The engagement was terminated in July 2025.

NOTE 10 -TAXES ON INCOME:

Taxation in the United States

The Company is subject to U.S. federal income tax at a statutory rate of 21% and state income taxes at varying rates.

Taxation in Israel

InspireMD Ltd., the Company’s Israeli subsidiary, is subject to Israeli corporate income tax at a statutory rate of 23%.

Taxation in Germany

InspireMD GmbH is taxed according to the tax laws in Germany. Accordingly, the applicable tax rates are corporate tax rate of 15.825% and trade tax rate of 17.15% in 2025 and 2024.

The Israeli subsidiary may qualify for tax benefits under the Law for the Encouragement of Capital Investments, 1959. As of December 31, 2025 and 2024 the Company has not recognized any material tax benefit related to such incentives due to cumulative losses and the existence of a full valuation allowance.

As of December 31, 2025, the Company had U.S. federal net operating loss (“NOLs”) carryforwards of approximately $66 million. Of this amount, approximately $35 million arose prior to January 1, 2018 and expire through 2038. Net operating losses generated after December 31, 2017 may be carried forward indefinitely but are limited to offsetting 80% of taxable income in the year utilized.

As of December 31, 2025, and 2024, InspireMD Ltd., the Company’s Israeli subsidiary, had a net carry forward tax loss of approximately $180 and $126 million. Under Israeli tax laws, the carry forward tax losses can be utilized indefinitely.

The Company’s Israeli subsidiary is taxed in New Israeli Shekel (“NIS”), which is different from its functional currency (U.S. Dollar). The change in the Company’s Israeli subsidiary NOLs for tax purposes partly resulted by such rate differences.

The components of loss before income taxes are as follows:

The changes in the valuation allowance for the years ended December 31, 2025, and 2024 were as follows:

The following is a reconciliation of the total amounts of the Company’s uncertain tax positions during the years ended December 31, 2025, and 2024:

A summary of open tax years by major jurisdiction is presented below:

The provision for income taxes differs from the expected amount calculated by applying the Company’s federal statutory rate to loss before tax expenses for 2025 and 2024 as follows:

NOTE 11 -SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION:

Balance sheets:

NOTE 12 –DISAGGREGATED REVENUE AND ENTITY WIDE DISCLOSURES:

Revenues are attributed to geographic areas based on the location of the customers. The following is a summary of revenues:

By principal customers (part of revenues):

The following table presents the Company’s long-lived assets by geographic region, which consist of property, plant and equipment, net and operating lease right of use assets:

NOTE 13 –SEGMENT INFORMATION

The Company hasone operating and reporting segment, that develops, manufactures and markets products for the treatment of carotid artery disease and other vascular disease, including the Company’s proprietary CGuard™ stent platform. The Company’s Chief Operating Decision Maker (“CODM”), who is the CEO evaluates the Company’s performance based on its internal reporting which is consistent with the presentation in the Company’s consolidated financial statements. Accordingly, our CODM uses consolidated net loss to measure segment profit or loss, allocate resources, and assess performance.

The CODM examines, within each operational function, the employee salaries including the bonus and share based compensation. In addition, the CODM examines the clinical trials expenses within the research and development operations.

NOTE 14 -SUBSEQUENT EVENTS:

Subsequent to December 31, 2025, the Company granted 3,455,519 restricted shares of the Company’s common stock to employees and directors. The shares to employees are subject to athree-year vesting period, with one-third of such awards vesting each year. The shares to directors are subject to aone-year vesting period.

Subsequent to December 31, 2025, the Company granted 1,114,792 restricted share units of the Company’s common stock to the chief executive officer. The shares are subject to a three-year vesting period, with one-third of such awards vesting each year.