2.LIQUIDITY AND FINANCIAL CONDITION

As of June 30, 2026, the Company had cash and cash equivalents of $3.7 million, working capital of $3.4 million and a history of net operating losses for each of the three-month periods during the last year. The Company has financed its operations primarily through issuances of convertible debt and, in the prior fiscal year, through the proceeds of the Feit asset sale.

Our ability to continue as a going concern is dependent on our ability to generate cash flows from operations and find additional sources of funding through either equity offerings, debt financings, or a combination of any such transactions.

In June 2026, we entered into a securities purchase agreement providing for the sale of convertible notes in an aggregate principal amount of up to $10,600,000, of which $1,060,000 in principal amount of notes were issued for $970,000 in cash proceeds funded during the three months ended June 30, 2026, net of a discount of $60,000 and issuance costs of $30,000. The closing of the remaining tranches is subject to various contingencies, some of which are outside our control. Accordingly, there is no assurance that this financing will be available when needed, or that management will be able to obtain other financing on terms acceptable to us, if at all. See Note 9 for additional information regarding our convertible notes.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern for at least one year after the date these condensed consolidated financial statements are issued. The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts, or the amount and classification of liabilities, that might result should the Company be unable to continue as a going concern. If the foregoing plans are unsuccessful and we are unable to continue as a going concern, you could lose all or part of your investment in our company.