Celularity Inc

Previous wording

Our business has evolved from the broader development and direct commercialization model historically associated with our cellular therapy, biomaterials and biobanking activities. In March 2026, we entered into agreements with NexGel, Inc., or NexGel, providing for the transfer of certain commercial and other assets associated with our biomaterials portfolio and an exclusive license to develop and commercialize specified products, subject to territorial and other contractual limitations. We subsequently completed the transaction in April 2026. The transaction shifted responsibility for specified biomaterials commercialization and development activities to NexGel while preserving certain contractual rights and opportunities for future economic participation.

Current wording

Our business has evolved from the broader development and direct commercialization model historically associated with our cellular therapy, biomaterials and biobanking activities. In March 2026, we entered into agreements with NexGel, Inc. (“NexGel”), providing for the transfer of certain commercial and other assets associated with our biomaterials portfolio and an exclusive license to develop and commercialize specified products, subject to territorial and other contractual limitations. We completed the transaction in April 2026. The transaction shifted responsibility for specified biomaterials commercialization and development activities to NexGel while preserving certain contractual rights and opportunities for future economic participation.

Previous wording

Our cellular therapy strategy is based on the potential of cells derived from the postpartum placenta to address biological processes associated with age-related disease, including chronic inflammation, impaired tissue repair and immune dysfunction. Our objective is to develop therapies that may extend healthspan, which we define as the period of life spent in good health and with preserved function.

Current wording

Our cellular therapy strategy is based on the potential of cells derived from the postpartum placenta to address biological processes associated with age-related disease, including chronic inflammation, impaired tissue repair and immune dysfunction. Our objective is to develop therapies that may extend health span, which we define as the period of life spent in good health and with preserved function.

Previous wording

Our ability to advance our development programs, expand manufacturing services and realize the anticipated benefits of our business realignment remains dependent on access to capital, effective management of our operating expenses, regulatory developments and the performance of our commercial and strategic counterparties.

Current wording

Our ability to advance our development programs, expand manufacturing services and realize the anticipated benefits of our business realignment remain dependent on access to capital, effective management of our operating expenses, regulatory developments and the performance of our commercial and strategic counterparties.

Previous wording

We have determined there are conditions that raise substantial doubt about our ability to continue as a going concern within one year from the date these financial statements were issued. We have minimal cash on hand, do not generate sufficient cash from operations to operate the business for the next twelve months, and may not be able to continue as a going concern. We have historically funded operations through sales of products and services and equity and debt securities financings from both public and private investors. There is no assurance that such cash flows will continue in the future or that we will achieve cash positive operations.

Current wording

We have determined there are conditions that raise substantial doubt about our ability to continue as a going concern within one year from the date these financial statements were issued. We have less than twelve-months cash on hand, do not generate sufficient cash from operations to operate the business for the next twelve months, and may not be able to continue as a going concern. We have historically funded operations through sales of products and services and equity and debt securities financings from both public and private investors. There is no assurance that such cash flows will continue in the future or that we will achieve cash positive operations.

Previous wording

We have generally not been profitable and since our inception, we have incurred significant operating losses and used net cash for operating activities. During the three months ended March 31, 2026, we recorded net income of $874. Net cash provided by operating activities was $1,447 for the three months ended March 31, 2026, which included $12,159 of proceeds from the sale of New Jersey net operating loss carryforwards; excluding those proceeds, operating activities used net cash. As of March 31, 2026, we have an accumulated deficit of $990,609 and have a working capital deficit of $64,282. We restructured operations in the first months of 2026 and believe increased sales are required to achieve break even operating cash flows in the next 6 to 12 months, however there is no assurance this will be achieved and significant operating losses and net cash uses for operations may continue for the foreseeable future. We will need to secure additional financing however there is no assurance that financing can be raised or at acceptable terms. These factors indicate we may be unable to meet our obligations as they become due over the next 12 months, or sooner, and continue as a going concern.

Current wording

We have generally not been profitable and since our inception, we have incurred significant operating losses and used net cash for operating activities. During the six months ended June 30, 2026, net income was $1.6 million and net cash provided by operating activities was $0.3 million which included proceeds of $12.2 million from the sale of New Jersey net operating loss carryforwards. Excluding these proceeds, operating activities used net cash. As of June 30, 2026, we have an accumulated deficit of $989.9 million and have a working capital deficit of $53.3 million. We restructured operations in the first six months of 2026 and believe increased sales are required to achieve break even operating cash flows in the next 12 months, however there is no assurance this will be achieved and significant operating losses and net cash uses for operations may continue for the foreseeable future. We will need to secure additional financing, however there is no assurance that financing can be raised or at acceptable terms. These factors indicate we may be unable to meet our obligations as they become due over the next twelve months, or sooner, and continue as a going concern.

Previous wording

On May 27, 2026, we received a notice from Nasdaq Stock Market LLC indicating that we are not in compliance with the timely filing requirement under Nasdaq Listing Rule 5250(c)(1) due to our failure to timely file its Form 10-Q for the period ended March 31, 2026. On July 23, 2026, Nasdaq notified the Company of its failure to maintain a sufficient minimum bid price. We intend to regain compliance; however, there can be no assurance that we will be able to do so within any applicable period or that our securities will continue to be listed on Nasdaq.

Current wording

On August 21, 2026, we received a notice from Nasdaq Stock Market LLC indicating that we are not in compliance with the timely filing requirement under Nasdaq Listing Rule 5250(c)(1) due to our failure to timely file its Form 10-Q for the period ended June 30, 2026. We intend to regain compliance; however, there can be no assurance that we will be able to do so within any applicable period or that our securities will continue to be listed on Nasdaq.

Previous wording

Cost of revenues consists of labor, material and overhead costs associated with our two existing commercial business segments, biobanking and degenerative disease. Biobanking costs include the cost of storage and transportation kits for newly banked materials as well as tank and facility overhead costs for cord blood and other units in storage. Degenerative disease costs include costs associated with procuring placentas, qualifying the placental material and processing the placental tissue into a marketable product. Costs in the degenerative disease segment include labor and overhead costs associated with the production of the Biovance, Biovance 3L, Interfyl and CentaFlex product lines. Cost of revenues associated with direct sales are part of Product Sales while cost of revenues associated with sales through our network of distribution partners are included in License, royalty and other.

Current wording

Cost of revenues consists of labor, material and overhead costs associated with our two existing commercial business segments, biobanking and degenerative disease. Biobanking costs include the cost of storage and transportation kits for newly banked materials as well as tank and facility overhead costs for cord blood and other units in storage. Degenerative disease costs include costs associated with procuring placentas, qualifying the placental material and processing the placental tissue into a marketable product. Costs in the degenerative disease segment include labor and overhead costs associated with the production of the Biovance, Biovance 3L, ReboundTM, Interfyl and CentaFlex product lines. Cost of revenues associated with direct sales are part of Product Sales while cost of revenues associated with sales through our network of distribution partners are included in License, royalty and other.

Previous wording

Selling, general and administrative expense consists primarily of personnel costs including salaries, bonuses, stock compensation and benefits for specialized staff that support our core business operations. Executive management, finance, legal, human resources and information technology are key components of selling, general and administrative expense and those expenses are recognized when incurred. The magnitude and timing of our selling, general and administrative costs commercialization efforts for any approved therapies including the release of new products within the degenerative disease portfolio, changes in the regulatory environment or staffing needs to support our business strategy.

Current wording

Selling, general and administrative expenses consists primarily of personnel costs including salaries, bonuses, stock compensation and benefits for specialized staff that support our core business operations. Executive management, finance, legal, human resources and information technology are key components of selling, general and administrative expense and those expenses are recognized when incurred. The magnitude and timing of our selling, general and administrative costs commercialization efforts for any approved therapies including the release of new products within the degenerative disease portfolio, changes in the regulatory environment or staffing needs to support our business strategy.

Previous wording

Revenues from license, royalty and other were $1.7 million in 2026 compared to $1.0 million in 2025, an increase of $0.7 million or 73.0%, including $0.2 million recognized on the Biocellgraft arrangement.

Current wording

Revenues from license, royalty and other were $0.7 million in 2026 compared to $2.1 million in 2025, a decrease of $1.4 million, 65.5%, driven by lower distributor BioCellgraft demand.

Previous wording

Product sales were $0.9 million in the three months ended March 31, 2026, compared to $9.0 million in 2025, a decrease of $8.2 million, or 90.4%, mainly driven by lower Biovance 3L and Rebound product sales and in part by changes in customer purchasing behavior due to the insurance reimbursement environment. Ongoing developments and delays in the rollout of coverage guidance from Medicare Administrative Contractors (MACs), the regional entities responsible for administering Medicare claims and issuing coverage determinations, particularly with respect to skin substitute grafts, created ambiguity around which products would ultimately qualify for reimbursement and under what criteria. As a result, providers and distributors appear to have adopted a more cautious approach to inventory and utilization, including deferring purchases or limiting order volumes.

Current wording

Product sales were $4.9 million for the six months ended June 30, 2026, compared to $11.4 million in 2025, a decrease of $6.5 million, 56.8%, mainly driven by lower Biovance 3L and Rebound product sales and in part by changes in customer purchasing behavior due to the insurance reimbursement environment.

Previous wording

Revenues from BioBanking services were $1.3 million in 2026 compared to $1.4 million in 2025, a decrease of $0.2 million, or 11.2%.

Current wording

Revenues from BioBanking services were $1.9 million in 2026 compared to $2.7 million in 2025, a decrease of $0.8 million, 29.1% driven by one-time Biobanking sales adjustments of $0.6 million.

Previous wording

Cost of revenues from product sales were $0.2 million in 2026 compared to $2.5 million in 2025, a decrease of $2.3 million or 93.1%. The decrease was driven by lower product sales volume. Further, cost of revenues from product sales in 2025 included a write-off of capitalized bulk material costs that did not recur in 2026.

Current wording

Cost of revenues from product sales were $2.2 million in 2026 compared to $5.1 million in 2025, a decrease of $2.8 million, 55.6% driven by lower product sales volume and cost of revenues from product sales in 2025 included a write-off of capitalized material costs of $1.9 million. License and royalty revenues have minimal cost of sales.

Previous wording

As of March 31, 2026, we had cash and cash equivalents of $0.4 million, an accumulated deficit of $990.6 million, and a working capital deficit of $64.3 million. Our primary sources of cash are from financing activities and from products, services and licensing sales. We use this cash to fund our operations and satisfy our debt obligations.

Current wording

As of June 30, 2026, cash and cash equivalents were $0.6 million, the accumulated deficit was $989.9 million, and the working capital deficit was $53.3 million. Our primary sources of cash are from financing activities and from products, services and licensing sales. We use this cash to fund our operations and satisfy our debt obligations.

Previous wording

We expect to finance our cash needs through equity offerings, debt financings or other capital sources, and from commercial sales of our biomaterials products, and from sales collaborations, licenses and other similar arrangements for our cellular therapeutics and these sales activities must increase to achieve positive cash flows form operations. We continue to explore licensing and collaboration arrangements for our cellular therapeutics as well as distribution arrangements for our degenerative disease business. We may be unable to raise additional funds or enter such other arrangements when needed. Failure to raise needed cash will have a negative impact on our financial condition and on our ability to pursue our business plans and strategies.

Current wording

We expect to finance our cash needs through equity offerings, debt financings or other capital sources, and from commercial sales of our biomaterials products, and from sales collaborations, licenses and other similar arrangements for our cellular therapeutics and these sales activities must increase to achieve positive cash flows from operations. We continue to explore licensing and collaboration arrangements for our cellular therapeutics as well as distribution arrangements for our degenerative disease business. We may be unable to raise additional funds or enter such other arrangements when needed. Failure to raise the cash needed will have a negative impact on our financial condition and on our ability to pursue our business plans and strategies.

Previous wording

We expect to incur substantial expenses in the foreseeable future for our degenerative disease business and ongoing internal research and development programs. We will require substantial additional funding in the future to build the sales, marketing and distribution infrastructure that will be necessary to commercialize our biomaterials products.

Current wording

We expect to incur substantial expenses in the foreseeable future for our degenerative disease business and ongoing internal research and development programs. We will require substantial additional funding in the future to build the sales, marketing and distribution infrastructure that will be necessary to commercialize our cell therapies products.

Previous wording

Inflation has not significantly impacted on our business, however, sustained increases in inflation or interest rates could affect the broader economy and, in turn, impact our cash flows.

Current wording

Inflation has not significantly impacted our business, however, sustained increases in inflation or interest rates could affect the broader economy and, in turn, impact our cash flows.

Previous wording

Cash provided by operating activities was $1.4 million in 2026 compared to cash used of $3.0 million in 2025. The change was driven by the receipt of proceeds of $12,159 from the sale of New Jersey net operating loss carryforwards, offset in part by lower revenue.

Current wording

Cash provided by operating activities was $0.3 million in 2026 compared to cash used of $4.0 million in 2025. The change was primarily driven by higher earnings adjusted for non-cash items, inclusive of the receipt of proceeds from the sale of New Jersey net operating loss carryforwards of $12.2 million, partially offset by unfavorable period over period changes in working capital.

Previous wording

We made no investing cash expenditures in 2026 and none in 2025.

Current wording

We made no investing cash expenditures in the six months ended June 30, 2026 and 2025.

Previous wording

In 2026 we used cash of $7.3 million in financing activities compared to $2.3 million provided in 2025. During 2026 our financing activities consisted of $7.0 million of repayments of short-term unaffiliated debt and a $0.3 million redemption of preferred stock.

Current wording

Cash used in financing activities was $6.3 million in 2026 compared to $4.0 million provided in 2025 driven by $7.0 million of repayments of short-term unaffiliated debt, offset by $1.3 million of promissory note borrowings.

Previous wording

In 2025, our financing activities included $2.5 million of proceeds from the issuance of common stock to Dragasac in connection with a warrant inducement agreement, offset by $42 of repayments on related party notes and $98 of tax withholding on the vesting of restricted stock units.

Current wording

In 2025, our financing activities included $2.5 million of proceeds from the issuance of common stock to Dragasac in connection with a warrant inducement agreement and the sale of accounts receivable of $0.9 million.

Previous wording

On April 17, 2026, Helena delivered to us a notice of event of default (the “Helena Default Notice”) under the Helena Note. In the Helena Default Notice, Helena asserted that one or more events of default had occurred under the Helena Note, including among other things, our failure to comply with the reporting requirements of the Securities Exchange Act of 1934, as amended, including becoming delinquent in its filings. We believe the asserted default arose from our failure to timely file its Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Under the Helena Note, if an event of default is not cured within the applicable cure period, which is five business days for this type of asserted default, Helena may declare due and payable the “Mandatory Default Amount,” which is equal to 115% of the outstanding principal amount, accrued interest and all other amounts owing under the Helena Note. In addition, following an event of default, any outstanding principal balance accrues interest at a rate of 15% per annum, compounded annually. On May 21, 2026, we entered into a settlement agreement with Helena to resolve certain existing claims and restructure obligations under our existing transaction documents. Under the settlement agreement, we agreed to make an initial payment of $500,000 and five monthly installment payments of $100,000 each, assign rights under a $2.5 million portion of the NexGel promissory note described below, and amend the existing security agreement. Helena’s release of claims was conditioned on our satisfaction of specified release conditions. We did not timely make the installment payments due on July 21 and August 21, 2026. On August 25, 2026, we paid Helena $200,000, bringing our aggregate cash payments under the settlement agreement to $800,000. Helena has asserted that the missed payments constitute defaults and that it is entitled to exercise conversion rights under the Helena Note. We dispute Helena’s asserted entitlement to the conversion amount it has demanded. We are engaged in discussions to resolve the matter.

Current wording

On April 17, 2026, Helena delivered to us a notice of event of default (the “Helena Default Notice”) under the Helena Note. In the Helena Default Notice, Helena asserted that one or more events of default had occurred under the Helena Note, including among other things, our failure to comply with the reporting requirements of the Securities Exchange Act of 1934, as amended, including becoming delinquent in its filings. We believe the asserted default arose from our failure to timely file our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Under the Helena Note, if an event of default is not cured within the applicable cure period, which is five business days for this type of asserted default, Helena may declare due and payable the “Mandatory Default Amount,” which is equal to 115% of the outstanding principal amount, accrued interest and all other amounts owing under the Helena Note. In addition, following an event of default, any outstanding principal balance accrues interest at a rate of 15% per annum, compounded annually. On May 21, 2026, we entered into a settlement agreement with Helena to resolve certain existing claims and restructure obligations under our existing transaction documents. Under the settlement agreement, we agreed to make an initial payment of $500,000 and five monthly installment payments of $100,000 each, assign rights under a $2.5 million portion of the NexGel promissory note described below, and amend the existing security agreement. Helena’s release of claims was conditioned on our satisfaction of specified release conditions. We did not make the installment payments due on July 21 and August 21, 2026 timely. On August 25, 2026, we paid Helena $200,000, bringing our aggregate cash payments under the settlement agreement to $800,000. Helena has asserted that the missed payments constitute defaults and that it is entitled to exercise conversion rights under the Helena Note. We dispute Helena’s asserted entitlement to the conversion amount it has demanded. We are engaged in discussions to resolve the matter. For the three and six months ended June 30, 2026, we recognized a loss on settlement with Helena of $2.5 million.

Previous wording

In March 2026 and as amended in April 2026, the Company sold NexGel, Inc. an exclusive, transferable and sublicensable license to develop and commercialize certain degenerative disease products in exchange for $13.3 million. NexGel paid the Company $4.8 million cash at closing, $0.6 million cash in the 2 nd quarter of 2026, which was contingent on the Company filing its 2025 Report on Form 10-K, NexGel assumed the obligation to pay sales commissions of $2.9 million earned by and owed to certain Celularity employees, and NexGel issued Celularity a $5.0 million 18-month convertible note which, subject to certain conditions, is convertible into NexGel common stock. The note was subsequently split into two notes of $2.5 million each, one of which was assigned to Helena Global Investment Opportunities, Ltd as partial satisfaction of amounts due Helena and one of which was assigned to Sequence LifeSciences, Inc. as partial satisfaction of amounts due Sequence, see Subsequent Events.

Current wording

In March 2026 and as amended in April 2026, the Company sold NexGel, Inc. an exclusive, transferable and sublicensable license to develop and commercialize certain degenerative disease products in exchange for $13.3 million. NexGel paid the Company $4.8 million cash at closing, $0.6 million cash in the 2 nd quarter of 2026, which was contingent on the Company filing its 2025 Report on Form 10-K, NexGel assumed the obligation to pay sales commissions of $2.9 million earned by and owed to certain Celularity employees, and NexGel issued Celularity a $5.0 million 18-month convertible note which, subject to certain conditions, is convertible into NexGel common stock. The note was subsequently split into two notes of $2.5 million each, one of which was assigned to Helena Global Investment Opportunities, Ltd (“Helena”) as partial satisfaction of amounts due Helena and one of which was assigned to Sequence as partial satisfaction of amounts due Sequence.

Previous wording

The NexGel license agreement entitles the Company to earn up to $20.0 million in milestone payments, with the first milestone payment of $2.5 million due to the Company upon the earlier of NexGel achieving $25.0 million in net sales or 15 months, provided that net sales of at least $15.0 million have been achieved.

Current wording

The NexGel license agreement entitles the Company to earn up to $20.0 million in milestone payments, with the first milestone payment of $2.5 million due to the Company upon the earlier of NexGel achieving $25.0 million in net sales or 15 months, provided that net sales of at least $15.0 million have been achieved. Milestones have not been achieved as of June 30, 2026.

Previous wording

On April 14, 2026, the Company entered into a Settlement Agreement and Mutual General Release (the “SLS Settlement Agreement”) with Sequence LifeScience, Inc. (“SLS”) to resolve certain disputes arising under the parties’ prior asset purchase and supply agreements. Pursuant to the SLS Settlement Agreement, and subject to the closing of our previously announced transaction with NexGel (the “NexGel Transaction”), we agreed to provide consideration to SLS, including (i) the grant of a sublicense to certain intellectual property and related assets, (ii) the return of certain product inventory, (iii) the assignment of a portion of future milestone payments payable to us in connection with the NexGel Transaction, (iv) the assignment of a portion of the convertible promissory note to be received from NexGel, and (v) certain manufacturing rights. The SLS Settlement Agreement was expressly contingent upon the closing of the NexGel Transaction. The NexGel Transaction closed on April 17, 2026.

Current wording

On April 14, 2026, the Company entered into a Settlement Agreement and Mutual General Release (the “SLS Settlement Agreement”) with Sequence LifeScience, Inc. (“Sequence”) to resolve certain disputes arising under the parties’ prior asset purchase and supply agreements. Pursuant to the SLS Settlement Agreement, and subject to the closing of our previously announced transaction with NexGel (the “NexGel Transaction”), we agreed to provide consideration to Sequence, including (i) the grant of a sublicense to certain intellectual property and related assets, (ii) the return of certain product inventory, (iii) the assignment of a portion of future milestone payments payable to us in connection with the NexGel Transaction, (iv) the assignment of a portion of the convertible promissory note to be received from NexGel, and (v) certain manufacturing rights. The SLS Settlement Agreement was expressly contingent upon the closing of the NexGel Transaction. The NexGel Transaction closed on April 17, 2026.

Previous wording

On May 27, 2026, we received a notice from Nasdaq Stock Market LLC indicating that it is not in compliance with the timely filing requirement under Nasdaq Listing Rule 5250(c)(1) due to its failure to timely file its Form 10-Q for the period ended March 31, 2026. On June 9, 2026, we received written notice from Nasdaq indicating that our market value of listed securities had been below the $35.0 million minimum required by Nasdaq Listing Rule 5550(b)(2) for 30 consecutive business days. Under Nasdaq Listing Rule 5810(c)(3)(C), we were provided 180 calendar days, or until December 7, 2026, to regain compliance. To regain compliance, our market value of listed securities must equal or exceed $35.0 million for at least 10 consecutive business days during that period, subject to Nasdaq’s discretion to require a longer period. On August 21, 2026, we received an additional notice indicating that we remained delinquent in filing that report and had not timely filed our Form 10-Q for the period ended June 30, 2026. Nasdaq requested and we submitted a plan to regain compliance. Any exception granted by Nasdaq would be limited to a maximum of 180 calendar days from the prescribed due date of the initial delinquent filing, or November 16, 2026. We intend to regain compliance; however, there can be no assurance that it will be able to do so within any applicable period or that its securities will continue to be listed on Nasdaq.

Current wording

On May 27, 2026, we received a notice from Nasdaq Stock Market LLC indicating that we were not in compliance with the timely filing requirement under Nasdaq Listing Rule 5250(c)(1) due to our failure to timely file our Form 10-Q for the period ended March 31, 2026. On June 9, 2026, we received written notice from Nasdaq indicating that our market value of listed securities had been below the $35.0 million minimum required by Nasdaq Listing Rule 5550(b)(2) for 30 consecutive business days. Under Nasdaq Listing Rule 5810(c)(3)(C), we were provided 180 calendar days, or until December 7, 2026, to regain compliance. To regain compliance, our market value of listed securities must equal or exceed $35.0 million for at least 10 consecutive business days during that period, subject to Nasdaq’s discretion to require a longer period. On September 11, 2026, Celularity Inc. (“Celularity”) received written notifications from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) confirming that Celularity has regained compliance with the minimum bid price requirement under Nasdaq Listing Rule 5550(a)(2) and the minimum market value of listed securities requirement under Nasdaq Listing Rule 5550(b)(2). Nasdaq has advised Celularity that each of these matters is now closed.

Previous wording

On June 3, 2026, we entered into a letter agreement with DefEYE, Inc. (“DefEYE”) resolving a dispute following our May 7, 2026 notice asserting nonpayment of approximately $1.34 million in outstanding invoices. The agreement terminates the availability of the product purchase credit provided under the August 5, 2025 Fourth Amendment to the Supply Agreement, which previously governed our relationship with DefEYE, for product invoiced after May 6, 2026 and requires DefEYE to pay for subsequent purchases under the applicable contractual terms. As a transition accommodation, we agreed to provide a one-time 20% discount on the next $1.5 million of eligible purchases, payable on net 30-day terms, and returned 3,910,706 shares of DefEYE Series Seed-2 Preferred Stock, satisfying the related condition to effectiveness. The agreement also establishes a framework for secondary manufacturing of specified shortfalls, while preserving our position as primary manufacturer and providing us fees on secondary manufacturing purchases. See Note 22 - Subsequent Events for additional information.

Current wording

On June 3, 2026, we entered into a letter agreement with DefEYE, Inc. (“DefEYE”) resolving a dispute following our May 7, 2026 notice asserting nonpayment of approximately $1.3 million in outstanding invoices. The agreement terminates the availability of the product purchase credit provided under the August 5, 2025 Fourth Amendment to the Supply Agreement, which previously governed our relationship with DefEYE, for product invoiced after May 6, 2026 and requires DefEYE to pay for subsequent purchases under the applicable contractual terms. As a transition accommodation, we agreed to provide a one-time 20% discount on the next $1.5 million of eligible purchases, payable on net 30-day terms, and returned 3,910,706 shares of DefEYE Series Seed-2 Preferred Stock, satisfying the related condition to effectiveness. The agreement also establishes a framework for secondary manufacturing of specified shortfalls, while preserving our position as primary manufacturer and providing us fees on secondary manufacturing purchases.

Previous wording

On July 28, 2026, we delivered a notice of default to BioCellgraft relating to unpaid license fee installments of $250,000 each due on March 31 and June 30, 2026 under our December 1, 2025 license agreement. We suspended performance under the applicable agreements and engaged in discussions regarding a potential resolution.

Current wording

On July 28, 2026, we delivered a notice of default to BioCellgraft, Inc. relating to unpaid license fee installments of $250,000 each due on March 31 and June 30, 2026 under our December 1, 2025 license agreement. We suspended performance under the applicable agreements and engaged in discussions regarding a potential resolution.

Previous wording

On September 23, 2026, the Company entered into a Securities Purchase Agreement providing for the issuance of senior secured convertible notes and warrants for aggregate gross proceeds of up to approximately $25.0 million. On September 24, 2026, the Company completed the initial closing under the agreement, resulting in aggregate gross proceeds of approximately $11.0 million. Additional proceeds are subject to the terms and conditions of the Securities Purchase Agreement.

Current wording

On September 23, 2026, we entered into a Securities Purchase Agreement providing for the issuance of senior secured convertible notes and warrants for aggregate gross proceeds of up to approximately $25.0 million. On September 24, 2026, we completed the initial closing under the agreement, resulting in aggregate gross proceeds of $9.7 million. Additional proceeds are subject to the terms and conditions of the Securities Purchase Agreement.