# EDGAR Filing Document

**Accession Number:** 0001716621
**File Stem:** 0001564590-23-000560
**Filing Date:** 2023-1
**Character Count:** 174193
**Document Hash:** 160f6016a08917459145e40a61077c71
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001564590-23-000560.hdr.sgml**: 20230119

**ACCESSION NUMBER**: 0001564590-23-000560

**CONFORMED SUBMISSION TYPE**: DEFA14A

**PUBLIC DOCUMENT COUNT**: 1

**FILED AS OF DATE**: 20230119

**DATE AS OF CHANGE**: 20230119

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Ra Medical Systems, Inc.
- **CENTRAL INDEX KEY:** 0001716621
- **STANDARD INDUSTRIAL CLASSIFICATION:** SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841]
- **IRS NUMBER:** 383661826
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** DEFA14A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-38677
- **FILM NUMBER:** 23537982

**BUSINESS ADDRESS:**
- **STREET 1:** 5857 OWENS DRIVE, SUITE 300
- **CITY:** CARLSBAD
- **STATE:** CA
- **ZIP:** 92009
- **BUSINESS PHONE:** (760) 804-1648

**MAIL ADDRESS:**
- **STREET 1:** 5857 OWENS DRIVE, SUITE 300
- **CITY:** CARLSBAD
- **STATE:** CA
- **ZIP:** 92009

### UNITED STATES

### SECURITIES AND EXCHANGE COMMISSION

#### Washington, DC 20549

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### FORM 8-K/A

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#### CURRENT REPORT

#### (Amendment No. 1)

#### Pursuant to Section 13 or 15(d) of

#### The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):

#### January 9, 2023

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### Ra Medical Systems, Inc.
(Exact name of registrant as specified in its charter)

------

---

| | | |
|:---|:---|:---|
| **<u>Delaware</u>** | **<u>001-38677</u>** | **<u>38-3661826</u>** |
| (State or other jurisdiction <br> of incorporation) | (Commission <br> File Number) | (IRS Employer<br> Identification No.) |

---

#### 1670 Highway 160 West, Suite 205

#### Fort Mill, SC 29708
(Address of principal executive offices, including zip code)

(973) 691-2000

(Registrant's telephone number, including area code)

#### 5857 Owens Drive, Suite 300

#### Carlsbad, California 92009
(Former name or former address, if changed since last report.)

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☒ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, par value $0.0001 per share | RMED | NYSE American |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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#### Item 2.01. Completion of Acquisition or Disposition of Assets.
On January 9, 2023, Ra Medical Systems, Inc., a Delaware corporation (the "Company" or "Ra Medical"), completed its acquisition (the "Merger") of Catheter Precision, Inc., a privately-held Delaware corporation ("Catheter"), pursuant to an Amended and Restated Agreement and Plan of Merger, as reported in the Company's Current Report on Form 8-K filed with the SEC on January 13, 2023. Catheter's audited financial statements as of December 31, 2021 and 2020, and for the years then ended, were previously filed with the Company's Preliminary Proxy Statement dated November 4, 2022. The Company hereby amends the Form 8-K dated January 13, 2023, to include the following financial statements and financial information:

• Catheter's Unaudited Financial Statements as of and for the nine months ended September 30, 2022 and September 30, 2021;

• Unaudited Pro Forma Condensed Combined Financial Information related to the Merger as of and for the nine months ended September 30, 2022 and for the year ended December 31, 2021; and

• Catheter's Management's Discussion and Analysis as of and for the nine months ended September 30, 2022 and September 30, 2021.

*Additional Information and Where to Find It*

This communication relates to the possible conversion of securities issued in the Merger, and the issuance of securities in private placements, and may be deemed to be solicitation material in respect of the stockholder approval thereof. In connection with the proposed approval of those conversions, the Company will file a Proxy Statement with the SEC. This communication is not a substitute for the Proxy Statement or any other documents that the Company may file with the SEC or send to the Company's stockholders in connection with the proposed securities conversions and issuances. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITYHOLDERS ARE URGED TO READ THE PROXY STATEMENT AND ALL OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED SECURITIES CONVERSIONS AND ISSUANCES AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED SECURITIES CONVERSIONS AND ISSUANCES AND RELATED MATTERS. INVESTORS AND SECURITY HOLDERS MAY OBTAIN FREE COPIES OF THESE DOCUMENTS (WHEN THEY ARE AVAILABLE) AND OTHER RELATED DOCUMENTS FILED WITH THE SEC AT THE SEC'S WEBSITE AT <u>WWW.SEC.GOV</u>, ON RA MEDICAL'S INVESTOR RELATIONS WEB PAGE AT <u>HTTPS://IR.RAMED.COM/</u>.

This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

The unaudited pro forma combined financial information does not purport to represent the actual results of operations that the Company and Catheter would have achieved had the companies been combined during the periods presented in the unaudited pro forma combined financial statements and is not intended to project the future results of operations that the combined company may achieve after the Merger. The unaudited pro forma combined financial information does not reflect any potential cost savings that may be realized as a result of the Merger and also does not reflect any restructuring or integration-related costs to achieve those potential cost savings. This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

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#### Participants in the Solicitation
Catheter, the Company, and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of the Company in connection with the proposed securities conversions and other proposals. Information about the Company's directors and executive officers is set forth in the Company's Current Report on Form 8-K that was filed with the SEC on January 13, 2023, the Company's definitive proxy statement for its annual meeting of stockholders filed on April 21, 2022, and in subsequent filings made by the Company with the SEC. OTHER INFORMATION REGARDING THE INTERESTS OF SUCH INDIVIDUALS, AS WELL AS INFORMATION REGARDING CATHETER'S DIRECTORS AND EXECUTIVE OFFICERS AND OTHER PERSONS WHO MAY BE DEEMED PARTICIPANTS IN THE PROPOSED TRANSACTION, WILL BE SET FORTH IN THE PROXY STATEMENT AND OTHER RELEVANT MATERIALS TO BE FILED WITH THE SEC WHEN THEY BECOME AVAILABLE. YOU MAY OBTAIN FREE COPIES OF THESE DOCUMENTS AS DESCRIBED IN THE PRECEDING PARAGRAPH.

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#### Item 9.01. Financial Statements and Exhibits.
(a) Financial statements of business acquired.

The unaudited financial statements of Catheter as of and for the nine months ended September 30, 2022 and September 30, 2021, with the accompanying notes, are attached hereto as Exhibit 99.1.

(b) Pro forma financial information.

The unaudited pro forma condensed combined financial information of Ra Medical and Catheter as of and for the nine months ended September 30, 2022 and for the year ended December 31, 2021, with the accompanying notes, is attached hereto as Exhibit 99.2.

(d) Exhibits

---

| | |
|:---|:---|
| Exhibit  | Description |
| 99.1 | Unaudited financial statements of Catheter as of and for the nine months ended September 30, 2022 and September 30, 2021, with the accompanying notes. |
| 99.2 | Unaudited pro forma condensed combined financial information of Ra Medical and Catheter as of and for the nine months ended September 30, 2022 and for the year ended December 31, 2021, with the accompanying notes. |
| 99.3 | Management's Discussion and Analysis of Catheter as of and for the nine months ended September 30, 2022 and September 30, 2021. |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL) |

---

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#### SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  |  | **RA MEDICAL SYSTEMS, INC.** |
| Date: January 19, 2023 | By: | /s/ Jonathan Will McGuire |
|  |  | Jonathan Will McGuire<br> Chief Executive Officer<br> *(Principal Executive Officer)* |

---

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#### Exhibit 99.1
CATHETER PRECISION, INC.

FINANCIAL STATEMENTS

September 30, 2022 and 2021

(Unaudited)

------

#### CATHETER PRECISION, INC
 **Contents**<br>

---

| | |
|:---|:---|
| **Condensed Financial Statements** | 2 |
| &nbsp;&nbsp; Condensed Balance Sheets as of September 30, 2022 (Unaudited) and December 31, 2021 | 3 |
| &nbsp;&nbsp; Condensed Statements of Operations (Unaudited) for the nine months ended September 30, 2022 and 2021 | 4 |
| &nbsp;&nbsp; Condensed Statements of Redeemable Convertible Preferred Stock and Stockholders' Deficit (Unaudited)<br> for the nine months ended September 30, 2022 and 2021 | 5-6 |
| &nbsp;&nbsp; Condensed Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2022 and 2021 | 7 |
| &nbsp;&nbsp; Notes to the Unaudited Condensed Financial Statements | 8-27 |

---

------

#### CONDENSED BALANCE SHEETS

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br> **2022** | **December 31,**<br> **2021** |
| **ASSETS** | (Unaudited) |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $139631 | $11911 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable | 36040 | 16393 |
| &nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | 95537 | 94268 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current assets | 271208 | 122572 |
| &nbsp;&nbsp;&nbsp;&nbsp; Property and equipment, net | 28322 | 19336 |
| &nbsp;&nbsp;&nbsp;&nbsp; Lease right of use assets, net | 12966 | 51867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets | $312496 | $193775 |
| **LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | $561707 | $112694 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses | 292510 | 109765 |
| &nbsp;&nbsp;&nbsp;&nbsp; Advance from related parties | 600000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Lease liability - current portion | 13100 | 52400 |
| &nbsp;&nbsp;&nbsp;&nbsp; Royalties payable | 159456 | 159456 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest payable - related parties | 13316945 | 11077441 |
| &nbsp;&nbsp;&nbsp;&nbsp; Convertible promissory notes - related parties | 25465000 | 23985000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Derivative liability | 722000 | 1057000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current liabilities | 41130718 | 36553756 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | 41130718 | 36553756 |
| Commitments and contingencies |  |  |
| Redeemable convertible preferred stock: |  |  |
| Series A preferred stock, $0.01 par value - 1,875,000 shares authorized, 0 and 1,731,250 issued and outstanding as of September 30, 2022 and December 31, 2021 |  | 15390813 |
| Series B preferred stock, $0.01 par value - 1,500,000 shares authorized, 0 and 1,187,649 issued and outstanding as of September 30, 2022 and December 31, 2021 |  | 21080771 |
| Series C preferred stock, $0.01 par value - 1,168,225 shares authorized, 0 and 1,156,543 issued and outstanding as of September 30, 2022 and December 31, 2021 |  | 19869410 |
| Series D preferred stock, $0.01 par value - 1,750,000 shares authorized, 0 and 1,097,549 issued and outstanding as of September 30, 2022 and December 31, 2021 |  | 17330298 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total redeemable convertible preferred stock |  | 73671292 |
| Stockholders' equity (deficit): |  |  |
| Common stock, $0.001 par value, 100,000,000 shares authorized, 10,096,055, and 1,444,848 shares issued and outstanding as of September 30, 2022 and December 31, 2021 | 10096 | 1445 |
| Additional paid-in capital | 75087650 | 514814 |
| Accumulated deficit | (115915968) | (110547532) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total stockholders' deficit | (40818222) | (110031273) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities, redeemable convertible preferred stock and stockholders' deficit | $312496 | $193775 |

---

See accompanying notes to the unaudited condensed financial statements

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#### CATHETER PRECISION, INC

#### CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
|  | **2022** | **2021** |
| Net sales | $192373 | $113284 |
| Cost of sales | 15668 | 8537 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gross profit | 176705 | 104747 |
| Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 1620988 | 861240 |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development | 180211 | 294384 |
| &nbsp;&nbsp;&nbsp;&nbsp; Sales and marketing | 922606 | 788707 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 2723805 | 1944331 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss from operations | (2547100) | (1839584) |
| Other income (expenses): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest income |  | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest expense | (2307494) | (2088036) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forgiveness of PPP loan |  | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Gain on transfer of intangible assets |  | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of derivative liability | 402768 | (35300) |
| &nbsp;&nbsp;&nbsp;&nbsp; Loss on foreign currency transactions | (9449) | (3782) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total other expenses, net | (1914175) | (1727090) |
| Net loss | $(4461275) | $(3566674) |
| Liquidation Preference Dividend on Series A preferred stock | (173125) | (519375) |
| Liquidation Preference Dividend on Series B preferred stock | (249406) | (748219) |
| Liquidation Preference Dividend on Series C preferred stock | (248657) | (745970) |
| Liquidation Preference Dividend on Series D preferred stock | (235973) | (707919) |
| Net loss attributable to common stockholders | $(5368436) | $(6288157) |
| Net loss per share attributable to common stockholders - basic and diluted | $(0.74) | $(4.43) |
| Weighted average number of common shares outstanding—basic and diluted | 7275698 | 1417857 |

---

See accompanying notes to the unaudited condensed financial statements

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#### CATHETER PRECISION, INC

#### CONDENSED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDER'S DEFICIT (Unaudited)

#### For the Nine Months Ended September 30, 2022

---

| | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series A Preferred Stock** | **Series A Preferred Stock** | **Series B Preferred Stock** | **Series B Preferred Stock** | **Series C Preferred Stock** | **Series C Preferred Stock** | **Series D Preferred Stock** | **Series D Preferred Stock** | **Common Stock** | **Common Stock** |  |  |  |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br> **Paid-In**<br> **Capital** | **Accumulated**<br> **Deficit** | **Total**<br> **Stockholders'**<br> **Deficit** |
| **Balances at December 31, 2021** | **1731250** | $**15390813** | **1187649** | $**21080771** | **1156543** | $**19869410** | **1097549** | $**17330298** | **1444848** | $**1445** | $**514814** | $**(110547532)** | $**(110031273)** |
| Stock-based compensation |  |  |  |  |  |  |  |  |  |  | 3034 |  | 3034 |
| Liquidation preference dividend on Series A preferred stock |  | 173125 |  |  |  |  |  |  |  |  |  | (173125) | (173125) |
| Liquidation preference dividend on Series B preferred stock |  |  |  | 249406 |  |  |  |  |  |  |  | (249406) | (249406) |
| Liquidation preference dividend on Series C preferred stock |  |  |  |  |  | 248657 |  |  |  |  |  | (248657) | (248657) |
| Liquidation preference dividend on Series D preferred stock |  |  |  |  |  |  |  | 235973 |  |  |  | (235973) | (235973) |
| Issuance of common stock due to conversion of preferred stock | (1731250) | (15563938) | (1187649) | (21330177) | (1156543) | (20118067) | (1097549) | (17566271) | 8651207 | 8651 | 74569802 |  | 74578453 |
| Net loss |  |  |  |  |  |  |  |  |  |  |  | (4461275) | (4461275) |
| **Balance at September 30, 2022** | **—** | $**—** | **—** | $**—** | **—** | $**—** | **—** | $**—** | **10096055** | $**10096** | $**75087650** | $**(115915968)** | $**(40818222)** |

---

See accompanying notes to the unaudited condensed financial statements

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#### CATHETER PRECISION, INC

#### CONDENSED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDER'S DEFICIT (Unaudited)

#### For the Nine Months Ended September 30, 2021

---

| | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series A Preferred Stock** | **Series A Preferred Stock** | **Series B Preferred Stock** | **Series B Preferred Stock** | **Series C Preferred Stock** | **Series C Preferred Stock** | **Series D Preferred Stock** | **Series D Preferred Stock** | **Common Stock** | **Common Stock** |  |  |  |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br> **Paid-In**<br> **Capital** | **Accumulated**<br> **Deficit** | **Total**<br> **Stockholders'**<br> **Deficit** |
| **Balances at December 31, 2020** | **1731250** | $**14698313** | **1187649** | $**20083146** | **1156543** | $**18874783** | **1097549** | $**16386406** | **1326000** | $**1326** | $**462161** | $**(101929180)** | $**(101465693)** |
| Issuance of common stock due to exercise of stock options |  |  |  |  |  |  |  |  | 118848 | 119 | 46232 |  | 46351 |
| Stock-based compensation |  |  |  |  |  |  |  |  |  |  | 4104 |  | 4104 |
| Liquidation preference dividend on Series A preferred stock |  | 519375 |  |  |  |  |  |  |  |  |  | (519375) | (519375) |
| Liquidation preference dividend on Series B preferred stock |  |  |  | 748219 |  |  |  |  |  |  |  | (748219) | (748219) |
| Liquidation preference dividend on Series C preferred stock |  |  |  |  |  | 745970 |  |  |  |  |  | (745970) | (745970) |
| Liquidation preference dividend on Series D preferred stock |  |  |  |  |  |  |  | 707919 |  |  |  | (707919) | (707919) |
| Net loss |  |  |  |  |  |  |  |  |  |  |  | (3566674) | (3566674) |
| **Balance at September 30, 2021** | **1731250** | $**15217688** | **1187649** | $**20831365** | **1156543** | $**19620753** | **1097549** | $**17094325** | **1444848** | $**1445** | $**512497** | $**(108217337)** | $**(107703395)** |

---

See accompanying notes to the unaudited condensed financial statements

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#### CATHETER PRECISION, INC

#### CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
|  | **2022** | **2021** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| Net loss | $(4461275) | $(3566674) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization expense | 10100 | 11885 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation | 3034 | 4104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of derivative liability | (402768) | 35300 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Amortization of debt discount | 67768 | 81700 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on transfer of intangible assets |  | (200000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain of forgiveness of PPP Loan |  | (200000) |
| Change in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable | (19647) | (68140) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | (10718) | (55300) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right of use asset and liability | (399) | (399) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | 449013 | (1082) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses | 182745 | (137276) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest payable - related parties | 2239504 | 2006337 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash used in operating activities | (1942643) | (2089545) |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Purchase of property and equipment | (19086) | (2855) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash used in investing activities | (19086) | (2855) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| Proceeds from the issuance of convertible promissory notes - related parties | 1480000 | 1900000 |
| Proceeds from related party advance | 600000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash provided by financing activities | 2080000 | 1900000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Effect of exchange rate on cash | 9449 | 3782 |
| **Net increase (decrease) in cash and cash equivalents** | 127720 | (188618) |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents at beginning of year | 11911 | 333168 |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents at end of period | $139631 | $144550 |
| **SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES** |  |  |
| Recognition of Liquidation Preference Dividend | $907161 | $2721483 |
| Conversion of preferred stock to common stock | $74578453 | $— |
| Offset of amount due from exercise of stock options to settle accrued compensation | $— | $46351 |

---

See accompanying notes to the unaudited condensed financial statements

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Note 1 - Nature of Operations
Catheter Precision, Inc. (the "Company"), a Delaware Corporation, was formed on September 6, 2006. The Company is dedicated to the design, manufacture and sale of new and innovative medical technologies focused in the field of cardiac electrophysiology ("EP"). The Company's primary product is the View into Ventricular Onset, ("VIVO" or "VIVO System").

VIVO is a non-invasive imaging system that offers 3D cardiac mapping to help with localizing the sites of origin of idiopathic ventricular arrhythmias in patients with structurally normal hearts prior to electrophysiology studies. The VIVO system has achieved a CE Mark allowing it to be commercialized in the European Union and has been placed at several hospitals in Europe. FDA 510(K) Clearance in the United States was received and the Company began a limited commercial release of VIVO in 2021.

Prior to 2018, the Company sold the AMIGO remote catheter system (the "AMIGO" or "AMIGO System") which provides for accurate positioning, manipulation and stable control of catheters for use by electrophysiologists in the diagnosis and treatment of abnormal heart rhythms known as cardiac arrhythmias. The Company owns the intellectual property related to the AMIGO System.

The spread of the novel coronavirus ("COVID-19") has affected many segments of the global economy, including the cancer screening and diagnostics industry. The COVID-19 outbreak, which the World Health Organization has classified as a pandemic, has prompted governments and regulatory bodies throughout the world to enact broad precautionary measures, including "stay-at-home" orders, restrictions on the performance of "non-essential" services, public gatherings and travel. Health systems, including key markets where the Company operates, have been, or may be, overwhelmed with high volumes of patients suffering from COVID-19. Medical practices continue to be cautious about allowing individuals, such as sales representatives, into their offices. Many individuals continue to work from home rather than from an office setting. The Company cannot forecast when the COVID-19 pandemic will end or the extent to which practices that have emerged during the pandemic will continue once it subsides.

We continue to monitor the rapidly evolving situation caused by the COVID-19 pandemic, and we may take further actions required by governmental authorities or that we determine are prudent to support the well-being of our employees, customers, suppliers, business partners and others. The degree to which the COVID-19 pandemic ultimately impacts our business, results of operations, cash flows and financial position will depend on future developments, which are highly uncertain, continuously evolving and cannot be predicted. This includes, but is not limited to, the duration and spread of the pandemic, its severity, the actions to contain the virus or treat its impact, (including the efficacy of vaccines, particularly with respect to emerging strains of the virus), and how quickly and to what extent normal economic and operating conditions can resume.

The ultimate impact of COVID-19 depends on factors beyond the Company's knowledge or control, including the duration and severity of the outbreak, as well as third-party actions taken to contain its spread and mitigate its public health effects. The COVID-19 pandemic impacted the Company's operations in 2021 and during the first quarter of 2022 through restrictions in hospitals and medical offices, as well as the inability to attend trade shows and conferences, limiting the Company's ability to expand operations and profitability. Beginning in the second quarter of 2022, the impact of COVID-19 on the Company's operations has subsided and has had an immaterial impact on the Company's operations through September 30, 2022. Additionally, the Company does not anticipate COVID-19 to have an impact on future results and financial conditions in subsequent periods.

On September 9, 2022, the Company entered into an Agreement and Plan of Merger ("Merger") with Ra Medical Systems, Inc. ("Ra Medical") whereby the Company will become a wholly-owned subsidiary of Ra Medical. Ra Medical is a smaller reporting company and an emerging growth company incorporated in the state of Delaware and its common stock is currently traded on the NYSE American exchange. See Note 15 for consummation of the Merger.

#### Note 2 - Going Concern
As of September 30, 2022, the Company had approximately $140,000 in cash and cash equivalents. Net cash used in operating activities was approximately $1,943,000 for the nine months ended September 30, 2022. Net loss for the nine months ended September 30, 2022 and 2021 was approximately $4,461,000 and $3,567,000, respectively. As of

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

September 30, 2022, the Company had negative working capital of approximately $40,900,000, an accumulated deficit of approximately $115,916,000, total outstanding debt of $25,465,000 which is due on demand, and total outstanding interest payable of approximately $13,317,000 which is due on demand. The Company has historically funded its operations through issuances of equity securities and debt instruments and the Company plans to support its operations by continuing to raise additional capital until the planned operating results are achieved. The Company has incurred substantial losses and negative cash flows from operations to date and expects to incur operating losses for the foreseeable future as it expands its commercialization efforts of its current product. The Company is unable to predict the extent of any future losses or when the Company will become profitable, if at all.

Subsequent to September 30, 2022, the Company received advances totaling $475,000 from the Company's Chairman of the Board of Directors in order to fund current operating expenses incurred until the closing of the Merger. Upon closing of the Merger, the Company is liable to repay the Chairman for the advances received. See Note 15.

These unaudited condensed financial statements have been prepared under the assumption that the Company will continue as a going concern. Due to the Company's recurring and expected continuing losses from operations, limited cash and cash equivalents balance, negative working capital, and significant debt and interest payable due on demand, the Company has concluded that there is substantial doubt in the Company's ability to continue as a going concern through one year from the issuance of these condensed financial statements. These condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The Company plans to build on its existing business, as well as grow through buy-and-build strategic acquisitions and partnerships. The Company will be required to raise additional capital to continue to support its operations at the current cash expenditure levels; however, the Company cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that the Company raises additional funds by issuing equity securities, its stockholders may experience significant dilution. Any debt financing, if available, may include potential dilutive instruments and include restrictive covenants that impact the Company's ability to conduct business. If the Company is unable to raise additional capital when required or on acceptable terms, the Company may have to (i) significantly scale back its current operations and/or commercialization efforts or (ii) relinquish or otherwise dispose of rights to technologies or products on unfavorable terms.

As discussed in Note 1, on September 9, 2022, the Company entered into a Merger agreement with Ra Medical whereby the Company will become a wholly-owned subsidiary of Ra Medical. The Merger will give the Company the ability to explore funding its strategic initiatives for their devices through the public capital markets. In the future, Ra Medical intends to raise additional funds, if necessary, through public or private equity or debt financings as well as by engaging in regular and ongoing reviews of its strategic options to help ensure that Ra Medical is focusing its cash resources on advancing its key corporate initiatives. See Note 15 for consummation of the Merger.

Management has continued to monitor the COVID-19 pandemic situation and federal, state, and local recommendations. While the COVID-19 pandemic did have an impact on operations in 2021 and the first quarter of 2022, beginning in the second quarter of 2022, Management has concluded that the impact of COVID-19 on the Company's operations has subsided. As discussed in Note 1, the Company does not anticipate COVID-19 to have an impact on future results, financial conditions, and other liquidity needs in subsequent periods.

#### Note 3 - Summary of Significant Accounting Policies

#### Basis of Presentation
The accompanying unaudited interim condensed financial statements have been prepared in accordance with GAAP. Accordingly, they do not include certain footnotes and financial presentations normally required under GAAP for complete annual financial statements. The unaudited interim condensed financial statements have been prepared on the same basis as the annual financial statements. The results for the nine month period ended September 30, 2022 are not necessarily indicative of the results to be expected for any subsequent period or the entire year ending December 31, 2022. These unaudited interim condensed financial statements should be read in conjunction with the Company's annual audited financial statements and notes thereto for the year ended December 31, 2021. These unaudited interim condensed financial statements, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) and disclosures necessary for a fair presentation of these unaudited interim condensed financial statements. The condensed balance sheet at December 31, 2021 has been derived from the audited balance sheet at that date.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to provisions for legal contingencies, income taxes, deferred income tax, asset valuation allowances, valuation of derivative liabilities, stock-based compensation, and revenues. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

#### Segment Information
The Company operates in one business segment, which is the marketing, sales and development of medical technologies focused in the field of cardiac electrophysiology.

#### Foreign Currency Transaction Gain Or loss
The Company measures the foreign currency denominated assets and liabilities at the transaction date. Monetary assets and liabilities are then re-measured at exchange rates in effect at the end of each period, and property and non-monetary assets and liabilities are converted at historical rates.

#### Fair Value Measurements
Accounting Standards Codification ("ASC") 820, Fair Value Measurements, provides guidance on the development and disclosure of fair value measurements. The Company follows this authoritative guidance for fair value measurements, which defines fair value, establishes a framework for measuring fair value under GAAP, and expands disclosures about fair value measurements. The guidance requires fair value measurements be classified and disclosed in one of the following three categories:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3: Unobservable inputs which are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of and during the nine months ended September 30, 2022 and 2021. The carrying amount of cash, accounts payable, interest payable, and convertible notes payable approximated fair value as they are short term in nature. The estimated fair value of the embedded put included in the convertible promissory notes – related parties, represent Level 3 measurements.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

The following table details the fair value measurements within the fair value hierarchy of the Company's financial instruments, which includes the Level 3 liabilities:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Derivative liability | $722000 | $— | $— | $722000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | $722000 | $— | $— | $722000 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Derivative liability | $1057000 | $— | $— | $1057000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | $1057000 | $— | $— | $1057000 |

---

The table below provides a summary of the changes in fair value of the derivative liabilities measured on a recurring basis using significant unobservable inputs (Level 3):

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
| Derivative liabilities: | **2022** | **2021** |
| Balance, beginning of period | $1057000 | $910000 |
| Interest expense accrued on derivative liability | 67768 | 81700 |
| Change in fair value of derivative liability | (402768) | 35300 |
| Balance, end of period | $722000 | $1027000 |

---

For further discussion on the derivative liability, see Note 6.

#### Cash and Cash Equivalents
The Company considers all highly liquid investing instruments, which consist solely of money market funds, purchased with an original maturity of three months or less to be cash equivalents. Cash is maintained at financial institutions and, at times, balances may exceed federally insured limits. The Company has not experienced any losses related to these balances.

#### Concentration of Credit Risk
Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. Cash equivalents represent highly liquid investments with maturities of 90 days or less at the date of purchase. Credit risk related to cash and cash equivalents are limited based on the creditworthiness of the financial institutions at which these funds are held. We maintain cash balances in multiple bank accounts with one bank. Accounts located in the United States are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. We did not have any account balances exceed the FDIC limit during the year.

The Company has no significant off-balance sheet risk such as foreign exchange contracts, option contracts, or other hedging arrangements.

#### Property and Equipment
Property and equipment of the Company, consisting primarily of demonstration and clinical equipment ("demo equipment") and computers, are recorded at cost. Major renewals and betterments are charged to the property accounts, while maintenance and minor repairs and replacements, which do not improve or extend the lives of the respective assets, are expensed. Depreciation is calculated using the straight-line method for all assets over the estimated useful lives of the respective assets which range from 2 to 3 years, except for leasehold improvements which are amortized

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

over the term of the lease. When property and equipment is retired or otherwise disposed of, the asset and accumulated depreciation accounts are adjusted accordingly, and the gain or loss, if any, arising from its disposal, is credited, or charged to general and administrative expenses.

The Company's long-lived assets consist of property and equipment. The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. An impairment loss is recognized when expected cash flows are less than an asset's carrying value. Accordingly, when indicators of impairment are present, the Company evaluates the carrying value of such assets in relation to the operating performance and future undiscounted cash flows of the underlying assets. The Company's policy is to record an impairment loss when it is determined that the carrying amount of the asset may not be recoverable. No such impairment charges have been recognized during the nine months ended September 30, 2022 or 2021.

#### Software Development Costs
In accordance with ASC 985-20-25, Costs of Software to be Sold, Leased, or Marketed, software development costs are expensed as incurred until technological feasibility and marketability has been established, generally with the release of a beta version for customer testing. Once the point of technological feasibility and marketability is reached, direct production costs (including labor directly associated with the development projects), indirect costs and other direct costs (including costs of outside consultants, purchased software to be included in the software product being developed, travel expenses and other direct costs) are capitalized until the product is available for general release to customers. The Company amortizes capitalized costs on a product-by-product basis. Total cumulative capitalized software development costs have been insignificant.

Capitalized software development costs are stated at the lower of amortized costs or net realized value. Recoverability of these capitalized costs is determined at each balance sheet date by comparing the forecasted future revenues from the related products, based on management's best estimates using appropriate assumptions and projections at the time, to the carrying amount of the capitalized software development costs. If the carrying value is determined not to be recoverable from future revenues, an impairment loss is recognized equal to the amount by which the carrying amount exceeds the future revenues.

#### Revenue Recognition
The Company applies the provisions of Financial Accounting Standards Board ("FASB") ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"), and all related appropriate guidance. The core principle of this standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services.

The Company measures revenue based upon the consideration specified in the client arrangement, and revenue is recognized when the performance obligations in the client arrangement are satisfied. A performance obligation is a promise in a contract to transfer a distinct service to the customer. The transaction price of a contract is allocated to each distinct performance obligation. Under ASC 606, revenue is recognized when a customer obtains control of promised goods. To achieve this core principle, the Company applies the following five steps:

Step 1: Identify the contract with the customer

Step 2: Identify the performance obligations in the contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the performance obligations in the contract

Step 5: Recognize revenue when the Company satisfies a performance obligation

The Company's primary product is the VIVO System. The VIVO System offers 3D cardiac mapping to help with localizing the sites of origin of idiopathic ventricular arrhythmias in patients with structurally normal hearts prior to electrophysiology studies. In addition to the VIVO System, customers are provided with VIVO Positioning Patch Sets, which are custom patches, that are used in conjunction with the VIVO System to complete the intended output of the VIVO System. The delivery of the VIVO System, including the VIVO Positioning Patch Sets represents the Company's primary performance obligation. The Company recognizes revenue upon the delivery of the VIVO system.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

The Company also provides customers with the option to pay for software upgrades in advance at the time of the contract's inception. Software upgrades are stand-ready services, whereby the Company will provide software upgrade services to the customer when and as upgrades are available. Terms of the period covered by the payment of software upgrades in advance can range from one year to multiple years. Customers have the option to renew terms covered by software upgrades at the end of each term. The stand-ready software upgrades represent the Company's second separate performance obligation and revenue is recognized over the term of the period.

The Company invoices the customers after physical possession and control of the VIVO System is transferred to the customer and recognizes revenue upon delivery. The timing of payment for the corresponding invoices is dependent upon the credit terms identified in each contract. The Company invoices customers who pay for software upgrades in advance in conjunction with the invoice for the delivery of the VIVO System, and subsequent renewals of software upgrades are invoiced at the inception of the term. Revenue for these stand-ready services is recognized evenly over the term of the upgrade period, consistently with similar stand-ready services under ASC 606. Similar to the delivery of the VIVO System, the timing of payment for the corresponding invoices is dependent upon the credit terms identified in each contract.

*Disaggregation of Revenue*

The Company operates primarily in a single geographic location and enters into contracts with similar customers. In the following table, revenue is disaggregated by each of the Company's product offerings during the nine months ended September 30, 2022 and 2021:

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
| **Revenue by Type** | **2022** | **2021** |
| Net sales from sale of hardware | $170563 | $79784 |
| Net sales from sale of software | 21810 | 30000 |
| Net sales from sale of software upgrades |  | 3500 |
| **Total net sales** | $192373 | $113284 |

---

#### Derivative Financial Instruments
The Company does not use derivative instruments to hedge exposures to interest rate, market, or foreign currency risks. The Company evaluates all of its financial instruments, including notes payable, to determine if such instruments contain features that qualify as embedded derivatives.

Embedded derivatives must be separately measured from the host contract if all the requirements for bifurcation are met. The assessment of the conditions surrounding the bifurcation of embedded derivatives depends on the nature of the host contract. Bifurcated embedded derivatives are recognized at fair value, with changes in fair value recognized in the statement of operations each period.

#### Distinguishing Liabilities from Equity
The Company relies on the guidance provided by ASC 480, Distinguishing Liabilities from Equity, to classify certain redeemable and/or convertible instruments. The Company first determines whether a financial instrument should be classified as a liability. The Company will determine the liability classification if the financial instrument is mandatorily redeemable, or if the financial instrument, other than outstanding shares, embodies a conditional obligation that the Company must or may settle by issuing a variable number of its equity shares.

Once the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet ("mezzanine equity"). The Company will determine temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e., at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

*Initial Measurement*

The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received.

*Subsequent Measurement - Financial instruments classified as liabilities*

The Company records the fair value of its financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of its financial instruments classified as liabilities are recorded as other expense/income.

#### Advances from Related Party
Advances from related parties represent advances from the Company's Chairman of the Board of Directors in conjunction with the Merger. The Company accounted for the advances as refundable liabilities for the amount of funds received until the Company repaid the Chairman of the Board of Directors upon the closing of the Merger. See Note 15.

#### Stock-Based Compensation
Stock-based compensation for employees and non-employees is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which is generally the vesting period of the respective award. Forfeitures are recognized when they occur.

The Company estimates the grant date fair value of stock options using the Black-Scholes option pricing model. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the volatility, expected term of the option, risk-free interest rates, the value of the common stock and the expected dividend yield of the common stock.

See Note 10 for a discussion of the assumptions used by the Company in determining the grant date fair value of options granted under the Black-Scholes option pricing model, as well as a summary of the stock option activity under the Company's stock-based compensation plan.

#### Research and Development Expense
Costs for research and development are expensed as incurred. Research and development expense primarily consists of salaries, product development, third-party contractors, and materials.

#### Advertising and Marketing
Advertising costs are expensed as incurred and included in sales and marketing expense. Advertising costs were $1,725 and $1,765 during the nine months ended September 30, 2022 and 2021, respectively.

#### Income Taxes
Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement carrying amount and tax bases of assets and liabilities at the applicable enacted tax rates. The Company will establish a valuation allowance for deferred tax assets if it is more likely than not that these items will expire before either the Company is able to realize their benefit or that future deductibility is uncertain.

The Company believes that it is currently more likely than not that its deferred tax assets will not be realized and as such, it has recorded a full valuation allowance for these assets. The Company evaluates the likelihood of the ability to realize deferred tax assets in future periods on a quarterly basis, and when appropriate evidence indicates it would release its valuation allowance accordingly. The determination to provide a valuation allowance is dependent upon the assessment of whether it is more likely than not that sufficient taxable income will be generated to utilize the deferred tax assets. Based on the weight of the available evidence, which includes the Company's historical operating losses, lack of taxable income, and accumulated deficit, the Company provided a full valuation allowance against the U.S. tax assets resulting from the tax losses.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Basic and Diluted Net Loss Per Share of Common Stock
Basic loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted loss per share excludes, when applicable, the potential impact of shares of common stock because their effect would be anti-dilutive due to our net loss. Because the Company had a net loss in each of the periods presented, basic and diluted net loss per common share are the same.

The table below provides total potential shares outstanding:

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| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
|  | **2022** | **2021** |
| Series A Preferred Stock |  | 1731250 |
| Series B Preferred Stock |  | 2096200 |
| Series C Preferred Stock |  | 2475002 |
| Series D Preferred Stock |  | 2348755 |
| Stock options | 1139000 | 1139000 |

---

#### Recently Adopted Accounting Standards
In August 2020, the FASB issued ASU No. 2020-06*—Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity ("ASU 2020-06")*, to simplify the accounting for convertible instruments by removing certain separation models in Subtopic 470-20, *Debt with Conversion and Other Options*, for convertible instruments. Under the amendments in ASU 2020-06, the embedded conversion features no longer are separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital. Consequently, a convertible debt instrument will be accounted for as a single liability measured at its amortized cost and a convertible preferred stock will be accounted for as a single equity instrument measured at its historical cost, as long as no other features require bifurcation and recognition as derivatives. By removing those separation models, the interest rate of convertible debt instruments typically will be closer to the coupon interest rate when applying the guidance in Topic 835, Interest. The amendments in ASU 2020-06 provide financial statement users with a simpler and more consistent starting point to perform analyses across entities. The amendments also improve the operability of the guidance and reduce, to a large extent, the complexities in the accounting for convertible instruments and the difficulties with the interpretation and application of the relevant guidance.

The amendments in ASU 2020-06 are effective for public business entities, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Entities should adopt the guidance as of the beginning of its annual fiscal year and are allowed to adopt the guidance through either a modified retrospective method of transition or a fully retrospective method of transition. In applying the modified retrospective method, entities should apply the guidance to transactions outstanding as of the beginning of the fiscal year in which the amendments are adopted. Transactions that were settled (or expired) during prior reporting periods are unaffected. The cumulative effect of the change should be recognized as an adjustment to the opening balance of retained earnings at the date of adoption. If an entity elects the fully retrospective method of transition, the cumulative effect of the change should be recognized as an adjustment to the opening balance of retained earnings in the first comparative period presented. The Company adopted ASU 2020-06 using the modified retrospective method as of January 1, 2022, and the adoption did not have a material impact on its condensed interim financial statements.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Recently Announced Accounting Standards
In June 2016, the FASB issued ASU No. 2016-13, *Financial Instruments: Credit Losses (Topic 326)* ("ASU 2016-13"), which requires measurement and recognition of expected losses for financial assets held. The new standard changes the impairment model for most financial instruments, including trade receivables, from an incurred loss method to a new forward-looking approach, based on expected losses. The estimate of expected credit losses will require organizations to incorporate considerations of historical information, current conditions, and reasonable and supportable forecasts. The standards update is effective prospectively for annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted, for a U.S. Securities Exchange filer, excluding entities eligible to be smaller reporting companies. The standards update is effective prospectively for annual and interim periods beginning after December 15, 2022 for smaller reporting companies. The Company is required to adopt ASU 2016-13 on January 1, 2023. Management is currently evaluating the impact of these changes on its financial statements.

#### Note 4 - Development Grant
During 2006 and 2007, the Company entered into two investment grant agreements with a non-profit foundation for the purpose of funding the initial development of the Company's AMIGO System and received a total of $1,589,500 from the foundation.

The agreement calls for payment of royalties based on sales by the Company to the foundation upon successful commercialization of the AMIGO System as follows:

---

| | |
|:---|:---|
|  **Royalty Percentage** | **Until Royalty**<br> **Payment Reaches**<br> **a Total of** |
|  4% | $1589500 |
|  2% | $3179000 |
|  1% | In perpetuity |

---

There was no royalty expense recorded for the nine months ended September 30, 2022 and 2021. The Company has accumulated royalties payable of $159,456 at September 30, 2022 and December 31, 2021. No royalties have been paid under the agreements.

#### Note 5 -Property and Equipment, net
Property and equipment, net at September 30, 2022 and December 31, 2021 are comprised of the following:

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| | | | |
|:---|:---|:---|:---|
|  | **Estimated**<br> **Useful**<br> **Lives** | **September 30,**<br> **2022** | **December 31,**<br> **2021** |
| Property and equipment | 3 years | $17280 | $10975 |
| VIVO DEMO/Clinical Systems | 2 years | 58955 | 50967 |
| Computer software and equipment | 3 years | 53894 | 49101 |
|  |  | 130129 | 111043 |
| Less: Accumulated depreciation |  | (101807) | (91707) |
|  |  | $28322 | $19336 |

---

Depreciation expense for the nine months ended September 30, 2022 and 2021 was $10,100 and $11,885, respectively.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Note 6 - Convertible Promissory Notes – Related Parties and Derivative Liability
Convertible Promissory notes – related parties at September 30, 2022 and December 31, 2021 are comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br> **2022** | **December 31,**<br> **2021** |
| Convertible Promissory Note One | $20455000 | $18975000 |
| Convertible Promissory Note Two | 4685000 | 4685000 |
| Convertible Promissory Note Three | 75000 | 75000 |
| Convertible Promissory Note Four | 250000 | 250000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Carrying value of promissory notes- related parties | $25465000 | $23985000 |

---

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| | | |
|:---|:---|:---|
|  | **September 30,**<br> **2022** | **December 31,**<br> **2021** |
| Interest payable – convertible promissory note one | $9696437 | $7906598 |
| Interest payable – convertible promissory note two | 3373240 | 2952745 |
| Interest payable – convertible promissory note three | 57074 | 50343 |
| Interest payable – convertible promissory note four | 190194 | 167755 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total Interest Payable | $13316945 | $11077441 |

---

In March 2017, the Company issued convertible promissory notes (the "Notes") to four shareholders of the Company (See Note 14) for an aggregate principal amount of $10,410,000. The notes bear interest at a rate of 12% per annum and matured on December 31, 2017 ("Maturity Date"). Upon Maturity Date, the four shareholders extended all terms related to the Notes. Any new monies provided under the Notes were also made pursuant to the same terms and, effective January 1, 2018, all monies due pursuant to the Note are due and payable on demand.

In November 2020, the Company's Board authorized raising the ceiling of the Notes to $23,000,000 under the same terms of the existing Notes.

In 2021, the related party holder of Convertible Promissory Note One provided the Company with an additional $2,350,000 in cash proceeds which was received by the Company for the year ended December 31, 2021. All monies due pursuant to the Note are due and payable on demand.

During the nine months ended September 30, 2022, the related party holder of Convertible Promissory Note One provided the Company with an additional $1,480,000 in cash proceeds. All monies due pursuant to the Note are due and payable on demand.

The Notes provide that upon the closing of the Company's next financing in an aggregate amount greater than $8,000,000 ("Next Financing"), the outstanding principal balance of each Note shall convert into shares of stock at a conversion price per share equal to 80% of the lowest price per share paid by the investors in the Next Financing.

Upon closing, the Notes settle by providing the holder with a variable number of shares sold in the Next Financing with an aggregate fair value determined by reference to the debt principal. In this scenario, the value that the holder receives at settlement does not vary with the value of the Company's common stock, so the settlement provision was not a typical conversion option. Rather, the share settlement feature was considered a contingent redemption provision (i.e., a contingent embedded put). The Company evaluated the embedded put features in accordance with ASC 815-15-25. The embedded puts are not clearly and closely related to the debt host instrument and therefore have been separately measured at fair value, with subsequent changes in fair value recognized in the Statement of Operations.

As discussed in Note 1, on September 9, 2022, the Company entered into a Merger agreement with Ra Medical whereby the Company will become a wholly-owned subsidiary of Ra Medical. In conjunction with the closing of the Merger, the Company will enter into a Debt Settlement Agreement and Release with each of the four Noteholders of the Convertible Notes discussed above (collectively, the "Debt Settlement Agreements"). The Debt Settlement Agreements will state that upon the closing of the Merger, the Convertible Notes will be extinguished and the

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

Noteholders will be issued newly designated non-voting preferred stock of Ra Medical in exchange for the outstanding balance of the Convertible Promissory Notes (referred to as the "Merger Shares"). Additionally, all interest accrued and unpaid on the Convertible Notes will be forgiven in exchange for a royalty, representing a certain percentage of net sales of its surgical vessel closing pressure device, beginning at the commencement of its first commercial sale ("Royalty Right"). The Royalty Right is set to expire December 31, 2035. See Note 13 for additional details on royalties related to this device.

Management used a scenario-based analysis to estimate the fair value of the embedded put features at issuance of the Convertible Notes and as of September 30, 2022 and December 31, 2021. In the scenario-based analysis management considered the following as inputs to the calculation (1) principal balance, (2) accrued interest to date, (3) fixed interest rate, (4) payment frequency, (5) maturity date, (6) market rate (which is the implied discount rate, (7) discount period, (8) discount factor and (9) the probability of conversion upon a qualified financing as defined in the agreement. As a result of the Debt Settlement Agreements above, the Company reassessed inputs utilized in its scenario-based analysis. Specifically, the Company's estimate of the probability of conversion of the Convertible Notes decreased, as the conversion of notes payable to Ra Medical common stock upon the closing of the Merger does not meet the definition of the Next Financing in the convertible note agreements. Historically, the Company has estimated the probability of conversion at 2.5%. Subsequent to entering into the Merger, the Company has estimated the probability of conversion at 1.5%, as the Debt Settlement Agreements are effective immediately following the closing of the Merger. The Company expects to close the Merger prior to December 31, 2022. The decreased probability of conversion from 2.5% to 1.5% used in the Company's scenario-based analysis resulted in a decrease of $402,768 (net of amortization of debt discount) in the estimated fair value of the derivative liability as of September 30, 2022.

At September 30, 2022 and December 31, 2021, the fair value of the derivative liability was $722,000 and $1,057,000, respectively. At September 30, 2021 and December 31, 2020, the fair value of the derivative liability was $1,027,000 and $910,000, respectively. The Company recorded a gain related to the decrease in fair value of the derivative liability of $402,768 for the nine months ended September 30, 2022. The Company recorded a loss related to the increase in the fair value of the derivative liability of $35,300 for the nine months ended September 30, 2021. Additionally, the Company recorded debt discounts to the Notes which were fully amortized as non-cash interest expense of $67,768 and $81,700 for the nine months ended September 30, 2022 and 2021, respectively.

#### Note 7 -Note Payable
On April 30, 2020, the Company received $200,000 in loan proceeds from the Payroll Protection Program (the "PPP") administered by the Small Business Administration (the "SBA") of the United States government. This program was established under the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act"). In accordance with the provisions of the PPP, the use of the proceeds is restricted by the CARES Act for such expenses as payroll related costs and other allowable costs as defined by the PPP. The Company submitted the application for forgiveness of the PPP loan on November 4, 2020. In May 2021, the Company received forgiveness for the entire amount of principal and accrued interest of the PPP loan. The Company recorded a gain on forgiveness of PPP loan in the amount of $200,000 during the nine months ended September 30, 2021.

#### Note 8 - Preferred Stock
The Company had the following Preferred Stock at December 31, 2021:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | **Shares** |  | **Liquidation** | **Conversion**  |
|  | **Authorized**<br> **Shares** | **Issued and**<br> **Outstanding** | **Liquidation**<br> **Preference** | **Preference**<br> **per Share** | **Price per**<br> **Share** |
| **At December 31, 2021** |  |  |  |  |  |
| Series A | 1875000 | 1731250 | $15390813 | $8.89 | $4.00 |
| Series B | 1500000 | 1187649 | 21080771 | $17.75 | $7.06 |
| Series C | 1168225 | 1156543 | 19869410 | $17.18 | $8.34 |
| Series D | 1750000 | 1097549 | 17330298 | $15.79 | $8.56 |
|  | 6293225 | 5172991 | $73671292 |  |  |

---

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

On March 31, 2022, the holders of a majority of the then outstanding shares of Preferred Stock, voted together as a single class, and approved the conversion of all shares of Preferred Stock into a total of 8,651,207 shares of Common Stock as determined in accordance with the Certificate of Incorporation. All current holders of Preferred Stock were advised of the conversion on March 31, 2022. The Company recorded its quarterly liquidation preference prior to the conversion of preferred stock to common stock, and converted the outstanding balance including the March 31, 2022 liquidation preferences to common stock. The details of the conversions by class of Preferred Stock are as follows:

The Company converted its 1,731,250 shares of Series A Preferred Stock outstanding with a liquidation preference as of March 31, 2022 of $15,563,938 into 1,731,250 shares of common stock at a par value of $0.001 per share. As a result of the conversion, the Company recorded an additional $1,731 of common stock and $15,562,207 of additional paid-in capital on March 31, 2022.

The Company converted its 1,187,649 shares of Series B Preferred Stock outstanding with a liquidation preference as of March 31, 2022 of $21,330,177 into 2,096,200 shares of common stock at a par value of $0.001 per share. As a result of the conversion, the Company recorded an additional $2,096 of common stock and $21,328,081 of additional paid-in capital on March 31, 2022.

The Company converted its 1,156,543 shares of Series C Preferred Stock outstanding with a liquidation preference as of March 31, 2022 of $20,118,067 into 2,475,002 shares of common stock at a par value of $0.001 per share. As a result of the conversion, the Company recorded an additional $2,475 of common stock and $20,115,592 of additional paid-in capital on March 31, 2022.

The Company converted its 1,097,549 shares of Series D Preferred Stock outstanding with a liquidation preference as of March 31, 2022 of $17,566,271 into 2,348,755 shares of common stock at a par value of $0.001 per share. As a result of the conversion, the Company recorded an additional $2,349 of common stock and $17,563,922 of additional paid-in capital on March 31, 2022.

There was no Series D, Series C, Series B, and Series A Preferred Stock issued and outstanding at September 30, 2022. The Series D, Series C, Series B and Series A Preferred Stock have been designated with the following preferences:

*Dividends:*

Dividends shall accrue at the rate of $0.86 per annum on shares of Series D preferred stock, whether or not declared and shall be cumulative. The Company is under no obligation to pay such accruing dividends except as set forth in certain sections of the agreement, including in the event of liquidation and redemption. No dividends have been declared or accrued for the three months ended March 31, 2022 (the date of conversion) or for the nine months ended September 30, 2022 and 2021.

Dividends shall accrue at the rate of $0.86 per annum on shares of Series C preferred stock, whether or not declared, and shall be cumulative. The Company is under no obligation to pay such accruing dividends except as set forth in certain sections of the agreement, including in the event of liquidation and redemption. No dividends have been declared or accrued for the three months ended March 31, 2022 (the date of conversion) or for the nine months ended September 30, 2022 and 2021.

Dividends shall accrue at the rate of $0.84 per annum on shares of Series B preferred stock, whether or not declared, and shall be cumulative. The Company is under no obligation to pay such accruing dividends except as set forth in certain sections of the agreement, including in the event of liquidation and redemption. No dividends have been declared or accrued for the three months ended March 31, 2022 (the date of conversion) or for the nine months ended September 30, 2022 and 2021.

Dividends shall accrue at the rate of $0.40 per annum on shares of Series A preferred stock, whether or not declared, and shall be cumulative. The Company is under no obligation to pay such accruing dividends except as set forth in certain sections of the agreement, including in the event of liquidation and redemption. No dividends have been declared or accrued for the three months ended March 31, 2022 (the date of conversion) or for the nine months ended September 30, 2022 and 2021.

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

*Liquidation, Dissolution and Preferential Payments:* 

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series D Preferred Stock then outstanding shall be entitled to be paid before any payment shall be made to the holders of Common Stock or Series A, Series B, and Series C Preferred Stock, an amount per share equal to the Series D Original Issue Price, plus any Series D Dividends declared but unpaid.

After payment to the holders of shares of Series D Preferred Stock above, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series C Preferred Stock then outstanding shall be entitled to be paid before any payment is made to the holders of Series B and Series A Preferred Stock and Common Stock, an amount per share equal to the Series C Original Issue Price, plus any Series C Dividends declared but unpaid.

After payment to the holders of shares of Series D and Series C Preferred Stock above, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series B Preferred Stock then outstanding shall be entitled to be paid before any payment is made to the holders of Series A Preferred Stock or Common Stock, an amount per share equal to the Series B Original Issue Price, plus any Series B Dividends declared but unpaid.

After payment to the holders of shares of Series D, Series C and Series B Preferred Stock above, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series A Preferred Stock then outstanding shall be entitled to be paid before any payment is made to the holders of Common Stock, an amount per share equal to the Series A Original Issue Price, plus any Series A Dividends declared but unpaid.

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, after the payment of all preferential amounts required to be paid to the holders of shares of Preferred Stock or, in the case of a Deemed Liquidation Event, the remaining assets of the Company available for distribution to its stockholders shall be distributed among the holders of the shares of Preferred Stock and Common Stock, pro rata based on the number of shares held by each such holder, treating for this purpose all such securities as if they had been converted to Common Stock.

*Election of Directors:*

The holders of the shares of Series B Preferred Stock may elect one director to the Company's Board of Directors.

The holders of the shares of Series A Preferred Stock may elect one director to the Company's Board of Directors.

The holders of the shares of Common Stock and of any other class or series of voting stock (including the Preferred Stock), voting together as a single class, shall be entitled to elect the balance of the five directors of the Company.

*Conversion:*

Each share of Series D, Series C, Series B and Series A preferred stock shall be convertible, at the option of the holder, at any time and without the payment of additional consideration by the holder, into one share of common stock.

Mandatory conversion of Series D, Series C Series B and Series A preferred stock to common stock shall occur when either there is a public offering of shares of Common Stock resulting in at least $40 million of gross proceeds to the Company or by a vote or written consent of the holders of all of the then outstanding shares of Series D, Series C, Series B and Series A preferred stock.

*Adjustments to Series A, Series B, Series C, and Series D Conversion Price for Diluting Issues:* 

In the event the Company issues additional shares of Common Stock or securities convertible into Common Stock, without consideration or for a consideration per share less than the applicable Preferred Series Conversion Price, then the Conversion Price for that Series, whether Series D, Series C, Series B, or Series A shall be reduced to the consideration per share received by the Company for such issue of Common Stock.

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

In the event the Company issues additional shares of Common Stock for a consideration per share greater than the applicable Preferred Series Conversion Price in effect immediately prior to such issue, but less than a consideration per share equal to one-hundred and twenty percent (120%) of the applicable Preferred Series Original Issue Price, then the Preferred Series Conversion Price for that Series, whether Series D, Series C, Series B or Series A, shall be reduced, concurrently with such issue, to a price determined in accordance with a formula.

At December 31, 2011, the Company had not received the requisite marketing approval from the United States Food and Drug Administration to market and sell the Corporation's Amigo Remote Catheter System. Accordingly, the Series B Original Issue Price is deemed to be $7.06 per share for the purpose of calculating the Series B Conversion Price. The prior Original Issue Price was $8.42 per share

In August 2013, the Company issued its Series D Preferred Stock at a price of $8.56 per share, which is less than one-hundred and twenty percent (120%) of the Series C Preferred Original Issue Price, and as a result, the Series C Original Issue Price is deemed to be $8.34 per share for the purpose of calculating the Series C Conversion Price. The prior Original Issue Price of Series C was $8.56 per share.

The Company has determined that the Series D, Series C, Series B and Series A Preferred host instrument was more akin to equity than debt and that the above identified conversion feature, subject to adjustments, was clearly and closely related to the host instrument, and accordingly bifurcation and classification of the conversion feature as a derivative liability was not required. The Series D, Series C, Series B and Series A Preferred Stock is contingently redeemable at the option of the holders or upon the occurrence of a Deemed Liquidation Event that is not solely within the control of the Company. A Deemed Liquidation Event is considered, a merger or consolidation in which (i) the Company is a constituent party or (ii) a subsidiary of the Company is a constituent party and the Company issues shares of its capital stock pursuant to such merger or consolidation, except any such merger or consolidation involving the Company or a subsidiary in which the shares of capital stock of the Company outstanding immediately prior to such merger or consolidation continue to represent, or are converted into or exchanged for shares of capital stock that represent, immediately following such merger or consolidation, at least a majority, by voting power, of the capital stock of (1) the surviving or resulting corporation or (2) if the surviving or resulting corporation is a wholly owned subsidiary of another corporation immediately following such merger or consolidation, the parent corporation of such surviving or resulting corporation. Accordingly, the Series D, Series C, Series B, and Series A Preferred Stock are presented as redeemable convertible preferred stock based on their redemption values at December 31, 2021. There was no Series D, Series C, Series B and Series A Preferred Stock issued and outstanding at September 30, 2022.

#### Note 9 - Common Stock
The Company is authorized to issue 100,000,000 shares of common stock, par value $0.001 per share. The holders of the common stock are entitled to one vote per each share with respect to each matter voted on by the stockholders of the Company.

On March 31, 2022, the Company notified holders of the Company's Preferred Stock that all of their shares of Preferred Stock issued and outstanding would be converted into shares of common stock as a result of a collective vote of all Preferred Stockholders that approved of the conversion of all shares of Preferred Stock. The Company converted all 5,172,991 issued and outstanding shares of Preferred Stock to 8,651,207 shares of common stock. For additional details on the conversion of each class of Preferred Stock, see Note 8.

During the nine months ended September 30, 2021, the Company issued 118,848 shares of common stock for net proceeds of $46,351 as a result of options exercised during the year by the former CEO of the Company. The Company did not issue shares of common stock as a result of options exercised during the nine months ended September 30, 2022.

#### Note 10 - Stock Based Compensation
In October 2009, the Board of Directors and Stockholders of the Company adopted the 2009 Equity Incentive Plan (the "Plan"), which was amended in 2011. The Plan provides for grants of stock options, restricted stock, and other stock-based awards to eligible employees of the Company as well as directors, officers, and others. The Plan is administered by the Board of Directors of the Company and was amended on September 24, 2019 to extend the term of the plan for ten more years.

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

Stock options are granted with an exercise price as determined by the Board of Directors, but in no event shall the exercise price be less than the fair value of a share of common stock on the date of grant. Awards generally vest over five years of continuous service and have a ten-year term from the date of grant.

The Company lacks company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a set of publicly traded peer companies. Due to the lack of historical exercise history, the expected term of the Company's stock options for employees has been determined utilizing the "simplified" method for awards. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

In order to determine the fair value, the Company considered, among other things, the Company's business, financial condition and results of operations; the lack of marketability of the Company's common stock; the market performance of comparable publicly traded companies; and U.S. and global economic and capital market conditions.

The following table summarizes stock option activity under the Plan for the nine months ended September 30, 2022.

---

| | | | |
|:---|:---|:---|:---|
|  | **Shares**<br> **Underlying**<br> **Options** | **Average**<br> **Exercise**<br> **Price** | **Remaining**<br> **Contractual**<br> **Term (in years)** |
| Outstanding at January 1, 2022 | 1139000 | $0.40 | 8.67 |
| Granted |  |  |  |
| Exercised |  |  |  |
| Cancelled |  |  |  |
| Expired |  |  |  |
| Outstanding at September 30, 2022 | 1139000 | $0.40 | 7.92 |
| Vested options at September 30, 2022 | 1077627 | $0.57 | 7.87 |

---

The fair value of employee options is estimated on the date of each grant using the Black-Scholes option-pricing model. During the nine months ended September 30, 2021, the Company granted 990,000 options to employees, directors and one observer of the Board of Directors with a grant date fair value of $9,900, at a fair value of $0.01 a share. The stock options vest annually over one to five years, and exercisable for ten years from the grant date. All options would terminate ten years from the grant date or with termination of employment, whichever comes first. The exercise price of all the stock options is $0.39. There were no grants during the nine months ended September 30, 2022. The assumptions used in calculating the fair value of stock-based awards during 2021 represent management's best estimates and involve inherent uncertainties and the application of management's judgement. The assumptions are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br> **2021** | **September 30,**<br> **2021** |
| Fair value of company's common stock | $| 0.024 |
| Dividend yield |  | 0% |
| Expected volatility | 91% - 175% | 91% - 175% |
| Risk Free interest rate | 0.9% - 3.0% | 0.9% - 3.0% |
| Expected life (years) remaining | 1.83 – 6.50 | 1.83 – 6.50 |

---

The stock-based compensation expense for stock option awards was $3,034 and $4,104 for the nine months ended September 30, 2022 and 2021, respectively. Stock-based compensation is included within general and administrative expenses on the Company's Statement of Operations.

As of September 30, 2022, there was an aggregate of $657 of unrecognized compensation cost related to non-vested stock-based compensation arrangements. This amount will be recognized as expense over a weighted-average period of 3.30 years.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Note 11 - Leases
During 2018 and 2019, the Company leased office space from an entity controlled by the Chairman of the Board of Directors. On January 1, 2019, the Company entered into a new lease agreement with a term of three years due to expire December 31, 2022. As of December 1, 2020, the entity controlled by the Chairman of the Board of Directors is no longer the landlord of the leased office space. The Company has made monthly payments of $4,367 to the new landlord, an unrelated party.

The Company's lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach to derive an appropriate imputed discount rate. The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived an imputed rate, which was used in a portfolio approach to discount its real estate lease liabilities. We used an estimated incremental borrowing rate of 18.10% on September 30, 2022 for all leases that commenced prior to that date.

Right of use lease assets and lease liabilities for our operating leases were recorded in the balance sheet as follows:

---

| | | |
|:---|:---|:---|
|  | **As of**<br> **September 30,**<br> **2022** | **As of**<br> **December 31,**<br> **2021** |
| **Assets** |  |  |
| Lease right of use assets | 12966 | 51867 |
| Total lease assets | 12966 | 51867 |
| **Liabilities** |  |  |
| Current liabilities: |  |  |
| Lease liability - current portion | 13100 | 52400 |
| Non-current liabilities: |  |  |
| Lease liability, net of current portion |  |  |
| Total lease liability | 13100 | 52400 |

---

*Lease Terms and Discount Rate*

The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company's operating leases as of September 30, 2022:

Weighted average remaining lease term (in years) – operating leases 0.25 <br> Weighted average discount rate – operating leases 18.10

*Undiscounted Cash Flows*

Future lease payments included in the measurement of lease liabilities on the balance sheet as of September 30, 2022 are represented by the current portion of the lease liability totaling $13,100 for the final three months of rent due per the lease agreement, which expires December 31, 2022.

*Office Lease Agreement Dated September 27, 2022*

On September 27, 2022, the Company entered into a lease agreement for office space located in Fort Mill, South Carolina. The space will be used for office and general use. The term of the lease is 38 months which began on October 1, 2022, which includes two months of free rent to begin the lease. The lease contains two separate 36 month renewal periods, which require 180 days notice if the Company intends to exercise. As of the date of these financial statements, the Company does not intend to exercise either of the two extension options. Total rent is approximately $3,400 per month for the first ten months following the two months of free rent and will increase annually for the following

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

twelve month periods of the lease. The Company has adopted the practical expedient under ASC 842, which permits the Company to account for each separate lease component of a contract and its associated non-lease components as a single lease payment. As a result, beginning at lease inception on October 1, 2022, the Company will recognize both the lease payments and associated common area maintenance payments as a single lease payment. The Company estimated an incremental borrowing rate of 11.09% for this lease agreement. Future lease payments for the following five fiscal years and thereafter were as follows:

---

| | |
|:---|:---|
| **Lease Commitments** | **Operating Lease** |
| 2022\* | 1523 |
| 2023 | 48613 |
| 2024 | 50213 |
| 2025 | 47433 |
| Thereafter |  |
| Total Minimum Lease Payments | 147782 |
| Less effects of discounting | (25513) |
| Present value of future minimum lease payments | $122269 |

---

\*Per the provisions of the lease agreement, the Company received a $2,500 rental credit for its first month of rental payments in exchange for painting the premises prior to the first rental payment. The credit will be applied to the first month of rental payment in December 2022, resulting in a rental payment of $1,523 due on December 1, 2022.

#### Note 12 - Income Taxes
The Company recorded no provision or benefit for income tax expense for the nine months ended September 30, 2022 and 2021. For all periods presented, the pretax losses incurred by the Company received no corresponding tax benefit because the Company concluded that it is more likely than not that the Company will be unable to realize the value of any resulting deferred tax assets and therefore has recorded a valuation allowance reducing the benefit to zero. The Company will continue to assess its position in future periods to determine if it is appropriate to reduce a portion of its valuation allowance in the future.

On March 27, 2020, Congress enacted the CARES Act to provide certain relief as a result of the COVID-19 pandemic. The CARES Act, among other things, includes provisions relating to net operating loss carryback periods, alternative minimum tax credit refunds, and modification to the net interest deduction limitations. The CARES Act did not have a material impact on the Company's consolidated financial statements for the nine months ended September 30, 2022 and 2021. The Company continues to monitor any effects on its financial statements that may result from the CARES Act. As of September 30, 2022 and December 31, 2021, the Company had not recorded any liability for uncertain tax positions, accrued interest or penalties thereon.

#### Note 13 - Commitments and Contingencies
*Legal Proceedings*

The Company may be involved in lawsuits, claims and proceedings incidental to the ordinary course of business. The Company accounts for such contingencies when a loss is considered probable and can be reasonably estimated.

In May 2020, the Company received a Summons to appear before the District Court of the Hague in a matter brought against the Company by PEACS B.V. The dispute concerns the ownership of one of the Company's European patents and services provided by PEACS B.V. relating to its VIVO product. Management accrued $375,000 at December 31, 2020 representing its best estimate for the resolution of the PEACS B.V dispute.

In May 2021, the Company and PEACS B.V. settled the outstanding litigation. As part of the settlement, the Company agreed to pay PEACS B.V. $375,000. Additionally, PEACS B.V. agreed to pay $200,000 to the Company for the transfer of certain patents. Ultimately, the $200,000 due for the transfer of the patents was offset against the $375,000 due to PEACS B.V. Therefore, the Company paid PEACS B.V. $175,000 and recorded a gain on the transfer of intangible assets of $200,000 for the nine months ended September 30, 2021.

------

 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

*Royalty Agreement*

In February 2022, the Company entered into an agreement with an individual for the assignment and all rights to a surgical vessel closing pressure device. In exchange, the Company has agreed to pay a 5% royalty on net sales up to $1,000,000 in royalties, payable annually in arrears, beginning in the year ending December 31, 2022. After $1,000,000 in royalties has been paid, and only if a patent has been granted by the United States Patent and Trademark Office, then the Company will continue to pay a royalty at a reduced rate of 2% of net sales until a cumulative royalty of $10,000,000 has been paid. Royalty payments will end February 28, 2032, whether or not the full $10,000,000 has been paid. For the nine months ended September 30, 2022, no royalty has been accrued or paid under this agreement.

#### Note 14 - Related Party Transactions
During the nine months ended September 30, 2022, the Company received advances totaling $600,000 from the Company's Chairman of the Board of Directors in connection with the Merger. The advances were to be repaid by the Company without interest upon the closing of the Merger. Subsequent to September 30, 2022, the Company received additional advances from the Company's Chairman in the amount of $475,000. See Note 15 for additional detail regarding the advances.

On April 25, 2021, the Company granted 900,000 stock options to five directors and one observer on the Board of Directors. The stock options are to vest monthly over one year, and exercisable for ten years from the grant date. All options would terminate ten years from the grant date or with termination of employment, whichever comes first. The exercise price of all the stock options is $0.39.

The Company's Chairman of the Board of Directors is the lead investor of Convertible Promissory Note One and the holder of Convertible Promissory Note Two as of September 30, 2022 and December 31, 2021, respectively. The Chairman of the Board of Directors owns approximately 16% and 23% of the Company's common stock as of September 30, 2022 and December 31, 2021, respectively. The outstanding balance of Convertible Promissory Notes One and Two due to the Chairman of the Board of Directors is $25,140,000 and $23,660,000 as of September 30, 2022 and December 31, 2021, respectively. The outstanding balance of interest payable related to the Convertible Promissory Notes One and Two due to the Chairman of the Board of Directors is $13,069,677 and $10,859,343 as of September 30, 2022 and December 31, 2021, respectively.

The Company's former CEO is the acting CEO of another entity and it is no longer considered an affiliated entity. As of and for the nine months ended September 30, 2022 and 2021 there were no transactions between the Company and the affiliated entity. As of September 30, 2022, and December 31, 2021, there were no amounts due to or from the affiliated entity. During the nine months ended September 30, 2021, the amount due from the exercise of 118,848 stock options by the former CEO was offset against deferred compensation due to the former CEO.

A member of the Company's Board of Directors is the holder of Convertible Promissory Note Three and owns 67,945 and 2,959 shares of the Company's common stock as of September 30, 2022 and December 31, 2021, respectively. The outstanding balance of Convertible Promissory Note Three due to the member is $75,000 as of September 30, 2022 and December 31, 2021. The outstanding balance of interest payable related to Promissory Note Three is $57,074 and $50,343 as of September 30, 2022 and December 31, 2021, respectively.

The holder of Convertible Promissory Note Four is a stockholder of the Company and an active investor in other ventures directed by the Company's Chairman of the Board of Directors. The holder of Convertible Promissory Note Four owns 56,559 and 8,242 shares of the Company's common stock as of September 30, 2022 and December 31, 2021, respectively. The outstanding balance of Convertible Promissory Note Four due to the shareholder is $250,000 as of September 30, 2022 and December 31, 2021. The outstanding balance of interest payable related to Promissory Note Four is $190,194 and $167,755 as of September 30, 2022 and December 31, 2021, respectively.

Please refer to Note 6 for additional details relating to convertible promissory notes with related parties.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

#### Note 15 -Subsequent Events
The Company has evaluated subsequent events occurring after the balance sheet date through the date of January 19, 2023 which is the date the financial statements were available to be issued. Based on this evaluation, the Company has determined the following subsequent events have occurred which require disclosure in the financial statements.

On January 9, 2023, Ra Medical, completed its acquisition of the Company pursuant to an Amended and Restated Agreement and Plan of Merger (the "Merger Agreement"), by and among Ra Medical, the Company, Rapid Merger Sub 1, Inc., a newly-created wholly-owned subsidiary of the Ra Medical ("First Merger Sub"), and Rapid Merger Sub 2, LLC, a newly-created wholly owned subsidiary of the Ra Medical ("Second Merger Sub" and together with First Merger Sub, the "Merger Subs"), entered into on January 9, 2023, pursuant to which the First Merger Sub merged with and into the Company, with the Company being the surviving corporation (the "First Merger Surviving Company") and a wholly-owned subsidiary of the Ra Medical (the "First Effective Time"), and then, immediately following the First Effective Time, and as part of the same overall transaction, the First Merger Surviving Company merged with and into the Second Merger Sub(the "Second Effective Time"), with the Second Merger Sub being the surviving limited liability company (the "Second Merger Surviving Company") (such transactions collectively, the "Merger", with Ra Medical following the Merger being referred to herein as the "Post-Merger Combined Company"). The Merger Agreement amends and restates in its entirety the Agreement and Plan of Merger (the "Original Agreement") entered into between the parties to the Original Agreement on September 9, 2022.

Immediately upon the First Effective Time, each share of common stock of the Company, par value $0.001 ("Catheter Common Stock") issued and outstanding immediately prior to the First Effective Time (subject to certain exclusions set forth in the Merger Agreement) was converted into the right to receive a number of shares of a new class of the Ra Medical's preferred stock, designated Series X Convertible Preferred Stock, par value $0.0001 per share (the "Series X Preferred Stock"), calculated in the manner described as follows.

Each share of Catheter Common Stock previously outstanding now represents a number of shares of Series X Preferred Stock equal to approximately 0.6705 (the "Exchange Ratio"), divided by one thousand (1,000).

In addition, the principal amount owing under certain convertible promissory notes of the Company (the "Converted Catheter Notes"), representing an aggregate principal amount of $25,215,000 pursuant to certain Debt Settlement Agreements (as defined in the Merger Agreement) converted into shares of Series X Preferred Stock, at a conversion price of $3.20 per one one-thousandth of a share of Series X Preferred Stok. In exchange for the forgiveness of the interest accrued but remaining unpaid under the Converted Catheter Notes, under the terms of the Debt Settlement Agreements the holders of Converted Catheter Notes also received certain royalty rights which equal, in aggregate, 11.82% per year on Net Sales (as defined in the Merger Agreement), if any, of the Company's vessel closure device, which is currently under development by the Company. Certain additional convertible promissory notes of the Company ("Non-Converted Catheter Notes" and, together with the Converted Catheter Notes, the "Catheter Notes"), representing a principal amount of $250,000, plus accrued interest, were not converted and remain outstanding.

All outstanding options to purchase Company common stock ("Catheter Options") were assumed and converted, at the First Effective Time, into options to purchase, in the aggregate, approximately 753,694 shares of Ra Medical common stock ("New Company Options"), representing a conversion at the Exchange Ratio. Each share of Series X Preferred Stock is contingently convertible into one thousand (1,000) shares of Company Common Stock, subject to shareholder approval and certain ownership blockers as defined in the Merger Agreement, and has no voting rights.

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 **CATHETER PRECISION, INC**<br> **NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS**<br>

The Company's Chairman of the Board of Directors advanced the following amounts to the Company subsequent to September 30, 2022, in order to fund current operating expenses incurred until the closing of the Merger:

---

| | |
|:---|:---|
| October 21, 2022 | $75000 |
| October 31, 2022 | 150000 |
| November 30, 2022 | 100000 |
| December 14, 2022 | 50000 |
| December 29, 2022 | 100000 |
| Total | $475000 |

---

All advances made by the Company's Chairman of the Board of Directors were repaid on January 10, 2023 without interest and totaled $1,075,000.

On December 7, 2022, the Company entered into a lease agreement for office space located in Augusta, New Jersey. The space will be used for office and general use. The term of the lease is 24 months which began on January 1, 2023. The lease contains one 24 month renewal period, which requires 9 months' notice if the Company intends to exercise. Total rent is $1,207 per month throughout the term of the lease agreement.

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#### Exhibit 99.2

#### UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma condensed combined financial statements give effect to the Merger. Ra Medical Systems, Inc. ("Ra Medical") was determined to be the accounting acquirer based upon the terms of the Merger and other factors including Ra Medical's security holders retaining voting control.

In the unaudited pro forma condensed combined financial statements, the Merger will be accounted for as a business combination using the acquisition method of accounting under accounting principles generally accepted in the United States, or "U.S. GAAP" and Ra Medical, as the accounting acquirer, will record the assets acquired and liabilities assumed of Catheter Precision, Inc. (Catheter Precision) at their fair values as of the acquisition date. Catheter Precision and Ra Medical have determined a preliminary estimated purchase price consideration calculated as described in Note 2 to the unaudited pro forma condensed combined financial statements. Purchase price consideration in excess of the estimated fair value of net assets acquired and net liabilities assumed has been presented as goodwill and intangible assets in the unaudited pro forma condensed combined financial statements as no valuation has been completed at this time.

The unaudited pro forma condensed combined balance sheet as of September 30, 2022 gives effect to the Merger as if it took place on September 30, 2022 and combines the historical balance sheets of Ra Medical and Catheter Precision as of such date. The unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2022 and for the year ended December 31, 2021 gives effect to the Merger as if it took place as of January 1, 2021, and combines the historical results of Ra Medical and Catheter Precision for each period. The historical financial statements of Ra Medical and Catheter Precision have been adjusted to give pro forma effect to events that are (i) directly attributable to the Merger, (ii) factually supportable, and (iii) with respect to the unaudited pro forma condensed combined statements of operations, at the date hereof are expected to have a continuing impact on the combined companies' results.

The unaudited pro forma condensed combined financial information is based on the assumptions and adjustments that are described in the accompanying notes. The unaudited pro forma condensed combined financial statements and pro forma adjustments have been prepared based on preliminary estimates of fair value of consideration, assets acquired and liabilities assumed. Differences between these preliminary estimates and the final acquisition accounting are likely to occur and these differences could be material as compared to the accompanying unaudited pro forma condensed combined financial statements and the combined companies' future results of operations and financial position.

The unaudited pro forma condensed combined financial information does not give effect to the potential impact of current financial conditions, regulatory matters, operating efficiencies or other savings or expenses that may be associated with the integration of the two companies, if any. The unaudited pro forma condensed combined financial information is preliminary and has been prepared for informational purposes only and is not necessarily indicative of the financial position or results of operations in future periods or the results that actually would have been realized had Ra Medical and Catheter Precision been a combined company during the specified periods.

The unaudited pro forma condensed combined financial information, including the notes thereto, should be read in conjunction with the separate Ra Medical and Catheter Precision historical financial statements, and their respective management's discussion and analysis of financial condition and results of operations referenced or included as exhibits to this Form 8-K amendment.

------

#### RA MEDICAL SYSTEMS, INC.

#### UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

#### (in thousands)

#### As of September 30, 2022

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Historical** | **Historical** | **Pro Forma** | **Pro Forma** | **Pro Forma** |
|  |  | **Catheter** | **Pro Forma** |  | **Pro Forma** |
|  | **Ra Medical** | **Precision** | **Adjustments** | **Notes** | **Results** |
| **Assets** |  |  |  |  |  |
| Current Assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $13657 | $140 | $(600) | **3.d** | $13197 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable, net |  | 36 |  |  | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other current assets | 1885 | 95 |  |  | 1980 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current assets | 15542 | 271 | (600) |  | 15213 |
| Property and equipment, net |  | 28 |  |  | 28 |
| Operating lease right-of-use assets | 1893 | 13 |  |  | 1906 |
| Goodwill and intangible assets |  |  | 96658 | **3.a** | 96658 |
| Other long-term assets | 36 |  |  |  | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets | $17471 | $312 | $96058 |  | $113841 |
| **Liabilities and Shareholders' Equity** |  |  |  |  |  |
| Current liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | $460 | $562 | $— |  | $1022 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses | 2447 | 292 | 5000 | **3.b** | 10833 |
|  |  |  | 514 | **3.c** |  |
|  |  |  | 2580 | **3.k** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Advance from related parties |  | 600 | (600) | **3.d** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of operating lease liabilities | 308 | 13 |  |  | 321 |
| &nbsp;&nbsp;&nbsp;&nbsp; Royalties payable |  | 159 |  |  | 159 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest payable - related parties |  | 13317 | (13127) | **3.e** | 190 |
| &nbsp;&nbsp;&nbsp;&nbsp; Convertible promissory notes - related parties |  | 25465 | (25215) | **3.f** | 250 |
| &nbsp;&nbsp;&nbsp;&nbsp; Derivative liability |  | 722 | (722) | **3.g** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current liabilities | 3215 | 41130 | (31570) |  | 12775 |
| Royalties payable |  |  | 1000 | **3.e** | 1000 |
| Operating lease liabilities | 1746 |  |  |  | 1746 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | 4961 | 41130 | (30570) |  | 15521 |
| Shareholders' equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Convertible preferred stock |  |  | 93904 | 2. | 93904 |
| &nbsp;&nbsp;&nbsp;&nbsp; Common stock |  | 10 | (10) | **3.h** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Additional paid-in capital | 209488 | 75088 | (75088) | **3.h** | 209488 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated deficit | (196978) | (115916) | 115916 | **3.h** | (205072) |
|  |  |  | (5000) | **3.b** |  |
|  |  |  | (514) | **3.c** |  |
|  |  |  | (2580) | **3.k** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shareholders' (deficit) equity | 12510 | (40818) | 126628 |  | 98320 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities and shareholders' equity | $17471 | $312 | $96058 |  | $113841 |

---

See notes to unaudited pro forma condensed combined financial information.

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#### RA MEDICAL SYSTEMS, INC.

#### UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

#### (in thousands, except per share data)

#### For the Nine Months Ended September 30, 2022

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Historical** | **Historical** | **Pro Forma** | **Pro Forma** | **Pro Forma** |
|  |  | **Catheter** | **Pro Forma** |  | **Pro Forma** |
|  | **Ra Medical** | **Precision** | **Adjustments** | **Notes** | **Results** |
| Net revenue | $14 | $192 | $— |  | $206 |
| Cost of revenue | 161 | 16 |  |  | 177 |
| Gross profit (loss) | (147) | 176 |  |  | 29 |
| Operating expenses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Selling, general and administrative | 8292 | 2543 |  |  | 10835 |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development | 6238 | 180 |  |  | 6418 |
| &nbsp;&nbsp;&nbsp;&nbsp; Restructuring and impairment | 4069 |  |  |  | 4069 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 18599 | 2723 |  |  | 21322 |
| Loss from operations | (18746) | (2547) |  |  | (21293) |
| Other income (expense), net: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest expense |  | (2307) | 2285 | **3.e** | (22) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other income (expense), net | 40 | 393 | (403) | **3.g** | 30 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total other income (expense), net | 40 | (1914) | 1882 |  | 8 |
| Loss before income taxes | (18706) | (4461) | 1882 |  | (21285) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income taxes |  |  |  |  |  |
| Net loss | (18706) | (4461) | 1882 |  | (21285) |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends on preferred shares |  | (907) |  |  | (907) |
| Net loss attributable to common stockholders | $(18706) | $(5368) | $1882 |  | $(22192) |
| Net loss attributable to common stockholders per share, basic and diluted | $(28.00) | $(0.74) |  |  | $(33.22) |
| Shares used in computing net loss per share: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic and diluted | 668 | 7276 |  | **3.i** | 668 |

---

See notes to unaudited pro forma condensed combined financial information.

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#### RA MEDICAL SYSTEMS, INC.

#### UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

#### (in thousands, except per share data)

#### For the Year Ended December 31, 2021

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Historical** | **Historical** | **Pro Forma** | **Pro Forma** | **Pro Forma** |
|  |  | **Catheter** | **Pro Forma** |  | **Pro Forma** |
|  | **Ra Medical** | **Precision** | **Adjustments** | **Notes** | **Results** |
| Net revenue | $22 | $149 | $— |  | $171 |
| Cost of revenue | 1560 | 10 |  |  | 1570 |
| Gross profit (loss) | (1538) | 139 |  |  | (1399) |
| Operating expenses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Selling, general and administrative | 15475 | 2228 | 5000 | **3.b** | 25797 |
|  |  |  | 514 | **3.c** |  |
|  |  |  | 2580 | **3.k** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development | 12253 | 422 |  |  | 12675 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 27728 | 2650 | 8094 |  | 38472 |
| Loss from operations | (29266) | (2511) | (8094) |  | (39871) |
| Other income (expense), net: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest expense |  | (2828) | 2798 | **3.e** | (30) |
| &nbsp;&nbsp;&nbsp;&nbsp; Gain on extinguishment of PPP promissory note | 2023 | 200 |  |  | 2223 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other income (expense), net | (14) | 149 | 43 | **3.g** | 178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total other income (expense), net | 2009 | (2479) | 2841 |  | 2371 |
| Loss from continuing operations before income taxes | (27257) | (4990) | (5253) |  | (37500) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income taxes | 4 |  |  |  | 4 |
| Loss from continuing operations before dividends | (27261) | (4990) | (5253) |  | (37504) |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends on preferred shares |  | (3628) |  |  | (3628) |
| Loss from continuing operations | (27261) | (8618) | (5253) |  | (41132) |
| Income from discontinued operations, net of taxes | 2191 |  |  |  | 2191 |
| Net loss attributable to common stockholders | $(25070) | $(8618) | $(5253) |  | $(38941) |
| Net loss attributable to common stockholders per share, basic and diluted |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Continuing operations | $(269.91) | $(6.05) |  |  | $(407.25) |
| &nbsp;&nbsp;&nbsp;&nbsp; Discontinued operations | 21.69 |  |  |  | 21.69 |
| Total net loss attributable to common stockholders per shares, basic and diluted | $(248.22) | $(6.05) |  |  | $(385.55) |
| Shares used in computing net loss per share: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic and diluted | 101 | 1425 |  | **3.j** | 101 |

---

See notes to unaudited pro forma condensed combined financial information.

------

#### RA MEDICAL SYSTEMS, INC.

#### NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
(Unaudited)

------

1. **BASIS OF PRESENTATION** 

After completion of the Merger, the consolidated financial statements of the consolidated entity will be prepared and presented in accordance with U.S. GAAP. The unaudited pro forma condensed combined financial information includes (all financial information is prepared in accordance with U.S. GAAP):

(a) The unaudited pro forma condensed combined balance sheet as at September 30, 2022, combines (i) the unaudited balance sheet of Catheter Precision as of September 30, 2022, as derived from information included as exhibits to this Form 8-K amendment and (ii) the unaudited condensed balance sheet of Ra Medical as of September 30, 2022 as filed on Ra Medical's Form 10-Q with the SEC on November 14, 2022, as if the Merger had been completed on September 30, 2022.

(b) The unaudited pro forma condensed combined statement of operations for the nine month period ended September 30, 2022 combines (i) the unaudited condensed statement of operations of Catheter Precision for the nine month period ended September 30, 2022 as derived from information included as exhibits to this Form 8-K, and (ii) the unaudited interim condensed statement of operations of Ra Medical for the nine month period ended September 30, 2022, as filed on Ra Medical's Form 10-Q with the SEC on November 14, 2022 and gives effect to the Merger as if it took place as of January 1, 2021.

(c) The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2021 combines (i) the audited statement of operations of Catheter Precision for the year ended December 31, 2021, as derived from information included in Ra Medical's Preliminary Proxy Statement (Amendment No. 1) dated November 4, 2022 and (ii) the audited statement of operations of Ra Medical for the year ended December 31, 2021, as filed on Ra Medical's Form 10-K with the SEC on March 24, 2022 and amended on July 13, 2022, and included in Ra Medical's Preliminary Proxy Statement (Amendment No. 1) dated November 4, 2022, and gives effect to the Merger as if it took place as of January 1, 2021.

The unaudited pro forma condensed combined financial information should be read in conjunction with the historical financial statements and notes included therein of Ra Medical and Catheter Precision, as referred to above. Further review may identify differences between the accounting policies of Catheter Precision and Ra Medical that, when conformed, could have a material impact on the financial statements of the combined company. At this time, Catheter Precision and Ra Medical are not aware of any accounting policy differences that would have a material impact on the unaudited pro forma condensed combined financial information of the combined company.

The Merger reflected in the unaudited pro forma condensed combined financial information has been prepared using the acquisition method of accounting in accordance with ASC 805, Business Combinations, under U.S. GAAP. Under the acquisition method, the total estimated purchase price consideration is calculated as described in Note 2 to the unaudited pro forma condensed combined financial information. In accordance with the accounting guidance for business combinations, the assets acquired and liabilities assumed of Cather Precision will be measured at their estimated fair values on the date of acquisition. The pro forma financial information has been presented for Catheter Precision's assets and liabilities based on their historical amounts as no valuation has occurred at this time to determine their respective fair values. Purchase price consideration in excess of the estimated fair value of net assets acquired and net liabilities assumed has been presented as goodwill and intangible assets in the unaudited pro forma condensed combined financial statements.

It is Ra Medical's management's opinion that the unaudited pro forma condensed combined financial information includes all adjustments necessary for the fair presentation of the Merger described herein except for the adjustments that will result from the completion of the valuation. Management intends to engage a third-party valuation expert to help Ra Medical determine the purchase price consideration and the fair values of tangible and intangible assets acquired, and liabilities assumed, from Catheter Precision. The estimates used in the accompanying unaudited pro forma condensed combined financial information may differ materially from the amounts determined once management's analysis has been completed. This unaudited pro forma condensed combined financial information has

------

been presented for informational purposes only and is not intended to reflect the results of operations or the financial position of Ra Medical which would have actually resulted had the Merger been effected on the dates indicated. Furthermore, the unaudited pro forma condensed combined financial information is not necessarily indicative of the results of operations that may be obtained in the future.

2. **MERGER** 

The management of Ra Medical and Catheter Precision has preliminarily concluded that Ra Medical is the accounting acquirer and that the Merger represents a business combination pursuant to Financial Accounting Standards Board Accounting Standards Codification Topic 805, *Business Combinations*, or ASC 805 and Ra Medical will record the acquired assets and liabilities assumed at their fair value as of the Merger closing date. Purchase price consideration in excess of the estimated fair value of net assets acquired and net liabilities assumed has been presented as goodwill and intangible assets in the unaudited pro forma condensed combined financial statements.

Management has estimated the purchase price consideration based on the closing market price of Ra Medical's common stock on the date of the Merger. This estimate does not consider potential discounts or adjustments related to Ra Medical's Series X Preferred Stock lack of marketability, stockholder ownership limitations, and the nonvoting nature, of the shares.

Management has not yet completed an external valuation analysis of the fair market value of Catheter Precision's assets to be acquired and liabilities assumed. As a result, management has estimated the allocation of the preliminary purchase price consideration to Catheter Precision's assets and liabilities. This preliminary purchase price allocation has been used to prepare the pro forma adjustments in the unaudited pro forma condensed combined balance sheet. The final purchase price allocation will be determined when the final purchase price has been determined and the final acquired assets and assumed liabilities are known, and detailed valuations and any other studies and calculations deemed necessary have been completed, reviewed by management and accepted by the Company. The final purchase price and purchase price allocation could differ materially from the preliminary purchase price and purchase price allocation used to prepare the pro forma adjustments resulting from changes to assets and liabilities and to the ultimate purchase price consideration, and operations during the intervening period to the closing of the Merger, among other factors.

On January 9, 2023, Ra Medical completed its acquisition of Catheter Precision. Pursuant to the terms of the Merger Agreement, Ra Medical issued 14,649.561 shares of Series X Preferred Stock to Catheter debtholders and stockholders in exchange for 100% of the issued and outstanding common shares of Catheter Precision and the cancellation of the principal amount of certain Convertible Promissory Notes. The estimated purchase price consideration has been based on the closing price of Ra Medical common stock on the NYSE American on January 6, 2023, the last trading day before completion of the Merger.

---

| | |
|:---|:---|
| Number of convertible preferred shares issued | 14649.561 |
| Conversion ratio | 1000 |
| Common stock equivalent shares | 14649561 |
| Multiplied by the fair value per share of Ra Medical common stock | $6.41 |
| Estimated consideration | $93903686 |

---

The actual purchase price consideration could differ significantly from the preliminary estimate when the valuation analysis is completed, as Ra Medical's Series X Preferred Stock possesses different characteristics than Ra Medical's common stock.

------

**3.** **PRO FORMA ADJUSTMENTS** 

The adjustments reflect the acquisition method of accounting, which takes into account the total estimated purchase price consideration transferred for Catheter Precision's assets and liabilities based on their historical amounts as no valuation has occurred at this time to determine their respective fair values on the date of the Merger.

a. The estimated purchase price consideration transferred, and assets acquired and liabilities assumed are recorded as follows (in thousands):

---

| | |
|:---|:---|
| Estimated consideration (2.) | $93904 |
| Cash and cash equivalents | 140 |
| Other assets | 131 |
| Long-term assets | 41 |
| Accounts payable, accrued expenses and other liabilities | (1626) |
| Interest payable | (190) |
| Convertible promissory note | (250) |
| Royalties payable long-term | (1000) |
| Net liabilities assumed | (2754) |
| Excess of consideration over net liabilities assumed | $96658 |

---

Excess of the purchase price over the estimated fair value of the net liabilities assumed has been reflected as goodwill and intangible assets.

A final determination of fair value may differ materially from the preliminary estimates and will include management's final valuation. The final valuation may materially change the calculation of consideration, which could affect the fair value assigned to the assets acquired and liabilities assumed and could result in a change to the unaudited pro forma condensed combined financial information.

b. The adjustment includes a contractual obligation owed to the Department of Justice, which is due shortly after completion of the Merger.

c. The adjustment includes expenses relating to an employment agreement.

d. The adjustment reflects repayment of the advanced payments received from a related party which were received in connection with the Merger and were repaid upon closing.

e. The adjustment reflects the agreement with the Convertible Promissory Noteholders (Noteholders) to forgive all accrued interest and future interest expense in exchange for a future royalty right. The Company will pay to the Noteholders a total royalty equal to approximately 12% of net sales of its Surgical Vessel Closing Pressure Device, commencing upon the first commercial sale through December 31, 2035. The adjustment has an estimated fair value of $1.0 million. Management has not yet completed an external valuation analysis and therefore the final estimate may differ materially from the amounts determined once management's analysis has been completed.

f. The adjustment removes the Convertible Promissory Notes principal as the Convertible Promissory Notes have been converted to Ra Medical equity in conjunction with the Merger under the Debt Settlement Agreement and Release with certain Noteholders.

g. The adjustment removes the derivative liability and related expense or income for the changes in fair value of the derivative liability which will be terminated as the result of the conversion of the Convertible Promissory Notes.

h. The adjustments remove the historical value of equity and accumulated deficit of the accounting acquiree.

i. Anti-dilutive common share equivalents excluded from the computation of diluted net loss per share at September 30, 2022 consisted of warrants of 1,150,686, stock options of 1,427, assumed options of

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Catheter Precision of 753,694, restricted stock awards of 1,354, restricted stock units of 75 and Series X Convertible Preferred shares of 14,649.561.

j. Anti-dilutive share equivalents excluded from the computation of diluted net loss per share at December 31, 2021 consisted of warrants of 48,385, stock options of 2,168, assumed options of Catheter Precision of 753,694, restricted stock awards of 3,586, restricted stock units of 1,400, Employee Stock Purchase Plan shares of 452 and Series X Convertible Preferred shares of 14,649.561.

k. The adjustment reflects non-recurring transactions expenses incurred subsequent to September 30, 2022. Non-recurring t ransaction expenses of $1.6 million are included in the Statement of Operations for the nine month period ended September 30, 2022 and $0.8 million remains unpaid as of September 30, 2022.

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#### Exhibit 99.3

#### CAUTION REGARDING FORWARD-LOOKING STATEMENTS
The following discussion contains forward-looking statements which include, but are not limited to, statements regarding the plans and expectations of the combined company regarding Catheter Precision's products, including its plans, strategies, projected timelines and estimated markets, for and/or related to VIVO and the Amigo and vessel closure devices described above, and future cash and financing needs. These forward-looking statements are subject to the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. The Company's expectations and beliefs regarding these matters may not materialize. Actual outcomes and results may differ materially from those contemplated by these forward-looking statements as a result of uncertainties, risks and changes in circumstances, including but not limited to risks and uncertainties related to: the ability of the parties to consummate the transactions described in its recent securities purchase agreement, satisfaction of closing conditions precedent to the consummation of those transactions, the potential impact of decreases in the Company's stock price on those transactions, the ability of the Company to timely and successfully achieve the anticipated benefits of the merger between Ra Medical and Catheter Precision, including the ability of the combined company to access the capital markets at such times and in such amounts, and on such terms, as needed, execute its future business strategies and maintain its listing on the NYSE American or other national stock exchange, and the ability of the combined company to successfully pursue its product lines in the manner and in the timeframe described here. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption "Risk Factors" and elsewhere in the Company's most recent filings with the SEC, including the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, and any prior or subsequent reports on Form 10-K, Form 10-Q or Form 8-K filed with the SEC from time to time and available at www.sec.gov, including its amended Preliminary Proxy Statement filed on November 4, 2022 (the "Preliminary Proxy"). Important business and financial information about Catheter's business and the related discussion and analysis of financial condition and results of operations of Catheter are described in the Preliminary Proxy and in "Catheter Precision Management's Discussion and Analysis," included therein. This information should be read in conjunction with such Catheter Precision Management's Discussion and Analysis, and the Catheter Financial Statements contained in the Preliminary Proxy, and the Catheter Financial Statements and Pro Forma Financial Information which are filed as Exhibits to Ra Medical's Current Report on Form 8-K/A filed on January 19, 2023. Risks and uncertainties related to Catheter, and the projections and estimates described above that may cause actual results to differ materially from those expressed or implied in any forward-looking statement are described in "Risk Factors – Risks Related to the Business of Catheter Precision," which are contained in the Preliminary Proxy. The Preliminary Proxy and other documents filed by the Company with the SEC can be accessed on the Company's Investor Relations page at https://ir.ramed.com/ by clicking on the link titled "SEC Filings." The risks and uncertainties may be amplified by the COVID-19 pandemic, which has caused significant economic uncertainty, and ongoing volatility in the stock markets and the U.S. economy in general. The extent to which the COVID-19 pandemic impacts the Company's businesses, operations, and financial results, including the duration and magnitude of such effects, will depend on numerous factors, which are unpredictable, including, but not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume.

The forward-looking statements included in this communication are made only as of the date hereof. The Company assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

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*The following discussion and analysis of financial condition and results of operations should be read together with Catheter's financial statements, accompanying notes and other financial information filed as Exhibits to the Current Report on Form 8-K/A on which this Management's Discussion and Analysis has been filed. Operating results are not necessarily indicative of results that may occur in future periods.* 

#### CATHETER'S Management's Discussion and Analysis of Financial Condition and Results of Operations

#### Comparison of the Nine Months Ended September 30, 2021 and 2022

#### Revenue, Cost of Sales and Gross Profit

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| | | |
|:---|:---|:---|
|  | **For the nine months ended**<br> **September 30,** | **For the nine months ended**<br> **September 30,** |
|  | **2021** | **2022** |
| **Revenue** | $113284 | $192373 |
| **Cost of sales** | 8537 | 15668 |
| **Gross profit** | $104747 | $176705 |

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*Revenue*

Revenue is generated from the sales of our VIVO System, single use disposable patches and software upgrades directly to hospitals and to our international distributors. Revenue for the nine months ended September 30, 2022 increased by $79,089 from $113,284 to $192,373 as compared to the nine months ended September 30, 2021, as our number of customers has increased following the market release of VIVO in the US during 2021.

---

| | | |
|:---|:---|:---|
|  | **For the nine months ended**<br> **September 30,** | **For the nine months ended**<br> **September 30,** |
| **Revenue by Type** | **2021** | **2022** |
| **Net sales from sale of hardware** | $79784 | $170563 |
| **Net sales from sale of software** | 30000 | 21810 |
| **Net sales from software upgrades** | 3500 | - |
| **Total Net Sales** | $113284 | $192373 |

---

*Cost of Sales*

Cost of Sales for the nine months ended September 30, 2022 increased by $7,131 from $8,537 to $15,668 as compared to the nine months ended September 30, 2021, consistent with the growth in revenue. The principal component of cost of sales is the cost of the off the shelf computer incorporated into a VIVO System as well as the cost of disposable patches sold to customers.

*Gross Profit*

Gross profit for the nine months ended September 30, 2022 increased by $71,958 from $104,747 to $176,705, as compared to the nine months ended September 30, 2021, due to increased sales. Given our limited operations and the use of outside vendors, the Company is able to operate with low fixed overhead costs. We believe we will be able to effectively manage costs in this manner for the next 12 to 24 months.

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#### Operating Expenses
Our operating expenses consist of research and development expense, sales and marketing expense and general and administrative expense. Personnel costs are the most significant component of operating expenses and consist of salaries, benefits, stock-based compensation, and sales commissions. We expect operating expenses to increase in absolute dollars as we grow our business.

---

| | | |
|:---|:---|:---|
|  | **For the nine months ended**<br> **September 30,** | **For the nine months ended**<br> **September 30,** |
|  | **2021** | **2022** |
| **General and Administrative Expense** | $861240 | $1620988 |
| **Research and Development Expense** | 294384 | 180211 |
| **Sales and Marketing Expense** | 788707 | 922606 |
| **Total Operating Expense** | $1944331 | $2723805 |

---

#### General and Administrative Expense
General and administrative expense consists primarily of personnel costs, including salary, employee benefits and stock-based compensation expenses for our administrative personnel that support our general operations, such as information technology, executive management and financial accounting. It also includes costs attributable to intellectual property and other legal fees, audit fees, general business insurance, consulting services, depreciation and facilities costs.

General and administrative expense for the nine months ended September 30 2022, increased by $759,748 from $861,240 to $1,620,988, as compared to the nine months ended September 30, 2021. The increase was attributable to accrued but unpaid legal, audit and professional accounting fees related to the proposed merger with Ra Medical and to higher salary expense.

#### Research and Development Expense
Research and development costs are expensed as incurred. Research and development expense consists of costs of technology licenses, third-party software development consultants, engineering supplies and materials. Research and development expense also includes costs related to our clinical and quality and regulatory activities, including medical advisors, contractors, research grants and all clinical study-related costs.

Research and development expense for the nine months ended September 30, 2022 decreased by $114,173 from $294,384 to $180,211, as compared to the nine months ended September 30, 2021. During the nine months ended September 30, 2021, the Company incurred clinical study related costs of approximately $119,000 as compared to approximately $46,000 during 2022 as the Company has completed its US multi-center study. During 2022, the Company incurred development costs of approximately $26,000 related to its closure device that is under development.

It is likely that we will incur increased clinical and regulatory related costs in 2023 and beyond, including costs associated with our post-market surveillance registry of our most recent FDA de novo clearance for use of the VIVO System and costs of any study undertaken as we attempt to expand our approved indications for use.

#### Sales and Marketing Expense
Sales and marketing expense consist primarily of personnel costs, including salary, commissions, employee benefits and stock-based compensation expenses for our sales and marketing personnel and contractors in the U.S. and Europe. It also includes costs associated with product demonstrations, trade shows, marketing materials, royalties, and travel.

Sales and marketing expense for the nine months ended September 30, 2022 increased by $133,899 from $788,707 to $922,606, as compared to the nine months ended September 30, 2021. The primary cause for the increase

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was an increase in headcount, travel, trade show and related expenses as we achieved limited commercialization of VIVO in the US and EU.

#### Other Income and Expense, Income Tax Benefit

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended**<br> **September 30,** | **For the Nine Months Ended**<br> **September 30,** |
|  | **2021** | **2022** |
| **Interest income** | $28 | $- |
| **Interest expense** | (2088036) | (2307494) |
| **Forgiveness of PPP loan** | 200000 | - |
| **Gain on transfer of intangible assets** | 200000 | - |
| **Change in fair value of derivative liability** | (35300) | 402768 |
| **Loss on Foreign currency transaction** | (3782) | (9449) |
|  | $(1727090) | $(1914175) |

---

#### Interest Expense
The aggregate principal balance of the Company's convertible promissory notes (the "Notes"), including amounts payable to officers, directors and stockholders of the Company was $25,465,000 at September 30, 2022. The notes accrue interest at a rate of 12% per year that is payable in cash. Accrued but unpaid interest on the notes at September 30, 2022 was $13,316,945.

#### Forgiveness of PPP loan
On April 30, 2020, the Company received approximately $200,000 in loan proceeds from the Paycheck Protection Program (the "PPP") administered by the Small Business Administration (the "SBA") of the United States government. This program was established under the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act"). In accordance with the provisions of the PPP, the use of the proceeds is restricted by the CARES act for such expenses as payroll related costs and other allowable costs as defined by the PPP. The Company submitted the application for forgiveness of the PPP loan on November 4, 2020. During the nine months ended September 30, 2021 the Company received forgiveness for the entire amount of principal and accrued interest of the PPP loan. The Company recorded a gain for the loan proceeds forgiven within other income for the nine months ending September 30, 2021.

#### Gain on transfer of intangible assets
In May 2020, the Company received a Summons to appear before the District Court of the Hague in a matter brought against the Company by PEACS B.V. The dispute concerned the ownership of one of the Company's European patents and services provided by PEACS B.V. relating to its VIVO product. Management accrued $375,000 at December 31, 2020 representing its best estimate for the resolution of the PEACS B.V dispute.

In May 2021, the Company and PEACS B.V. settled the outstanding litigation. As part of the settlement, the Company agreed to pay PEACS B.V. $375,000. Additionally, PEACS B.V. agreed to pay $200,000 to the Company for the transfer of certain patents. Ultimately, the $200,000 due for the transfer of the patents was offset against the $375,000 due to PEACS B.V. Therefore, the Company paid PEACS B.V. $175,000 and recorded a gain on the transfer of intangible assets of $200,000 for the nine months ending September 30, 2021.

#### Convertible Promissory Notes – Related Parties and Derivative Liability
The Company has historically funded its operations through issuances of equity securities and debt instruments. Between March 2017 through September 30, 2022, the Company has issued convertible promissory notes (the "Notes") to four shareholders of the Company of the Company for an aggregate principal amount of $25,465,000, including $1,480,000 during the nine months ended September 30, 2022. The notes bear interest at a

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rate of 12% per annum and are due and payable on demand. The Company had accrued interest payable under the Notes of $13,316,945 as of September 30, 2022.

The Notes contain additional conversion features, including that upon the closing of Catheter's next financing in an aggregate amount greater than $8,000,000 ("Next Financing"), the outstanding principal balance of each Note shall convert into shares of stock at a conversion price per share equal to 80% of the lowest price per share paid by the investors in the Next Financing. The Notes also provide that upon a Change in Control, the Notes will either become due and payable in full prior to closing, or will convert into Company common stock or other securities on terms and conditions agreed upon by the Company and the requisite purchasers.

Under the Next Financing conversion provision, upon closing, the Notes settle by providing the holder with a variable number of shares sold in the Next Financing with an aggregate fair value determined by reference to the debt principal. In this scenario, the value that the holder receives at settlement does not vary with the value of the Company's common stock, so the settlement provision was not a typical conversion option. Rather, the share settlement feature was considered a contingent redemption provision (i.e., a contingent embedded put). The Company evaluated the embedded put features in accordance with ASC 815-15-25. The embedded puts are not clearly and closely related to the debt host instrument and therefore have been separately measured at fair value, with subsequent changes in fair value recognized in the Statement of Operations.

On September 9, 2022, the Company entered into a merger agreement with Ra Medical whereby the Company would become a wholly-owned subsidiary of Ra Medical. On January 9, 2023, Ra Medical, completed its acquisition of the Company pursuant to an Amended and Restated Agreement and Plan of Merger. In conjunction with the closing of the merger, the Company entered into a Debt Settlement Agreement and Release with each of the Noteholders of the Convertible Notes (collectively, the "Debt Settlement Agreements"), except for one unaffiliated holder of a Convertible Note with a principal amount of $250,000. Pursuant to the Debt Settlement Agreements, upon the closing of the merger, the Convertible Notes were extinguished and the Noteholders were issued newly designated non-voting preferred stock of Ra Medical in exchange for the outstanding principal balance of the Convertible Promissory Notes (referred to as the "Merger Shares"). Additionally, all interest accrued and unpaid on the Convertible Notes was forgiven in exchange for a royalty, representing a certain percentage of net sales of the Company's surgical vessel closing pressure device, beginning at the commencement of its first commercial sale ("Royalty Right"). The Royalty Right is set to expire December 31, 2035.

Management used a scenario-based analysis to estimate the fair value of the embedded put features at issuance of the Convertible Notes as of September 30, 2022 and December 31, 2021. At September 30, 2022 and December 31, 2021, the fair value of the derivative liability was $722,000 and $1,057,000, respectively. As a result of the Debt Settlement Agreements, the Company reassessed inputs utilized in its scenario-based analysis. Specifically, the Company's estimate of the probability of conversion of the Convertible Notes decreased, as the conversion of notes payable to Ra Medical common stock upon the closing of the merger does not meet the definition of the Next Financing in the convertible note agreements. Historically, the Company has estimated the probability of conversion at 2.5%. Subsequent to entering into the merger, the Company has estimated the probability of conversion at 1.5%, as the Debt Settlement Agreements are effective immediately following the closing of the merger. The Company expected to close the merger during the fourth quarter of 2022 or the first quarter of 2023. The decreased probability of conversion from 2.5% to 1.5% used in the Company's scenario-based analysis resulted in a decrease of $402,768 (net of amortization of debt discount) in the estimated fair value of the derivative liability as of September 30, 2022.

As a result, the Company recorded a gain related to the decrease of the derivative liability of $402,768 and a loss related to the increase in fair value of the derivative liability of $35,300 for the nine months ended September 30, 2022 and 2021, respectively. Additionally, the Company recorded debt discounts to the Notes which were fully amortized as non-cash interest expense of $67,768 and $81,700 for the nine months ended September 30, 2022 and 2021, respectively.

All except $250,000 of the Notes were discharged pursuant to the terms of the Debt Settlement Agreements as further described below under "Liquidity and Capital Resources."

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#### Liquidity and Capital Resources
Since Catheter's incorporation, Catheter has received equity financing, debt financing through stockholders, advances from related parties and grant monies from a non-profit foundation to develop the technology and pursue the regulatory approvals necessary to commercialize Catheter's products in the United States and European Union ("EU"). The amount of equity investment in Catheter from its incorporation through September 30, 2022 was approximately $36 million. The amount of Convertible Promissory Notes issued through September 30, 2022 was approximately $25,465,000. The amount of accrued and unpaid interest on these Notes at September 30, 2022 was approximately $13,317,000.

During the nine months ended September 30, 2022, Catheter has incurred additional debt in the form of short-term, interest-free Advances from Mr. Jenkins in the principal amount of $600,000. Subsequent to September 30, 2022, the Company received additional advances from Mr. Jenkins in the amount of $475,000. Following consummation of the merger on January 9, 2023, the entire balance of $1,075,000 was repaid.

Catheter expects to continue to incur net losses for the next several years and therefore require additional funding, which may include future equity and debt financings. There is no guarantee that this financing can be obtained.

As noted above, when the merger closed on January 9, 2023, under the Debt Settlement Agreements, all except $250,000 of the Notes were extinguished, and the holders of the extinguished Notes were issued newly designated non-voting preferred stock of Ra Medical at the price specified by the merger agreement and described in more detail in the Form 8-K filed by Ra Medical with the SEC on January 13, 2023.

Additionally, all interest accrued and unpaid was forgiven in exchange for the Royalty Rights described above under "Royalty Agreements." The Advances, in the aggregate amount of $1,075,000, are not included in the Debt Settlement Agreements and were not so discharged. They were repaid following the closing of the merger.

As of September 30, 2022, Catheter had approximately $140,000 in cash and cash equivalents. As of December 31, 2021, Catheter had approximately $12,000 in cash and cash equivalents. Additionally, the Company has accrued but unpaid legal and other professional fees incurred in connection with the proposed merger with Ra Medical.

On March 31, 2022, the holders of a majority of the then outstanding shares of Preferred Stock voted together as a single class, and approved the conversion of all shares of Preferred Stock into a total of 8,651,207 shares of Common Stock as determined in accordance with the Certificate of Incorporation. All current holders of Preferred Stock were advised of the conversion on March 31, 2022. The Company recorded its quarterly liquidation preference prior to the conversion of preferred stock to common stock, and converted the outstanding balance including the March 31, 2022 liquidation preferences to common stock.

Net cash used in operating activities was approximately $1,943,000 for the nine months ended September 30, 2022. Net loss for the nine months ended September 30, 2022 and 2021 was approximately $4,461,000 and $3,567,000, respectively.

Net cash used in operating activities was approximately $2,654,000 for the year ended December 31, 2021. Net loss for the year ended December 31, 2021 and 2020 was approximately $4,990,000 and $2,811,000, respectively.

As of September 30, 2022, Catheter had an accumulated deficit of approximately $115,916,000, total outstanding convertible debt of $25,465,000, and total outstanding interest payable of approximately $13,317,000, which is due on demand, as well as $600,000 of additional debt that is payable on demand. Catheter's accumulated deficit as of December 31, 2021 was approximately $110,548,000.

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Catheter has incurred substantial losses and negative cash flows from operations to date and expects to incur operating losses for the foreseeable future as it expands its commercialization efforts of its current product and attempts to commercialize its closure device that is under development. Catheter is unable to predict the extent of any future losses or when Catheter will become profitable, if at all. Catheter's future capital requirements will depend upon many factors, including progress with developing, manufacturing and marketing its technologies, the time and costs involved in preparing, filing, prosecuting, maintaining and enforcing patent claims and other proprietary rights, its ability to establish collaborative arrangements, marketing activities and competing technological and market developments, including regulatory changes affecting medical procedure reimbursement, and overall economic conditions in our target markets.

#### Summary of Cash Flows

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the year ended**<br> **December 31,** | **For the year ended**<br> **December 31,** | **For nine months ended**<br> **September 30,** | **For nine months ended**<br> **September 30,** |
|  | **2020** | **2021** | **2021** | **2022** |
| **Cash used in operating activities** | $**(2874668)** | $**(2653522)** | **(2089545)** | **(1942643)** |
| **Cash used in investing activities** | **(9132)** | **(24072)** | **(2855)** | **(19086)** |
| **Cash provided by financing activities** | **3120000** | **2350000** | **1900000** | **2080000** |
| **Effect of exchange rate on cash** | **623** | **6337** | **3782** | **9449** |
| **Net increase (decrease) in cash** | $**236823** | $**(321257)** | $**(188618)** | $**127720** |

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*Cash Used in Operating Activities*

Net cash used in operating activities decreased by $146,902 from $2,089,545 for the nine months ended September 30, 2021 to $1,942,643 for the nine months ended September 30, 2022. The net loss for the nine months ended September 30, 2022 of $4,461,275 included a favorable change in the derivative liability related to the conversion feature of its Notes of $402,768, while the net loss of $3,566,674 recorded in for the nine months ended September 30, 2021 included an unfavorable change in the fair value of derivative liability of $35,300. During the nine months ended September 30, 2021 and 2022, the Company incurred accrued but unpaid interest on its Notes Payable to related parties of $2,006,337 and $2,239,504, respectively. Additionally, during the nine months ended September 30, 2022, the Company's accounts payable and accrued expenses increased by $631,758, mostly representing professional fees incurred but not paid in connection with the proposed merger with Ra Medical.

Cash flow from operating activities during the nine months ended September 30, 2021 were also impacted by the forgiveness of a $200,000 PPP loan and a $200,000 gain on the transfer of intangible assets.

Net cash used in operating activities decreased by $221,146 from $2,874,668 for the year ended December 31, 2020 to $2,653,522 for the year ended December 31, 2021. The net loss in 2021 of $4,989,708 included an unfavorable change in the derivative liability related to the conversion feature of its Notes of $43,437 while the net loss of $2,810,779 recorded in 2020 included a favorable change in the fair value of derivative liability of $2,591,736. The $2,591,736 non-cash variance in the change in fair value of the derivative liability represented the majority of the change in net loss for the years. During the years ended December 31, 2020 and 2021, the Company incurred accrued but unpaid interest on its Notes Payable to related parties of $2,409,903 and $2,724,830, respectively, favorably impacting cash flow from operations.

Cash flow from operating activities during the year ended December 31, 2021 was also impacted by the forgiveness of a $200,000 PPP loan and a $200,000 gain on the transfer of intangible assets.

*Cash Used in Investing Activities*

Cash used in investing activities was $2,855 and $19,086 during the nine months ended September 30, 2021 and 2022, respectively. These purchases were primarily computer equipment and VIVO demo equipment purchased during the periods.

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Cash used in investing activities increased by $14,940 from $9,132 during the year ended December 31, 2020 to $24,072 during the year ended December 31, 2021. These purchases were primarily computer equipment and VIVO demo equipment purchased during the periods.

*Cash Provided by Financing Activities*

Cash provided by financing activities of $2,080,000 and $1,900,000 for the nine months ended September 30, 2022 and 2021, respectively, included the proceeds of convertible promissory notes to related parties of $1,480,000 and $1,900,000, respectively.

Additionally, during the nine months ended September 30, 2022, the Company received advances totaling $600,000 from the Company's Chairman of the Board of Directors. The advances were repaid by Ra Medical upon the closing of the merger.

Cash provided by financing activities of $2,350,000 during the year ended December 31, 2021 represented the proceeds of a convertible promissory note to related parties of $2,350,000.

Cash provided by financing activities of $3,120,000 during the year ended December 31, 2020 represented the proceeds of a convertible promissory note to related parties of $2,920,000 and proceeds of $200,000 from a federal Paycheck Protection Program ("PPP loan") which was subsequently forgiven in 2021.

#### Contractual Obligations and Commitments

#### Undiscounted Cash Flows
Catheter had lease obligations consisting of operating leases, for Catheter's New Jersey principal offices which expired in 2022, the remaining future lease payments included in the measurement of lease liabilities on the balance sheet as of September 30, 2022 were $13,100.

On September 27, 2022, the Company entered into a lease agreement for office space located in Fort Mill, South Carolina. The space will be used for office and general use. As of September 30, 2022, future lease payments for the following five fiscal years and thereafter were as follows:

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| | |
|:---|:---|
| **Lease Commitments** | **Operating Lease** |
| 2022**\*** | $1523 |
| 2023 | 48613 |
| 2024 | 50213 |
| 2025 | 47434 |
| Thereafter |  |
| Total Minimum Lease Payments | 147782 |
| Less effects of discounting | (25513) |
| Present value of future minimum lease payments | $122269 |

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\*Per the provisions of the lease agreement, the Company received a $2,500 rental credit for its first month of rental payments. The credit will be applied to the first month of rental payment in December 2022, resulting in a rental payment of $1,523 due on December 1, 2022.

On December 7, 2022, the Company entered into a lease agreement for office space located in Augusta, New Jersey. The space will be used for office and general use. The term of the lease is 24 months which began on January 1, 2023. The lease contains one 24-month renewal period, which requires 9 months' notice if the Company intends to exercise. Total rent is $1,207 per month throughout the term of the lease agreement.

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#### Segment Information
Catheter operates in one business segment, which is the marketing, sales and development of medical technologies focused in the field of cardiac electrophysiology.

#### Effects of Inflation
During the periods for which financial information is presented, management does not believe that the business and operations were materially affected by inflation.

#### Foreign Currency Exchange Risk
Catheter uses the U.S. dollar as its functional currency, and initially measure the foreign currency denominated in assets and liabilities at the transaction date. Monetary assets and liabilities are then re-measured at exchange rates in effect at the end of each period, and property and non-monetary assets and liabilities are converted at historical rates.

To date, Catheter has incurred minor foreign currency transaction realized gains and losses related to Catheter's European activities. As Catheter's international operations grow, foreign currency exchange risk may become a factor and Catheter will reassess its approach to managing the risks relating to fluctuations in currency rates at that time.

Catheter does not believe that inflation and change in prices had a significant impact on Catheter's results of operations for any periods presented in Catheter's financial statements.

#### Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Catheter regularly evaluates estimates and assumptions related to provisions for legal contingencies, income taxes, deferred income tax, asset valuation allowances, valuation of warrant liabilities, valuation of derivative liabilities, share based compensation, and revenues. Catheter bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by Catheter may differ materially and adversely from Catheter's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

#### Fair Value Measurements
ASC 820, Fair Value Measurements, provides guidance on the development and disclosure of fair value measurements. Catheter follows this authoritative guidance for fair value measurements, which defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles in the United States, and expands disclosures about fair value measurements. The guidance requires fair value measurements be classified and disclosed in one of the following three categories:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3: Unobservable inputs which are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of and during the nine months ended September 30, 2022 and 2021 and the year ended December 31, 2021 and 2020. The carrying amount of cash and accounts payable approximated fair value as they are short term in nature. The guidance in ASC 815, Derivatives and Hedging, requires that Catheter mark the value of Catheter's preferred stock warrant liability to market and recognize the change in valuation in Catheter's statements of operations each reporting period. Determining the warrant liability to be recorded requires Catheter to develop estimates to be used in calculating the fair value of the warrant. The fair value of preferred stock warrants issued were estimated based on a Black-Scholes model during the nine months ended September 30, 2022 and 2021 and the year ended December 31, 2021 and 2020. The estimated fair value of the warrant and embedded put included in the convertible promissory notes – related parties, represent Level 3 measurements.

The following table details the fair value measurements within the fair value hierarchy of Catheter's financial instruments, which includes the Level 3 liabilities:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** | **Fair value at September 30, 2022** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| &nbsp;&nbsp;&nbsp;&nbsp; Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative liability | $722000 | $— | $— | $722000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | $722000 | $— | $— | $722000 |

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** | **Fair value at December 31, 2021** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| &nbsp;&nbsp;&nbsp;&nbsp; Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative liability | $1057000 | $— | $— | $1057000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | $1057000 | $— | $— | $1057000 |

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#### Off-Balance Sheet Arrangements
Catheter does not have any off-balance sheet arrangements as such term is used in SEC Regulation S-K Item 303 during the periods presented, investments in special-purpose entities or undisclosed borrowings or debt. Additionally, Catheter is not a party to any derivative contracts or synthetic leases.

#### Indemnification
Catheter has agreements whereby Catheter indemnifies its officers and directors for certain events or occurrences while the officer or director is or was serving, at Catheter's request, in such capacity, to the maximum extent permitted under the laws of the State of Delaware.

#### Stock-based Compensation
In October 2009, the Board of Directors and Stockholders of the Company adopted the 2009 Equity Incentive Plan (the "Plan"), which was amended in 2011. The Plan provides for grants of stock options, restricted stock, and other stock-based awards to eligible employees of the Company as well as directors, officers, and others. The Plan is administered by the Board of Directors of the Company and was amended on September 24, 2019 to extend the term of the plan for ten more years.

Stock options are granted with an exercise price as determined by the Board of Directors, but in no event shall the exercise price be less than the fair value of a share of common stock on the date of grant. Awards generally vest over five years of continuous service and have a ten-year term from the date of grant.

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The Company lacks company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a set of publicly traded peer companies. Due to the lack of historical exercise history, the expected term of the Company's stock options for employees has been determined utilizing the "simplified" method for awards. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

In order to determine the fair value, the Company considered, among other things, the Company's business, financial condition and results of operations; the lack of marketability of the Company's common stock; the market performance of comparable publicly traded companies; and U.S. and global economic and capital market conditions.

The following table summarizes stock option activity under the Catheter Plan for the years ended December 31, 2021 and 2020 and the nine months ended September 30, 2022:

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| | | | |
|:---|:---|:---|:---|
|  | **Shares**<br> **Underlying**<br> **Options** | **Average**<br> **Exercise**<br> **Price** | **Remaining**<br> **Contractual**<br> **Term**<br> **(in years)** |
| Outstanding at January 1, 2020 | 590950 | $1.20 | 6.10 |
| Granted |  | $— |  |
| Cancelled | (125980)) | $0.39 |  |
| Expired | (77000)) | $4.00 |  |
| Outstanding at December 31, 2020 | 387970 | $0.47 | 5.94 |
| Granted | 990000 | 0.39 | 9.31 |
| Exercised | (118848) | 0.39 |  |
| Cancelled | (115122) | 0.43 |  |
| Expired | (5000) | $4.00 | 0.00 |
| Outstanding at December 31, 2021 | 1139000 | $0.40 | 8.67 |
| Vested options at December 31, 2021 | 499707 | $0.83 | 6.01 |
| Granted |  |  |  |
| Cancelled |  |  |  |
| Expired |  |  |  |
| Outstanding at September 30, 2022 | 1139000 | $0.40 | $7.92 |
| Vested options at September 30, 2022 | 1077627 | $0.57 | $7.87 |

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The stock-based compensation expense for stock option awards was $6,421 and $353 for the year ended December 31, 2021 and 2020, respectively, and $3,034 and $4,104 for the nine months ended September 30, 2022 and 2021, respectively.

The fair value of employee options is estimated on the date of each grant using the Black-Scholes option-pricing model. 990,000 options were granted to employees during the year ended December 31, 2021, with a grant date fair value of $9,900. There were no grants during the year ended December 31, 2020.

During the nine months ended September 31, 2021, Catheter granted 990,000 options with a grant date fair value of $9,900. There were no grants during the nine months ended September 30, 2022.

As of December 31, 2021, there was an aggregate of approximately $3,691 of unrecognized compensation cost related to non-vested stock-based compensation arrangements. This amount will be recognized as expense over a weighted-average period of 1.13 years. As of September 30, 2022, there was an aggregate of $657 of unrecognized compensation cost related to non-vested stock-based compensation arrangements. This amount will be recognized as expense over a weighted-average period of 3.30 years.

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The following assumptions were used to estimate the fair value of stock options granted using the Black-Scholes option pricing model for the years ended December 31, 2021. There were no grants during the nine months ended September 30, 2022.

The risk-free interest rate assumption is based upon observed U.S. government security interest rates with a term that is consistent with the expected term of Catheter's employee stock options. The expected term is based on the average of the vesting period and contractual term of Catheter's options. Catheter has not paid a dividend, and does not expect to pay a dividend in the foreseeable future.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31,**<br> **2021** | **December 31,**<br> **2021** | **September 30,**<br> **2022** | **September 30,**<br> **2022** |
| **Fair value of common stock** | $| 0.024 | $| 0.024 |
| **Risk-free interest rate** | .9% - 3.0% | .9% - 3.0% | .9% - 3.0% | .9% - 3.0% |
| **Expected term in years** | 1.83 - 6.50 | 1.83 - 6.50 | 1.83 - 6.50 | 1.83 - 6.50 |
| **Expected volatility** | 91% - 175% | 91% - 175% | 91% - 175% | 91% - 175% |
| **Expected Dividend yield** |  | 0% |  | 0% |

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Due to a lack of a public market for Catheter's Common Stock, Catheter utilized a public company peer group's historical volatility to determine Catheter's expected volatility for purposes of the Black-Scholes option pricing model. Stock-based compensation expense is trued up periodically for actual forfeitures.

#### Dividends
Catheter has not paid a dividend on its common stock and is unlikely to pay one in the future.