Analogy 1: Nexalin Technology is like a Brainsway that uses a unique electrical waveform device to treat mental health conditions without drugs.

Analogy 2: Nexalin Technology is like a Dexcom (which makes medical devices for chronic conditions used at home) but focused on non-invasive, drug-free brain stimulation for mental health.

• Gen-1 Devices: Legacy cranial electrotherapy stimulation (CES) devices for anxiety and insomnia, from which the company continues to derive revenue through existing installations, licensing fees, and consumable sales in the US.
• Gen-2 Devices: Advanced neurostimulation devices with a higher current waveform, currently approved and marketed in China for insomnia and depression, and undergoing pilot trials in the United States.
• Gen-3 Headset Devices: A new generation of neurostimulation headsets under development, designed for at-home use under physician oversight to enhance patient access and treatment compliance.
• Electrodes: Consumable components sold for use with their Gen-1 and Gen-2 neurostimulation devices.

Major Customers of Nexalin Technology (NXL)

Nexalin Technology primarily sells its devices and services to other companies and organizations rather than directly to individuals. Its major customers can be categorized as follows:

• Wider Com Limited: This is a private company based in China that acts as a distributor for Nexalin's Gen-2 devices in China. Nexalin recognized approximately $624,000 in revenue from sales through Wider Com Limited during the first half of 2022. Wider Com Limited is also involved in a potential joint venture with Nexalin for broader distribution in China, Hong Kong, Macau, and Taiwan.
• Medical Professionals and Healthcare Providers: In the United States, Nexalin's Gen-1 devices were historically utilized by medical professionals and providers in clinical settings to administer treatments for anxiety and insomnia. While new sales of Gen-1 devices in the U.S. are currently suspended due to FDA reclassification, Nexalin continues to derive revenue from existing devices through monthly licensing fees and the sale of electrodes to these medical professionals and providers.

Mark White

President and Chief Executive Officer, Board of Directors

Mark White has served as President and Chief Executive Officer of Nexalin Technology since 2018 and has been with the company since 2012, initially as an independent consultant. He possesses over 25 years of experience in medical device development, clinical operations, and business development. Prior to joining Nexalin, Mr. White owned and operated his own clinics and addiction centers. He has also been involved in building companies and recruiting management teams across various industries.

Justin Van Fleet

Chief Financial Officer

Justin Van Fleet was appointed Chief Financial Officer of Nexalin Technology, effective August 1, 2025. He brings over 20 years of experience in public accounting and assurance services. Before joining Nexalin, Mr. Van Fleet served as a Partner at Marcum LLP (formerly Friedman LLP), where he led the firm's assurance practice and advised publicly traded and privately held clients across various sectors. He is a licensed CPA in New York and New Jersey and has experience guiding companies through complex financial transactions, including IPOs and mergers.

Dr. David Owens, M.D.

Chief Medical Officer, Board of Directors

Dr. David Owens joined Nexalin Technology in 2017 as Chief Medical Officer. He also serves on the Board of Directors and the Scientific Advisory Board.

Carolyn Shelton

Executive Vice President of Clinical, Quality and Regulatory Affairs

Carolyn Shelton holds the position of Executive Vice President of Clinical, Quality and Regulatory Affairs at Nexalin Technology.

John Patrick Claude

Co-Founder and Director of Engineering and Development

John Patrick Claude is a Co-Founder of Nexalin Technology and serves as its Director of Engineering and Development. He was instrumental in designing and developing the original tACS waveform used by the company. Mr. Claude has an extensive background in regulatory, compliance, and quality management. He earned a BS in Physiology from the University of Notre Dame and an ME in Biomedical Engineering from the University of Virginia.

Key Risks to the Business

1. Significant Regulatory Hurdles and Delays in the United States: Nexalin Technology faces substantial regulatory challenges in the U.S. stemming from the FDA's December 2019 reclassification of its Generation 1 (Gen-1) devices. This reclassification has halted new sales and marketing of Gen-1 devices for anxiety and insomnia, requiring a new 510(k) application, and necessitates a Class III device classification and Premarket Approval (PMA) application for depression. The company is currently analyzing whether to proceed with an amended application for Gen-1 devices. Furthermore, the new Generation 2 (Gen-2) and Generation 3 (Gen-3) devices, which are critical for future growth, also require new PMA applications in the United States for indications like depression, with the determination of safety and efficacy solely resting with the FDA. This dependency on lengthy and costly FDA approval processes poses a significant barrier to commercialization and revenue generation in their domestic market.
2. Uncertainty and Repeated Delays in Establishing the China Joint Venture: The formation of a critical joint venture with Wider Com Limited, intended to design and implement a comprehensive business model and distribution plan for Nexalin's devices in China, Hong Kong, Macau, and Taiwan, has been subject to repeated delays. The joint venture, initially anticipated by the third quarter of 2023, has been extended multiple times, with reasons cited including regulatory issues in both China and the United States, trade and political issues between the two countries, and potential changes in the use and market for the company’s products and technology. While Gen-2 devices have been sold in China through Wider acting as a distributor, the continued uncertainty surrounding the formal establishment of the joint venture impedes the company's strategic expansion and full market penetration in this key international region.
3. Limited and Potentially Decreasing Revenue Streams: The company's U.S. revenue from Gen-1 devices is currently restricted to monthly licensing fees and payments for electrodes from devices in operation prior to the December 2019 FDA reclassification, with no new sales or marketing efforts. While Nexalin recognized approximately $624,000 in revenue from Gen-2 device sales in China during the first half of 2022, and a smaller royalty fee from electrode sales, the company explicitly expects that gross margins may decrease in the second half of 2022 and future periods. This anticipated decrease is attributed to an increase in the costs of components, manufacturing, delivery, sales, and marketing. This reliance on limited revenue sources and the expectation of declining profitability for its current active product in China present a substantial financial vulnerability.

The following clear emerging threats have been identified for Nexalin Technology:

• Increased costs of components, manufacturing, delivery, sales, and marketing are expected to lead to a decrease in gross margins starting in the second half of 2022.
• Ongoing delays and complications in establishing the strategic Joint Venture in China due to regulatory, trade, and political issues between the United States and China, which impedes the company's primary international growth strategy in a key market where its Gen-2 device is approved.

Nexalin Technology (NXL) is poised for future revenue growth driven by several key initiatives over the next 2-3 years:

1. FDA Approval and Commercialization of the Gen-2 Device in the United States: The company is strategically pursuing a Premarket Approval (PMA) application with the FDA for its Gen-2 device to treat major depressive disorder (MDD) in the United States. Additionally, Nexalin has completed Q-submission meetings and received acceptance from the FDA for its Gen-2 SYNC neurostimulation console in its Alzheimer's Disease and dementia programs, indicating a broader push for this device in significant U.S. markets.
2. Expanded Sales of the NMPA-Approved Gen-2 Device in China through a Joint Venture: The Gen-2 device has already received approval from China's National Medical Products Administration (NMPA) for marketing and sale for the treatment of insomnia and depression. The anticipated formation of a formal Joint Venture with Wider Com Limited by the third quarter of 2023 is expected to significantly expand the comprehensive business model and distribution plan for the Gen-2 device across China, Hong Kong, Macau, and Taiwan.
3. Launch and Adoption of the Gen-3 Home-Use Headset Device: Nexalin is developing a Gen-3 headset designed for home use with physician oversight, aiming to increase patient access and compliance by addressing the stigma associated with clinical treatments. The company is undertaking a pivotal HALO Clarity Trial to support a planned De Novo FDA submission targeting the multi-billion-dollar insomnia market for this device, which represents a new product line and market approach.
4. Introduction of the "Neurocare®?" AI-Driven Virtual Clinic: Nexalin recently launched Neurocare®?, an AI-driven virtual clinic designed to transform access for patients with Alzheimer's, mood disorders, traumatic brain injury (TBI), and post-traumatic stress disorder (PTSD). This initiative represents a new service-based revenue stream, expanding beyond device sales to offer integrated care and broaden market entry.
5. Expansion of Treatable Indications for the Gen-2 Device: Beyond its primary indications, Nexalin is currently designing clinical trials for the use of its Gen-2 device for additional conditions such as substance use disorders, opiate addictions, chronic pain, Alzheimer’s disease, and dementia. Successful trials and subsequent regulatory approvals for these expanded indications would significantly enlarge the addressable market for the Gen-2 technology.

Share Issuance

• In May 2025, Nexalin Technology announced the pricing of an underwritten public offering of 3,850,000 shares of its common stock at $1.30 per share, with gross proceeds expected to be approximately $5.0 million.

Capital Expenditures

• The net proceeds from the May 2025 public offering of $5.0 million are intended to be used for working capital and other general corporate purposes, including capital expenditures and product development.