What changed in this filing

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Item 1. Financial Statements

2026-08-12 compared with 2026-05-14 · 250 added, 281 removed, 615 unchanged (46% of the section changed)

33 unchanged sentences

Series A Convertible Preferred Stock $ 0.0001 par value;

40,000 shares authorized and 5,546 shares issued and outstanding at March 31, 2026 and December 31, 2025.

40,000 shares authorized and 5,546 shares issued and outstanding at June 30, 2026 and December 31, 2025.

Series B Convertible Preferred Stock $ 0.0001 par value;

50,000 shares authorized and 2,263 and 2,813 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively.

50,000 shares authorized and 2,013 and 2,813 shares issued and outstanding at June 30, 2026 and December 31, 2025 , respectively.

Series C Convertible Preferred Stock $ 0.0001 par value;

100,000 shares authorized and 3,777 and 2,154 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively.

100,000 shares authorized and 7,193 and 2,154 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively.

Common stock, $ 0.0001 par value;

625,000,000 shares authorized and 4,291,998 and 3,601,400 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively.*

625,000,000 shares authorized and 6,871,706 and 3,601,400 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively.*

Additional paid-in capital 349,531,016 330,581,384

Accumulated other comprehensive income ( 42,229 ) ( 42,229 )

Accumulated other comprehensive loss ( 42,229 ) ( 42,229 )

Accumulated deficit ( 344,307,710 ) ( 323,520,110 )

1 unchanged sentence

Total Liabilities and Stockholders’ Equity $ 35,929,509 $ 42,609,695

* Reflects the 1-for-9 reverse split effected September 5, 2025 and the 1-for-8 effected April 21, 2026.

* Reflects the 1-for-8 effected April 21, 2026.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2 unchanged sentences

Three months ended

June 30, Six months ended

2026 2025 2026 2025

Service $ 885,947 $ 2,075,566 $ 1,045,521 $ 2,240,822

26 unchanged sentences

Stockholders’ Equity

Shares Amount Shares Amount Shares Amount Amount Shares Amount

Shares Amount Shares Amount Shares Amount Shares Amount

(As adjusted, see Note 15)

Balance at March 31, 2025 19,846 $ 2 - $ - - $ - 488,242 $ 49 $ 262,829,219 $ ( 42,229 ) $ ( 261,265,539 ) $ 1,521,502

Stock-based compensation - - - - - - - - 257,334 - - 257,334

Conversion of Series A Preferred Stock to Common Stock ( 1,550 ) - - - - - 29,794 3 ( 3 ) - - -

Vesting of RSUs - - - - - - 1,481 - - - - -

Net loss - - - - - - - - - - ( 7,454,176 ) ( 7,454,176 )

Balance at June 30, 2025 18,296 $ 2 - $ - - $ - 519,517 $ 52 $ 263,086,550 $ ( 42,229 ) $ ( 268,719,715 ) $ ( 5,675,340 )

Balance at March 31, 2026 5,546 $ 1 2,263 $ - 3,777 $ - 4,291,998 $ 429 $ 337,266,475 $ ( 42,229 ) $ ( 332,977,441 ) $ 4,247,235

Stock-based compensation - - - - - - - - 315,861 - - 315,861

Conversion of Term Loan notes to Common Stock - - - - - - 782,829 78 1,608,063 - - 1,608,141

Exchange of Term Loan notes to Series C Preferred Stock - - - - 4,800 - - - 8,320,000 - - 8,320,000

Conversion of Series B Preferred Stock to Common Stock - - ( 250 ) - - - 67,436 7 ( 7 ) - - -

Conversion of Series C Preferred Stock to Common Stock - - - - ( 1,384 ) - 967,330 97 ( 97 ) - - -

ELOC Commitment Fee settlement in Common Stock - - - - - - 6,661 1 99,999 - - 100,000

At the Market (ATM) share offering - - - - - - 690,860 69 1,720,716 - - 1,720,785

Vesting of RSUs - - - - - - 9,225 1 ( 1 ) - - -

Preferred stock dividend - - - - - - - - 200,013 - ( 214,298 ) ( 14,285 )

Reverse stock split round up - - - - - - 55,367 6 ( 6 ) - - -

Net loss - - - - - - - - - - ( 11,115,971 ) ( 11,115,971 )

Balance at June 30, 2026 5,546 $ 1 2,013 $ - 7,193 $ - 6,871,706 $ 688 $ 349,531,016 $ ( 42,229 ) $ ( 344,307,710 ) $ 5,181,766

Balance at December 31, 2024 35,034 $ 4 - $ - - $ - 135,582 $ 14 $ 233,343,150 $ ( 42,229 ) $ ( 253,698,352 ) $ ( 20,397,413 )

3 unchanged sentences

At the Market (ATM) share offering - - - - - - 104,012 10 19,438,111 - - 19,438,121

Earnout shares - - - - - - - - 6,864,729 - - 6,864,729

Earnout shares liability - - - - - - - - 6,864,729 - - 6,864,729

Vesting of RSUs - - - - - - 2,306 - - - - -

1 unchanged sentence

Net loss - - - - - - - - - - ( 15,021,363 ) ( 15,021,363 )

Balance at March 31, 2025 19,846 $ 2 0 $ - 0 $ - 488,242 $ 49 $ 262,829,219 $ ( 42,229 ) $ ( 261,265,539 ) $ 1,521,502

Balance at June 30, 2025 18,296 $ 2 - $ - - $ - 519,517 $ 52 $ 263,086,550 $ ( 42,229 ) $ ( 268,719,715 ) $ ( 5,675,340 )

Balance at December 31, 2025 5,546 $ 1 2,813 $ - 2,154 $ - 3,601,400 $ 360 $ 330,581,384 $ ( 42,229 ) $ ( 323,520,110 ) $ 7,019,406

1 unchanged sentence

Conversion of November 2024 Debentures to Common Stock - - - - - - 27,932 3 283,788 - - 283,791

Exchange of November 2024 Debentures for Series C Preferred Stock - - - - 2,023 - - - 3,659,502 - - 3,659,502

Exchange of November 2024 Debentures to Series C Preferred Stock - - - - 2,023 - - - 3,659,502 - - 3,659,502

Conversion of Term Loan notes to Common Stock - - - - - - 782,829 78 1,608,063 - - 1,608,141

Exchange of Term Loan notes to Series C Preferred Stock - - - - 4,800 - - - 8,320,000 - - 8,320,000

Conversion of Series B Preferred Stock to Common Stock - - ( 800 ) - - - 214,217 21 ( 21 ) - - -

Conversion of Series C Preferred Stock to Common Stock - - - - ( 1,784 ) - 1,034,650 104 ( 104 ) - - -

ELOC Commitment Fee Settlement in Common Stock - - - - - - 6,661 1 99,999 - - 100,000

At the Market (ATM) share offering - - - - - - 1,055,124 106 4,063,823 - - 4,063,929

2 unchanged sentences

Preferred stock dividend - - - - - - - - 373,184 - ( 405,548 ) ( 32,364 )

Reverse stock split round up - - - - - $ - 55,367 6 ( 6 ) - - -

Net loss - - - - - $ - - - - - - ( 20,382,052 ) ( 20,382,052 )

Balance at March 31, 2026 5,546 $ 1 2,263 $ - 3,777 $ - 4,291,998 $ 429 $ 337,266,475 $ ( 42,229 ) $ ( 332,977,441 ) $ 4,247,235

Balance at June 30, 2026 5,546 $ 1 2,013 $ - 7,193 $ - 6,871,706 $ 688 $ 349,531,016 $ ( 42,229 ) $ ( 344,307,710 ) $ 5,181,766

* Reflects the 1-for-9 reverse split effected September 5, 2025 and the 1-for-8 effected April 21, 2026.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended March 31,

Six months ended June 30,

Cash flows from operating activities:

5 unchanged sentences

Capitalized paid-in-kind (PIK) interest 365,288 338,782

Accretion of exit fee 12,600 24,152

Accretion of exit fee, net of amount settled on conversion ( 59,824 ) 48,624

Stock-based compensation 541,413 570,015

4 unchanged sentences

Non-cash lease expense 185,822 205,688

Changes in operating assets and liabilities:

Loss on disposal of assets 8,057 -

Change in operating assets and liabilities

Accounts receivable ( 462,388 ) ( 1,906,246 )

Inventories - 42,553

Other assets ( 8,647 ) 2,207

Accounts payable and accrued liabilities ( 1,478,833 ) ( 517,629 )

Accounts payable, accrued and other liabilities ( 2,593,881 ) 20,083

Contract liabilities - ( 2,786 )

Operating lease liabilities ( 209,777 ) ( 222,228 )

3 unchanged sentences

Acquisition of business, net of cash acquired - ( 3,871,992 )

Proceeds from sale of property and equipment 4,515 ( 500 )

Net cash used in investing activities ( 9,772 ) ( 3,919,731 )

9 unchanged sentences

Cash paid for interest $ 104,140 $ 31,140

Non-cash investing and financing activities:

Conversion of Term Loan notes and interest to Common Stock $ - $ 2,870,573

Series C Preferred Stock issued in exchange for convertible debt $ 3,659,502 $ -

Fair value of conversion of Term Loan notes and interest to Common Stock $ 1,608,141 $ 2,870,573

Series C Preferred Stock issued in exchange for November 2024 Debentures $ 3,659,502 $ -

Series C Preferred Stock issued in exchange for Convertible Senior Secured Term Loan Notes $ 8,320,000 $ -

Conversion of November 2024 Debentures to Common Stock $ 283,790 $ -

2 unchanged sentences

Preferred stock dividend $ 405,548 $ -

ELOC Commitment Fee settlement in Common Stock $ 100,000 $ -

Earnout shares for acquisition $ - $ 6,864,729

14 unchanged sentences

The Company currently funds its operations with cash on hand, availability under the November 2024 Debentures (see Note 8 - Notes Payable) and the offer and sale of additional shares of Common Stock under the At The Market Offering Agreement (see Note 24 - Subsequent Events).

The Company may require additional liquidity to continue its operations over the next twelve months.

The Company will require additional liquidity to continue its operations over the next twelve months.

While a current investor has expressed an intention to provide financial support, factors such as stock price, volatility, trading volume, market conditions, demand and regulatory requirements may adversely affect the Company's ability to raise capital in an efficient manner.

Because of these factors, the Company believes that this creates substantial doubt about the Company's ability to continue as a going concern for a period of at least twelve months from the date these consolidated financial statements were issued.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty.

The accompanying Condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty.

Reverse Stock Split - On September 5, 2025, the Company effected a 1-for-9 reverse stock split of the shares of the Company's common stock, par value $ 0.0001 per share.

13 unchanged sentences

Summary of Significant Accounting Policies

Basis of Presentation - The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), under the rules and regulations of the U.S.

Basis of Presentation - The accompanying Condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), under the rules and regulations of the U.S.

Securities and Exchange Commission (the “SEC”).

All intercompany balances and transactions have been eliminated in preparation of these consolidated financial statements.

Use of Estimates – The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period.

Use of Estimates – The preparation of Condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period.

Significant items subject to such estimates and assumptions include the (i) estimates of future costs to complete customer contracts recognized over time, (ii) valuation allowances for deferred income tax assets, (iii) valuation of stock-based compensation awards, (iv) the valuation of conversion options, warrants and earnouts, (v) fair value of the November 2024 Debentures, (vi) the fair value of the SeaTrepid acquisition and (vii) fair value of Preferred Stock.

3 unchanged sentences

Historically, the Company has not experienced any losses in such accounts.

Restricted Cash – The Company had restricted cash of $ 602,796 and $ 600,342 , held by a bank on our behalf as of March 31, 2026 and December 31, 2025, respectively, relating to a custom bond guarantee.

Restricted Cash – The Company had restricted cash of $ 604,291 and $ 600,342 , held by a bank on our behalf as of June 30, 2026 and December 31, 2025, respectively, relating to a custom bond guarantee.

Accounts Receivable, Unbilled Revenues, and Allowance for Credit Losses - With the adoption of the Accounting Standards Update ("ASU") 2016-13 Financial Instruments - Credit Losses (Topic 326) , accounts receivable and contract assets are recorded at the invoiced amount and do not typically bear interest.

9 unchanged sentences

If any recoveries are made from any accounts previously written off, they will be recognized in income in the year of recovery, in accordance with the entity’s accounting policy election.

There was no allowance for credit losses as of March 31, 2026 and December 31, 2025.

There was no allowance for credit losses as of June 30, 2026 and December 31, 2025.

Property and Equipment – Property and equipment is recorded at cost and depreciated using the straight-line method.

16 unchanged sentences

If the undiscounted future cash flows are less than the carrying amount of the asset, an impairment loss is recognized for the difference between its carrying value and estimated fair value.

For the three months ended March 31, 2026 and 2025 no property and equipment was impaired.

For the six months ended June 30, 2026 and 2025 no property and equipment was impaired.

Segment Reporting - In November of 2023, the Financial Accounting Standards Board ("FASB") issued ASU No.

8 unchanged sentences

These contracts can be service sales (cost plus fixed fee or firm fixed price) or product sales.

The Company had no product sales for the three months ended March 31, 2026 and 2025, respectively.

The Company had no product sales for the three and six months ended June 30, 2026 and 2025, respectively.

A performance obligation is a promise in a contract to transfer distinct goods or services to a customer.

29 unchanged sentences

Changes in recognition or measurement are reflected in the period in which a change in judgment occurs.

The Company had no material uncertain income tax positions as of March 31, 2026 and December 31, 2025.

The Company had no material uncertain income tax positions as of June 30, 2026 and December 31, 2025.

Fair Value Measurements - The Company categorizes financial assets and liabilities using a three-tier fair value hierarchy, based on the nature of the inputs used to determine fair value.

28 unchanged sentences

Accordingly, the Earnout Shares will be recognized in stockholders’ equity at fair value on the issuance date and will not be subsequently remeasured.

The fair value will be determined using a Monte Carlo simulation model, which represents a Level 3 fair value measurement under ASC 820 – Fair Value Measurement.

Earnings (Loss) per Share – Basic earnings per share is computed by dividing income attributable to common stockholders by the weighted average number of shares of Common Stock outstanding during the period.

5 unchanged sentences

Major Customer and Concentration of Credit Risk – We have a limited number of customers.

During the three months ended March 31, 2026, sales to two customers accounted for 100 % of total revenue.

Sales to Customer A accounted for 51.43 % of total revenue and sales to Customer B accounted for 48.57 % of total revenue.

The total balance due from these customers as of March 31, 2026, was zero.

During the three months ended March 31, 2025, sales to two customers accounted for 100 % of total revenue.

Sales to Customer C accounted for 75 % of total revenue and sales to Customer D accounted for 25 % of total revenue.

Total accounts receivable as of December 31, 2025 was made up of three customers.

During the three months ended June 30, 2026, sales to one customer accounted for 61 % of total revenue.

During the six months ended June 30, 2026, sales to one customer accounted for 72 % of total revenue.

As of June 30, 2026, amounts due from two customers accounted for 86 % of accounts receivable, net, made up of 76 % due from Customer A and 10 % due from Customer B.

During the three months ended June 30, 2025 sales to three customers accounted for 87 % of total revenue.

Sales to Customers C, D and E accounted for 42 %, 27 % and 18 % of total revenue, respectively.

During the six months ended June 30, 2025, sales to three customers accounted for 86 % of total revenue.

Sales to Customers C, D and E accounted for 44 %, 25 % and 17 % of total revenue, respectively.

As of December 31, 2025, amounts due from two customers accounted for 97 % of accounts receivable, net, made up 76 % due from Customer F and 20 % due from Customer G.

Loss of these customers could have a material adverse impact on the Company.

Reclassifications – Consolidated f inancial statements presented for prior periods include reclassifications that were made to conform to the current year presentation.

For the three months ended March 31, 2025, we reclassified $ 50,000 of franchise tax expense from other expense to general and administrative expense in the consolidated statements of operations to conform to the current year presentation.

Reclassifications – Consolidated financial statements presented for prior periods include reclassifications that were made to conform to the current year presentation.

For the three and six months ended June 30, 2025, we reclassified $ 50,000 and $ 100,000 respectively, of franchise tax expense from other expense to general and administrative expense in the consolidated statements of operations to conform to the current year presentation.

For the year ended December 31, 2025 we reclassified $ 331,607 of accrued insurance from accrued liabilities to notes payable in the consolidated balance sheets to conform to current year presentation.

1 unchanged sentence

Distinguishing Liabilities from Equity – The Company evaluates financial instruments, including preferred stock, convertible debt, equity line of credit, and warrants to determine whether they should be classified as liabilities or equity in accordance with ASC 480 and ASC 815.

For warrants, the Company assesses whether the instrument is indexed to its own stock and meets the equity classification conditions.

Instruments that fail equity classification are recorded as liabilities and

measured at fair value, with changes recognized in earnings.

For warrants, the Company assesses whether the instrument is indexed to its own

stock and meets the equity classification conditions.

Instruments that fail equity classification are recorded as liabilities and measured at fair value, with changes recognized in earnings.

This assessment is performed at issuance and reassessed each reporting period while outstanding.

4 unchanged sentences

Provisional amounts are adjusted during the measurement period as new information becomes available about facts and circumstances that existed as of the acquisition date.

Accounting Standards issued but not adopted as of March 31, 2026 – In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, an update that improves income statement expense disclosure requirements.

Accounting Standards issued but not adopted as of June 30, 2026 – In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, an update that improves income statement expense disclosure requirements.

Under ASU 2024-03 issuers will be required to incorporate new tabular disclosures disaggregating prescribed expense categories within relevant income statement captions in the notes to their financial statements.

8 unchanged sentences

Three months ended

June 30, Six months ended June 30,

2026 2025 2026 2025

Cost plus fixed fee $ 852,357 $ 2,075,566 $ 934,431 $ 2,240,822

2 unchanged sentences

Our performance obligations under service agreements are generally satisfied over time as the service is provided and, therefore, all revenue above has been recognized over time.

Contract Balances – As of March 31, 2026, accounts receivable, net totaled $ 0 .

There were no allowances for credit losses included in accounts receivable as of March 31, 2026 and December 31, 2025, respectively.

Bad debt expense was $ 0 for the three months ended March 31, 2026 and 2025.

Contract Balances – As of June 30, 2026, accounts receivable, net totaled $ 841,071 .

There were no allowances for credit losses included in accounts receivable as of June 30, 2026 and December 31, 2025.

Bad debt expense was $ 0 for the three and six months ended June 30, 2026 and 2025.

NAUTICUS ROBOTICS, INC.

2 unchanged sentences

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated statements of cash flows to the amounts shown in the condensed consolidated balance sheets:

2026 March 31,

2026 June 30,

Cash and cash equivalents $ 1,372,758 $ 2,663,404

10 unchanged sentences

Property and equipment consisted of the following:

Life (years) March 31,

Life (years) June 30,

2026 December 31,

9 unchanged sentences

Total property and equipment, net $ 20,600,075 $ 21,827,769

Depreciation expense for the three months ended March 31, 2026 and March 31, 2025 was $ 575,891 and $ 480,376 , respectively.

Depreciation expense for the three and six months ended June 30, 2026 and June 30, 2025 was $ 653,519 and $ 1,229,410 and $ 574,563 and $ 1,054,939 , respectively.

During the six months ended June 30, 2026, $ 4,649,643 of construction in progress was reallocated to property and equipment.

NAUTICUS ROBOTICS, INC.

15 unchanged sentences

On March 20, 2025, the Company completed the acquisition of SeaTrepid International LLC (“SeaTrepid”), an expert in providing subsea robotic services to customers throughout the world, for total consideration of $ 14,209,810 .

As of March 31, 2026, a liability of $ 3,173,515 , was outstanding to SeaTrepid payable in cash which was due on September 30, 2025.

During the quarter ended March 31, 2026, the Company made partial payments to the sellers and continues to accrue interest on the past due balance based on the initial Asset Purchase Agreement.

On May 11, 2026, the Company entered into Amendment No.

2 to the Asset Purchase Agreement, which revised the payment terms for the remaining deferred purchase considerations and established the post-closing working capital adjustment at zero.

As part of the agreement, $ 1,500,000 were paid down on the owed balance on May 15, 2026.

The Company accounted the amended arrangement as a debt extinguishment under ASC 470.

Accordingly, during the quarter ended June 30, 2026, the Company derecognized the accrued purchase price liability and recognized the new accrued purchase price liability at fair value and recognized a loss of extinguishment for $ 201,681 .

As of June 30, 2026, the outstanding accrued purchase liability was $ 1,724,199 .

Notes Payable

2 unchanged sentences

November 2024 Debentures - (fair value) $ 2,729,000 $ 163,672

Convertible senior secured term loan 19,824,812 19,284,709

Senior Secured Convertible Term Loan 16,363,459 19,284,709

SBA loan 485,325 485,300

3 unchanged sentences

debt discount, net ( 1,895 ) ( 26,225 )

capitalized debt issuance costs ( 209,524 ) ( 321,004 )

capitalized debt issuance costs, net ( 77,341 ) ( 321,004 )

2023 Term Loan Agreement exit fee provision 55,813 115,638

4 unchanged sentences

November 2024 Debentures

On November 4, 2024, the Company entered into a Securities Purchase Agreement with ATW Special Situations I LLC ("ATW I"), pursuant to which ATW I purchased, in a private placement, $ 1,150,000 in principal amount of debentures, with an option to purchase up to an additional aggregate of $ 20,000,000 in principal amount of senior secured convertible debentures (the “November 2024 Debentures”).

On December 11, 2024, ATW I purchased, in a private placement, $ 1,000,000 in principal amount of debentures.

The November 2024 Debentures provide for, among other items:

6 unchanged sentences

In addition, the exercise price of the November 2024 Debentures is subject to customary anti-dilution adjustments, and, in the case of a subsequent equity sale at a per share price below the exercise price, the exercise price will be adjusted to such lower price.

On February 9, 2026 and March 10, 2026, the Company issued Senior Secured Convertible Debentures Due 2026 to ATW Special Situations II LLC ("ATW II"), in aggregate principal amount of $ 1,960,000 and $ 1,000,000 , respectively, pursuant to the Securities Purchase Agreement dated November 4, 2024.

During the three months ended March 31, 2026, November 2024 Debentures with a principal value of $ 100,000 and fair value of $ 283,790 , were converted into 27,932 shares of Common Stock.

During the three months ended March 31, 2026, November 2024 Debentures with a principal value of $ 2,000,000 and fair value of $ 2,729,994 , were exchanged into 2,023 shares of Series C Preferred Stock.

The fair value of the Series C Preferred Stock was $ 3,659,502 and a loss on extinguishment of debt of $ 929,508 was reported in the condensed consolidated statements of operations for the three months ended March 31, 2026 .

The fair value of the November 2024 Debentures at March 31, 2026 and December 31, 2025 was estimated at $ 1,298,728 and $ 163,672 , respectively, using Monte Carlo simulations with the following assumptions at March 31, 2026:

On February 9, 2026, March 10, 2026 and May 12, 2026, the Company issued Senior Secured Convertible Debentures Due 2026 to ATW Special Situations II LLC ("ATW II"), in aggregate principal amounts of $ 1,960,000 , $ 1,000,000 and $ 1,525,000 , respectively, pursuant to the Securities Purchase Agreement dated November 4, 2024.

During the six months ended June 30, 2026, November 2024 Debentures with a principal value of $ 100,000 and fair value of $ 283,790 , were converted into 27,932 shares of Common Stock.

During the six months ended June 30, 2026, November 2024 Debentures with a principal value of $ 2,000,000 and fair value of $ 2,729,994 , were exchanged into 2,023 shares of Series C Preferred Stock.

The fair value of the November 2024 Debentures at June 30, 2026 and December 31, 2025 was estimated at $ 2,729,000 and $ 163,672 , respectively, using Monte Carlo simulations with the following assumptions at June 30, 2026:

stock price of $ 1.23 , a risk free rate of 4.0 % implied volatility of 145 % and a remaining term of 0.19 years and assumptions at December 31, 2025:

stock price of $ 6.16 , a risk free rate of 3.55 % implied volatility of 154 % and a remaining term of 0.69 years.

A loss on change in fair value of $ 1,188,840 and $ 723,926 was reported in the condensed consolidated statements of operations for the three months ended March 31, 2026 and 2025, respectively.

The principal amount of the November 2024 Debentures at March 31, 2026 and December 31, 2025 was $ 960,000 and $ 100,000 , respectively.

RCB Equities #1, LLC

On July 14, 2023, the Company issued a secured promissory note to RCB Equities #1, LLC (RCB) for $ 5,000,000 .

The promissory note included a 2.5 % original issue discount or $ 125,000 , interest at 15 % per annum, and was scheduled to mature on September 9, 2026.

The promissory note provided for an exit fee of $ 125,000 if paid off in full between October 12, 2023, and the maturity date, with no other considerations triggered for premiums or penalties.

Further, the promissory note provided for an automatic rollover into the structure of certain future debt-financing transactions.

On September 18, 2023, the RCB promissory note was rolled into the convertible senior secured term loan discussed below bearing interest at 12.5 % per annum including the $ 125,000 exit fee.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Convertible Senior Secured Term Loan

On September 18, 2023, the Company entered into a convertible senior secured term loan agreement, the "2023 Term Loan Agreement", with ATW II as collateral agent (in such capacity, the “Collateral Agent”) and lender, and Transocean Finance Limited, ATW I, Material Impact Fund ("MIF"), and RCB, as lenders.

The 2023 Term Loan Agreement provides the Company with up to $ 20 million of secured term loans.

Any portion of the outstanding principal amount of the loans is prepayable at the Company’s option pro rata to each Lender upon at least 5 days' prior written notice to each Lender.

The initial amount funded under the 2023 Term Loan Agreement was $ 11,600,000 , (the "2023 Term Loan").

The 2023 Term Loan Agreement included a 2.5 % exit fee of $ 290,000 , bearing interest at 12.50 % per annum, payable quarterly in arrears on the first day of each calendar quarter commencing April 1, 2024.

The exit fee is being provided for over the period of the loan.

The loan agreement included a 2.5 % original issue discount of $ 125,000 from the RCB promissory note.

The loan includes assumed debt issuance costs of $ 577,500 and deemed interest from convertible debentures of $ 378,118 .

The debt discount and debt issuance costs are being amortized to interest expense over the period of the loan.

The Loans will mature on the earliest of (a) the third anniversary of the date of the 2023 Term Loan Agreement of September 17, 2026, (b) 91 days prior to the maturity of the 5 % Original Issue Discount Senior Secured Convertible Debentures, dated as of September 9, 2022.

Subject to the terms and conditions of the 2023 Term Loan Agreement, the Company may, upon at least two trading days’ written notice to the Lenders, elect to redeem some or all of the then outstanding principal amount of the Loans.

In connection with any such election, which shall be irrevocable, the Company shall pay each Lender, on a pro rata basis, an amount in cash equal to the greater of (x) the sum of (i) 100 % of the then outstanding principal amount of the Loans, (ii) accrued but unpaid interest and (iii) all liquidated damages and other amounts due in respect of the Loans (including, without limitation, the Exit Fee (as defined in the 2023 Term Loan Agreement)) (the “Optional Redemption Amount”) and (y) the product of (i) the aggregate number of shares of the Company’s common stock, par value $ 0.0001 per share (“Common Stock”), then issuable upon conversion of the applicable Optional Redemption Amount (without regard to any limitations on conversion set forth in the 2023 Term Loan Agreement) multiplied by (ii) the highest closing sale price of the Common Stock on any trading day during the period commencing on the date immediately preceding the date that the applicable notice of redemption is delivered to the Lenders and ending on the trading day immediately prior to the date the Company makes the entire payment required to be made in connection with such redemption.

The Loans are convertible, in whole or in part, at the option of each Lender into shares of Common Stock until the date that the Loans are no longer outstanding, at a conversion rate equal to the outstanding principal amount of the Loans to be converted divided by a conversion price of $ 15,552 per share of Common Stock (the “Conversion Price”), subject to certain customary anti-dilution adjustments as described in the 2023 Term Loan Agreement.

First Amendment to Convertible Senior Secured Term Loan

On December 31, 2023, the Company entered into a First Amendment to 2023 Term Loan Agreement, dated as of December 31, 2023 (the “First Amendment”), by and among the Company, the subsidiary guarantors (as defined in the First Amendment) and ATW II which amended that certain 2023 Term Loan Agreement dated as of September 18, 2023 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Term Loan Agreement”) with ATW II, as collateral agent (as replaced by Acquiom Agency Services LLC, in such capacity, the “Collateral Agent”) and lender, and Transocean Finance Limited (“Transocean Finance”), ATW I, MIF, and RCB, as lenders (collectively, the “Initial Lenders”).

The First Amendment provided the Company with an incremental loan in the aggregate principal amount of $ 695,000 (the “December 2023 Incremental Loan”), subject to the terms and conditions set forth in the Term Loan Agreement and the First Amendment.

The total loan funded under the Term Loan Agreement and First Amendment as of December 31, 2023 is $ 12,295,000 .

The December 2023 Incremental Loan was made on the same terms as the 2023 Term Loan and be deemed to be Additional Term Loans for all purposes under the Term Loan Agreement.

The loan incurred debt issuance costs of $ 72,000 which are being amortized to interest expense over the period of the loan.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Second Amendment to Convertible Senior Secured Term Loan

On January 30, 2024, the Company entered into a Second Amendment to Term Loan Agreement, dated as of January 30, 2024 (the “Second Amendment”), by and among the Company, the guarantors (as defined in the Second Amendment) and the required lenders (as defined in the Second Amendment), which amended that certain Term Loan Agreement, dated as of September 18, 2023, by and among the Company, Transocean Finance, ATW I, MIF and RCB as lenders and ATW II, as collateral agent (as succeeded by Acquiom Agency Services LLC).

In connection with the Second Amendment, the Company also entered into a Second Agreement regarding incremental loans, dated as of January 30, 2024 (the “Second Agreement”), by and among the Company, the guarantors (as defined in the Second Agreement), and ATW II and MIF, as incremental lenders.

The Second Agreement provides the Company with an incremental loan in the aggregate principal amount of $ 3,753,144 (the “January 2024 Incremental Loan”).

The January 2024 Incremental Loan would be made on the same terms as the 2023 Term Loan and be deemed to be Additional Term Loans for all purposes under the Term Loan Agreement.

New Senior Secured Term Loan Agreement

On January 30, 2024, the Company also entered into a senior secured term loan agreement (the “2024 Term Loan Agreement”) with ATW Special Situations Management LLC (“ATW Management”), as collateral agent (in such capacity, the “Collateral Agent”) and lender, and ATW Special Situations III LLC (“ATW III”), MIF, VHG Investments, ATW II and ATW I, as lenders.

The 2024 Term Loan Agreement provides the Company with an aggregate $ 9,551,856 of secured term loans (the “2024 Loans”), including $ 1,000,000 which has an extended repayment period, (the "ATW Extended Maturity Term Loan").

Any portion of the outstanding principal amount of the 2024 Loans are prepayable at the Company’s option pro rata to each Lender upon at least 5 days’ prior written notice to each Lender.

The 2024 Term Loan Agreement also provided for up to an additional $ 6 million of secured term loans within 180 days of signing.

The 2024 Loans assumed debt issuance costs of $ 1,237,291 which are being amortized to interest expense over the period of the loan.

The 2024 Loans bear interest at the rate of 15 % per annum, payable quarterly in arrears on the first day of each calendar quarter commencing April 1, 2024.

The Company shall pay interest in cash or the Company may, at its option, elect for up to (x) 100 % for the six ( 6 ) months after the Closing Date and (y) thereafter, 50 %, in each case, of any accrued but unpaid interest that would otherwise be payable on an Interest Payment Date, to be capitalized and added as of such date to the principal amount of the Loans (the “PIK Interest”).

The principal amount of the Loans shall be deemed to be increased by the PIK Interest so capitalized and added to the unpaid principal balance of the Loans in accordance with the provisions hereof.

The Company opted to capitalize the interest payable.

The 2024 Loans (other than the ATW Extended Maturity Term Loan) will mature on the earliest of:

(a) the third anniversary of the date of the Term Loan Agreement, (b) the maturity of the Indebtedness under the 2023 Term Loan Agreement among the Company, the lenders party thereto and Acquiom Agency Services LLC, as collateral agent, dated September 18, 2023, as amended on December 31, 2023, and as further amended on January 30, 2024, and (c) 91 days prior to the maturity of the 5 % Original Issue Discount Senior Secured Convertible Debentures, dated as of September 9, 2022, issued by the Company pursuant to that certain Securities Purchase Agreement, dated as of December 16, 2021, as amended on January 31, 2022, and as further amended on September 9, 2022, and as further amended on January 30, 2024.

The ATW Extended Maturity Term Loan will mature on the earlier of the 30th anniversary of the date of the Term Loan Agreement or such earlier date as is required or permitted to be repaid under the Term Loan Agreement.

The 2024 Loans were convertible, in whole or in part, at the option of each Lender into shares of Common Stock until the date that the 2024 Loans are no longer outstanding.

On January 3, 2025, the Company voluntarily reduced the conversion price of the loans under the 2024 Term Loan Agreement dated as of January 30, 2024 to $ 114.48 , in accordance with the original terms and provisions of the note agreement.

A gain of $ 94,728 and a loss of $ 1,094,112 on change in fair value was reported in the condensed consolidated statements of operations for the three and six months ended June 30, 2026, respectively.

The principal amount of the November 2024 Debentures at June 30, 2026 and December 31, 2025 was $ 2,485,000 and $ 100,000 , respectively.

Senior Secured Convertible Term Loan

The Company entered into senior secured convertible term loan agreements in September 2023 and January 2024 (the "2023 Term Loan Agreement" and "2024 Term Loan Agreement" and collectively, the "Term Loan Agreements") that provide aggregate financing of approximately $ 30.6 million (the "2023 Term Loans" and the "2024 Term Loans" and collectively the "Senior Secured Convertible Term Loan").

The 2023 Term Loan bears interest at 12.5 % per annum and includes a 2.5 % exit fee and an original issue discount.

The 2024 Term Loan bears interest at 15 % per annum, with an option for the Company to elect to capitalize and add to the principal amount of the 2024 Term Loan, accrued but unpaid

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Amendment to 2024 Term Loan Agreement

On May 1, 2024, the Company entered into an amendment (the “May 2024 Amendment”) to the 2024 Term Loan Agreement dated January 30, 2024 between the Company, ATW Management as collateral agent, and the lenders party thereto.

Pursuant to the Amendment, ATW I loaned an additional $ 1,000,000 (the “ May 2024 Incremental Loan ” ) to the Company.

The May 2024 Incremental Loan has the same terms as the ATW Extended Maturity Term Loan under the 2024 Term Loan Agreement and will mature on the 30th anniversary of the date of the 2024 Term Loan Agreement or such earlier date as is required or permitted to be repaid under the 2024 Term Loan Agreement.

The May 2024 Incremental Loan incurred debt issuance costs of $ 37,500 which are being amortized to interest expense over the period of the loan.

The 2023 Term Loan, the December 2023 Incremental Loan, the January 2024 Incremental Loan, 2024 Loans and the May 2024 Incremental Loan are collectively the S enior Secured Convertible Term Loan.

The principal amounts outstanding on the Senior Secured Convertible Term Loan as of March 31, 2026 to related parties ATW II, ATW III and MIF was $ 9,158,251 , $ 1,222,518 and $ 4,444,042 , respectively.

The principal amount outstanding on the convertible senior term loans as of December 31, 2025 to related parties ATW II, ATW III and MIF was $ 2,687,981 , $ 7,197,668 , and $ 4,399,060 , respectively.

interest as of the Interest Payment Date (as defined therein), up to (x) 100 % for the six (6) months after the Closing Date (as defined therein) and (y) thereafter, 50 %.

The Company opted to capitalize interest payable.

The Senior Secured Convertible Term Loans mature on various dates, generally tied to the third anniversary of the respective Term Loan Agreements, with the exception of a $ 1.0 million extended maturity loan with a 30 -year term.

The Senior Secured Convertible Term Loans are convertible into shares of the Company’s common stock at the lenders’ option, subject to anti-dilution adjustments.

On May 11, 2026, the Company entered into a Second Amendment to the 2023 Term Loan Agreement, with each lender thereto, pursuant to which the conversion price was reduced from $ 15,552 to $ 2.20 , for the period from May 11, 2026 to May 21, 2026.

Thereafter the conversion price reverted to $ 15,552 .

During this period, a lender converted its 2023 Term Loan notes with a principal amount of $ 500,000 into 227,273 shares of Common Stock.

On June 1, 2026, the Company entered into a Third Amendment to the 2023 Term Loan Agreement, with each lender thereto, pursuant to which the conversion price was reduced from $ 15,552 to $ 1.80 for the period from June 1, 2026 to June 15, 2026.

Thereafter the conversion price reverted to $ 15,552 .

During this period, a lender converted its 2023 Term Loan notes with a principal amount of $ 1,000,000 into 555,556 shares of Common Stock.

The Company evaluated these transactions under ASC 470-50, Debt Modifications and Extinguishments, and concluded they qualified as an extinguishment of debt through the issuance of equity securities.

The fair values of the May 11, 2026 and June 1, 2026 conversions were estimated as $ 532,991 and $ 1,075,150 , respectively, and a loss on extinguishment of debt of $ 108,141 was reported in the condensed consolidated statements of operations for the three and six months ended June 30, 2026.

On June 26, 2026, the Company entered into an Exchange Agreement pursuant to which a lender converted a total of $ 4,000,000 2023 Term Loan notes, with principal and interest amounts of $ 2,146,701 and $ 1,853,299 , respectively, into 4,800 shares of Series C Convertible Preferred Stock with a total stated value of $ 4,800,000 .

The fair value of the Series C Preferred Stock was $ 8,320,000 and a loss on extinguishment of debt of $ 4,320,000 was reported in the condensed consolidated statements of operations for the three and six months ended June 30, 2026.

The principal amounts outstanding on the Senior Secured Convertible Term Loans as of June 30, 2026 to related parties ATW II, ATW III and MIF was $ 9,274,089 , $ 1,245,695 and $ 4,490,377 , respectively.

The principal amount outstanding on the Senior Secured Convertible Term Loans as of December 31, 2025 to related parties ATW II, ATW III and MIF was $ 2,687,981 , $ 7,197,668 , and $ 4,399,060 , respectively.

Term Loan Note Conversions

During the three months ended March 31, 2025, ATW I and ATW II converted Term Loan notes with principal amount of $ 2,551,855 and interest payable of $ 318,718 into 25,075 shares of Common Stock.

Interest expense includes the following relating to the Senior Secured Convertible Term Loan:

During the six months ended June 30, 2025, ATW I and ATW II converted Senior Secured Convertible Term Loan notes with principal amount of $ 2,551,855 and interest payable of $ 318,718 into 25,075 shares of Common Stock.

Interest accrues on each note in accordance with its applicable interest rate, which is recorded as interest expense.

Interest expense also includes the following relating to the Senior Secured Convertible Term Loans:

Three months ended

June 30, Six months ended

2026 2025 2026 2025

Debt discount amortization $ 14,354 $ 10,025 $ 24,329 $ 19,920

Amortization of debt issuance costs 132,183 176,856 244,023 350,303

Provision for bridge note exit fee 12,600 24,152

Provision for exit fee ( 72,423 ) 24,472 ( 59,824 ) 48,624

Capitalized paid-in-kind (PIK) interest 185,349 171,900 365,288 338,782

For the three months ended March 31, 2026 interest expense attributable to related parties ATW II, ATW III and MIF, on the Senior Secured Convertible Term Loan was $ 95,255 , $ 27,000 and $ 116,479 .

For the three months ended March 31, 2025 interest expense attributable to related parties ATW I, ATW II, ATW III and MIF was $ 58,609 , $ 140,514 , $ 25,000 and $ 4,167 , respectively.

For the three and six months ended June 30, 2026, interest expense, including amortization of debt discount and issuance costs, exit fee provision and PIK interest, attributable to ATW II, ATW III and MIF on the Senior Secured Convertible

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Term Loans was $ 235,318 , $ 27,812 and $ 118,796 and $ 465,519 , $ 54,812 and $ 235,275 respectively.

For the three and six months ended June 30, 2025, interest expense attributable to ATW I, ATW II, ATW III and MIF was $ 51,944 , $ 139,161 , $ 25,794 and $ 114,762 and $ 103,317 , $ 276,793 , $ 75,876 and $ 277,386 , respectively.

Small Business Association Loan (SBA)

On June 19, 2020, SeaTrepid entered into a term loan with the US Small Business Administration in response to the COVID-19 pandemic.

The loan amount is $ 485,300 with an annual interest rate of 3.75 %, and a maturity date of June 19, 2050.

In connection with the acquisition of SeaTrepid on March 20, 2025, the loan, with an outstanding principal of $ 485,300 as of March 31, 2026, is now an obligation of the Company.

In 2020, SeaTrepid entered into a term loan with the US Small Business Administration ("SBA") for principal amount of $ 485,300 , with an annual interest rate of 3.75 %, and a maturity date of June 19, 2050.

In connection with the acquisition of SeaTrepid on March 20, 2025, the loan, with an outstanding principal of $ 485,325 as of June 30, 2026, is now an obligation of the Company.

The loan is secured by collateral which includes all tangible and intangible property of SeaTrepid.

Under the terms of the agreement, the sale of collateral without lender consent constitutes a violation of the loan agreement.

As of March 31, 2026, the lender had not issued a notice of default.

As a result of this and as the Company intends to repay the loan on or before June 30, 2026, the outstanding loan balance has been classified as a current liability.

As of June 30, 2026, the lender had not issued a notice of default.

As a result of this and as the Company intends to repay the loan on or before December 31, 2026, the outstanding loan balance has been classified as a current liability.

AmeriState Loan

On August 17, 2017, SeaTrepid entered into a term loan with AmeriState Bank.

The loan amount was $ 2,335,000 with an annual interest rate of prime plus 2.5 %, and a maturity date of May 4, 2036.

In connection with the acquisition of SeaTrepid on March 20, 2025, the loan with an outstanding principal of $ 1,785,026 as of March 31, 2026 is now an

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

obligation of the Company.

In 2017, SeaTrepid entered into a term loan with AmeriState Bank for a principal amount of $ 2,335,000 with an annual interest rate of prime plus 2.5 %, and a maturity date of May 4, 2036.

In connection with the acquisition of SeaTrepid on March 20, 2025, the loan with an outstanding principal of $ 1,757,571 as of June 30, 2026 is now an obligation of the Company.

The loan is secured by collateral which includes all assets of SeaTrepid.

2 unchanged sentences

Under the terms of the agreement, the sale of collateral without lender consent constitutes a violation of the loan agreement and as such constitutes a non compliance with the financial covenants related to the debt-to-net worth ratio and debt service coverage ratio.

As of March 31, 2026 the lender had not issued a notice of default.

As a result of this and as the Company intends to repay the loan on or before June 30, 2026, the outstanding loan balance has been classified as a current liability.

As of June 30, 2026 the lender had not issued a notice of default.

As a result of this and as the Company intends to repay the loan on or before December 31, 2026, the outstanding loan balance has been classified as a current liability.

Insurance Financing

1 unchanged sentence

The agreements are generally collateralized by the underlying insurance policies and require monthly installment payments over terms of twelve months or less.

At March 31, 2026, the outstanding balance under the agreements was $ 603,272 , with interest rates ranging from 7.15 % to 7.69 %.

At June 30, 2026, the outstanding balance under the agreements was $ 297,355 , with interest rates ranging from 7.15 % to 7.69 %.

The agreements mature at various dates through the fourth quarter of 2026.

8 unchanged sentences

Lease expense and lease income are recognized on a straight-line basis over the lease term for operating leases.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In March 2024, the Company extended the lease on its current office and manufacturing facility for an additional 3 years.

The incremental borrowing rate on this lease of 8 % was used to determine the present value of lease payments and establish the right-of-use asset and lease liability at lease inception for this lease.

In August 2023, the Company entered into an operating lease for office space in Norway.

The lease has a term of 5 years.

The Company’s secured borrowing rate of 15 % was used to determine the present value of the lease payments and establish the right-of-use asset and lease liability at lease inception for this lease.

In July 2023, the Company entered into an operating lease for office space in Scotland.

3 unchanged sentences

The Company’s other operating leases include leases for certain office equipment.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the Company’s lease costs which are included in general and administrative expenses in the unaudited condensed consolidated statements of operations:

Three months ended

June 30, Six months ended June 30,

2026 2025 2026 2025

Fixed lease expense $ 103,329 $ 122,318 $ 206,658 $ 244,636

3 unchanged sentences

Total lease expense $ 155,439 $ 215,778 $ 281,290 $ 418,147

Cash paid for operating leases was $ 91,865 and $ 95,247 for the three months ended March 31, 2026, and 2025, respectively.

Cash paid for operating leases was $ 206,658 and $ 244,361 for the six months ended June 30, 2026, and 2025, respectively.

The following table presents the balance and classifications of the Company’s right-of-use assets and lease liabilities included in the unaudited condensed consolidated balance sheets:

4 unchanged sentences

Total operating lease liabilities $ 427,970 $ 637,747

For operating lease assets and liabilities, the weighted average remaining lease term was 2.5 years and 2.7 years as of March 31, 2026, and December 31, 2025, respectively.

The weighted average discount rate used in the valuation over the remaining lease terms was 10.5 % as of March 31, 2026, and December 31, 2025, respectively.

The following table presents the Company’s maturities of lease liabilities as of March 31, 2026:

2026 (excluding the 3 months ended March 31, 2026) $ 309,986

For operating lease assets and liabilities, the weighted average remaining lease term was 0.9 years and 1.4 years as of June 30, 2026, and December 31, 2025, respectively.

The weighted average discount rate used in the valuation over the remaining lease terms was 8.1 % as of June 30, 2026, and December 31, 2025.

The following table presents the Company’s maturities of lease liabilities as of June 30, 2026:

2026 (excluding the 6 months ended June 30, 2026) $ 206,658

Total lease payments 527,364

1 unchanged sentence

Operating lease liabilities $ 427,970

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Commitments and Contingencies

1 unchanged sentence

While the Company records accruals for certain matters as appropriate, it does not believe that any currently pending or threatened matters, individually or in the aggregate, are material to its consolidated financial statements.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company recognized goodwill as a result of the acquisition of SeaTrepid on March 20, 2025.

1 unchanged sentence

The goodwill is not deductible for tax purposes.

As of March 31, 2026 and December 31, 2025, goodwill totaled $ 9,600,745 .

As of June 30, 2026 and December 31, 2025, goodwill totaled $ 9,600,745 .

The Company did not have any goodwill recorded on its consolidated balance sheets prior to this acquisition.

The Company evaluates goodwill for impairment annually or more frequently if events or changes in circumstances indicate the asset might be impaired.

No indicators of impairment were identified through the f irst quarter of 2026.

No indicators of impairment were identified through the second quarter of 2026.

Intangible Assets

Intangible assets consisted of the following:

March 31, 2026

Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount

June 30, 2026 December 31, 2025

Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Tradename- Trademark 15 years 687,300 58,630 628,670 687,300 35,720 651,580

2 unchanged sentences

Total intangible assets 1,429,400 250,284 1,179,116 1,429,400 152,484 1,276,916

Amortization expense for the three months ended March 31, 2026 was $ 48,900 .

Amortization expense for the three and six months ended June 30, 2026 were $ 48,900 and $ 97,799 , respectively.

The following table presents the Company's estimated future amortization expense:

Years ending December 31, Amount

2026 (excluding the 3 months ended March 31, 2026) $ 146,700

2026 (excluding the 6 months ended June 30, 2026) $ 97,800

Thereafter 376,660

Total $ 1,179,116

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Income tax provisions for interim periods are generally based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent, or unusual items related specifically to interim periods.

No income tax expense was recognized for the three months ended March 31, 2026, or 2025, respectively.

The Company has a full valuation allowance against its net deferred tax assets as of March 31, 2026, and December 31, 2025, respectively.

No income tax expense was recognized for the three and six months ended June 30, 2026 or 2025, respectively.

The Company has a full valuation allowance against its net deferred tax assets as of June 30, 2026, and December 31, 2025, respectively.

NAUTICUS ROBOTICS, INC.

2 unchanged sentences

Rights and Preferences of the Series A, B and C Preferred Stock

Each share of Series A, B and C Preferred Stock has a stated value of $ 1,000 per share and, when issued, the Preferred Stock will be fully paid and non-assessable.

The Preferred Stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all capital stock of the Company, unless the Required Holders (as defined in the applicable Certificate of Designations) consent to the creation of other capital stock of the Company that is senior or equal in rank to the specific series of Preferred Stock.

The Series A, B and C Preferred Stock of the Company, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all capital stock of the Company, unless the Required Holders (as defined in the applicable Certificate of Designations) consent to the creation of other capital stock of the Company that is senior or equal in rank to the specific series of Preferred Stock.

For the avoidance of doubt, the Series A, B and C Preferred Stock ranks in parity with each other.

2 unchanged sentences

Management has elected to capitalize dividends on each dividend date, which is the first Trading Day of the quarter after to which the dividend relates.

During the three months ended March 31, 2026, dividends relating to the Series A, B and C Preferred Stock of $ 71,958 , $ 71,399 and $ 16,753 , respectively, were capitalized.

The stated value of the Series A, B and C Preferred Stock increased to $ 1,050.95 , $ 1,040.66 and $ 1,007.78 , respectively.

At March 31, 2026, dividends payable of $ 72,857 , $ 58,875 and $ 46,456 relating to Series A, B and C Preferred Stock, respectively, were reported under other creditors in the Condensed Consolidated Balance Sheets.

During the three months ended June 30, 2026, dividends relating to the Series A, B and C Preferred Stock of $ 72,857 , $ 59,779 and $ 67,377 , respectively, were capitalized.

During the six months ended June 30, 2026, dividends relating to the Series A, B and C Preferred Stock of $ 144,814 , $ 140,993 and $ 87,377 , respectively, were capitalized.

The stated value of the Series A and B Preferred Stock increased to $ 1,064.08 and $ 1,066.68 , respectively.

The stated value of the Series C Preferred Stock was $ 1,020.08 for stock held by ATW I and $ 1,000 for stock held by a non related party investor.

At June 30, 2026, dividends payable of $ 73,767 , $ 53,680 and $ 65,026 relating to Series A, B and C Preferred Stock, respectively, were reported under other creditors in the Condensed Consolidated Balance Sheets.

At December 31, 2025, dividends payable of $ 71,958 , $ 71,399 and $ 16,753 relating to Series A, B and C Preferred Stock, respectively, were reported under other liabilities in the Condensed Consolidated Balance Sheets.

If at any time the Company grants, issues or sells any options, convertible securities, or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”), then each holder of Preferred Stock will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such holder could have acquired if such holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Preferred Stock held by such holder immediately prior to the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights at the Alternate Conversion Price (as defined below);

subject to certain limitations on beneficial ownership.

Conversion at Option of Holder

At any time from and after the first date of issuance of any Preferred Shares, each holder of Preferred Stock may convert all, or any part, of the outstanding Preferred Stock, at any time at such holder’s option, into shares of the Common Stock (which converted shares of Common Stock are referred to as “Conversion Shares” herein) at the fixed “Conversion Price” of $ 7.60 for Series C, and $ 4.7520 for Series A and B respectively, which is subject to proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions.

The amounts to be converted include unpaid dividends and other charges for the Preferred Shares.

Subject to the rules and regulations of the Nasdaq, the Company has the right, at any time, with the written consent of the Required Holders, to lower the fixed conversion price to any amount and for any period of time deemed appropriate by the board of directors of the Company.

Alternate Conversion at the Holder’s Election

At any time after the Initial Issuance Date, a holder may elect to convert the Preferred Stock held by such holder at the “Alternate Conversion Price” equal to the lesser of:

• the Conversion Price;

• the greater of:

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

◦the floor price of $ 1.52 , $ 13.22 and $ 17.71 for Series C, B and A Preferred Stock respectively (the “Floor price”);

◦ 98 % of the lowest volume weighted average price ("VWAP") of the Common Stock during the 10 consecutive trading days immediately prior to such conversion.

Alternate Conversion Upon a Triggering Event

Following the occurrence and during the continuance of a Triggering Event (as defined below), each holder may alternatively elect to convert the Preferred Stock at the “Alternate Conversion Price”.

The Certificate of Designations contains standard and customary triggering events (each, a “Triggering Event” including certain Bankruptcy Triggering Event (as defined therein)), including but not limited to:

(i) the suspension from trading or the failure to list the Common Stock within certain time periods;

(ii) failure to declare or pay any dividend when due;

(iii) the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $ 500,000 of Indebtedness (as defined in the applicable exchange or purchase agreements) of the Company, (iv) the Company’s failure to cure a conversion failure of failure to deliver shares of the Common Stock upon conversion, or notice of the Company’s intention not to comply with a request for conversion of any Preferred Stock, and (v) bankruptcy or insolvency of the Company.

From and after the occurrence and during the continuance of any Triggering Event, the Dividend Rate in effect shall automatically be increased to the lesser of 18 % per annum and the maximum rate permitted under applicable law.

If at the time of a conversion the Alternate Conversion Price is determined to be the Floor Price because such Floor Price is greater than 98 % of the lowest VWAP of a share of Common Stock during the ten ( 10 ) trading day period ending and including the trading day immediately preceding the delivery or deemed delivery of the applicable conversion notice, then the Conversion Amount (as defined in the applicable Certificate of Designations) shall automatically increase pro rata, by the applicable Alternate Conversion Floor Amount (as defined in the applicable Certificate of Designations).

Rights Upon Issuance of Other Securities

If the Company in any manner issues or sells (or enters into any agreement to issue or sell) any Convertible Securities and the lowest price per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance or sale (or the time of execution of such agreement to issue or sell, as applicable) of such Convertible Securities for such price per share.

For the purposes of this Section, the “lowest price per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to one share of Common Stock upon the issuance or sale (or pursuant to the agreement to issue or sell, as applicable) of the Convertible Security and upon conversion, exercise or exchange of such Convertible Security or otherwise pursuant to the terms thereof;

and (y) the lowest conversion price set forth in such Convertible Security for which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions) upon conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof, minus (2) the sum of all amounts paid or payable to the holder of such Convertible Security (or any other Person) with respect to any one share of Common Stock upon the issuance or sale (or the agreement to issue or sell, as applicable) of such Convertible Security plus the value of any other consideration received or receivable (including, without limitation, any consideration consisting of cash, debt forgiveness, assets or other property) by, or benefit conferred on, the holder of such Convertible Security (or any other Person).

In determining the classification of the Series A, B and C Preferred Stock, the Company considered ASC 480 - Distinguishing Liabilities from Equity and ASC 815 - Derivatives and Hedging.

The Company concluded the Preferred Stock be classified as permanent equity because it is not mandatorily redeemable except upon a Bankruptcy Triggering Event, which the Company views as a liquidation-type contingency rather than a substantive redemption feature.

Series A Convertible Preferred Stock - A total of 5,546 shares of Series A Convertible Preferred Stock were outstanding as of June 30, 2026 of which 5,342 and 204 were held by related parties MIF and SLS Family Irrevocable Trust ("SLS"), respectively.

During the six months ended June 30, 2025, ATW I and SLS converted 14,438 and 2,300 shares of Series A Preferred Stock into 213,426 and 38,844 shares of Common Stock, respectively.

Series B Convertible Preferred Stock - A total of 2,013 shares of Series B Convertible Preferred Stock were outstanding at June 30, 2026, held by related party ATW II.

During the three and six months ended June 30, 2026, 250 and 800 shares of Series B Preferred Stock were converted into 67,436 and 214,217 shares of Common Stock, respectively.

Series C Convertible Preferred Stock - A total of 7,193 shares of Series C Convertible Preferred Stock were outstanding at June 30, 2026, of which 2,393 were held by related party ATW I.

On June 28, 2026, the Company entered into an Exchange Agreement pursuant to which a lender exchanged a total of $ 4,000,000 2023 Term Loan notes, with principal and interest amounts of $ 2,146,701 and $ 1,853,299 , respectively, for 4,800 shares of Series C Convertible Preferred Stock with a stated value of $ 4,800,000 .

During the six months ended June 30, 2026, November 2024 Debentures with a principal value of $ 2,000,000 and fair value of $ 2,729,994 , were exchanged into 2,023 shares of Series C Preferred Stock.

The fair value of the Series C Preferred

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

instrument also does not provide holders with a general put right, and any holder-controlled exchange is contingent upon a Change of Control, an event subject to the Company’s governance and approval processes.

In addition, the Company may settle the Change of Control Election Price in equity-linked rights convertible into the same consideration payable to common stockholders, and management has concluded that sufficient authorized shares exist to settle conversions in shares.

Series A Convertible Preferred Stock - A total of 5,546 shares of Series A Convertible Preferred Stock were outstanding as of March 31, 2026 of which 5,342 and 204 were held by related parties MIF and SLS Family Irrevocable Trust ("SLS"), respectively.

During the three months ended March 31, 2025, ATW I and SLS converted 13,188 and 2,000 shares of Series A Preferred Shares into 188,676 and 33,800 shares of Common Stock, respectively.

Series B Convertible Preferred Stock - A total of 2,263 shares of Series B Convertible Preferred Stock were outstanding at March 31, 2026, held by related party ATW II.

During the three months ended March 31, 2026, ATW II converted 550 Series B Convertible Preferred Stock into 146,781 shares of Common Stock.

Series C Convertible Preferred Stock - A total of 3,777 shares of Series C Convertible Preferred Stock were outstanding at March 31, 2026, held by related party ATW I.

During the three months ended March 31, 2026, 400 Series C Convertible Preferred Stock were converted into 67,320 shares of Common Stock.

Stock was $ 3,659,502 and a loss on extinguishment of debt of $ 929,508 was reported in the condensed consolidated statements of operations for the six months ended June 30, 2026 .

During the three and six months ended June 30, 2026, 1,384 and 1,784 shares of Series C Preferred Stock were converted into 967,330 and 1,034,650 shares of Common Stock, respectively.

Series D Convertible Preferred Stock

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At each such milestone closing, the Company will issue to Investor a number of shares of Series D Preferred Stock equal to the applicable milestone aggregate investment amount invested by Investor, at a price of $ 1,000 per share.

The Company and Investor agree that the proceeds of the Preferred Offering will be deployed to exclusively as UAE related working capital to fund and support, directly or indirectly, the establishment and operation of the Company’s business in the United Arab Emirates.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Common Stock with an aggregate initial value equal to 30 % of the value of the Series D Preferred Stock to be issued at each such additional closings, subject to mutually agreed milestones, assignments, and definitive documentation, and in each case, consent of certain existing holders of securities of the Company.

The Company and Investor agree that the proceeds of the Preferred Offering will be deployed exclusively as UAE related working capital to fund and support, directly or indirectly, the establishment and operation of the Company’s business in the United Arab Emirates.

In addition, for a period of up to 3 years from the date of the Purchase Agreement (or such later date as mutually agreed to by the Company and Investor), by written notice from the Company to Investor and subject to other terms and conditions set forth in the Purchase Agreement, the Company may require the Investor to participate in one or more additional milestone closings and issue additional shares of Series D Preferred Stock to Investor up to an aggregate maximum purchase price of $ 47,000,000 in one or more tranches, and additional Warrants exercisable for an amount of shares of Common Stock with an aggregate initial value equal to 30 % of the value of the Series D Preferred Stock to be issued at each such additional closings, subject to mutually agreed milestones, assignments, and definitive documentation, and in each case, consent of certain existing holders of securities of the Company.

The Purchase Agreement further provides for a two-year lock-up period, during which Investor shall not, without the prior written consent of the Company and certain existing holders of securities of the Company, sell, transfer, pledge or otherwise dispose of any shares of Common Stock upon conversion of the Series D Preferred Stock, nor enter into any swap or other arrangement that transfers the economic consequence of ownership of such shares.

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The Purchase Agreement and the Registration Rights Agreement contain customary representations, warranties, conditions and indemnification obligations of the parties.

On or prior to the first milestone closing, the Company will designate 50,000 shares of the Company’s authorized and unissued preferred stock as Series D Preferred Stock and establish the rights, preferences and privileges of the Series D Preferred Stock pursuant to the Certificate of Designations of Series D Preferred Stock (the “Certificate of Designations”), to be filed with the Secretary of State of the State of Delaware.

As of March 31, 2026 no Series D Preferred Shares have been issued as no services have been provided or exchanges made under the agreement as of the date of the issuance of these financial statements.

As of June 30, 2026 no Series D Preferred Shares have been issued as no services have been provided or exchanges made under the agreement as of the date of the issuance of these financial statements.

On July 6, 2026, the Company designated 50,000 shares of the Company’s authorized and unissued preferred stock as Series D Preferred Stock and established the rights, preferences and privileges of the Series D Preferred Stock pursuant to the Certificate of Designations of Series D Preferred Stock (the “Certificate of Designations”), filed with the Secretary of State of the State of Delaware (see Note 24 - "Subsequent Events").

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Warrants, when issued pursuant to the Purchase Agreement, are immediately exercisable upon issuance and will expire on the fifth anniversary of the original issuance date.

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A Warrant holder will not have the right to exercise any portion of the Warrants to the extent that, after giving effect to such conversion, the holder would beneficially own in excess of 4.99 % (the “Maximum Percentage”) of the number of shares of the Common Stock outstanding immediately after giving effect to such conversion.

Corrections to Certificates of Designations

On April 15, 2026, the Company filed with the Secretary of State of the State of Delaware, amendments to the Certificates of Designations of Rights and Preferences, respectively, of the Series A Convertible Preferred Stock, the Series B Convertible Preferred Stock, and the Series C Convertible Preferred Stock, to correct an error in each such instrument.

NAUTICUS ROBOTICS, INC.

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333-284675), initially filed with the SEC on February 3, 2025 registering the sale of up to $ 92 million of its common stock pursuant to its ATM offering program.

During the three months ended March 31, 2026, we issued and sold 364,264 shares, for gross proceeds of $ 2,464,316 and net proceeds of $ 2,343,144 after deducting commissions and offering expenses totaling $ 121,172 .

At March 31, 2026, $ 83,572,157 remains available for issuance under the Company's ATM program pursuant to the prospectus supplement filed on October 31, 2025 under a registration statement on Form S-1.

During the three months ended March 31, 2025, the Company conducted ATM offerings to offer and sell shares of its common stock for an aggregate offering price of up to $ 20,189,798 .

During the three and six months ended June 30, 2026, we issued and sold 690,860 and 1,055,124 shares, for gross proceeds of $ 1,779,788 and $ 4,244,104 and net proceeds of $ 1,720,785 and $ 4,063,929 after deducting commissions and offering expenses totaling $ 59,003 and $ 180,175 , respectively.

At June 30, 2026, $ 81,792,369 remains available for issuance under the Company's ATM program pursuant to the prospectus supplement filed on October 31, 2025 under a registration statement on Form S-3.

During the six months ended June 30, 2025, the Company conducted ATM offerings to offer and sell shares of its common stock for an aggregate offering price of up to $ 20,189,798 .

Under this offering we issued and sold 104,012 shares for gross proceeds of $ 20,141,905 and net proceeds of $ 19,438,121 after deducting commissions and offering expenses totaling $ 703,784 .

During the three months ended March 31, 2026, 550 Series B Convertible Preferred Stock and 400 Series C Convertible Preferred Stock were converted into 146,781 and 67,320 shares of Common Stock, respectively.

During the three months ended March 31, 2026, November 2024 Debentures with a principal value of $ 100,000 and fair value of $ 283,790 , were converted into 27,932 shares of Common Stock.

During the three months ended March 31, 2025, ATW I and SLS converted 13,188 and 2,000 shares of Series A Preferred Shares into 188,676 and 33,800 shares of Common Stock, respectively.

During the three months ended March 31, 2025, ATW I and ATW II converted Term Loan notes with principal amount of $ 2,551,855 and interest payable of $ 318,718 into 25,075 shares of Common Stock.

During the three and six months ended June 30, 2026, 250 and 800 Series B Convertible Preferred Stock and 1,384 and 1,784 Series C Convertible Preferred Stock were converted into 67,436 and 214,217 and 967,330 and 1,034,650 shares of Common Stock, respectively.

During the six months ended June 30, 2026, November 2024 Debentures with a principal value of $ 100,000 and fair value of $ 283,790 , were converted into 27,932 shares of Common Stock.

During the three and six months ended June 30, 2026, Senior Secured Term Loan notes with principal amount of $ 1,500,000 were converted into 782,829 shares of Common Stock.

During the six months ended June 30, 2025, ATW I and SLS converted 14,438 and 2,300 shares of Series A Preferred Shares into 213,426 and 38,844 shares of Common Stock, respectively.

During the six months ended June 30, 2025, ATW I and ATW II converted Term Loan notes with principal amount of $ 2,551,855 and interest payable of $ 318,718 into 25,075 shares of Common Stock.

CleanTech Merger Earnout Shares

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one-quarter of the Earnout Shares will be released if, within a 5-year period from September 9, 2022, the volume-weighted average price of our Common Stock equals or exceeds $ 51,840 per share over any 20 trading days within a 30 -day trading period.

As of March 31, 2026, the earn out targets have not been achieved and the Earnout Shares remain in escrow.

As of June 30, 2026, the earn out targets have not been achieved and the Earnout Shares remain in escrow.

SeaTrepid Acquisition Earnout Shares

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Public Warrants – As of March 31, 2026 there were 11,779,167 Public Warrants outstanding.

Public Warrants – As of June 30, 2026 there were 11,779,167 Public Warrants outstanding.

For every 2,592 Public Warrants, the holder is entitled to purchase one share of Common Stock at a price of $ 11.50 , subject to adjustment.

However, no Public Warrants will be exercisable for cash unless we have an effective and current registration statement covering the shares of Common Stock issuable upon exercise of the Public Warrants and a current prospectus relating to such shares of Common Stock.

The Public Warrants expire on September 9, 2027, or earlier upon redemption or liquidation.

Our Public Warrants are listed on Nasdaq under the symbol “KITTW”.

We may redeem the outstanding Public Warrants, in whole and not in part, at a price of $ 0.01 per warrant:

• at any time after the Public Warrants become exercisable,

• upon not less than 30 days’ prior written notice of redemption to each warrant holder,

• if, and only if, the reported last sale price of the shares of Common Stock equals or exceeds $ 42,768 per share (subject to adjustment for splits, dividends, recapitalizations and other similar events), for any 20 trading days within a 30 -day trading period ending on the third business day prior to the notice of redemption to warrant holders, and

• if, and only if, there is a current registration statement in effect with respect to the shares of Common Stock underlying such warrants at the time of redemption and for the entire 30 -day trading period referred to above and continuing each day thereafter until the date of redemption.

If we call the Public Warrants for redemption as described above, we have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”

The exercise price and number of shares of Common Stock issuable on exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation.

The Public Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of March 31, 2026 and December 31, 2025 at $ 1,769 and $ 1,612 , respectively, based on their publicly-traded price.

For the three months ended March 31, 2026 and 2025, the Company reported a gain and loss in value of the Public Warrants of $ 157 and $ 11,263 , respectively.

The Public Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of June 30, 2026 and December 31, 2025 at $ 105 and $ 1,612 , respectively, based on their publicly-traded price.

For the three months ended June 30, 2026 and 2025, the Company reported a gain and loss in value of Public Warrants of $ 1,664 and $ 11,465 , respectively.

For the six months ended June 30, 2026 and 2025, the Company reported a gain and loss in value of the Public Warrants of $ 1,507 and $ 22,698 , respectively.

The change in fair value of the Public Warrants was reported within other (income) expense in our condensed consolidated statements of operations.

Private Warrants – We assumed 4,020,833 Private Warrants, which are not publicly traded, on September 9, 2022.

These remained outstanding as of March 31, 2026.

For every 2,592 Private Warrants, the holder is entitled to purchase one share of Common Stock at an exercise price of $ 11.50 and is identical in all material respects to the Public Warrants except that the Private Warrants are exercisable for cash (even if a registration statement covering the shares of Common Stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option, and will not be redeemable by us, in each case so long as they are still held by the initial purchasers or their affiliates.

The Private Warrants purchased by CleanTech Investments, LLC are not exercisable after 5 years as long as Chardan Capital Markets, LLC or any of its related persons beneficially own these Private Warrants.

The Private Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of March 31, 2026 and December 31, 2025 at $ 647 and $ 589 , respectively.

The fair value of the Private Warrants was estimated using a Black-Scholes option pricing model using the following assumptions:

Private Warrants – As of June 30, 2026 there were 4,020,833 Private Warrants outstanding, which are not publicly traded.

For every 2,592 Private Warrants, the holder is entitled to purchase one share of Common Stock at an exercise price of $ 11.50 .

The Private Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of June 30, 2026 and December 31, 2025 at $ 51 and $ 589 , respectively.

The fair value of the Private Warrants at June 30, 2026 was estimated using a Black-Scholes option pricing model using the following assumptions:

stock price of $ 1.23 , no assumed dividends, a risk-free rate of 4.0 %, implied volatility of 284.6 %, and a remaining term of 1.19 years.

The gain and loss in fair value of the Private Warrants during the three months ended March 31, 2026 and 2025 of $ 58 and $ 4,977 , respectively, and was reported with other (income) expense in our consolidated statements of operations.

SPA Warrants – On September 9, 2022 and pursuant to the Securities Purchase Agreement, we issued an aggregate 1,127 Original SPA Warrants to the SPA Parties.

Upon issuance, each whole Original SPA Warrant was exercisable over its 10-

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

year term for one share of Common Stock at a price of $ 51,840 per share, subject to certain adjustments including full ratchet anti-dilution price protections.

On June 22, 2023, we entered into the Letter Agreements with the SPA Parties (the “Letter Agreements”), pursuant to which the SPA Parties (also being the holders of the Original SPA Warrants) agreed to amend the exercise price of the Original SPA Warrants, which, since issuance, had been exercisable to purchase an aggregate 1,127 shares of Common Stock in exchange for the Company’s agreement to (i) lower the exercise price of the Original SPA Warrants to a weighted average of $ 8,502 per share, with multiple tranches priced between $ 5,288 and $ 12,027 per share, and (ii) upon the SPA Parties’ exercise of the Amended SPA Warrants, issue New SPA Warrants to the SPA Parties to purchase, in the aggregate, up to 1,127 shares of Common Stock.

During any period when we shall have failed to maintain an effective registration statement covering the shares of Common Stock issuable upon exercise of the Amended SPA Warrants, the registered holder may exercise its Amended SPA Warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act.

The New SPA Warrants will be (and, with respect to those already issued, are) substantially in the form of the Amended SPA Warrants as described above except that the New SPA Warrants (i) have an exercise price of $ 51,840 per share (including, for purposes of clarification, full-ratchet anti-dilution on the exercise price and number of underlying shares issuable based on the aggregate exercise price using $ 51,840 as the base exercise price), (ii) are immediately exercisable upon issuance, and (iii) are exercisable until September 9, 2032.

Unless context otherwise requires, the term “SPA Warrants” means (i) before the entry into the Letter Agreements, the Original SPA Warrants, and (ii) upon and following the entry into the Letter Agreements, (a) the Amended SPA Warrants, and (b) the New SPA Warrants.

The SPA Warrants, which are accounted for as liabilities in our consolidated balance sheets, were valued as of March 31, 2026 and 2025 at $ 5,846 and $ 9,080 , respectively, and were estimated using a Black-Scholes valuation model using the following assumptions:

The gain in fair value of the Private Warrants during the three months ended June 30, 2026 and 2025 was $ 596 and $ 1,179 , respectively.

The gain and loss in fair value of the Private Warrants during the six months ended June 30, 2026 and 2025 was $ 538 and $ 3,798 , respectively.

The change in fair value of the Private Warrants was reported with other (income) expense in our consolidated statements of operations.

SPA Warrants – As of June 30, 2026, there were 1,480 SPA warrants outstanding.

Each whole SPA Warrant is exercisable for one share of Common Stock.

The SPA Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of June 30, 2026 and December 31, 2025 at $ 1,781 and $ 9,080 , respectively, and were estimated using a Black-Scholes valuation model using the following assumptions:

stock price $ 1.23 , implied volatility of 152.0 %, and remaining term of 6.25 years.

The change in the value of the SPA Warrants during the three months ended March 31, 2026 and 2025 was a loss and gain of $ 3,235 and $ 67,128 , respectively, and was reported with other (income) expense in our consolidated statements of operations.

The change in the value of the SPA Warrants during the three months ended June 30, 2026 and 2025 was a gain of $ 4,065 and $ 1,499 , respectively.

The change in fair value of SPA Warrants during the six months ended June 30, 2026 and 2025 was a gain of $ 7,299 and $ 68,627 respectively .

The change in fair value of SPA Warrants was reported with other (income) expense in our condensed consolidated statements of operations.

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In connection with the EPFA, on October 24, 2025, the Company also entered into the Registration Rights Agreement with the Investor with respect to the resale of the shares of Common Stock issuable under the EPFA Agreement and the Commitment Shares.

The Registration Rights Agreement requires a registration statement registering such shares (the “Resale Registration Statement”) to be filed and that to be declared effective under the Securities Act of 1933, as amended, by the earlier of the (i) 90th day after following the date the Resale Registration Statement is filed, or (ii) the fifth business day following the date when the SEC notifies the Company that the Resale Registration Statement will not be reviewed or is no longer subject to further review and comments of the SEC.

The Company filed the Resale Registration Statement on May 13, 2026.

The Company evaluated the EPFA under ASC 815, Derivatives and Hedging, and concluded that the EPFA meets the definition of a derivative instrument.

The Company further determined that the EPFA does not qualify for the scope

The Company further determined that the EPFA does not qualify for the scope exception for contracts indexed to and settled in the Company’s own stock under ASC 815-40 due to certain provisions that adjust the number of shares deliverable based on trading volume and other factors that are not inputs to the fair value of a fixed-for-fixed equity instrument.

Accordingly, the EPFA is accounted for as a freestanding derivative instrument and is measured at fair value at each reporting date, with changes in fair value recognized in earnings.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

exception for contracts indexed to and settled in the Company’s own stock under ASC 815-40 due to certain provisions that adjust the number of shares deliverable based on trading volume and other factors that are not inputs to the fair value of a fixed-for-fixed equity instrument.

Accordingly, the EPFA is accounted for as a freestanding derivative instrument and is measured at fair value at each reporting date, with changes in fair value recognized in earnings.

As of December 31, 2025, the Company determined that the fair value of the derivative associated with the EPFA was de minimis due to the low likelihood of utilization, the absence of any outstanding advances, and the Company’s discretion over whether to access the EPFA.

As of March 31, 2026, the Company recorded a derivative liability of $ 515,827 related to the EPFA.

The increase in fair value during the three months ended March 31, 2026 was primarily attributable to an increase in the likelihood that the Company may utilize the EPFA, driven by increased liquidity needs and changes in market conditions affecting the Company’s stock price.

The Company recognized a loss on derivative of $ 515,827 during the three months ended March 31, 2026 related to the change in fair value of the derivative liability, which is included in the condensed consolidated statements of operations within other (expense) income, net.

As of June 30, 2026, the Company recorded a derivative liability of $ 251,000 related to the EPFA.

The fair value of the derivative liability was estimated using Monte Carlo simulations and estimates as to the likelihood of the Company utilizing the EPFA and the following assumptions at June 30, 2026:

stock price $ 1.23 , implied volatility of 153.0 % and a risk free rate of 4.0 %.

The Company recognized a gain of $ 264,827 for the three months and loss of $ 251,000 on derivative for the six months ended June 30, 2026 related to the change in fair value of the derivative liability, which is included in the condensed consolidated statements of operations within other (expense) income, net.

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Our 2022 Omnibus Incentive Plan provides for the grant of options, stock appreciation rights, restricted stock units (“RSU”s), restricted stock and other stock-based awards, any of which may be performance-based, and for incentive bonuses, which may be paid in cash, Common Stock, or a combination thereof.

Total stock-based compensation expense including options and RSUs for the three months ended March 31, 2026, net of forfeiture adjustments, totaled $ 225,552 and $ 312,679 , respectively.

During the three months ended June 30, 2026, 69,708 RSUs were granted with a weighted-average grant-date fair value of $ 2.41 .

As of June 30, 2026, 71,243 RSUs remained outstanding.

Total stock-based compensation expense including options and RSUs for the three and six months ended June 30, 2026, net of forfeiture adjustments, totaled $ 315,861 and $ 541,413 , respectively.

Stock based compensation expense including options and RSUs for the three and six months ended June 30, 2025, net of forfeiture adjustments, totaled $ 257,334 and $ 570,015 , respectively.

Employee Benefit Plan

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The 401(k) plan provides several investment options, for which the employee has sole investment discretion.

The Company’s cost for the 401(k) plan was $ 43,848 and $ 55,003 for the three months ended March 31, 2026, and 2025, respectively.

The Company’s cost for the 401(k) plan was $ 56,199 and $ 100,046 for the three and six months ended June 30, 2026 respectively.

The Company's cost for the 401(k) plan was $ 61,231 and $ 95,692 for the three and six months ended June 30, 2025, respectively.

Related Party Transactions

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Flexible Consulting, LLC is considered to be a related party from December 1, 2023.

The total value of services provided by Flexible Consulting, LLC to the Company for the three months ended March 31, 2026 and 2025 was $ 250,000 and $ 332,994 , respectively.

Accounts payable included $ 40,000 and $ 45,000 due to Flexible Consulting, LLC at March 31, 2026 and December 31, 2025, respectively.

The total value of services provided by Flexible Consulting, LLC to the Company for the three and six months ended June 30, 2026 and 2025 was $ 253,016 and $ 533,016 and $ 319,726 and $ 652,721 , respectively.

Accounts payable included $ 80,000 and $ 45,000 due to Flexible Consulting, LLC at June 30, 2026 and December 31, 2025, respectively.

NAUTICUS ROBOTICS, INC.

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Three months ended

June 30, Six Months Ended

2026 2025 2026 2025

Net loss $ ( 11,115,971 ) $ ( 7,454,176 ) $ ( 20,382,052 ) $ ( 15,021,363 )

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Net loss attributable to Common Stockholders $ ( 11,330,269 ) $ ( 7,454,176 ) $ ( 20,787,600 ) $ ( 15,021,363 )

Weighted average shares used to compute basic LPS 3,840,563 381,215

Weighted average shares outstanding 5,367,986 402,876 4,608,495 392,105

Basic and diluted loss per share $ ( 2.11 ) $ ( 18.50 ) $ ( 4.51 ) $ ( 38.31 )

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In computing the loss attributable to common shareholders, the Company deducts dividends on its preferred stock in accordance with ASC 260, Earnings Per Share.

For the three months ended March 31, 2026, total preferred dividends of $ 191,250 were deducted from net loss, consisting of $ 13,062 of dividends that were capitalized and added to the stated value of the preferred stock in accordance with the Certificates of Designation;

and $ 178,188 of dividends that were accrued but unpaid as of March 31, 2026.

For the three and six months ended June 30, 2026, total preferred dividends of $ 214,298 and $ 405,548 were deducted from net loss, consisting of $ 21,825 and $ 213,075 of dividends that were capitalized and added to the stated value of the preferred stock in accordance with the Certificates of Designation;

and $ 192,473 of dividends that were accrued but unpaid as of June 30, 2026.

Total preferred dividends increased the loss attributable to common shareholders for purposes of calculating basic and diluted earnings per share.

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The fair value measurement is classified as Level 3 in the fair value hierarchy due to the use of unobservable inputs.

At March 31, 2026, the following assumptions were used in order to estimate the fair value of the November 2024 Debentures:

At June 30, 2026, the following assumptions were used in order to estimate the fair value of the November 2024 Debentures:

stock price of $ 1.23 , a risk free rate of 4.0 % implied volatility of 145 % and a remaining term of 0.19 years.

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The fair value of the derivative liability is classified within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs.

The fair value of the derivative liability was estimated using a Probability Weighted Expected Return Model ("PWERM") valuation model that incorporates probability-weighted scenarios regarding the Company’s expected utilization of the EPFA.

The valuation model incorporates both observable and unobservable inputs at March 31, 2026 including stock price of $ 4.00 , discount rate of 9.17 %, expected timing and frequency of potential draws under the EPFA and probability of utilization.

The probability of utilization represents a significant unobservable input and reflects management’s assessment of the likelihood that the Company will access the EPFA during its term.

As of March 31, 2026, this probability increased compared to December 31, 2025, primarily due to increased liquidity needs and declines in the Company’s stock price, which resulted in a corresponding increase in the fair value of the derivative liability.

The fair value of the 2,023 Series C Preferred Stock was measured on the exchange date of March 27, 2026 in accordance with ASC 820-10, Fair Value Measurement, using a Monte Carlo simulation model.

The fair value of the derivative liability was estimated using a Monte Carlo simulation model.

This model incorporates Level 3 inputs, including, current stock price, stock price volatility (historical and implied), risk free interest rate (U.S.

Treasury rates), and the expected utilization of the EPFA during its term.

The fair value measurement is classified as Level 3 in the fair value hierarchy due to the use of unobservable inputs.

The following assumptions were used in order to estimate the fair value of the EPFA at June 30, 2026:

stock price $ 1.23 , implied volatility of 153.0 % and a risk free rate of 4.0 %.

The fair values of the 2,023 and 4,800 Series C Preferred Stock was measured on the exchange dates of March 27, 2026 and June 28, 2026, respectively, in accordance with ASC 820-10, Fair Value Measurement, using a Monte Carlo simulation model.

This model incorporates Level 3 inputs, including, current stock price, stock price volatility (historical and implied), risk free interest rate (U.S.

Treasury rates), and expected term to maturity.

The fair value measurement is classified as Level 3 in the fair value hierarchy due to the use of unobservable inputs.

The following assumptions were used in order to estimate the fair value of the Series C

The following assumptions were used in order to estimate the fair value of the Series C Preferred Stock at March 27, 2026:

stock price of $ 4.24 , risk free rate of 3.77 %, implied volatility of 152 %, and remaining term of 1.01 years.

The following assumptions were used in order to

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Preferred Stock at March 27, 2026:

estimate the fair value of the Series C Preferred Stock at June 28, 2026:

stock price of $ 1.15 , risk free rate of 3.9 %, implied volatility of 75 % and remaining term of 0.76 years.

In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial liabilities that are required to be measured at fair value on a recurring and non-recurring basis and the related activity for periods presented:

Fair Value as of March 31, 2026 Fair Value as of December 31, 2025

Fair Value as of June 30, 2026 Fair Value as of December 31, 2025

Carrying Value Level 1 Level 2 Level 3 Carrying Value Level 1 Level 2 Level 3

8 unchanged sentences

Series C Preferred Stock at March 27, 2026 $ 3,659,502 $ - $ - $ 3,659,502

Series C Preferred Stock at June 28, 2026 $ 8,320,000 $ - $ - $ 8,320,000

The following table sets forth a summary of the changes in fair value of the Company’s financial liabilities categorized within Level 3:

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

November 2024 Debentures Warrant

3 unchanged sentences

Change in fair value of warrant liabilities - ( 64,829 ) -

Balance March 31, 2025 $ 3,307,758 $ 110,682 $ -

Balance June 30, 2025 $ 3,119,892 $ 108,004 $ -

Balance, December 31, 2025 $ 163,672 $ 9,669 $ -

5 unchanged sentences

Change in fair value of derivative liability - - 251,000

Balance, March 31, 2026 $ 1,298,728 $ 6,493 $ 515,827

Balance, June 30, 2026 $ 2,729,000 $ 1,832 $ 251,000

NAUTICUS ROBOTICS, INC.

10 unchanged sentences

ATM offeri ng

From April 1, 2026 to May 14, 2026, the Company has conducted ATM offerings to offer and sell shares of the Company's Common Stock.

From July 1, 2026 to August 12, 2026 the Company has conducted ATM offerings to offer and sell shares of the Company's Common Stock.

Under this offering we issued and sold 31,852 shares, for gross proceeds of $ 36,101 and net proceeds of $ 34,422 after deducting commissions and offering expenses totaling $ 1,679 .

Series B and C Preferred Stock Conversions

From April 1, 2026 to May 14, 2026, 250 and 325 shares of Series B and C Preferred Stock were converted into 67,436 and 165,026 shares of Common Stock, respectively.

Corrections to Certificates of Designations

Nasdaq Compliance Letter

On April 27, 2026, the Company received a formal notice from The Nasdaq Capital Market ("Nasdaq") confirming that the Company has demonstrated compliance with all continued listing requirements through the end of the Nasdaq Hearing Panel's jurisdiction, which expired on April 14, 2026.

Second Amendment to the 2023 Term Loan Agreement

On May 11, 2026, the Company entered into a Second Amendment to the 2023 Term Loan Agreement, dated September 18, 2023, with each Lender, pursuant to which the conversion price was reduced to $ 2.20 for the period ending on May 21, 2026.

November 2024 Debentures

On May 12, 2026, the Company issued November 2024 Debentures to an institutional investor, in aggregate principal amount of $ 1,556,122 , which are convertible into 204,753 shares of Common Stock of the Company calculated at a conversion price of $ 7.60 , pursuant to the Securities Purchase Agreement dated November 4, 2024.

NAUTICUS ROBOTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Series D Preferred Stock

On July 6, 2026, the Company filed with the Secretary of State of the State of Delaware a Certificate of Designations of Series D Convertible Preferred Stock (the “Certificate of Designation”), establishing a new series of preferred stock designated as the Company's Series D Convertible Preferred Stock, consisting of up to 50,000 shares.

November 2024 Debenture

On July 20, 2026, the Company issued November 2024 Debentures to an institutional investor in aggregate principal amount of $ 1,500,000.00 which are convertible into 197,369 shares of common stock of the Company calculated at a conversion price of $ 7.60 pursuant to the Securities Purchase Agreement dated as of November 4, 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements