Note 1. Description of Business

Organization and Description of Business

SeaStar Medical Holding Corporation, a Delaware corporation (“SeaStar”) and its wholly owned subsidiary, SeaStar Medical, Inc., are collectively referred to as the “Company”. SeaStar Medical, Inc. was incorporated as a Delaware corporation in June 2007, and it is headquartered in Denver, Colorado. The Company is principally engaged in the research, development, and commercialization of a platform medical device technology designed to modulate inflammation in various patient populations. The initial target of this technology is for the treatment of patients with acute kidney injuries ("AKI"), but through additional Breakthrough Device Designation (“BDD”) from the Food and Drug Administration (“FDA”), has expanded into treatments of patients with cardiorenal syndrome awaiting left ventricular assist device implantation, patients with hepatorenal syndrome, patients with end stage renal disease and adult and pediatric patients undergoing cardiac surgery. The BDD enables the potential for a speedier pathway to approval and the ability to have more frequent and flexible meetings with the FDA.

The Company received FDA approval on February 21, 2024, under a Humanitarian Device Exemption (“HDE”) for the Company’s pediatric SCD therapy. It is the only FDA approved product for use in pediatric patients with AKI due to sepsis or a septic condition requiring kidney replacement therapy. The Company shipped its first commercial pediatric SCD (“QUELIMMUNE”) in July 2024. In addition, the Company is currently conducting a pivotal clinical trial to assess the safety and efficacy of the SCD therapy in critically ill adult patients with AKI requiring continuous renal replacement therapy (“CRRT”).

On October 28, 2022, LMF Merger Sub, Inc., a wholly owned subsidiary of LMF Acquisition Opportunities, Inc. (“LMAO”) merged with and into SeaStar Medical, Inc. (the “Business Combination”), with SeaStar Medical, Inc. surviving the Business Combination as a wholly owned subsidiary of LMAO. Following the consummation of the Business Combination, LMAO was renamed “SeaStar Medical Holding Corporation.”

Basis of Presentation and Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules and regulations, certain notes or other financial information normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The interim unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal, recurring adjustments that are necessary to present fairly the Company’s results for the interim periods presented. The results from operations for the six months ended June 30, 2025, are not necessarily indicative of the results to be expected for the year ending December 31, 2025, or for any future annual or interim period.

The accompanying interim unaudited condensed consolidated financial statements should be read in conjunction with the annual consolidated financial statements and the related notes for the year ended December 31, 2024. There have been no material changes in our significant accounting policies as described in our Annual Report on Form 10-K for the year ended December 31, 2024.

The interim unaudited condensed consolidated financial statements include the consolidated accounts of the Company’s wholly owned subsidiary, SeaStar Medical, Inc. All significant intercompany transactions have been eliminated in consolidation.

On June 7, 2024, the Company effected a 1-for-25 reverse stock split (the “Reverse Stock Split”) of its issued and outstanding shares of common stock, par value $0.0001 (the “common stock”). Following the effect of the Reverse Stock Split, each 25 shares of the Company’s common stock that were issued and outstanding automatically converted into one outstanding share of common stock.

All stock options and warrants of the Company outstanding immediately prior to the Reverse Stock Split were proportionally adjusted except for the Listed Warrants and the private placement warrants that were issued as part of the SPAC transaction that closed on October 28, 2022, which total 16,788,000 outstanding warrants in the aggregate (the “Unadjusted Warrants”). The Unadjusted Warrants retained an $11.50 exercise price each and require the exercise of 25 warrants to purchase one share of common stock. Unless otherwise indicated, all other share and per share amounts in this quarterly report reflect the effect of the Reverse Stock Split. The par value of the Company’s common stock remained unchanged at $0.0001 per share and the number of authorized shares of common stock remained the same after the Reverse Stock Split.

Segment Information

The Company is comprised of a single reportable segment, its Device Segment. This organizational structure aligns with how our Chief Operating Decision Maker (“CODM”), the Chief Executive Officer, manages the Company’s business, including resource allocation and performance assessment. The Company is focused entirely on the development, regulatory approval and commercialization of the Company’s adult and pediatric Selective Cytopheretic Devices (SCDs). The Company had a total of 18 employees at June 30, 2025, and total assets of $8.4 million and $4.7 million, as of June 30, 2025, and December 31, 2024, respectively

For segment reporting purposes, the CODM uses operating profit/(loss) to evaluate segment performance and allocate resources. As a Company that only recently began limited commercial sales of QUELIMMUNE, the CODM is primarily focused on evaluating the overall spending for research and development activities needed to fund further development of the SCDs, and general and administrative activities incurred to support the research and development activities of the Company. Accounting policies associated with the Company’s sole segment are the same as those described in Note 2.

All of the Company’s sales are located within the United States. As of the date of this report, the Company has obtained regulatory approval for commercial sales in the U.S. of QUELIMMUNE from the FDA. The Company does not have any inter-entity sales or transfers.

Liquidity and Going Concern

The Company incurred losses of $5.8 million for the six months ended June 30, 2025. As of June 30, 2025, the Company has an accumulated deficit of $145.3 million and cash of $6.3 million. The Company does not believe that its cash on hand will be sufficient to enable it to fund its operations, including clinical trial expenses and capital expenditure requirements for at least 12 months from the issuance of these unaudited condensed consolidated financial statements. The Company believes that these conditions raise substantial doubt about its ability to continue as a going concern.

The Company’s need for additional capital will depend in part on the scope and costs of its development activities. To date, the Company has generated insufficient revenue from the sales of its commercialized product, QUELIMMUNE to fund its operations. Its ability to generate meaningful product revenue will depend on the commercial successful launch of QUELIMMUNE and development and eventual commercialization of the adult SCD. Until such time, if ever, it expects to finance its operations through the sale of equity or debt, borrowing under credit facilities, or through potential collaborations, other strategic transactions or government and other grants. Adequate capital may not be available to the Company when needed or on acceptable terms.

If the Company is unable to raise capital, it could be forced to delay, reduce, suspend, or cease its research and development programs or any future commercialization efforts, which would have a negative impact on its business, prospects, operating results and financial condition. The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include adjustments that might result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course of business.

Risks and Uncertainties

The Company is subject to risks common to early-stage companies in the medical technology industry including, but not limited to, new medical and technological innovations, dependence on key personnel, protection of proprietary technology, and product liability.

There can be no assurance that the Company’s products or services will be accepted in the marketplace, nor can there be any assurance that any future products or services can be developed or deployed at an acceptable cost and with appropriate performance characteristics, or that such products or services will be successfully marketed, if at all. These factors could have a materially adverse effect on the Company’s future financial results, financial position and cash flows.

Note 2. Summary of Significant Accounting Policies

Note 3. Revenues and Contract Obligations

Revenue by Geographic Location

The Company’s sales are entirely in the United States of America, as it does not have any regulatory approval to sell elsewhere as of June 30, 2025.

Note 4. Accounts Receivable, net

Note 5. Accrued Expenses

Note 6. Notes Payable

Insurance Financing

In October 2024, the Company entered into a financing arrangement with a lender to finance a portion of the annual premium of an insurance policy in the amount of $0.7 million. As of June 30, 2025, the Company paid the entire balance.

Note 7. Equity Transactions

June 2025 Offering

In June 2025, the Company did a best efforts public offering (the “June 2025 Offering”) pursuant to which the Company issued aggregate of (i) 4,935,385 shares of the Company's common stock, (ii) 1,218,462 pre-funded warrants to purchase up to 1,218,462 shares of Common Stock (the “June 2025 Pre-Funded Warrants”) with an exercise price of $0.0001, (iii) 6,153,847 Series A warrants to purchase up to 6,153,847 shares of Common Stock with an exercise price of $0.65 (the “Series A Warrants”), and (iv) 6,153,847 Series B warrants to purchase up to 6,153,847 shares of Common Stock at an exercise price of $0.65 (the “Series B Warrants”). Collectively, these warrants are referred herein as the "June 2025 Warrants".

The Company received aggregate gross proceeds from the June 2025 Offering of approximately $4.0 million, before deducting fees to H.C. Wainwright & Co. (“Wainwright”) and other estimated offering expenses payable by the Company. The June 2025 Pre-Funded Warrants will not expire and are exercisable upon issuance and at any time until all of the June 2025 Pre-Funded Warrants are exercised in full. As of June 30, 2025, a total of 1,218,462 pre-funded warrants were exercised with no June 2025 Pre-Funded Warrants outstanding.

The Series A Warrants and Series B Warrants were immediately exercisable with the Series A warrants expiring in June 2030 and the Series B Warrants expiring in December 2026.

The Company paid approximately $0.4 million in fees to Wainwright and issued 430,769 warrants (the "June 2025 PA Warrants") to purchase shares of the Company's common stock at an exercise price of $0.8125. The 2025 PA Warrants were exercisable upon issuance and expire on June 20, 2030. The June 2025 PA Warrants, Series A Warrants and Series B Warrants are herein defined as the "June 2025 Warrants".

In accordance with ASC 815-40, Derivatives and Hedging-Contracts in Entity’s own Equity, the Company determined that all the different warrants issued in connection with the June 2025 Offering met the conditions for equity classification and were included as a component of stockholders’ equity (deficit).

Standby Equity Purchase Agreement

On April 25, 2025, the Company entered into a standby equity purchase agreement (“Common Stock Purchase Agreement”) and related registration rights agreement (the “Registration Rights Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), collectively the “SEPA”. Pursuant to the Common Stock Purchase Agreement, the Company has the right, but not the obligation, to direct Lincoln Park to purchase up to $15.0 million in aggregate gross purchase price of newly issued shares of Common Stock, subject to certain limitations and conditions as described below (the “SEPA Program”) at a purchase price equal to 97% of the lesser of (i) the lowest sale price of the common stock on the purchase date or (ii) average of the three lowest closing sale prices of the common stock over the last ten business days prior to the purchase date.

The Company controls the timing and amount of any sales to Lincoln Park, which depend on a variety of factors including, among other things, market conditions, the trading price of the Company’s common stock, and determinations by the Company as to appropriate sources of funding for its business and operations. However, Lincoln Park’s obligation to purchase shares is subject to certain conditions, including the daily trading volume of the Company’s stock.

In all instances, the Company may not sell shares of Common Stock under the Purchase Agreement if it would result in Lincoln Park and its affiliate beneficially owning more than 9.99% of outstanding voting power or shares of the Common Stock at any one point in time. Additionally, the Company may not issue more than 1,981,163 shares of common stock under the Common Stock Purchase Agreement for less than $1.25 unless shareholder approval is obtained.

As part of the SEPA, the Company agreed to pay Lincoln Park 236,406 shares of the Company’s common stock, valued at approximately $0.3 million on the date of issuance, April 25, 2025 (the “Commitment Fee”).

The Company evaluated the contract that includes the right to require Lincoln Park to purchase shares of common stock in the future (“put right”) considering the guidance in ASC 815-40, Derivatives and Hedging — Contracts on an Entity’s Own Equity and concluded that it is an equity-linked contract that does not qualify for equity classification, and therefore requires fair value accounting. The Company analyzed the terms of the freestanding put right and concluded that it has an immaterial value as of June 30, 2025.

The Company has not yet raised any capital nor issued any shares from the use of the SEPA.

February 2025 Offering

In January 2025, the Company entered into a Securities Purchase Agreement with an institutional investor (the "Q1 2025 SPA"), pursuant to which the Company issued on February 3, 2025, to the investor, (i) in a registered direct offering, 713,000 shares of the Company’s common stock, and pre-funded warrants to purchase 2,816,412 shares of Common Stock (the "February 2025 Pre-Funded Warrants") with an exercise price of $0.0001 per share, and (ii) in a concurrent private placement, warrants to purchase 3,529,412 shares of common stock with an exercise price of $1.70 (“February 2025 Common Warrants”). Such registered direct offering and concurrent private placement are referred to herein as the “February 2025 Offering". Collectively, the warrants are referred herein as "the February 2025 Warrants".

The Company received aggregate gross proceeds from the February 2025 Offering of approximately $6.0 million, before deducting fees to H.C. Wainwright & Co. (“Wainwright”) and other estimated offering expenses payable by the Company. The February 2025 Pre-Funded Warrants did not have a set expiration and were exercisable upon issuance and at any time until all of the February 2025 Pre-Funded Warrants were exercised in full. As of June 30, 2025, a total of 2,816,412 pre-funded warrants were exercised, leaving no remaining February 2025 Pre-Funded Warrants outstanding.

The February 2025 Common Warrants became exercisable on March 28, 2025, the effective date of stockholder approval for the issuance of the shares of common stock issuable upon exercise of the warrants and expire on March 28, 2030.

Prior to their exercise, the February 2025 Pre-Funded Warrants had dividend participation rights, and any unexercised pre-funded warrants are included in the Company's weighted-average shares outstanding for calculation the Company's net loss per share.

In connection with the January 2025 Offering, the Company amended the exercise price of the Series A and Series B common warrants (collectively “January 2024 Warrants”), issued in a financing transaction with the institutional investor in January 2024, to $1.70 from the original exercise price of $20.76. Furthermore, the expiration date of 216,816 of the January 2024 Warrants was extended to January 30, 2029, upon stockholder approval on March 28, 2025. With the amendment to the expiration date, all of the January 2024 Warrants now expire in 2029.

The Company paid approximately $0.4 million in fees to Wainwright and issued 247,059 warrants (the "February 2025 PA Warrants") to purchase shares of the Company's common stock at an exercise price of $2.13. The 2025 PA Warrants were exercisable upon issuance and expire on January 30, 2029. The 2025 PA Warrants and February 2025 Common Warrants are herein defined as the "February 2025 Warrants".

In accordance with ASC 815-40, Derivatives and Hedging-Contracts in Entity’s own Equity, the Company determined that all the different warrants issued or amended in connection with the February 2025 Offering met the conditions for equity classification and were included as a component of stockholders’ equity / (deficit).

At-The-Market Offering

On August 20, 2024, the Company entered into an At-The-Market Offering Agreement (the “ATM Agreement”) with Wainwright as sales agent, to sell shares of its common stock, from time to time, through an “at the market offering” program under which Wainwright will act as sales agent. The sales, if any, of the Company’s Common Stock made under the ATM Agreement will be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly on or through the Nasdaq Capital Market or on any other existing trading market for the Company’s common stock (the “ATM”).

Through June 30, 2025, the Company has raised approximately $6.8 million utilizing the ATM since inception in August 2024, issuing 3,207,573 shares of the Company’s Common Stock. During the six months ended June 30, 2025, the Company raised approximately $2.1 million, net of offering costs, issuing 1,427,685 of the Company's common stock.

Note 8. Warrants

The Company issued warrants in connection with various financing transactions. The Company had the following warrants outstanding at June 30, 2025, and December 31, 2024:

During the three and six months ended June 30, 2025, the Company incurred a gain of approximately $16 thousand and $32 thousand from the mark-to-market adjustment for all remaining liability classified warrants, respectfully.

Note 9. Stock-Based Compensation Awards

Equity Incentive Plan - Summary

2022 Omnibus Incentive Plan

The Company’s Board of Directors adopted, and the shareholders approved the 2022 Omnibus Incentive Plan to provide long-term incentive for its employees and non-employee service providers. The vesting of stock options is stated in each individual grant agreement, which is generally one to four years. Options granted expire 10 years after the date of grant.

2019 Stock Incentive Plan

The Company’s Board of Directors adopted the 2019 Stock Incentive Plan on February 25, 2019, to provide long-term incentive for its employees and non-employee service providers. The Stock Incentive Plan was terminated on October 28, 2022, and no further awards were granted under such plan.

Stock Options

Option activity for the period ended June 30, 2025, is as follows:

Restricted Stock Units