The information presented as of and for the -month periods ended and is unaudited, but includes all adjustments (which consist only of normal recurring adjustments) that the management of Navidea Biopharmaceuticals, Inc. (“Navidea”, the “Company,” or “we”) believes to be necessary for the fair presentation of results for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission. The balances as of and the results for the interim periods are necessarily indicative of results to be expected for the year. The consolidated financial statements should be read in conjunction with Navidea’s audited consolidated financial statements for the year ended which were included as part of our Annual Report on Form -K.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

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The carrying amounts approximate fair value because of the short maturity of these instruments.

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The carrying value of our debt at and primarily consisted of the face amount of the notes plus accrued interest. At the fair value of our notes payable was approximately equal to the carrying value of At the fair value of our notes payable was approximately equal to the carrying value of See Note

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Derivative liabilities are related to certain outstanding warrants which are recorded at fair value. Derivative liabilities totaling as of and were included in other liabilities on the consolidated balance sheets. The assumptions used to calculate fair value as of and included volatility, a risk-free rate and expected dividends. In addition, we considered non-performance risk and determined that such risk is minimal. Unrealized gains and losses on the derivatives are classified in other expenses as a change in the fair value of financial instruments in the statements of operations. See Note

We currently generate revenue primarily from grants to support various product development initiatives. We generally recognize grant revenue when expenses reimbursable under the grants have been paid and payments under the grants become contractually due.

In the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) - . ASU - requires the recognition of right-of-use lease assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. The core principle of Topic is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term.