Mr. Tom Looby reports

CONAVI MEDICAL PROVIDES SHAREHOLDER UPDATE AND 2025 OUTLOOK

To our shareholders,

As we enter 2025, I am encouraged by our recent progress and the favourable strategic landscape. Having completed our go-public transaction and raised concurrent financing of $7.7-million (U.S.), Conavi is well positioned to set a new imaging standard for the most common procedures in interventional cardiology.

The case for our Novasight platform has never been stronger. With the new European interventional cardiology guidelines strongly recommending intravascular imaging and the expectation that similar U.S. guidelines will soon follow, we have an extraordinary opportunity in a market where 80 per cent of procedures continue to rely on old technology. These developments come as demand is already rising, with intravascular imaging devices projected to be the fastest-growing segment of the global interventional cardiology market.

We believe we have achieved product-market fit based on feedback and clinical experience with earlier Novasight versions at multiple hospital sites. With our capability to match the performance and pricing of single-mode systems, we believe our next-generation solution offers a truly no-compromise solution for doctors, payers and hospital administrators.

Commercial readiness

Key opinion leaders (KOLs) are expected to commence system usability testing next quarter, which aims to demonstrate that we have met physician requirements and satisfied key functional specifications -- validating the system's suitability for routine clinical use. Also, in calendar Q2, we plan to continue showcasing the important clinical role to be played by hybrid imaging in coronary interventions by highlighting clinical case reports and developing a hybrid imaging whitepaper.

Our filing for U.S. FDA 510(k) clearance is targeted for the second half of 2025. Given previous clearances for earlier Novasight versions, we expect to satisfy the agency's safety, efficacy and quality standards. Upon clearance, we plan to begin placing systems at key United States hospitals on commercial terms -- several have already expressed interest. Also in early 2026, in collaboration with KOLs, we plan to conduct the first-in-human study of the next-generation Novasight system. Once achieved, this will be an important milestone marking the next-generation system's initial use in real-world clinical cases. If the results of this study are favourable, we expect they will assist us in highlighting Novasight's safety and ease of use, and in demonstrating those clinical scenarios where hybrid imaging is particularly advantageous.

As we bring the next-generation Novasight to market, we are working to extend our technological advantage; initiatives include further integration of AI (artificial intelligence) capabilities, achieving state-of-the-art image quality for both imaging modalities, and overcoming limitations in catheterization lab workflows. Our goal is for these efforts to help support expansion beyond the $700-million (U.S.) coronary (that is, heart-based) segment to the broader interventional cardiology market, a potential $4-billion (U.S.) market opportunity.

We also expect to continue to fortify our IP position, with planned patent filings covering novel methods of fabricating and assembling imaging cores and new means of improving clinical workflows.

Multiple near-term revenue and non-dilutive funding opportunities

We continue to explore opportunities with groups possessing significant experience in commercializing cardiovascular technologies outside of North America and China. As previously reported, our Chinese licensee recently gained regulatory approval for its coronary imaging system, triggering a fourth and final $5.9-million (U.S.) milestone payment of licensing revenue to Conavi, highlighting the potential of other markets as global demand for interventional cardiology procedures grows.

Beyond our core business, we are also pursuing the monetization of Titan Medical's intellectual property portfolio, acquired by Conavi as a result of the continuing public transaction and consisting of 240 patents and patent applications. Although we cannot yet estimate the likelihood of success, we are buoyed by the rising interest in robotic surgery technology and Titan's earlier success in licensing and selling aspects of their IP.

We continue to pursue government grants, including Ontario's recently announced program to support scale-up for market-ready products in life sciences, with up to $2.5-million available to each successful applicant. To date, the company has benefited from over $20-million in non-dilutive funding from government sources.

Upcoming targeted milestones

The following targeted milestones use calendar dates:

H1 2025

• Expected completion of usability and system validation with key opinion leaders;
• Expected publication of whitepaper and submissions to journals to drive awareness.

H2 2025

• Targeted time frame for U.S. FDA 510(k) submission for the next-generation Novasight system.

H1 2026

• Estimated time frame for U.S. FDA 510(k) clearance for the next-generation Novasight system;
• First-in-human clinical study to highlight safety and feasibility (subject to FDA (Food and Drug Administration) clearance);
• Targeted U.S. commercial launch (subject to FDA clearance).

Summary

We are planning a transformative year for Conavi, with several value-creating milestones expected to be achieved starting next quarter. As the market landscape evolves in our favour, we are refining our technology to extend Novasight's competitive advantage. We are excited to be setting a new imaging standard for the most common procedures in interventional cardiology.

I am deeply grateful to our people and partners as well as the many doctors and patients who have supported us in reaching this point.

We look forward to updating you on our progress!

Sincerely,

Tom Looby

Chief executive officer

Conavi Medical Corp.

We seek Safe Harbor.