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Item 7. Management’s Discussion and Analysis

2026-04-15 compared with 2025-03-31 · 570 added, 383 removed, 3 unchanged (100% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction

with our audited consolidated financial statements and the notes related thereto which are included in “Item 8.

Consolidated Financial

Statements and Supplementary Data” of this Annual Report on Form 10-K.

Certain information contained in the discussion and analysis

set forth below includes forward-looking statements.

Our actual results may differ materially from those anticipated in these forward-looking

statements as a result of many factors, including those set forth under “Cautionary Note Regarding Forward-Looking Statements,”

Risk Factors” and elsewhere in this Annual Report on Form 10-K.

are a blank check company incorporated on April 19, 2021 as a Delaware corporation and formed for the purpose of effecting a merger,

capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses

(a “Business Combination”).

We consummated our initial public offering on December 22, 2021 and have identified a target

company for our business combination.

We intend to use the cash proceeds from our Public Offering and the Private Placement described

below as well as additional issuances, if any, of our capital stock, debt or a combination of cash, stock and debt to complete the Business

expect to incur significant costs in the pursuit of our initial Business Combination.

We cannot assure you that our plans to raise capital

or to complete our initial Business Combination will be successful.

Business Combination

November 7, 2022, NorthView entered into a Merger Agreement and Plan of Reorganization (the “Merger Agreement”), by and among

NorthView, NV Profusa Merger Sub Inc., a Delaware corporation and a direct, wholly-owned subsidiary of NorthView (“Merger Sub”),

and Profusa, Inc., a California corporation (“Profusa”).

Merger Agreement provides that, among other things, at the closing (the “Closing”) of the transactions contemplated by the

Merger Agreement, Merger Sub will merge with and into Profusa (the “Merger”), with Profusa surviving as a wholly-owned subsidiary

of NorthView.

In connection with the Merger, NorthView will change its name to “Profusa, Inc.” The Merger and the other transactions

contemplated by the Merger Agreement are hereinafter referred to as the “Business Combination.”

Business Combination is subject to customary closing conditions, including the satisfaction of the minimum available cash condition of

$15,000,000, the receipt of certain governmental approvals and the required approval by the stockholders of NorthView and Profusa.

is no assurance that the Business Combination will be completed.

aggregate consideration to be received by the Profusa stockholders is based on a pre-transaction equity value of $155,000,000.

ratio will be equal to (a) $155,000,000, divided by an assumed value of NorthView Common Stock of $10.00 per share.

to the Merger Agreement, subject to certain future revenue and stock-price based milestones, Profusa stockholders will have the right

to receive an aggregate of up to an additional 3,875,000 shares of NorthView Common Stock (the “Earnout Shares”).

of the Earnout Shares will be issued if, between the 18-month anniversary and the two year anniversary of the Closing, the combined company’s

common stock achieves a daily volume weighted average market price of at least $12.50 per share for any 20 trading days within a 30 consecutive

trading day period (“Milestone Event I”).

One-quarter of the Earnout Shares will be issued if, between the first and second

anniversary of the Closing, the combined company’s common stock achieves a daily volume weighted average market price of at least

$14.50 per share for a similar number of days (“Milestone Event II”).

Pursuant to the Merger Agreement, the remaining one-quarter

of the Earnout Shares were to be issued if the combined company achieves at least $5,100,000 in revenue in fiscal year 2023, and one-quarter

of the Earnout Shares will be issued if the combined company achieves at least $73,100,000 in revenue in fiscal year 2024, (or up to

one-half of the Earnout Shares if both milestones are achieved).

September 12, 2023, the parties to the Merger Agreement entered into Amendment No.

1 to the Merger Agreement ( “Amendment No.

pursuant to which the parties agreed to revise the revenue earnout milestones to reflect updated projections provided by Profusa.

Specifically,

Amendment No.

1 revised the definition of “Milestone Event III” and “Milestone Event IV” such that one-quarter

of the Earnout Shares would be issued to Profusa stockholders if the combined company achieves Earnout Revenue of $11,864,000 for the

fiscal year ended December 31, 2024, and one-quarter of the Earnout Shares would be issued to Profusa stockholders if the combined company

achieves Earnout Revenue of $99,702,000 for the fiscal year ended December 31, 2025.

Amendment No.

1 also clarified the exercise price

of certain the Company Warrants.

On January 12, 2024, the parties to the Merger Agreement entered

into an Amendment No.

2 to the Merger Agreement (“Amendment No.

2”) pursuant to which the parties agreed to revise the definition

of “Milestone Event III” and such that the Earnout Revenue milestone of $11,864,000 for the fiscal year ended December 31,

2024, was replaced with a milestone of consummating the APAC Joint Venture and receipt of the related funding (as described elsewhere

in this proxy statement/prospectus) during the fiscal year ended December 31, 2024.

On March 4, 2024, the parties to the Merger Agreement entered

into an Amendment No.

3 to the Merger Agreement (“Amendment No.

3”) pursuant to which the parties agreed to revise

the Company Reference Value to adjust for financing proceeds and debt conversions that could be received by Profusa prior to the Business

On February 11, 2025, the parties to the Merger

Agreement entered into an Amendment No.

4 to the Merger Agreement (“Amendment No.

4”) pursuant to which the parties agreed

to revise the Company Reference Value to adjust for financing proceeds received by Profusa prior to the Business Combination, along with

debt conversions and incentive shares being issued.

Additionally, Amendment No.

4 to the Merger Agreement revised the definition of “Milestone

Event III” and “Milestone Event IV” such that the parties extended the period for Profusa to consummate the APAC Joint

Venture and receive the related funding until December 31, 2025, and extended the period for Profusa to achieve Earnout Revenue of $11,864,000

for the fiscal year ended December 31, 2026.

Additionally,

if Milestone Event I or Milestone Event II are achieved by the second anniversary of the Closing, NorthView’s sponsor, NorthView

Sponsor I, LLC and Profusa stockholders, will be issued additional shares up to the amount of any shares forgone as an inducement to

obtaining Additional Financings (as defined in the Merger Agreement).

Merger Agreement Amendment and Termination

January 12, 2024, the parties to the Merger Agreement entered into an Amendment No.

2 to the Merger Agreement pursuant to which the parties

agreed to revise the definition of “Milestone Event III” and such that the Earnout Revenue milestone of $11,864,000 for the

fiscal year ended December 31, 2024, was replaced with a milestone of consummating the Tasly JV (as defined in the amended Merger Agreement)

and receipt of the related funding during the fiscal year ended December 31, 2024.

All other aspects of the Merger Agreement were unmodified.

February 16, 2024, the Company’s Board of Directors approved and authorized the Company to execute a binding term sheet (“Original

term sheet”) between the Company and Profusa, Inc.

(the “Target”) for PIPE funding with Vellar Opportunities Fund Master,

Vellar agreed to subscribe for 2,500,000 shares of common and/or preferred stock of the Target upon the

closing of the Business Combination at a price of $2.00 per share, for a total amount of $5,000,000 to be funded by Vellar immediately

prior to the Business Combination.

On May 9, 2024, the original term sheet between the Company and Profusa was amended and restated to

clarify certain provisions of the Original term sheet.

March 4, 2024, the parties to the Merger Agreement entered into Amendment No.

3 to the Merger Agreement pursuant to which the parties

agreed to revise the definition of Company Reference Value (as defined in the Merger Agreement) to adjust for financing proceeds and

debt conversions that could be received by Profusa prior to the Business Combination.

All other aspects of the Merger Agreement were

September 25, 2024, Vellar terminated the Amended and Restated Binding Principal Terms and Conditions with the Company and Profusa,

dated May 9, 2024.

On February 11, 2025, the parties entered into

Amendment No.

4 to the Merger Agreement pursuant to which the parties agreed to revise the Company Reference Value (as defined in the

Merger Agreement) to adjust for financing proceeds received by Profusa prior to the Business Combination, along with debt conversions

and incentive shares to be issued.

Additionally, the Amendment (i) revised the definition of “Milestone Event III” such that

the parties extended the period for Profusa to consummate the APAC Joint Venture (as defined in the Merger Agreement) and receive the

related funding from December 31, 2024 until December 31, 2025, and (ii) revised the definition of “Milestone Event IV” to

change the earnout revenue target from $99,702,000 for the fiscal year ended December 31, 2025 to an earnout revenue target of $11,864,000

for the fiscal year ended December 31, 2026.

of Our Combination Period

On March 10, 2023, the Company held a vote to

amend its amended and restated certificate of incorporation to extend the date by which the Company must consummate a Business Combination

from March 22, 2023 to December 22, 2023 (the “First Extension Meeting”).

December 21, 2023, the Company held a special meeting of stockholders to vote on extending the Combination Period.

As a result, the Company

has extended the Combination Period from December 22, 2023 to March 22, 2024.

In connection with the extension, 140,663 shares of the

Company’s common stock were redeemed, with 6,027,219 shares of Common Stock remaining outstanding after the Redemption;

shares of Common Stock remaining outstanding after the Redemption are shares issued in connection with our initial public offering.

January 2024, $1,565,078 was paid from the trust account to redeeming stockholders in connection with the extension.

January 2, 2024, the Company and Continental Stock Transfer & Trust Company (“CST”) entered into Amendment No.

1 to Investment

Management Trust Agreement, dated December 20, 2021, by and between the Company and CST, to allow CST, upon written instruction of the

Company, to (i) hold the funds in the Company’s trust account uninvested or (ii) hold the funds in an interest-bearing bank demand

deposit account.

March 21, 2024, the Company held its 2024 Annual Meeting of Stockholders (the “Meeting”).

At the meeting, the Company’s

stockholders approved the amendment of the Company’s amended and restated certificate of incorporation to extend the date by which

the Company must consummate a business combination or, if it fails to do so, cease its operations and redeem or repurchase 100% of the

shares of the Company’s common stock issued in the Company’s initial public offering, from March 22, 2024, monthly for up

to six additional months at the election of the Company and only upon contribution of $0.05 per month per outstanding public share, ultimately

until September 22, 2024.

connection with the meeting, the holders of 95,394 Public Shares properly exercised their right to redeem, with 5,931,825 shares

of Common Stock remaining outstanding after the Redemption;

738,075 shares of Common Stock remaining outstanding after the Redemption

are shares issued in connection with the initial public offering.

Consequently, the contribution is $36,904 per month needed for

the Company to continue to extend the Combination Period monthly.

On May 8, 2024 and May 31, 2024, the Company made two deposits of $36,904

each for April and May extension contributions.

On September 10, 2024, the Company made a deposit of $112,114, of which $110,174 was

for June, July and August extension contributions and $1,400 for lost interest due to late trust payments.

September 19, 2024, the Company held a special meeting of stockholders.

At the meeting, the Company’s stockholders approved an

amendment to the Company’s amended and restated certificate of incorporation to extend the date by which the Company must consummate

its initial Business Combination to March 22, 2025.

In connection with the approval of the extension amendment, holders of 50,556 shares

of the Company’s common stock exercised their right to redeem, with 5,881,269 shares of common stock remaining outstanding after

the redemption;

687,519 shares of common stock remaining outstanding after the redemption are shares issued in connection with our initial

public offering.

Consequently, the contribution is $34,376 per month needed for the Company to continue to extend the Combination

Period monthly.

On October 4, 2024, the Company made a deposit of $34,376 for the September extension contribution.

In October 2024,

$595,439 was paid from the trust account to redeeming stockholders in connection with the extension that took place at the September

19, 2024 stockholders meeting.

On December 13, 2024, the Company made a deposit of $68,752 for the October and November extension contributions.

On December 23, 2024, the Company made a deposit of $34,376 for the December extension contribution.

On February 27, 2025, the Company

made a deposit of $49,376 for the January extension contribution and a portion ($15,000) of the February extension contribution.

7, 2025, the Company deposited the remainder of the February extension contribution of $19,376, plus interest.

On March 18, 2025, the company commenced a special

meeting of stockholders, which was adjourned until March 21, 2025 without conducting any business.

On March 21, 2025, the Company reconvened

the special meeting to approve an extension of time for the Company to consummate an initial business combination from March 22, 2025

to June 22, 2025.

The meeting was adjourned until March 21, 2025, at which the stockholders approve the extension of the business combination

period until June 22, 2025.

As a condition of the extension, the Company contributed $30,000 to the Trust Account, for the entire extension

period, on March 21, 2025.

January 10, 2024, the Company’s Board of Directors approved, and the Company amended, its Convertible Working Capital Promissory

Note (the “Note”) with the sponsor to increase the principal amount of the Note that could be drawn on to $1.5 million.

The amended and restated Note also allows for the conversion of the outstanding principal balance of the Note to be repaid in shares

of Company common stock at a price of $2.22 per share at the election of the sponsor.

May 31, 2024, the Company’s Board of Directors approved, and the Company second amended its Convertible Working Capital Promissory

Note with the sponsor to increase the principal amount of the Note that could be drawn on to $2.5 million.

The second amended and

restated Note also allows for the conversion of the outstanding principal balance of the Note to be repaid in shares of Company common

stock at a price of $2.22 per share at the election of the sponsor.

On December 20, 2024, the Company received a written

notice from the Nasdaq Listing Qualifications Department of The Nasdaq Stock Market that the Company’s securities would be delisted

from The Nasdaq Stock Market by reason of the failure of the Company to complete its initial business combination by December 20, 2024

(36 months from the effectiveness of its IPO registration statement) as required by Listing Rule IM-5101-2.

Accordingly, trading in the

Company’s Common Stock, Rights and Warrants was suspended at the opening of business on December 27, 2024 and a Form 25-NSE was

filed by Nasdaq with the Securities and Exchange Commission, which removed the Company’s securities from on the Nasdaq Stock Market.

The Company’s Common Stock, Rights and Warrants began to be quoted its on the Pink Markets operated on The OTC Market systems (“OTC

Market”) under the symbols “NVAC,” “NVACR” and “NVACW.”

to “Profusa,” the “Company,” “we,” “us,” and “our,” refer to Profusa, Inc.

and its subsidiaries.

The following discussion and analysis of the Company’s financial condition and results of operations should

be read in conjunction with the consolidated financial statements and the notes thereto contained elsewhere in this Annual Report.

information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

July 11, 2025 (the “Closing Date”), NorthView Acquisition Corporation (“Northview”), consummated its previously

announced business combination (the “Business Combination”) with Profusa, Inc., a California corporation (“Legacy Profusa”).

Legacy Profusa, became our accounting predecessor upon the closing of the Business Combination on the Closing Date.

The results of operations

discussed below reflect those of Legacy Profusa and its consolidated subsidiary for periods prior to July 11, 2025, and those of the

combined company for periods from July 11, 2025 onward.

The year ended December 31, 2025 results include Legacy Profusa up to July 11,

2025, and the combined company thereafter.

Note Regarding Forward-Looking Statements

Annual Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section

21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

We have based these forward-looking statements

on our current expectations and projections about future events.

These forward-looking statements are subject to known and unknown risks,

uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially

different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.

In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,”

“would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”

“continue,” or the negative of such terms or other similar expressions.

Factors that might cause or contribute to such a

discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission (“SEC”) filings.

are a clinical-stage digital health and medical technology company focused on developing biosensing solutions to improve health outcome

for patients in a variety of different diseases and conditions.

Our first product is Lumee Oxygen, which enables physicians to ascertain

the extent of perfusion, or passage of blood through the circulatory system to an organ or tissue, in patients with Critical Limb Ischemia

(“CLI”) both during and after endovascular revascularization procedures.

Lumee Oxygen has already received regulatory approval

in Europe through the attainment of a CE mark;

however, prior to commercialization in the U.S., Lumee Oxygen must obtain FDA clearance

latest version of Lumee Oxygen is called Wireless Lumee Oxygen System.

It has multiple components, one of which is a microsensor that

is injected into the tissue of the patient using a hypodermic needle.

The sensor is designed so it does not need to be removed as it

overcomes the foreign body response that usually inhibits the ability of permanent implants to function.

The sensor contains no electronics,

utilizing luminescence to send a light signal to a reader that is placed over the incision site, which in turn can send a signal to an

app on a smartphone.

We are in clinical trials for Lumee Glucose, our sensing solution being developed for use in continuous glucose

monitoring (CGM).

This system targets diabetics and pre-diabetics to allow them realtime access to their glucose data, at a price point

that our management thinks is comparable or lower to existing systems.

2024, we sold our oxygen sensor for research use only applications, namely animal models and in vitro testing.

Management is targeting

the European market (those jurisdictions that accept CE mark) for early launch for both Lumee Oxygen and Lumee Glucose.

Lumee Oxygen’s

launch in Europe occurred in 2023 and Lumee Glucose launch is expected to occur in 2026, subject to regulatory approval.

We have access

to key opinion leaders (“KOLs”) in both Europe and the United States, who deal with peripheral arterial disease (“PAD”)

and Critical Limb Ischemia (“CLI”).

will sell directly to facilities based on the endorsement of these KOLs.

In Germany, Austria and France, some KOLs have already used

Lumee Oxygen on a trial basis.

We have worked with reimbursement consultants to develop potential Category I Current Procedural Terminology

(“CPT”) codes for Lumee Oxygen use.

Additionally, we have entered into commercial and clinical collaboration agreements with

practitioners and hospital departments in Austria, Belgium and France.

Lumee Glucose, if and when we obtained marketing authorization, we plan to embark on a dual strategy of both direct to hospital sales,

for our professional-use and personal-use CGM product, and direct to pharmacy sales for our personal use product only, thereby maximizing

flexibility for the consumer.

By aiming for coverage under a user’s pharmacy benefit, we believe we can diversify our user base,

while accounting for any risk related to unlikely delay of attainment of a category I CPT code for sensor insertion.

We feel a difference

between other insertable or implantable CGMs and Lumee Glucose, is that the latter can be simply inserted with a hypodermic needle and

does not require a surgical implantation, similar to how pharmacists use these needles to administer flu shots and other vaccines.

the same time, physicians can still leverage existing CPT codes related to interpretation of CGM data and we have, in parallel, initiated

steps for CPT codes related to our sensor insertion.

We will target both public and private payors for coverage.

our launch, we have devoted significantly all of our resources to research and development, as well as all clinical study activities

related but not limited to Lumee Oxygen, Lumee Glucose and prototypes for sensors of at least eight other analytes.

We have also invested,

on a smaller scale, in making sales of Lumee Oxygen for research- use only clients, which include entities working with animal models.

Furthermore, we also performed research and development under government grants.

inception, we have incurred recurring annual losses from operations.

For the years ended December 31, 2025 and 2024, we incurred a net

loss of $35.8 million and $9.2 million, respectively.

During the years ended December 31, 2025 and 2024, we have used $16.2 million and

$2.1 million, respectively, of cash in our operating activities.

We have notes and loans payable and interest due of $6.6 million within

twelve months of December 31, 2025.

Additionally, we have loans payable and interest due of $7.9 million which are considered non-current

and are due after December 31, 2026.

have been able to finance our operations primarily with the proceeds from the issuance of equity and debt instruments.

For the year ended

December 31, 2025, we obtained net cash from financing activities of $19.8 million, compared to $2.1 million for the same period in 2024.

We held cash of $1.8 million and $0.2 million as of December 31, 2025 and 2024, respectively.

consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction

of liabilities in the normal course of business.

We have reviewed the relevant conditions and events surrounding its ability to continue

as a going concern including among others:

historical losses, projected future results, including the effects of COVID-19, cash requirements

for the upcoming year, funding capacity, net working capital, total stockholders’ deficit and future access to capital.

is our expectation to continue to make substantial investments in building its European and United States commercial infrastructure and

enhancing existing products and developing new ones.

Furthermore, we aim to continue discussions with potential partners in Asia.

expect to incur additional expenses due to operating as a public company, including expenses related to compliance with the rules and

regulations of the SEC and those of the Nasdaq Stock Market LLC, additional insurance expenses, investor relations activities and other

administrative, professional and consulting services.

As a result of these and other factors, we expect that we will require additional

financing to fund our operations and planned growth.

We may seek to raise any additional capital through equity offerings or debt financings,

additional credit or loan facilities or a combination of one or more of these funding sources.

In the scenario that we are unable to

acquire sufficient financing or financing on terms satisfactory to our management or Board of Directors, our ability to continue to pursue

our business objectives and to respond to business opportunities, challenges or unforeseen circumstances could be significantly limited,

and our business, financial condition and results of operations could be materially adversely affected.

For the current period and for

twelve months following the issuance of these financial statements, our risk of going concern has been mitigated but not fully alleviated

by Tranches 1 and 2 of the Ascent PIPE Notes issued for gross proceeds of $11.0 million.

As of and for the year ended December 31,

2025, there continue to be factors which raise substantial doubt about our ability to continue as a going concern.

for Business Combination

July 11, 2025, the Business Combination was successfully completed and was accounted for as a reverse capitalization in accordance with

Legacy Profusa was deemed the accounting predecessor of the combined business, and the Company as the parent company of the

combined business, is the successor SEC registrant, meaning that our financial statements for previous periods will be disclosed in the

registrant’s future periodic reports filed with the SEC.

The Business Combination had a significant impact on our capital structure

and operating results, and de-risked our product development, manufacturing and commercialization.

The most significant changes in New

Profusa’s future reported financial positions were approximately $11.0 million in proceeds from the PIPE Investment.

million is offset by various deferred offering costs and $2.0 million closing fees related to the underwriters marketing fee for the

IPO, which became payable upon the consummation of the Business Combination.

a result of the Business Combination, the Company has become the successor to an SEC-registered and Nasdaq-listed company, we have hired

additional personnel and implement procedures and processes to address public company regulatory requirements and customary practices.

We expect to incur additional annual expenses as a public company for, among other things, directors’ and officers’ liability

insurance, director fees, and additional internal and external accounting, legal and administrative resources.

Monetary Response, and Economic Impacts

world economy is experiencing stubbornly high inflation, a challenge not faced for decades.

Following the global financial crisis, with

inflationary pressures muted, interest rates were extremely low for years and investors became accustomed to low volatility.

The resulting

easing of financial conditions supported economic growth, but it also contributed to a buildup of financial vulnerabilities.

With inflation

at multi-decade highs, monetary authorities in advanced economies are accelerating the pace of policy normalization.

Policymakers have

continued to tighten policy against a backdrop of rising inflation and currency pressures, albeit with notable differences across regions.

Global financial conditions have tightened notably this year, leading to capital outflows.

Amid heightened economic and geopolitical

uncertainties, investors have aggressively pulled back from risk-taking and adjusted their investment preferences generally.

of systemic risk, such as higher dollar funding costs and counterparty credit spreads, have risen.

There is a risk of a disorderly tightening

of financial conditions that may be amplified by vulnerabilities built over the years.

addition, our business, growth, financial condition or results of operations could be materially adversely affected by instability or

changes in a country’s or region’s economic conditions;

changes in laws or regulations or in the interpretation

of existing laws or regulations, whether caused by a change in government or otherwise;

increased difficulty of conducting business in

a country or region due to actual or potential political or military conflict;

or action by the U.S.

or foreign governments that may

restrict our ability to transact business in a foreign country or with certain foreign individuals or entities.

A possible slowdown in

global trade caused by increasing tariffs or other restrictions could decrease consumer or corporate confidence and reduce consumer,

government and corporate spending in countries inside or outside the U.S., which could adversely affect our operations.

Climate-related

events, including extreme weather events and natural disasters and their effect on critical infrastructure in the U.S.

or internationally,

could have similar adverse effects on our operations, users, or third-party suppliers.

Continued Listing and Reverse Stock Split

previously disclosed, on September 11, 2025, we received written notice from the Staff stating that we were not in compliance with the

Minimum Bid Price Requirement and the MVLS Requirement.

The Staff provided us an initial compliance period of 180 calendar days, or until

March 10, 2026, to regain compliance with each of the Minimum Bid Price Requirement and the MVLS Requirement.

On February 9, 2026, we effected a 1-for-75 reverse stock split of

our common stock (the “Reverse Stock Split”).

The Reverse Stock Split did not change the par value of the common stock or

the authorized number of shares of common stock.

All share and per share information has been retroactively adjusted to reflect the Reverse

Stock Split for all periods presented.

as previously disclosed, on October 27, 2025, we received a letter from the Staff notifying us that, for the previous 30 consecutive

business days, the market value of our publicly held shares was below the Market Value Requirement.

The Staff provided us with an initial

period of 180 calendar days, or until April 27, 2026, to regain compliance with the Market Value Requirement.

March 11, 2026, we received a staff determination letter from the Staff indicating that we have not regained compliance with the Minimum

Bid Price Requirement.

The Staff previously provided a 180-day compliance period that expired on March 10, 2026;

we did not regain compliance

by that date.

As a result, our securities are subject to delisting from The Nasdaq Global Market.

In addition, the Staff indicated in

its March 11, 2026 letter that we also did not regain compliance with the MVLS Requirement by March 10, 2026.

The Staff stated that this

MVLS deficiency is an additional basis for delisting.

We exercised our right to appeal the delisting decision, and were notified on March

19, 2026 that the delisting action has been stayed.

Our hearing with the Nasdaq Hearings Panel is scheduled for April 21, 2026.

1 to ELOC Purchase Agreement

July 28, 2025, we entered into an Equity Line of Credit (“ELOC”) Purchase Agreement and a related registration rights agreement

with an investor, Ascent.

Pursuant to the terms and conditions set forth in the ELOC Purchase Agreement, we may, from time to time and

at its discretion, issue and sell to Ascent shares of its Common Stock for an aggregate purchase price of up to $100.0 million, subject

to certain limitations and conditions.

December 22, 2025, we entered into Amendment No.

1 (the “SPA Amendment”) to the ELOC Purchase Agreement.

Pursuant to the

SPA Amendment, Section 1.1 of the ELOC Purchase Agreement was amended and restated to modify the definition of Floor Price to provide

for a Floor Price at or above $0.111 per share during the period commencing on the date of the SPA Amendment and ending on, but excluding

February 9, 2026, the effective date of the Company’s 1-for-75 reverse stock split (the “Modification Period”).

“Floor Price” as amended and restated means, during the Modification Period, solely with respect to an aggregate number of

shares of Common Stock issued and sold as Purchased Securities not to exceed 182,000 shares, to be sold at or above $0.111 per share

and below $0.14.

Upon the earliest to occur of (x) the issuance of such aggregate number of 182,000 shares as Purchased Securities during

the Modification Period or (y) the end of the Modification Period, the Floor Price shall thereafter mean $0.14, the price per share of

Common Stock equal to the product obtained by multiplying (x) twenty percent (20%) by (y) the Official Closing Price on July 25, 2025,

in each case as further adjusted to reflect any reduction (but excluding any increase) in the price per share of Common Stock caused

by any reorganization, recapitalization, non-cash dividend, share split or other similar transaction, all as provided in this Agreement.

The modified Floor Price of $0.111 per share applies only during the Modification Period and only up to the 182,000 share cap relating

to shares issued and sold below $0.14, and the unmodified definition applies to all other times and shares.

execution of the ELOC Purchase Agreement through December 31, 2025, we have drawn

$10.3 million under the ELOC Purchase Agreement, and have made loan and interest repayments with these proceeds of $1.9 million through

December 31, 2025.

Subsequent to December 31, 2025 and through the date of filing, we issued 321,439 shares of our common stock

in exchange for $0.8 million under the ELOC Purchase Agreement and issued 2,696,907 shares of our common stock for the settlement of $1.9

million of principal and interest on the Ascent PIPE Notes.

Clinic License Agreement

February 11, 2026, we entered into a know-how License Agreement (the “License Agreement”) with Mayo Foundation for Medical

Education and Research (“Mayo”), pursuant to which Mayo granted us an exclusive license to certain patent rights, which the

parties plan to file for and obtain during the term of the License Agreement, and a non-exclusive license to specified know-how in the

fields of continuous oxygen measurement and critical limb-threatening ischemia, with the right to sublicense such rights.

customary reserved rights for educational, research and clinical programs of Mayo.

consideration, beginning with the first commercial sale of a licensed product, we are required to pay royalties on net sales of licensed

products in amounts that vary depending on the applicable field and intellectual property coverage.

We are also obligated to make milestone

payments upon the achievement of specified commercial, regulatory and clinical events.

connection with the License Agreement, we will collaborate with Mayo to investigate high impact clinical applications of our technologies

for new product development and commercialization.

License Agreement contains customary provisions regarding confidentiality, representations, warranties, disclaimers and indemnifications,

and termination rights.

The term of the License Agreement extends for a period tied to the life of the licensed patent rights and a post-commercialization

period, unless earlier terminated.

Loan Forgiveness

applied for loan forgiveness for the remaining PPP loan in December 2025.

On February 11, 2026, the Company received approval for forgiveness

from the SBA for the full $1.3 million principal loan balance.

This amount will be recognized as a gain on PPP loan forgiveness in Other

Income for the year ended December 31, 2026.

On February 10, 2026, we sold 3 Bitcoins at a price of $69,222 per

Bitcoin for an aggregate amount of $0.2 million.

On February 17, 2026, we sold 5.5 Bitcoins at a price of $67,156 per Bitcoin for an aggregate

amount of $0.4 million.

On March 11, 2026, we made the determination to terminate our Bitcoin treasury reserve strategy in light of current

market conditions and the evaluation of our capital allocation priorities.

On March 13, 2026, we sold the remaining balance of 8.01 Bitcoins,

at a price of $71,457 per Bitcoin for an aggregate amount of $0.6 million.

on Related-party Convertible Promissory Note

On March 20, 2026, we entered into an amendment for our related-party

promissory note to extend the maturity date from January 11, 2026 to December 31, 2026.

On April 6, 2026, we amended the note to update

the conversion price to $0.76 per share and concurrently approved the conversion of the entire outstanding principal balance of $1.9 million

into 2,460,257 shares of its common stock to the holders.

4 on the PIPE Subscription Agreement

April 2, 2026, we entered into Amendment No.

4 to our PIPE Subscription Agreement and related Pledge Agreement with Ascent.

Under Amendment

4, we may request additional funding with an aggregate principal amount of up to $12.2 million, subject to the terms and conditions

of the amended agreements.

4 also modified certain terms of the related Pledge Agreement, including revising the release condition to provide that the applicable

release condition will be satisfied upon payment in full, whether in cash or through conversion, of an aggregate principal amount of

$1.7 million of notes issued in the additional closings expected to occur on or shortly after April 2, 2026.

In addition, we have agreed

with Ascent that any mandatory prepayment amounts received under the notes will first be applied to obligations related to such additional

notes and thereafter to certain previously issued secured convertible promissory notes.

connection with the additional closing on April 2, 2026, we issued an Ascent PIPE Note with an aggregate principal amount of $0.6 million

and a warrant to purchase 1,111,111 shares of our common stock at an initial exercise price of $0.50 per share.

The note matures on April

2, 2027, bears interest at 12% per annum and is convertible into shares of our common stock, subject to the terms of the note.

contains customary terms and provisions for instruments of this nature.

of Intent Relating to Proposed Acquisition

On March 31, 2026 (and amended and restated on April 3, 2026), we entered

into a non-binding letter of intent with Bio Insights LLC (“Bio Insights”) to acquire certain assets, including the PanOmics

assay and related know-how, for aggregate consideration of $30.0 million, payable entirely through the issuance of our equity securities,

including common stock and convertible preferred stock.

In connection with the proposed transaction, Bio Insights would be entitled to

receive royalty payments equal to 3% of net revenues, payable annually following completion of audited financial statements.

transaction remains subject to the execution of definitive agreements, stockholder approval, and other customary closing conditions.

of Accounting and Consolidation

accompanying consolidated financial statements have been prepared in conformity with U.S.

GAAP and pursuant to applicable rules and regulations

of the SEC and include all adjustments necessary for the fair presentation of our financial position as of December 31, 2025 and

2024 and the results of operations and cash flows for the years then ended.

The accompanying consolidated financial statements include

the accounts of Profusa Inc.

and its wholly owned subsidiary, Profusa Asia Pacific Pte.

Ltd (“APAC”).

All intercompany balances

and transactions have been eliminated in consolidation.

of Results of Operations

Grant Revenue

grant revenue consists of amounts we earn under grants from two government agencies:

NIH and DARPA.

These grants are provided either

in the form of expense reimbursement (expense reimbursement grants) or on a fixed fee basis (fixed fee grants).

Under the expense reimbursement

grants the government agencies reimburse us for a portion of our expenses (allowable expenses) that have been incurred in a given period

on the basis of reports that we provide to these agencies.

Fixed fee grants are awarded for specific research and development programs

undertaken by us.

Under these grants we receive milestone payments from the government agencies upon our submission and approval by the

government of agreed upon deliverables, consisting primarily of the documented results of the specific research and development programs.

and Development Expenses

and development expenses consist primarily of personnel expenses, including salaries, benefits, and stock-based compensation, costs of

consulting, supplies, depreciation and amortization and allocations of facility-related expenses.

We expect our research and development

expenses to increase as we increase staffing to support product development, continue our clinical trials, build prototypes, and continue

to explore and develop next generation technologies.

and Administrative Expenses

and administrative expenses consist of personnel expenses, including salaries, benefits, and stock-based compensation, related to executive

management, finance, legal, human resource functions, and business development, contractor and professional services fees, audit and

compliance expenses, insurance costs and general corporate expenses, including merger transaction costs incurred, allocated facility-related

expenses and information technology costs.

on Change in the Fair Value of Convertible Notes

elected to apply the fair value option to account for (i) the convertible notes issued between June 2023 and March 2024 (the “Tasly

Convertible Note”), (ii) the Ascent PIPE Notes issued during the year ended December 31, 2025 and (iii) the Northview Sponsor working

capital promissory note.

Loss on change in the fair value of convertible notes comprise of the change in fair value of the Company’s

convertible notes and its related accrued interest on the convertible notes.

These abovementioned notes were recorded at fair value at

inception and are subject to remeasurement to fair value at each balance sheet date, with the change in fair value reflected in our consolidated

statements of operations.

on Change in the Fair Value of Warrant Liabilities

change in fair value of our private warrant liabilities that we acquired as a result of our Business Combination is reflected in this

financial statement line item.

on Change in the Fair Value of Digital Assets

change in fair value of Bitcoins that we hold during the respective periods is reflected in this financial statement line item.

costs consists of costs in relation to the issuance of shares under the ELOC Purchase Agreement.

expense consists primarily of the interest on our convertible notes, related party convertible notes, senior notes, promissory notes,

and PPP Loans.

income consists primarily of interest income earned from our operating cash account, income earned from sale of equipment and a short-term

sublease of a portion of our facilities.

of Operations

of December 31, 2024, we had not commenced any operations.

All activity for the period from April 19, 2021 (inception) through December

31, 2024 relates to our formation and the Initial Public Offering, and, subsequent to the IPO, identifying a target company for a Business

We have neither engaged in any operations nor generated any operating revenues to date.

We will not generate any operating

revenues until after the completion of our initial Business Combination, at the earliest.

We will generate non-operating income in the

form of interest income and unrealized gains from the cash and marketable securities held in the Trust Account.

We expect to incur expenses

as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence

For the year ended December 31, 2024, we had

net loss of $8,711,619 which consisted of operating costs of $1,351,038, income tax provision of $80,513, change in fair value of our

warrant liabilities of $539,531 and change in fair value of convertible note of $7,165,953, offset by interest income on securities held

in the Trust Account of $425,416.

For the year ended December 31, 2023, we had

net income of $1,161,910, which consisted of interest income on securities held in the Trust Account of $2,248,538 and a gain of $701,148

for the change in fair value of our warrant liabilities and change in fair value of convertible note of $177,697, offset by operating

costs of $1,508,683, and income tax provision of $456,790.

and Going Concern

As of December 31, 2024, we had $16,204 in cash and a working capital

deficit of $12,254,024.

For the year ended December 31, 2024, cash used

in operating activities was $1,296,812.

Net loss of $8,711,619 was impacted primarily by trust interest income of $425,416, change in

fair value of convertible note of $7,165,953 and change in fair value of our warrant liabilities of $539,531.

Changes in operating assets

and liabilities reflected cash provided by operating activities of $134,739 during such period.

the year ended December 31, 2024, cash provided by investing activities included $485,350 of extension payments made to the trust, $204,459

of reimbursement from the trust of franchise and income tax payments and cash withdrawn from the trust of $3,248,878 in relation to stock

For the year ended December 31, 2024, cash used in financing activities

included $797,981 of proceeds from a convertible promissory note, $791,407 of an advance from Profusa and $3,248,878 paid out in relation

to stock redemptions.

the year ended December 31, 2023, cash used in operating activities was $2,064,860.

Net income of $1,161,910 was impacted primarily by

trust interest income of $2,248,538, change in fair value of convertible note of $177,697, change in fair value of our warrant liabilities

Changes in operating assets and liabilities reflected a use of cash of $99,387 from operating activities during such period.

the year ended December 31, 2023, cash provided by investing activities included $438,360 of extension payments made to the trust, $1,192,438

of reimbursement from the trust of franchise and income tax payments and cash withdrawn from the trust of $184,845,836 in relation to

a partial stock redemption.

the year ended December 31, 2023, cash used in financing activities included $1,121,815 of proceeds from a convertible promissory note

and $184,845,836 of a partial stock redemption.

to the completion of the initial public offering, our liquidity needs had been satisfied through a capital contribution from the sponsor

of $25,000 for the founder shares to cover certain of the offering costs and the loan under an unsecured promissory note from the sponsor

of $204,841, which was fully paid upon the initial public offering.

Subsequent to the consummation of the initial public offering and

private placement, our liquidity needs have been satisfied through the proceeds from the consummation of the private placement not held

in the trust account, and the drawdowns on the convertible promissory note.

order to finance transaction costs in connection with an intended Business Combination, the initial stockholders or an affiliate of the

initial stockholders or certain of the Company’s officers and directors may, but are not obligated to, provide the Company Working

Capital Loans (see Note 5).

On April 27, 2023, the Company signed a Convertible Working Capital

Promissory Note (“the Note”) with the Sponsor for $1,200,000.

The Note is non-interest bearing and is due the earlier of the

consummation of a business combination or the date of liquidation.

The Sponsor may elect to convert all or any portion of the unpaid principal

balance of this Note into warrants, at a price of $1.00 per warrant.

On January 10, 2024, the Company’s Board of Directors approved,

and the Company amended the Note to increase the principal amount of the Note that could be drawn on to $1.5 million.

and restated Note also allows for the conversion of the outstanding principal balance of the Note to be repaid in shares of Company common

stock at a price of $2.22 per share at the election of the sponsor.

On May 31, 2024, the Company’s Board of Directors approved and

the Company entered into a second amendment of its Convertible Working Capital Promissory Note with the sponsor to increase the principal

amount of the Note that could be drawn on to $2.5 million.

The second amended and restated Note also allows for the conversion of

the outstanding principal balance of the Note to be repaid in shares of Company common stock at a price of $2.22 per share at the

election of the sponsor.

The Company had principal outstanding of $1,919,796 and is presenting the Note at fair value on its balance sheet

at December 31, 2024 in the amount of $8,908,052.

The Company has until June 22, 2025 to consummate

a Business Combination.

It is uncertain that the Company will be able to consummate a Business Combination by June 22, 2025.

If a Business

Combination is not consummated by the required date, there will be an option to either extend the time available for us to consummate

our initial business combination or execute a mandatory liquidation and subsequent dissolution.

In connection with the Company’s

assessment of going concern considerations in accordance with the authoritative guidance in Financial Accounting Standards Board (“FASB”)

Accounting Standards Update (“ASU”) 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue

as a Going Concern,” management has determined that mandatory liquidation, and subsequent dissolution, should the Company be unable

to complete a business combination, raises substantial doubt about the Company’s ability to continue as a going concern for the

next twelve months from the issuance of these consolidated financial statements.

No adjustments have been made to the carrying amounts

of assets and liabilities should the Company be required to liquidate after June 22, 2025.

Sheet Financing Arrangements

did not have any off-balance sheet arrangements as of December 31, 2024 and 2023.

of December 31, 2024 and 2023, we did not have any long-term debt or capital or operating lease obligations.

entered into an administrative services agreement with our sponsor pursuant to which we pay for office space and secretarial and administrative

services provided to members of our management team, in an amount of $5,000 per month.

As of June 30, 2023, the Company and the sponsor

terminated this agreement.

For the year ended December 31, 2024, $0 had been incurred and billed relating to the administrative service

For the year ended December 31, 2023, $30,000 had been incurred and billed relating to the administrative service fee.

As of December

31, 2024 and 2023, $50,000 relating to the administrative service fee was not paid and recorded as due to related party.

NorthView previously engaged I-Bankers as an advisor

to assist in holding meetings to discuss the potential business combination and the target business’ attributes, introduce NorthView

to potential investors that are interested providing funding in connection with a Business Combination, assist NorthView in obtaining

stockholder approval for such business combination and assist NorthView with its press releases and public filings in connection with

such business combination (the “Business Combination Marketing Agreement”).

In connection with such engagement, NorthView

agreed to pay I-Bankers and Dawson James a cash fee (the “Business Combination Fee”) for such services upon the consummation

of a business combination in an amount equal to 3.68% of the gross proceeds of its initial public offering (exclusive of any applicable

finders’ fees which might become payable).

In connection with the Business Combination, NorthView, I-Bankers and Dawson James amended

the Business Combination Marketing Agreement to revise a portion of the Business Combination Fee to be partially payable in NorthView

securities and partially payable in cash upon the closing of the Merger with Profusa, with such securities to be subject to lock-up provisions.

Subsequently, on January 19, 2025, the agreement was modified by the parties such that the Company will be required to pay $2,000,000,

payable in cash, if a business combination is consummated.

Critical Accounting Estimates

Certain of our accounting policies require that

management apply significant judgments in defining the appropriate assumptions integral to financial estimates.

On an ongoing basis, management

reviews the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented

fairly and in accordance with U.S.

Judgments are based on historical experience, terms of existing contracts, industry trends and

information available from outside sources, as appropriate.

Some of the more significant estimates are in connection with determining

the fair value of the warrant liabilities and convertible promissory note.

However, by their nature, judgments are subject to an inherent

degree of uncertainty, and, therefore, actual results could differ from our estimates.

Promissory Note

fair value of the Company’s convertible promissory note is valued using a compound option formula on the convertible feature and

a present value of the host contract.

The valuation technique requires inputs that are both unobservable and significant to the overall

fair value measurement.

These inputs reflect management’s own assumption about the assumptions a market participant would use in

pricing the working capital loan.

account for the warrants issued in connection with the IPO in accordance with the guidance contained in ASC 815-40.

Such guidance provides

that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability.

we classified each warrant as a liability at its fair value.

This liability is subject to re-measurement at each balance sheet date.

With each such re-measurement, the warrant liabilities will be adjusted to fair value, with the change in fair value recognized in our

consolidated statements of operations.

determining the fair value of the Private Placement Warrants and the Representative’s Warrants assumptions related to expected

share-price volatility, expected life and risk-free interest rate are utilized.

The Company estimates the volatility of its common stock

based on historical volatility that matches the expected remaining life of the warrants.

of the years ended December 31, 2025 and 2024

following table sets forth our consolidated statements of operations for the periods indicated (in thousands):

Ended December 31,

Operating expenses:

and development

and administrative

operating expenses

Loss from operations

on change in the fair value of convertible notes

on the change in fair value of warrant liabilities

on the change in fair value of digital assets

expense (including related parties amounts of

$1,330 and $2,400 for the years ended December 31, 2025 and 2024, respectively)

– Grant revenue was recognized in 2024, while no grant revenue was recognized in 2025, as we focused on closing the Business Combination.

and Development – Research and development expenses increased by $1.2 million, or 74%, to $2.8 million during the year ended

December 31, 2025 from $1.6 million during the year ended December 31, 2024.

The increase was driven primarily by the increase in regulatory

and contract research organization (“CRO”) costs of $0.8 million, plus laboratory rent and materials costs of $0.2 million

and $0.1 million, respectively, which is in line with our intent to focus on research and development to complete device functionality

and reach the point of commercialization in the near future.

and Administrative – General and administrative expenses increased by $21.9 million, or 732%, to $24.9 million during the year

ended December 31, 2025 from $3.0 million during the year ended December 31, 2024.

The increase was driven primarily by the increase

in transaction closing costs of $14.5 million, an increase in personnel costs of $4.3 million, increase in accounting fees of $1.1 million,

an increase in public relations expense of $0.7 million and an increase to insurance and legal fees of $0.6 million.

on Change in the Fair Value of Convertible Notes – Loss on change in the fair value of convertible notes increased by $3.1

million, or 986%, to $3.4 million during the year ended December 31, 2025 from a loss of $0.3 million during the year ended December

The loss recognized during the year ended December 31, 2025 was driven by the losses on the remeasurement of the Ascent PIPE

Notes and the Tasly Convertible Note of approximately $3.3 million and $0.1 million, respectively, partially offset by the gain on the

remeasurement of the Northview Sponsor working capital promissory note of $0.2 million.

During the year ended December 31, 2024, the

entirety of the loss on change in the fair value of convertible notes was due to the remeasurement of the Tasly Convertible Note.

on Change in the Fair Value of Warrant Liabilities – Gain on change in the fair value of warrant liabilities was $0.9

million during the year ended December 31, 2025 due to the decline in our stock price during the same period.

We acquired the warrant

liabilities as a result of the Business Combination and therefore the change in fair value of warrant liabilities is only reflected in

the year ended December 31, 2025.

on Change in the Fair Value of Digital Assets – Loss on change in the fair value of digital assets was $0.6 million during

the year ended December 31, 2025.

We did not have any Bitcoin in the year ended December 31, 2024.

Expense – Interest expense decreased by $1.9 million, or 43%, to $2.5 million during the year ended December 31, 2025 from

$4.4 million during the year ended December 31, 2024.

The decrease was primarily due to junior and senior convertible notes being converted

and settled on July 11, 2025, the Closing Date of our Business Combination, which reduced the accrued interest on these notes for the

remainder of the year ended December 31, 2025.

Costs – Increased by $2.6 million in relation to the issuance of shares under the ELOC Purchase Agreement.

Income – Other income increased by an immaterial $11 thousand during the year ended December 31, 2025 relating to interest

income earned on our cash operating account.

and Capital Resources

incurred net losses and negative operating cash flows from operations since inception, and we expect to continue to incur losses and

negative operating cash flows for the foreseeable future until we successfully commence sustainable commercial operations.

have funded our operations primarily with proceeds from the issuance of convertible preferred stock, junior and senior convertible notes,

related party loans payable, ELOC, PPP Loans available to us under the Paycheck Protection Program, convertible PIPE note, related party

convertible notes, and other promissory notes.

From inception through December 31, 2025, we raised gross proceeds of $98.0 million

from the issuances of convertible preferred stock and convertible notes and loans, $11.0 million from loans payable, $10.3 million from

ELOC, $2.5 million from PPP Loans and $1.0 million from issuance of promissory notes.

As of December 31, 2025, we had cash of $1.8

junior convertible notes bore interest at 12% per annum and their outstanding principal and accrued but unpaid interest automatically

converted into shares of Common Stock at $525.00 per share upon consummation of the Business Combination, as adjusted by our Reverse

In addition, upon consummation of the Business Combination, all junior noteholders have a right to receive additional shares

upon achievement by the Company of certain share price and sales milestones (the earnout shares).

commenced issuance of our senior convertible notes in April 2021 and continued issuing them until the Closing.

Our senior convertible

notes bore interest at 12% per annum and their outstanding principal and accrued but unpaid interest automatically converted into shares

of Common Stock between $37.50 and $300.00 per share upon consummation of the Business Combination, based on the fixed conversion price

defined in the notes, as adjusted by our Reverse Stock Split.

In addition, upon consummation of the Business Combination, all senior

noteholders obtained the right to receive additional shares upon achievement by the Company of certain share price and sales milestones

(the earnout shares).

August 8, 2023, a new wholly owned subsidiary, APAC, was created and incorporated by Legacy Profusa under the laws of Singapore.

creation, the new entity was capitalized by Legacy Profusa by payment of $1,000 for 1,000 Ordinary Shares.

As a result, at the time of

incorporation, the entity became a wholly owned subsidiary of Legacy Profusa.

The entity was created with the expectation of jointly

conducting the business of developing, manufacturing and commercializing the Lumee Glucose and the Lumee Oxygen products, currently under

development by the Company, together with a third party.

No business or activities will have been conducted by the entity from the date

of formation through and until the closing date of the proposed License Agreement and Shareholders Agreement between the Company and

Best Life Technology Ltd, an entity wholly owned and controlled by Tasly.

the event we either fail to complete the formation of the APAC Joint Venture or fail to repay the amounts under the Tasly Convertible

Note when they become due, the lender will have an option to convert the outstanding balance and accrued but unpaid interest (in part

or in full) into senior unsecured promissory notes on substantially the same terms as the outstanding Senior Notes as converted on July

11, 2025 into New Profusa (which terms include conversion into Company Common Stock).

Notwithstanding the conversion provisions above,

any repayment obligations (in part or in full) of the outstanding principal balance and accrued but unpaid interest under the Tasly Convertible

Note may, at the lender’s option, be made through conversion of part or all amounts payable into (i) senior unsecured promissory

notes on substantially the same terms as the outstanding Senior Notes as converted on July 11, 2025, $37.50 per share, or (ii) Common

Stock at a conversion price of $144.00 per share.

outstanding PPP Loan of $1.4 million bears interest at 1% per annum.

As of December 31, 2025, the repayment of the PPP Loan was expected

to be made in equal monthly payments of principal and interest from October 25, 2022 until May 25, 2026.

In February 2026, our application

for forgiveness for this loan was approved.

outstanding promissory notes accrue interest at 5% and 12% per annum, most of which do not have a set maturity date.

Any promissory notes

that did have an initial maturity date, which has passed, we have verbally agreed to pay off these loans subsequent to the Closing.

are currently in default;

accordingly, we classified the entire outstanding amount as a current liability on the consolidated balance

funds may be necessary to maintain current operations and will be required for successful product commercialization efforts.

to the year ended December 31, 2025, we obtained additional funds from the ELOC, however, conditions exist that raise substantial doubt

about our ability to continue as a going concern within one year from the date the consolidated financial statements as of and for the

year ended December 31, 2025 are issued.

Liquidity Requirements

expect our cash on hand, and cash that we received from the Business Combination and PIPE Investment, together with proceeds from the

ELOC and the cash we expect to generate from future operations and sale of digital assets, will provide sufficient funding to support

initial commercial operations.

The cash generated from the Business Combination includes an initial net $9.0 million in PIPE proceeds

from the first tranche and net $2.0 million from the second tranche of a convertible note.

The cash generated from the ELOC was $10.3

million for the year ended December 31, 2025.

Until we generate sufficient operating cash flow to cover our operating expenses,

working capital needs and planned capital expenditures, or if circumstances evolve differently than anticipated, we expect to utilize

a combination of equity and debt financing to fund any future capital needs.

If we raise funds by issuing equity securities, dilution

to stockholders may result.

Any equity securities issued may also provide for rights, preferences, or privileges senior to those of holders

of common stock.

If we raise funds by issuing debt securities, these debt securities may have rights, preferences, and privileges senior

to those of common stockholders.

The terms of debt securities or borrowings could impose significant restrictions on our operations.

The capital markets are currently experiencing, and may continue to experience in the future, periods of upheaval that could impact the

availability and cost of equity and debt financing.

principal uses of cash in recent periods have been funding our research and development activities, legal and bank transaction fees,

and other personnel cost.

Near-term capital requirements through December 31, 2026 leading to and supporting initial commercialization

are estimated to total approximately $14.5 million and include further research and development to enable us to obtain the required regulatory

approvals, manufacturing, commercialization and wide-scale marketing for our Lumee Oxygen and Lumee Glucose devices.

Our future capital

requirements will depend on many factors, including our revenue growth rate, the timing and the amount of cash received from our customers,

the expansion of sales and marketing activities, the timing and extent of spending to support development efforts.

In the future, we

may enter into arrangements to acquire or invest in complementary businesses, products, and technologies.

For any periods after the twelve

months subsequent to the filing of these financial statements as of December 31, 2025, we may be required to seek additional equity

or debt financing.

In the event that we require additional financing we may not be able to raise such financing on acceptable terms or

If we are unable to raise additional capital or generate cash flows necessary to continue our research and development and invest

in continued innovation, we may not be able to compete successfully, which would harm our business, results of operations, and financial

If adequate funds are not available, we may need to reconsider our production investments, the pace of our production ramp-up,

expansion plans or limit our research and development activities, which could have a material adverse impact on our business prospects

and results of operations.

following table summarizes our cash flows for the periods presented (in thousands):

Ended December 31,

Net cash provided by (used in):

increase in cash

used in operating activities for the year ended December 31, 2025 of $16.2 million was primarily driven by our net loss of $35.8 million,

adjusted for non-cash charges of $15.2 million and net cash inflows of $4.3 million provided by changes in our operating assets and liabilities.

Non-cash charges primarily consisted of non-cash issuance of inducement shares in connection with the merger of $7.3 million, the non-cash

loss on fair value of convertible notes of $3.1 million, non-cash interest expense of $2.5 million, non-cash issuance cost of $1.0 million

for ELOC Warrants, stock-based compensation of $0.9 million, the loss on the change in fair value of digital assets of $0.6 million,

non-cash merger transaction costs of $0.5 million, offset by the gain on fair value of warrant

liabilities of $0.9 million.

The main driver of the cash inflows from the changes in operating assets and liabilities was primarily related

to an increase in accounts payable of $3.6 million and in accrued liabilities of $0.5 million and a decrease in prepaid expenses and

other current assets of $0.2 million.

used in investing activities was $2.0 million for the year ended December 31, 2025, which consisted primarily of the purchase of digital

As of December 31, 2025, the Company held 16.51 units of Bitcoin.

Bitcoin is subject to significant price volatility.

A substantial

decline in the market price of Bitcoin could materially reduce the value of our holdings and adversely affect our financial position.

did not have any investing activities in the year ended December 31, 2024.

provided by financing activities was $19.8 million for the year ended December 31, 2025, which consisted primarily of net proceeds from

the issuance of ELOC of $10.3 million, issuance of PIPE of $11.0 million, issuance of senior notes of $1.5 million, offset by the repayment

of convertible notes and senior notes of $2.9 million.

provided by financing activities was $2.1 million for the year ended December 31, 2024, which consisted primarily of net proceeds from

the issuance of senior notes of $3.2 million, primarily offset by payment of deferred offering costs of $1.0 million and the repayment

of related party promissory notes of $0.2 million.

following table summarizes our contractual obligations as of December 31, 2025, and the years in which these obligations are due

(in thousands):

Tasly convertible

note - related party

Convertible promissory note

- related party

Loans payable

Promissory notes

contractual obligations

Accounting Estimates

discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which

have been prepared in accordance with U.S.

The preparation of these consolidated financial statements requires us to make estimates

and assumptions for the reported amounts of assets, liabilities, revenue, expenses and related disclosures.

Our estimates are based on

our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form

the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

results may differ from these estimates under different assumptions or conditions and any such differences may be material.

consider an accounting estimate to be critical if:

(1) the accounting estimate requires us to make assumptions about matters that were

highly uncertain at the time the accounting estimate was made, and (2) changes in the estimate that are reasonably likely to occur from

period to period, or use of different estimates that we reasonably could have used in the current period, would have a material impact

on our financial condition or results of operations.

has discussed several significant accounting estimates and believes that the fair value of the Ascent PIPE Notes, is the only accounting

estimate that rises to the level of a critical accounting estimate.

Ascent PIPE Notes is carried at fair value based on unobservable market inputs.

The fair value of financial instrument is determined

using the Monte Carlo simulation model.

Where observable market prices are not available, we use models that incorporate assumptions

about credit risk, interest rates, and market volatility.

These estimates require significant judgment, particularly for instruments

classified as Level 3 in the fair value hierarchy.

Changes in these assumptions could materially affect the reported fair values and

related income or expense.

We regularly review and update our valuation to reflect current market conditions and ensure consistency with

accounting standards.

Standards Adopted

In November 2023, the FASB

issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are

regularly provided to the chief operating officer decision maker (“CODM”), as well as the aggregate amount of other

segment items included in the reported measure of segment profit or loss.

The ASU requires that a public entity disclose

the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in

assessing segment performance and deciding how to allocate resources.

Public entities will be required to provide all annual

disclosures currently required by Topic 280 in interim periods, and entities with a single reportable segment are required

to provide all the disclosures required by the amendments in this ASU and existing segment disclosures in Topic 280.

This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years

beginning after December 15, 2024, with early adoption permitted.

The Company adopted ASU 2023-07, which was applied retrospectively

to all prior periods presented.

See Note 10 for further details regarding this adoption.

Standards not yet Adopted

December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”),

which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional

information for reconciling items that meet a quantitative threshold.

ASU 2023-09 will also require the Company to disaggregate its income

taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions.

ASU 2023-09 will become effective for annual periods beginning after December 15, 2024.

The Company is still reviewing the impact of

management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have

a material effect on the accompanying consolidated financial statements.

Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies.

as an “emerging growth company” under the JOBS Act and are allowed to comply with new or revised accounting pronouncements

based on the effective date for private (not publicly traded) companies.

We are electing to delay the adoption of new or revised accounting

standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such

standards is required for non-emerging growth companies.

As a result, our consolidated financial statements may not be comparable

to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Additionally,

we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act.

Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such

exemptions we may not be required to, among other things, (i) provide an independent registered public accounting firm’s attestation

report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure

that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection

Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the

independent registered public accounting firm’s report providing additional information about the audit and the consolidated financial

statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation

between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.

exemptions will apply for a period of five years following the completion of our initial public offering or until we are no longer an

“emerging growth company,” whichever is earlier.

considered various fair value instruments;

however, only the Ascent PIPE Notes is both classified as a Level 3 fair value instrument

and is material to our consolidated financial statements.

The Ascent PIPE Notes was valued at $7.9 million as of December 31, 2025.

In addition, we consider this estimate critical due to its complexity, subjectivity, and material impact on reported results.

we have one critical accounting estimate to report, and have included our considerations below.

have elected to account for our Ascent PIPE Notes at fair value under ASC 825, “Financial Instruments.” The PIPE Subscription

Agreement is classified as a Level 3 financial instrument due to the absence of observable market inputs and the significant use of management

judgment in determining fair value.

fair value is estimated using a probability-weighted discounted cash flow model that incorporates multiple simulated settlement scenarios,

including conversion, repayment, and extension.

Key inputs include the discount rate, expected term, volatility, and conversion likelihood.

When the PIPE Subscription Agreement was executed between Northview and the PIPE investors, the loan was with a related party, as such

observable market data is limited, and management applies significant judgment in assessing the economic substance of the arrangement.

the year ended December 31, 2025, the estimated fair value of the Ascent PIPE Notes increased by $3.3 million.

Changes in fair value

are recognized in earnings each period.

We consider this estimate critical due to its complexity, subjectivity, and material impact on

reported results.

policies are reviewed quarterly, and inputs are updated based on evolving market conditions and contractual developments.

the discount rate of +100 basis points would result in a fair value change of approximately $13 thousand or (0.2)%, while a 10% change

in volatility would impact fair value by approximately $8 thousand or 0.1%.

reconciliation of the beginning and ending balances for the Ascent PIPE Notes can be referenced in Note 4 of the accompanying consolidated

financial statements included elsewhere in this Annual Report.

Accounting Pronouncements

the section titled “Recent Accounting Pronouncements” in Note 2 of the notes to our consolidated financial statements included

in this Annual Report for more information.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

required for smaller reporting companies.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

financial statements required to be filed pursuant to this Item 8 are appended to this Annual Report.

An index of those financial statements

is found in Item 15.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 7. Management’s Discussion and Analysis