Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations (amounts in thousands except for share and share amounts)

Readers are advised to review the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and related notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2024. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. See "Cautionary Note Regarding Forward-Looking Statements". You should review the "Risk Factors" section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

The following financial data in this narrative are expressed in thousands, except for stock and stock data or as otherwise noted.

All information included herein relating to shares or price per share reflects the 20-for-1 reverse stock split effected by us on August 28, 2025.

We are a leading global digital health company with a mission to power the behavior changes that drive better health. We are committed to transforming healthcare by delivering a comprehensive and highly engaging whole-person health platform, which enables us to create a future where healthy change is effortless and accessible to all.

At the core of our mission and vision is engagement. We believe that most existing digital health solutions in the market fail to deliver improved health outcomes because users are not engaged due to a lack relevance, personalization, consumerization, and longitudinal data and information. We, and our acquired companies, first commercialized our digital behavioral health products in the direct-to-consumer ("D2C") marketplace, and we continue to use the D2C marketplace as a sandbox and laboratory to innovation. These consumers pay for these digital health products out of their own pockets and are therefore the most value driven among all healthcare consumers. These consumers demanded that we deliver highly engaging user experiences that deliver strong clinical health outcomes for which consumers will pay. The bottom line is that if users are not engaged in digital solutions over a long period of time, they cannot change their behavior and they cannot get healthier - we first deliver engagement followed by sustained behavior change that then leads to measurable health outcomes and improvement. We believe that our D2C marketplace roots and continued focus delivers better user experiences, longer sustained engagement, stronger clinical outcomes, at the most affordable prices, that then delivers the highest return on investment ("ROI") in the industry.

Our whole-person health model includes the following five elements:

We have created our whole-person healthcare solution through both organic development and acquisitions of leading companies across several therapeutic areas. As a digital health consolidation leader, we have acquired companies to develop and deliver the most engaging whole-person health platform in the market to empower individuals to achieve

their optimal health through data-driven, precision artificial intelligence ("AI") personalized care solutions that integrate the management of physical and mental health needs.

Leveraging advanced analytics, data-driven AI precision and personalization, a deep understanding of consumer behavior, user-centric technology, and a holistic approach, we provide tailored interventions that meet the unique needs of each user to deliver the health industry's highest levels of user activation and sustained engagement. Our digital self-care solutions ensure optimal levels of clinical outcomes with the highest levels of clinical efficacy by empowering users to overcome the psychological, social, and physical barriers to effective and sustainable behavior change.

With our whole-person digital health platform, we address a broad range of health needs, including chronic condition management (e.g., diabetes, hypertension, obesity, and musculoskeletal issues), behavioral health (e.g., stress, anxiety, and depression), and preventive care. By integrating digital therapeutics and well-being solutions with real-time data monitoring and access to professional care teams, we ensure an AI driven adaptive and continuous care experience that combines digital self-care, with virtual coaching, and virtual clinical care. As of 2024, our eligible user base spans millions of individuals worldwide, supported by partnerships with employers, health plans, pharmaceutical companies, and providers aiming to deliver instant access to the highest quality and most effective self-care and virtual human care that delivers the optimal level of clinical utilization to ensure the best value and outcomes to our users and customers.

We serve four primary market segments that drive our business model. Our historic roots, as well as those of our largest acquisition, Twill, Inc. ("Twill"), began in the D2C market, which has forced us to create what we consider the industry's most engaging and effective self-care whole-person digital health solutions; and we continue to operate in the D2C market in the U.S. by providing our chronic condition management and patient engagement solutions across many different health conditions. In addition, we use the D2C market as an innovation laboratory to develop and test new features and benefits to ensure that these innovations meet our high engagement and outcomes standards before deploying them in the business-to-business ("B2B") market. From our D2C origins, Dario and Twill expanded into similar B2B market segments over the past seven years such that these market segments now represent the majority of our current revenues. These B2B market segments include medium-to-large employers, national and regional health plans, and global pharmaceutical companies.

Our medium-to-large employer market segment is focused on employers with over 1,000 employees and currently includes three of the five largest global technology companies and one of the two largest employers in the United States. We seek to provide solutions to their employees that address the primary areas of health condition focus on by employers for meaningful costs savings that can deliver high and sustainable returns on investment, which can exceed 5:1. In this market segment, we go to market through a direct sales force, consultants, brokers, and channel partners that sell our solutions to their health plan and employer customers.

Our health plan customers include five of the nation's largest organizations where we provide our solutions to their members both nationally and regionally. We have particularly specialized in providing its behavioral health offering to Medicare and Medicaid members, where we have established itself as the most engaging and effective solutions among these demographics. We are now leveraging this Medicare and Medicaid behavioral health specialty to expand access to its other chronic condition solutions to these populations. We go to market primarily through our own sales force and partners with large national health plans and other channel partners.

In 2018, Twill began to expand its offering to pharmaceutical companies, and in 2022 we entered into our first pharmaceutical company partnership. We now deliver these combined capabilities on our engagement platform to the pharmaceutical industry to provide three value propositions: 1) Top of the Funnel education and awareness to help companies find new patients for their treatments, 2) Mental and physical health support to improve medication adherence, persistence, and compliance, 3) Patient journey data analytics to better understand and target patients to get the right therapy to the right patient at the right time. We have provided our engagement platform services to a dozen global pharmaceutical companies across nearly as many medical conditions. We have a dedicated team with many years of experience selling into the pharmaceutical industry.

On September 3, 2025, we issued a shareholder update highlighting continued progress across our multi-condition digital health platform and expanding commercial momentum. Currently, our leadership is focused on five chronic conditions - diabetes, hypertension, weight management, musculoskeletal, and behavioral health within a single, unified platform. Over 70% of our commercial pipeline and 80% of our new contracts are for multi-condition programs, reflecting growing demand for integrated, value-based digital health solutions.

Recent Developments

​

New Clients

We have added 45 new accounts year-to-date in 2025, surpassing our annual goal of 40 new accounts expected in 2025.

During the third quarter of 2025, we announced the addition of ten new self-insured employer contracts, including the largest employer client in our history, collectively representing approximately 107,000 covered lives. All five programs launched during the second and third quarters of 2025 and include our full cardiometabolic suite for diabetes, hypertension, and prediabetes management.

In October 2025, we announced the addition of six new employer clients across multiple industries, representing tens of thousands of newly covered employees. Several of the agreements incorporate milestone-based, value-based pricing frameworks that tie payments to member engagement and clinical outcomes, supporting our continued expansion and leadership in value-based digital health solutions.

20-to-1 Reverse Stock Split

On August 28, 2025, we announced a reverse stock split of our outstanding shares of Common Stock at a ratio of twenty -for- one (the "Reverse Stock Split"). The Reverse Stock Split, which was approved by our board of directors under authority granted by our stockholders at our 2025 Annual Meeting of Stockholders held on July 23, 2025, was consummated pursuant to a Certificate of Amendment filed with the Secretary of State of Delaware on August 25, 2025 (the "Certificate of Amendment"). The Reverse Stock Split took effect on August 28, 2025. The Reverse Stock Split had no impact on our authorized shares, which remained 400,000,000 shares of Common Stock. No fractional shares were issued as a result of the Reverse Stock Split as any fractional shares resulting from the Reverse Stock Split were rounded up to the nearest whole share on a per stockholder basis.

Nasdaq Minimum Bid Price Compliance

On September 12, 2025, the Company received a letter from the listing qualifications staff (the "Staff") of the Nasdaq Stock Market ("Nasdaq") notifying us that the Staff has determined that for the last 10 consecutive business days, from August 28, 2025 to September 11, 2025, the closing bid price of our Common Stock had been at $1.00 per share or greater and that accordingly, we have regained compliance with Nasdaq Listing Rule 5550(a)(2) and the matter is now closed.

September 2025 Private Placement

On September 22, 2025, we entered into securities purchase agreements (each, a "Purchase Agreement") with accredited investors relating to an offering (the "Offering") and the sale of an aggregate of 1,154,420 shares of Common Stock and pre-funded warrants to purchase up to 1,558,760 shares of Common Stock, at a purchase price of $6.45 per share and $6.45 per pre-funded warrant. As a result of the purchase agreements, the aggregate gross proceeds to us were approximately $17,500. The closing of the Offering occurred on September 23, 2025.

Strategic Review Following Multiple Unsolicited Inbound Expressions of Interest

On September 25, 2025, we announced that our board of directors has initiated a comprehensive strategic review to maximize shareholder value following multiple unsolicited inbound strategic inquiries from interested parties. In relation to this review, our board of directors has established a special committee (the "Special Committee") of independent directors and engaged Perella Weinberg Partners as financial advisor. The Special Committee will consider a full range of potential opportunities including a sale, merger, strategic business combination, or continued execution of our strategy.

​

Strategic Collaboration to Enhance Fall Risk Prevention and Mobility Insights

On October 6, 2025, we announced a strategic collaboration with OneStep, a U.S. Food and Drug Administration ("FDA") -listed digital health company that delivers clinical-grade gait and mobility analysis using only a smartphone. The collaboration expands our multi-condition digital health platform with advanced fall-risk assessment and prevention capabilities designed to support high-risk populations, including individuals with obesity and Medicare Advantage members experiencing frailty and balance challenges.

Results of Operations

Comparison of the three and nine months ended September 30, 2025 and September 30, 2024 (dollar amounts in thousands)

Revenues

Revenues for the three and nine months ended September 30, 2025 amounted to $5,007and $17,128, respectively, compared to revenues of $7,423and $19,436, respectively, during the three and nine months ended September 30, 2024, representing a decrease of 32.5% and 11.9%, respectively. The decrease in revenues for the three months and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024, resulted primarily from a non-renewal of one customer acquired through the Twill acquisition.

Cost of Revenues

During the three and nine months ended September 30, 2025, we recorded costs related to revenues in the amount of $1,992 and $7,267, respectively, compared to costs related to revenues of $3,546 and $10,371, respectively, during the three and nine months ended September 30, 2024, representing a decrease of 43.8% and 29.9%, respectively. The decrease in cost of revenues in the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024, was mainly a result of the decrease in amortization of technology, hardware and consumables and decrease in hosting servers costs, which were partially offset by allocation of payroll related expenses recorded in the cost of revenues.

Cost of revenues consists mainly of the cost of hardware and consumables production, employees' salaries and related overhead costs, stock-based compensation, depreciation of production lines and related cost of equipment used in production, amortization of technologies, hosting costs, shipping and handling costs and inventory write-downs.

​

Gross Profit

Gross profit for the three and nine months ended September 30, 2025, amounted to $3,015 (60.2% of revenues) and $9,861 (57.6% of revenues), respectively, compared to $3,877 (52.2% of revenues) and $9,065 (46.6% of revenues), respectively, during the three and nine months ended September 30, 2024. The increase in gross profit as a percentage of revenues for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, resulted mainly lower amortization of technology, hardware and consumables and hosting servers expense. The increase in gross profit as a percentage of revenues for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, resulted mainly from lower amortization of technology, hardware and consumables and hosting servers expense. Gross profit for the three and nine months ended September 30, 2025, excluding amortization of acquired technology, stock-based compensation and depreciation was $3,213(64.2% of revenues) and $11,412(66.6% of revenues) compared to $5,229 (70.4% of revenues) and $12,854 (66.1% of revenues) during the three and nine months ended September 30, 2024.

Research and Development Expenses

Our research and development expenses decreased by $2,118, or 38.9%, to $3,328 for the three months ended September 30, 2025, compared to $5,446for the three months ended September 30, 2024, and decreased by $7,741, or 41.0%, to $11,157 for the nine months ended September 30, 2025, compared to $18,898for the nine months ended September 30, 2024. The decrease in research and development expenses was mainly due to efficiency and post Twill

merger integration activities resulting in a decrease in payroll expenses, stock-based compensation and subcontractors and consulting expenses. Our research and development expenses, excluding stock-based compensation and depreciation, for the three and nine months ended September 30, 2025, were $2,909and $9,697, respectively, compared to $4,635 and $16,400, respectively, for the three and nine months ended September 30, 2024, a decrease of $1,726and $6,703, respectively. The decrease in research and development expenses, excluding stock-based compensation and depreciation was mainly due to efficiency and post merger integration activities resulting in a decrease in payroll, and subcontractors and consulting expenses.

Research and development expenses consist mainly of employees' salaries and related overhead costs involved in research and development activities, expenses related to: (i) our solutions including our Diabetes Management, musculoskeletal (MSK), and our digital behavioral health solutions, (ii) labor, stock-based compensation contractors and engineering expenses, (iii) depreciation and maintenance fees related to equipment and software tools used in research and development and (iv) facilities expenses associated with and allocated to research and development activities.

Sales and Marketing Expenses

Our sales and marketing expenses decreased by $2,129, or 31.6%, to $4,604 for the three months ended September 30, 2025, compared to $6,733for the three months ended September 30, 2024, and decreased by $5,067, or 24.4%, to $15,708 for the nine months ended September 30, 2025, compared to $20,775for the nine months ended September 30, 2024. The decrease in sales and marketing expenses was mainly a result of lower payroll-related expenses, and stock-based compensation expenses, partially offset by an increase in subcontractors and consulting expenses. Our sales and marketing expenses, excluding stock-based compensation, depreciation and amortization for the three and nine months ended September 30, 2025, were $3,741and $12,829compared to $5,096 and $15,562for the three and nine months ended September 30, 2024, a decrease of $1,355and $2,733, respectively. The decrease in sales and marketing expenses, excluding stock-based compensation, depreciation and amortization was primarily driven by lower payroll-related expenses resulting from post-merger integration activities and a reduction in headcount.

Sales and marketing expenses consist mainly of employees' salaries and related overhead costs, stock-based compensation, depreciation of customer relationship intangible asset, online marketing campaigns of our service offering, trade show expenses and marketing consultants and subcontractors.

General and Administrative Expenses

Our general and administrative expenses increased by $839, or 22.5%, to $4,567 for the three months ended September 30, 2025, compared to $3,728for the three months ended September 30, 2024, and decreased by $4,379, or 28.3%, to $11,089 for the nine months ended September 30, 2025, compared to $15,468 for the nine months ended September 30, 2024. The increase in general and administrative expenses for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, resulted mainly from share-based compensation expenses. The decrease in general and administrative expenses for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, resulted mainly from share based compensation expenses, subcontractors and consulting expenses, and legal and accounting expenses specifically expenses that were related to Twill's acquisition on February 15, 2024. Our general and administrative expenses, excluding stock-based compensation, depreciation, and acquisition related costs for the three and nine months ended September 30, 2025, were $2,550and $7,047compared to $2,614and $7,757for the three and nine months ended September 30, 2024, a decrease of $64and $710, respectively. The decrease in general and administrative expenses, excluding stock-based compensation, depreciation, and acquisition related costs for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024, resulted mainly due to the decrease in subcontractors and consulting expenses, and legal and accounting expenses specifically expenses that were related to Twill's acquisition on February 15, 2024.

Our general and administrative expenses consist mainly of employees' salaries and related overhead costs, stock-based compensation, insurance costs, legal and accounting fees, acquisition related costs, expenses related to investor relations.

Financial Income (Expenses), net

Our financial expenses, net for the three months ended September 30, 2025, were $982, representing an increase of $669, compared to financial expenses, net of $313 for the three months ended September 30, 2024. Our financial expenses, net for the nine months ended September 30, 2025, were $4,568, representing an increase of $15,522, compared to financial income, net of $10,954 for the nine months ended September 30, 2024. The increase in our financial expenses, net, was mainly due to revaluation of pre-funded warrants issued in the first quarter of 2024, which are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of comprehensive loss.

Financial income, net primarily consists of credit facility interest expense, interest income from cash balances, revaluation of warrants and pre-funded warrants, revaluation of long-term loan, bank charges, lease liability and foreign currency translation differences.

Income tax

Income tax expenses were $0 and $22 for the three and nine months ended September 30, 2025, as compared to income from taxes of $13 and $2,007 for the three and nine months ended September 30, 2024. The increase in our income tax expenses was due to a reduction in the valuation allowance for deferred tax liability that resulted from the acquisition of Twill in 2024.

Net loss

Net loss decreased by $1,864, or 15.1%, to $10,466 for the three months ended September 30, 2025, compared to a net loss of $12,330 for the three months ended September 30, 2024, and decreased by $432, or 1.3%, to $32,683 for the nine months ended September 30, 2025, compared to a net loss of $33,115 for the nine months ended September 30, 2024. The decrease in net loss for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024, was mainly due to the decrease in our operating expenses for the three and nine months ended September 30, 2025.

The factors described above resulted in net loss attributable to common stockholders for the three and nine months ended September 30, 2025, amounted to $18,855and $51,483, compared to net loss attributable to common stockholders of $14,608 and $28,721 for the three and nine months ended September 30, 2024.

Non-GAAP Financial Measures

To supplement our unaudited condensed consolidated financial statements presented in accordance with generally accepted accounting principles in the United States ("U.S. GAAP") within this Quarterly Report on Form 10-Q, management provides certain non-GAAP financial measures ("NGFM") of the Company's financial results, including such amounts captioned: "Non-GAAP Adjusted Loss", as presented herein below. Importantly, we note the NGFM measures captioned "Non-GAAP Adjusted Loss" are not recognized terms under U.S. GAAP, and as such, it is not a substitute for, considered superior to, considered separately from, nor as an alternative to, U.S. GAAP and /or the most directly comparable U.S. GAAP financial measures.

Such NGFM are presented with the intent of providing greater transparency of information used by us in our financial performance analysis and operational decision-making. Additionally, we believe these NGFM provide meaningful information to assist investors, shareholders, and other readers of our unaudited condensed consolidated financial statements, in making comparisons to our historical financial results, and analyzing the underlying financial results of our operations. The NGFM are provided to enhance readers' overall understanding of our current financial results and to provide further information to enhance the comparability of results between the current year period and the prior year period.

We believe the NGFM provide useful information by isolating certain expenses, gains, and losses, which are not necessarily indicative of our operating financial results and business outlook. In this regard, the presentation of the NGFM herein below, is to help the reader of our unaudited condensed consolidated financial statements to understand the effects

of the non-cash impact on our (U.S. GAAP) unaudited condensed consolidated statement of operations of the revaluation of the warrants and the expense related to stock-based compensation, each as discussed herein above.

A reconciliation to the most directly comparable U.S. GAAP measure to NGFM, as discussed above, is as follows:

​

​

​

Liquidity and Capital Resources

As of September 30, 2025, we had approximately $31,907 in cash and cash equivalents compared to $27,764 on December 31, 2024.

We have experienced cumulative losses of $441,826since inception (August 11, 2011) through September 30, 2025, and have stockholders' equity of $74,934 as of September 30, 2025. In addition, we have not completed our efforts to establish a stable recurring source of revenues sufficient to cover our operating costs and expect to continue to generate losses for the foreseeable future.

Since inception, we have financed our operations primarily through private placements and public offerings of our Common Stock and warrants to purchase shares of our Common Stock, receiving aggregate net proceeds totaling $307,133 and a credit facility, net in the amount of $25,795, as of September 30, 2025.

On April 30, 2025, we entered into a Credit Agreement, by and among us as borrower, the financial institutions party thereto from time to time as lenders, and Callodine Commercial Finance, LLC (in its capacity as agent for all lenders, "Agent", and collectively with other lenders, "Lenders" and each a "Lender"). Under the terms of the Credit Agreement, each Lender agreed to make a multi-draw term loan to us (each a "Term Loan") in which we borrowed $32.5 million at the time of closing on April 30, 2025. In addition, we may at our option draw an aggregate of up to an additional $17.5 million. $2.5 million of such additional Term Loans is subject to the achievement of certain revenue and gross margin thresholds. $15.0 million of such additional Term Loans is subject to the discretion of the Agent and the Lenders. The Credit Agreement has a five-year term that matures in April 2030.

​

All obligations under the Credit Agreement are guaranteed by our subsidiaries (each a "Grantor"). All obligations under the Credit Agreement, and the guarantees of those obligations, are secured by substantially all of our and the Grantors' assets. In the event of a default set forth in the Credit Agreement, the Agent may apply all or any part of the proceeds as collateral to the payment of the obligations in the order and priority as determined by the Agent in its sole discretion.

​

The outstanding principal balance under the loan shall bear interest at a per annum rate of interest equal to (i) the Term SOFR Rate (as defined in the Credit Agreement) plus (ii) seven and three-quarters of one percent (7.75%). Upon maturity and/or upon an event of default (or upon any acceleration), interest shall automatically accrue without notice to us at a rate per annum equal to the lesser or (i) three percent (3%) over the Contract Rate (as defined in the Credit Agreement), or (ii) the maximum rate of interest permitted to be charged by applicable laws or regulations until paid. We will pay certain fees with respect to the Term Loan, including a closing fee, an exit fee, and an agent fee. Voluntary prepayments of the Term Loan prior to the third anniversary of the closing are also subject to certain pre-payment penalties.

​

The Credit Agreement contains customary events of default, including with respect to nonpayment of principal, interest, fees or other amounts; material inaccuracy of a representation or warranty; failure to perform or observe covenants; bankruptcy and insolvency events; material monetary judgment defaults; impairment of any material definitive loan documentation; other material adverse effects; key person events and change of control.

​

The Credit Agreement also contains a number of customary representations, warranties and covenants that, among other things, will limit or restrict our ability and the ability of our subsidiaries to (subject to certain qualifications and exceptions): create liens and encumbrances; incur additional indebtedness; merge, dissolve, liquidate or consolidate; make acquisitions, investments, advances or loans; dispose of or transfer assets; pay dividends or make other payments in respect of their capital stock; amend certain material documents; redeem or repurchase certain debt; engage in certain transactions with affiliates; and enter into certain restrictive agreements.

​

In connection with the funding of the closing amount, we agreed to issue for each Lender a warrant to purchase 105,707shares of our Common Stock, with an exercise price of $16.56, which shall have a term of seven years from the issuance date. In addition, up to $2,500 of the loaned amount can be converted into shares of our Common Stockat a price of $19.87 per share.

​

On August 15, 2025, the Company did not meet one of the financial covenants under the Credit Agreement. Upon an Event of Default (as defined in the Credit Agreement) under the Credit Agreement, interest shall accrue to at a rate per annum equal to the lesser of (i) three percent (3%) over the Contract Rate (as defined in the Credit Agreement), or (ii) the maximum rate of interest permitted to be charged by applicable laws or regulations, until paid. The Company notified Callodine of its intention to utilize an Equity Cure (as defined in the Credit Agreement) to address the event of default. Callodine waived the event of default, subject to the successful implementation of an Equity Cure no later than October 3, 2025.

​

On November 5, 2025, we entered into an Amendment to the Credit Agreement with the Lenders. Among other things, the amendment (i) resets financial covenants and waives financial-covenant testing for the second and third quarters of 2025; (ii) replaces the minimum cash covenant with a $10,000 minimum consolidated unencumbered liquid assets covenant; (iii) adds monthly 13-week cash-flow reporting when liquidity is below certain amount (subject to an EBITDA

exception); (iv) clarifies that Tranche B is uncommitted and at lender discretion; and (v) increases the exit fee by $150 (waived if a change-of-control prepayment fee is triggered).

​

In connection therewith, theCompany repriced the Warrant to purchase up to 105,707 shares of Common Stock issued to the lenders on April 30, 2025, at an exercise price $16.56 per share, to permit an amendment to the exercise price of such Warrants to $15.35. In addition, conversion right of the lender in the amount of $2,500 was amended to a conversion price of $15.35 per share.

​

On December 16, 2024, we and certain purchasers that were holders of our Series B and C Preferred Stock executed lock up agreements (the "Lock Up Agreement"), pursuant to which we agreed to issue, subject to stockholder approval, up to forty percent (40%) of the shares of Common Stock conversion shares of the preferred stock held by such purchaser, including dividend shares of Common Stock due upon conversion of these shares into shares of Common Stock, over the course of twelve (12) months (the "Additional Shares"). Each holder shall be entitled to receive 10% of the Additional Shares for each three (3) month period each holder agrees not to transfer or otherwise sell (subject to certain limitations) the shares of Common Stock issuable upon conversion of the Series B Preferred Stock and Series C Preferred Stock and the dividend shares of Common Stock due upon conversion. Between May 23, 2025 and May 28, 2025, the Company and holders that previously entered into Lock-Up Agreements, entered into an Amended and Restated Lock-Up Agreement (the "A&R Lock-Up Agreement") pursuant to which the holders agreed to extend the restrictive period previously provided in the Lock-Up Agreements until February 21, 2026 (the "Lock Up Period") for the right to receive an additional 10% of the Common Stock underlying the Series B Preferred Stock and the Series C Preferred Stock held by the holders. On October 20, 2025, we and holders that previously entered into the Lock-Up Agreement and the A&R Lock-Up Agreement entered into a Second Amended and Restated Lock-Up Agreement (the "Second A&R Lock-Up Agreement") pursuant to which the Lock-Up Period shall automatically terminate, and all share consideration shall be accelerated and immediately be issued by us in full (to the extent not already issued) upon (A) any merger or consolidation of our with or into another individual, entity, corporation, partnership, association, limited liability company, limited liability partnership, joint-stock company, trust or unincorporated organization, (B) any sale of all or substantially all of our assets in one transaction or a series of related transactions, or (C) any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property.

​

On January 7, 2025, we entered into securities purchase agreements (each, a "Series D Purchase Agreement") with accredited investors relating to an offering (the "Series D Offering") and the sale of an aggregate of (i) 4,950 shares of newly designated Series D-2 Preferred Stock (the "Series D-2 Preferred Stock"), and (ii) 1,850 shares of Series D-3 Preferred Stock (the "Series D-3 Preferred Stock"), at a purchase price of $1,000 for each share of preferred stock. As a result of the sale of the preferred stock, the aggregate gross proceeds we received from the Series D Offering are approximately $6,800. The closing of the Series D-2 Preferred Stock, and Series D-3 Preferred Stock occurred on January 14, 2025. The conversion of the preferred stock was subject to stockholder approval. In addition, the preferred stock will automatically convert into shares of Common Stock, subject to certain beneficial ownership limitations, on the 12-month anniversary of the issuance date. The holders of preferred stock will also be entitled to dividends equal to a number of shares of Common Stock equal to ten percent (10%) of the number of shares of Common Stock issuable upon conversion of the preferred stock then held by such holder for each full quarter anniversary of holding for a total of four quarters from the Closing Date, all issuable upon conversion of the preferred stock.

​

On April 28, 2025, we held a special meeting of stockholders in which the stockholders approved the (A) the issuance of shares of our Common Stock, in excess of 20% of our issued and outstanding shares of Common Stock, upon: (i) the conversion of 25,605 shares of our Series D, D-1, D-2 and D-3 Preferred Stock into an aggregate of 33,956,850 shares of Common Stock, which were issued pursuant to private placement transactions that closed on December 18, 2024 and January 14, 2025 (the "Private Placements"), (ii) the issuance of up to 13,582,740 shares of Common Stock issuable as dividends to the Series D, D-1, D-2 and D-3 Preferred Stock; and (iii) the issuance of up to 4,175,070 shares of Common Stock issuable as share consideration provided under the Lock Up Agreements; and (B) (i) reduce the exercise price of certain warrants to purchase 584,882 shares of Common Stock issued to Avenue Venture Opportunities Fund II, L.P. and Avenue Venture Opportunities Fund, L.P. (collectively "Avenue") to $0.7208 per share, and (ii) to permit the conversion of up to two million dollars of the principal amount of the loan issued by Avenue to us at a conversion price of $0.8650 per share.

​

On May 20, 2025, we filed an Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of the Company's Series C Preferred Stock (the "Series C Certificate of Designation"), an Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of the Company's Series C-1 Preferred Stock (the "Series C-1 Certificate of Designation"), and an Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of the Company's Series C-2 Preferred Stock (the "Series C-2 Certificate of Designation", collectively with the Series C Certificate of Designation and the Series C-1 Certificate of Designation, the "Series C Certificates of Designation"), all with the Secretary of State of the State of Delaware. The Series C Certificates of Designation were amended to extend the mandatory conversion period from fifteen (15) to twenty-four (24) months from the original issue date. We will issue a dividend equal to fifteen percent (15%) of the number of shares of Common Stock issuable upon conversion of the Series C Preferred Stock, Series C-1 Preferred Stock and/or Series C-2 Preferred Stock then held by such holder for each full quarter anniversary of holding following the filing of the Series C Certificates of Designation with the Secretary of State of the State of Delaware.

​

On September 18, 2025, upon obtaining the vote of a majority of the holders of the relevant classes of preferred stock and the approval of our board of directors, we filed an Amended and Restated Series A-1 Certificate of Designation, an Amended and Restated Series C Certificates of Designation, an Amended and Restated Series D Certificates of Designation, all with the Secretary of State of the State of Delaware. The Series C Certificates of Designation and Series D Certificates of Designation were amended to accelerate the mandatory conversion period of all outstanding shares of each such series into shares of the Company's common stock, or at each holder's election in pre-funded warrants, effective as of September 18, 2025. The Series A-1 Certificate of Designation was amended to provide holders with the option to receive pre-funded warrants in lieu of common stock.

On September 25, 2025, upon obtaining the vote of a majority of the holders of the relevant classes of preferred stock and the approval of our board of directors, we filed an Amended and Restated Series C-1 Certificate of Designation with the Secretary of State of the State of Delaware. The Series C-1 Certificate of Designation was amended to accelerate the mandatory conversion period of all outstanding shares of such series into shares of the Company's common stock, or at each holder's election in pre-funded warrants, effective as of September 25, 2025.

In connection with such mandatory conversion, each holder of preferred stock also received all accrued and unpaid dividends, including any dividend shares or payment-in-kind shares, in addition to the conversion shares issuable upon conversion, subject to certain beneficial ownership blockers.

The filings of the Series A-1 Certificate of Designation, the Series C Certificates of Designation and the Series D Certificates of Designation were intended to amend and restate the terms mentioned above, and no additional securities were issued or sold as a result.

In September 2025, all outstanding shares of Series C, C-1 and C-2 Preferred Stock, totaling 20,957 shares, were converted into 982,845 shares of Common Stock, and as of September 30, 2025, no Series C, C-1 and C-2 Preferred Stock remains outstanding.

In September 2025, all outstanding shares of Series D, D-1, D-2 and D-3 Preferred Stock, totaling 25,605 shares, were converted into 1,600,043 and 776,719 shares of common stock and pre-funded warrants, respectively, and as of September 30, 2025, no shares of Series D, D-1, D-2 and D-3 Preferred Stock remains outstanding.

In September 2025, all outstanding shares of Series A-1 Preferred Stock and B-1 Preferred Stock, totaling 1,882 and 4,946 shares, were converted into 43,803 and 114,974 shares of common stock, respectively, and as of September 30, 2025, no shares of Series A-1 Preferred Stock and B-1 Preferred Stock remains outstanding.

On September 22, 2025, we entered into securities purchase agreements (each, a "Purchase Agreement") with accredited investors relating to an offering (the "September 2025 Offering") and the sale of an aggregate of 1,154,420 shares of common stock (the "Shares") and pre-funded warrants (the "Pre-Funded Warrants") to purchase up to 1,558,760 shares of common stock (the "Pre-Funded Warrant Shares"), at a purchase price of $6.45 per share and $6.45

per Pre-Funded Warrant. As a result of the Purchase Agreements, the aggregate gross proceeds to us were approximately $17,500. The closing of the Offering took place on September 23, 2025.

​

The Pre-Funded Warrants are exercisable immediately upon issuance and remain exercisable until exercised in full. The Purchase Agreements contain representations and warranties that the parties made to the others in the context of all of the terms and conditions of that agreement and in the context of the specific relationship between the parties. In addition, pursuant to the terms of the Purchase Agreements, we have filed a registration statement to register the Shares and the Pre-Funded Warrant Shares on October 20, 2025. The provisions of such agreements, including the representations and warranties contained therein, are not for the benefit of any party other than the parties to such agreements and are not intended as documents for investors and the public to obtain factual information about the current state of affairs of the parties to that agreement. Rather, investors and the public should look to other disclosures contained in our filings with the U.S. Securities and Exchange Commission.

​

Management believes that the proceeds from the prior private placements and the Credit Agreement, combined with our cash on hand and short-term investments are sufficient to meet our obligations as they come due for at least a period of twelve months from the date of the issuance of these unaudited condensed consolidated financial statements. There are no assurances that we will be able to obtain an adequate level of financial resources that are required for the long-term development and commercialization of our product offerings.

Additionally, readers are advised that available resources may be consumed more rapidly than currently anticipated, resulting in the need for additional funding sooner than expected.

Cash Flows

The following table sets forth selected cash flow information for the periods indicated:

​

Net cash used in operating activities

Net cash used in operating activities was $20,054 for the nine months ended September 30, 2025, a decrease of 37% compared to $31,830 used in operations for nine months period ended September 30, 2024. Cash used in operations decreased mainly due to the decrease in our operating expenses and mainly due to efficiency and post merge integration activities.

Net cash used in investing activities

Net cash used in investing activities was $116 for the nine months ended September 30, 2025, compared to $8,913 net cash used in investing activities during the same period in 2024. The decrease is due to the acquisition of Twill during the nine months ended September 30, 2024, compared to the same period in 2025.

Net cash provided from financing activities

Net cash provided by financing activities was $24,332 for the nine months ended September 30, 2025, compared to $20,206 net cash used by financing activities during the same period in 2024. The increase is mainly due to proceeds from the issuance of shares of common stock.