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What changed in Alphatec Holdings, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Alphatec Holdings, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+249 added−255 removedSource: 10-K (2026-02-24) vs 10-K (2025-02-26)

Top changes in Alphatec Holdings, Inc.'s 2025 10-K

249 paragraphs added · 255 removed · 206 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

71 edited+14 added−30 removed101 unchanged
Biggest changePrivate suits filed under the False Claims Act, known as qui tam actions, can be brought by individuals on behalf of the government. These individuals, sometimes known as “relators” or, more commonly, as “whistleblowers,” may share in any amounts paid by the entity to the government in fines or settlement.
Biggest changeThe federal False Claims Act prohibits persons from knowingly filing or causing to be filed a false or fraudulent claim to, or the knowing use of false statements to obtain payment from, the federal government. Private suits filed under the False Claims Act, known as qui tam actions, can be brought by individuals on behalf of the government.
To ensure that our products are safe and effective for their intended use, the FDA regulates, among other things, the following activities that we or our partners perform and will continue to perform: • product design and development; • product testing; • non-clinical and clinical research; 9 Table of Contents • product manufacturing; • product labeling; • product storage; • premarket clearance or approval; • advertising and promotion; • product marketing, sales and distribution; • import and export; and • post-market surveillance, including reporting deaths or serious injuries related to products and certain product malfunctions.
To ensure that our products are safe and effective for their intended use, the FDA regulates, among other things, the following activities that we or our partners perform and will continue to perform: • product design and development; • product testing; • non-clinical and clinical research; • product manufacturing; • product labeling; • product storage; • premarket clearance or approval; • advertising and promotion; • product marketing, sales and distribution; 9 Table of Contents • import and export; and • post-market surveillance, including reporting deaths or serious injuries related to products and certain product malfunctions.
These include: • registration and listing requirements, which require manufacturers to register all manufacturing facilities and list all medical devices placed into commercial distribution; • the QSR, which requires manufacturers, including third-party contract manufacturers, to follow stringent design, testing, control, supplier/contractor selection, documentation, record maintenance and other quality assurance controls, during all aspects of the manufacturing process and to maintain and investigate complaints; • labeling regulations and unique device identification requirements; • advertising and promotion requirements; 12 Table of Contents • restrictions on sale, distribution, or use of a device; • FDA prohibitions against the promotion of products for uncleared or unapproved (“off-label”) uses; • medical device reporting obligations, which require that manufacturers submit reports to the FDA of device may have caused or contributed to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur; • medical device correction and removal reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; • device tracking requirements; and • other post-market surveillance requirements, which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device.
These include: • registration and listing requirements, which require manufacturers to register all manufacturing facilities and list all medical devices placed into commercial distribution; • the QSR, which requires manufacturers, including third-party contract manufacturers, to follow stringent design, testing, control, supplier/contractor selection, documentation, record maintenance and other quality assurance controls, during all aspects of the manufacturing process and to maintain and investigate complaints; • labeling regulations and unique device identification requirements; • advertising and promotion requirements; • restrictions on sale, distribution, or use of a device; • FDA prohibitions against the promotion of products for uncleared or unapproved (“off-label”) uses; • medical device reporting obligations, which require that manufacturers submit reports to the FDA of device may have caused or contributed to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur; • medical device correction and removal reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; • device tracking requirements; and • other post-market surveillance requirements, which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device.
Most of our product development efforts are fully integrated in our Carlsbad headquarters. Our resources include a technology advancement cell for rapid prototyping, a cadaveric lab, and mechanical testing laboratory. Sales and Marketing We market and sell our products through a sales force consisting of dedicated and non-dedicated independent sales agents and dedicated employee direct sales representatives.
Most of our product development efforts are fully integrated in our Carlsbad headquarters. Our resources include a technology advancement cell for rapid prototyping, a cadaveric lab, and mechanical testing laboratory. Sales and Marketing We market and sell our products through a sales force consisting of exclusive independent sales agents and dedicated employee direct sales representatives.
Of our U.S. employees, 408 were based in our Carlsbad, California headquarters, covering all of the following functional areas: sales, customer service, marketing, clinical education, advanced manufacturing, quality assurance, regulatory affairs, research and development, human resources, finance, legal, information technology, and administration.
Of our U.S. employees, 411 were based in our Carlsbad, California headquarters, covering all of the following functional areas: sales, customer service, marketing, clinical education, advanced manufacturing, quality assurance, regulatory affairs, research and development, human resources, finance, legal, information technology, and administration.
Our employee base is comprised of men, women, underrepresented individuals, individuals with disabilities, and protected veterans. 16 Table of Contents To attract and retain employees, we offer competitive, performance-based compensation and benefits, opportunities for discounted equity ownership, employee recognition programs, career development opportunities, and access to continual growth through in-house live trainings, as well as support and reimbursement for external trainings and educational programs.
Our employee base is comprised of men, women, underrepresented individuals, individuals with disabilities, and protected veterans. To attract and retain employees, we offer competitive, performance-based compensation and benefits, opportunities for discounted equity ownership, employee recognition programs, career development opportunities, and access to continual growth through in-house live trainings, as well as support and reimbursement for external trainings and educational programs.
We make these reports available to you free of charge through the Investor Relations section of our website as soon as reasonably practical after such materials have been electronically filed with, or furnished to, the SEC. The public can also obtain any documents that we file with the SEC at http://www.sec.gov. 17 Table of Contents
We make these reports available to you free of charge through the Investor Relations section of our website as soon as reasonably practical after such materials have been electronically filed with, or furnished to, the SEC. The public can also obtain any documents that we file with the SEC at http://www.sec.gov.
We have provided health and wellness initiatives throughout the year to promote the continued wellbeing of our employees, as well as opportunities for our employees to participate in community volunteer and clean-up programs to foster camaraderie within our employee base. Corporate and Available Information We are a Delaware corporation incorporated in March 2005.
We have provided health and wellness initiatives throughout the year to promote the continued wellbeing of our employees, as well as opportunities for our employees to participate in community volunteer and clean-up programs to foster camaraderie within our employee base. 16 Table of Contents Corporate and Available Information We are a Delaware corporation incorporated in March 2005.
If the HCT/P is minimally manipulated, is intended for homologous use only and meets other requirements, the HCT/P will not require 510(k) clearance, PMA, a Biologics License Application, or other premarket authorization from the FDA before marketing. Environmental Matters Our facilities and operations are subject to extensive federal, state, and local environmental and occupational health and safety laws and regulations.
If the HCT/P is minimally manipulated, is intended for homologous use only and meets other requirements, the HCT/P will not require 510(k) clearance, PMA, a Biologics License Application, or other premarket authorization from the FDA before marketing. 12 Table of Contents Environmental Matters Our facilities and operations are subject to extensive federal, state, and local environmental and occupational health and safety laws and regulations.
While some AIX applications are commercially available, significant development is underway to integrate and interconnect these technologies and bring unprecedented functionalities to market in 2025 and beyond. Our EOS imaging system is designed to provide unbiased, high-quality, and calibrated full-body imaging that enables a 3D model of patients’ skeletal system for diagnostic and surgical planning applications.
While some IX applications are commercially available, significant development is underway to integrate and interconnect these technologies and bring unprecedented functionalities to market in 2026 and beyond. Our EOS imaging system is designed to provide unbiased, high-quality, and calibrated full-body imaging that enables a 3D model of patients’ skeletal system for diagnostic and surgical planning applications.
Our current products on the market in the U.S. include Class II spinal implants, instruments, neuromonitoring systems, robotic navigation systems, x-ray imaging systems and software as a medical device (SaMD) marketed under 510(k) premarket clearance, as well as Class I 510(k) exempt spinal instruments and devices. 10 Table of Contents 510(k) Clearance Pathway .
Our current products on the market in the U.S. include Class II spinal implants, instruments, neuromonitoring systems, robotic navigation systems, x-ray imaging systems and software as a medical device (SaMD) marketed under 510(k) premarket clearance, as well as Class I 510(k) exempt spinal instruments and devices. 510(k) Clearance Pathway .
The EOS sales team focuses on hospital administrators, with the benefits of leads generated by our sales team and enhanced service support. We are in the nascent stages of building a profitable international footprint focusing on a select few economically attractive markets: Australia, New Zealand and Japan.
The EOS sales team focuses on hospital administrators, with the benefits of leads generated by our sales team and enhanced service support. We are in the nascent stages of building a profitable international footprint for our surgical implant business focusing on a select few economically attractive markets: Australia, New Zealand and Japan.
We completed a survey in December 2024, in which over 92% of respondents indicated a willingness to recommend the Company to friends and family as a desirable place to work. High employee satisfaction is also reflected in our high employee engagement and low undesired turnover, which was approximately 5% for 2024.
We completed a survey in December 2025, in which over 79% of respondents indicated a willingness to recommend the Company to friends and family as a desirable place to work. High employee satisfaction is also reflected in our high employee engagement and low undesired turnover, which was approximately 5% for 2025.
The sophisticated approaches that we create from the ground up integrate with our expanding Alpha InformatiX ™ ("AIX") platform to objectively inform surgery and achieve the goals of spine surgery more predictably and more reproducibly.
The sophisticated approaches that we create from the ground up integrate with our expanding InformatiX ™ ("IX") platform to objectively inform surgery and achieve the goals of spine surgery more predictably and more reproducibly.
By integrating SafeOp with our advanced access, implant, and fixation technologies, we offer surgeons procedural solutions designed to enhance safety, efficiency, and reproducibility. Valence was acquired in 2023.
By integrating SafeOp with our advanced access, implant, and fixation technologies, we offer surgeons procedural solutions designed to enhance safety, efficiency, and reproducibility. 5 Table of Contents Valence was acquired in 2023.
Further, in December 2016, the 21st Century Cures Act (“Cures Act”) was signed into law. The Cures Act, among other things, is intended to modernize the regulation of devices and spur innovation but its ultimate implementation is unclear. 11 Table of Contents Premarket Approval Pathway.
Further, in December 2016, the 21st Century Cures Act (“Cures Act”) was signed into law. The Cures Act, among other things, is intended to modernize the regulation of devices and spur innovation but its ultimate implementation is unclear. 11 Table of Contents Pervasive and Continuing FDA Regulation.
As of December 31, 2024, we and our affiliates owned 33 registered U.S. trademarks and 27 registered trademarks outside of the U.S. Government Regulation Our products are subject to extensive regulation by the FDA and other U.S. federal and state regulatory bodies and comparable authorities in other countries.
As of December 31, 2025, we and our affiliates owned 35 registered U.S. trademarks and 29 registered trademarks outside of the U.S. Government Regulation Our products are subject to extensive regulation by the FDA and other U.S. federal and state regulatory bodies and comparable authorities in other countries.
We believe that the principal competitive factors in our market include: • improved outcomes for spine pathology procedures; • ease of use, quality, and reliability of product portfolio; • effective and efficient sales, marketing, and distribution; • quality service and an educated and knowledgeable sales network; • technical leadership and superiority; • surgeon services, such as training and education; 8 Table of Contents • responsiveness to the needs of surgeons; • acceptance by spine surgeons; • product price and qualification for reimbursement; and • speed to market.
We believe that the principal competitive factors in our market include: • improved outcomes for spine pathology procedures; • ease of use, quality, and reliability of product portfolio; • effective and efficient sales, marketing, and distribution; • quality service and an educated and knowledgeable sales network; • technical leadership and superiority; • surgeon services, such as training and education; • responsiveness to the needs of surgeons; • acceptance by spine surgeons; • product price and qualification for reimbursement; and • speed to market. 8 Table of Contents Both our currently marketed products and any future products we commercialize are subject to fierce competition.
Our SafeOp Neural InformatiX System was the first reflection of the AIX product platform. SafeOp is a patented technology that delivers technical advancements and automation in the EMG, SSEP, and MEP monitoring modalities during surgery. The system is designed to provide surgeons with objective, real-time, and actionable information on nerve location and nerve health via a compact, easy-to-use, tablet-based platform.
SafeOp is a patented technology that delivers technical advancements and automation in the EMG, SSEP, and MEP monitoring modalities during surgery. The system is designed to provide surgeons with objective, real-time, and actionable information on nerve location and nerve health via a compact, easy-to-use, tablet-based platform.
We leverage our state-of-the-art, 7-station cadaveric lab to enable visiting surgeons to gain deep practical experience with our procedural solutions and educate participants on our role in shaping innovation. We believe that the surgeon relationships we create through our educational program support durable growth. The ATEC Experience drove 18% growth in our surgeon user base in 2024.
We leverage our state-of-the-art, 7-station cadaveric lab to enable visiting surgeons to gain deep practical experience with our procedural solutions and educate participants on our role in shaping innovation. 3 Table of Contents We believe that the surgeon relationships we create through our educational program support durable growth.
By creating clinically distinct procedures that improve surgical outcomes, we believe that we are well positioned to continue to earn increasing share of the U.S. spine market, becoming the partner of choice for spine surgeons, hospitals, healthcare systems, and payors.
Strategy Our vision is to be the standard bearer in spine. By creating clinically distinct procedures that improve surgical outcomes, we believe that we are well positioned to continue to earn increasing share of the U.S. spine market, becoming the partner of choice for spine surgeons, hospitals, healthcare systems, and payors.
We have a comprehensive product portfolio designed to address the spine’s various pathologies and we are perpetually innovating to accomplish our vision to be the standard bearer in spine. Total revenue was $611.6 million for the year ended December 31, 2024, representing an increase of $129.3 million, or 27% compared to $482.3 million for the year ended December 31, 2023.
We have a comprehensive product portfolio designed to address the spine’s various pathologies and we are perpetually innovating to accomplish our vision to be the standard bearer in spine. Total revenue was $764.2 million for the year ended December 31, 2025, representing an increase of $152.6 million, or 25% compared to $611.6 million for the year ended December 31, 2024.
With the expansion and adoption of our product portfolio, we continue to drive growth in surgical volume and average revenue per surgery. For the full year 2024, surgical volume grew 19% and average revenue per surgery expanded 8.0% compared to 2023.
With the expansion and adoption of our product portfolio, we continue to drive growth in surgical volume and average revenue per surgery. For the full year 2025, surgical volume grew 22% and average revenue per surgery expanded 4% compared to 2024.
While these non-operative treatments are considered to be an alternative to surgery, surgery is typically performed in the event that non-operative treatments are unsuccessful. We believe that, to date, these non-operative treatments have not caused a significant reduction in the demand for surgical treatment of spinal disorders.
Some of our competitors also provide non-operative therapies for spine disorder conditions. While these non-operative treatments are considered to be an alternative to surgery, surgery is typically performed in the event that non-operative treatments are unsuccessful. We believe that, to date, these non-operative treatments have not caused a significant reduction in the demand for surgical treatment of spinal disorders.
Our biologics offerings consist of several allograft (donated human tissue) options, including 3D ProFuse ™ Osteoconductive Bioscaffold, and a family of AlphaGRAFT ® products. 3D ProFuse Osteoconductive Bioscaffold is highly compressible when hydrated, allowing for ease of handling and better endplate-to-endplate contact.
Biologics We have a variety of biologics designed to facilitate the process of spinal fusion. Our biologics offerings consist of several allograft (donated human tissue) options, including 3D ProFuse ™ Osteoconductive Bioscaffold, and a family of AlphaGRAFT ® products. 3D ProFuse Osteoconductive Bioscaffold is highly compressible when hydrated, allowing for ease of handling and better endplate-to-endplate contact.
As of December 31, 2024, we and our affiliates owned or exclusively licensed 180 issued U.S. patents, 45 pending U.S. patent applications and 250 issued or pending foreign patents. We own multiple patents relating to unique aspects and improvements for several of our products.
As of December 31, 2025, we and our affiliates owned or exclusively licensed 178 issued U.S. patents, 51 pending U.S. patent applications and 268 issued or pending foreign patents. We own multiple patents relating to unique aspects and improvements for several of our products.
To be “substantially equivalent,” the proposed device must have the same intended use as the predicate device, and either have the same technological characteristics as the predicate device or have different technological characteristics and not raise different questions of safety or effectiveness than the predicate device. Clinical data is sometimes required to support substantial equivalence.
To be “substantially equivalent,” the proposed device must have the same intended use as the predicate device, and either have the same technological characteristics as the predicate device or have different technological characteristics and not raise different questions of safety or effectiveness than the predicate device.
We applied learnings from PTP to develop and introduce the Lateral TransPsoas ("LTP") and Midline ALIF approaches. Like PTP, the approaches were built from the ground up and integrated with SafeOp, and are designed to enable single-position surgery for the most commonly treated levels in spine.
We applied learnings from PTP to develop and introduce the Lateral TransPsoas (“LTP”) and Midline ALIF approaches. Like PTP, these approaches were built from the ground up, fully integrated with SafeOp, and designed to enable single-position surgery across the most commonly treated lumbar levels.
We also acquired EOS ® imaging, technology that enables full-body, calibrated, 3D-images that integrate throughout the span of spine patient care to influence procedure planning and improve and quantify the understanding of global alignment. From 2022 to 2024, the momentum of PTP ™ was robust, as both lateral-experienced surgeons and surgeons new to lateral surgery adopted the approach.
We also acquired EOS® Imaging, a technology platform that enables full-body, calibrated 3D imaging and integrates across the continuum of spine patient care to enhance procedure planning and improve and quantify the assessment of global alignment. From 2022 to 2024, the momentum of PTP™ was robust, as both lateral-experienced surgeons and surgeons new to lateral surgery adopted the approach.
Applying our unique, holistic view of procedural innovation, we integrated the approach-specific technologies with EOS and are beginning to introduce the comprehensive approaches to EOS’ AIS and deformity-centric installed base. The application of our team’s deep spine know-how, coupled with our commitment to advancing the field of spine continues to compel surgeons and sales talent to partner with us.
Applying our unique, holistic view of procedural innovation, we integrated the approach-specific technologies with EOS and are beginning to introduce the comprehensive approaches to EOS’ AIS and deformity-centric installed base. The application of our team’s deep spine expertise, coupled with our commitment to advancing the field of spine, has supported continued engagement with surgeons and sales professionals.
Our Technology Alpha InformatiX Designed to provide actionable information that controls clinical variables in spine care, our AIX™ product platform comprises our EOS imaging system and VEA™ alignment mobile application, our SafeOp Neural InformatiX System and our navigation-enabled robotics platform ("Valence™").
Our Technology InformatiX Designed to provide actionable information that controls clinical variables in spine care, our IX™ product platform comprises our EOS imaging system, EOS Insight alignment assessment and surgical planning web/mobile platform, our SafeOp Neural InformatiX System and our navigation-enabled robotics platform ("Valence™").
To deliver consistent, predictable growth, we have added, and intend to continue to add, clinically astute and exclusive independent sales agents and direct sales representatives to reach untapped surgeons, hospitals, and national accounts and better penetrate existing accounts and territories.
Elevate Distribution We market and sell our products through a strategic network of independent sales agents and direct sales representatives. To deliver consistent, predictable growth, we have added, and intend to continue to add, clinically astute and exclusive independent sales agents and direct sales representatives to reach untapped surgeons, hospitals, and national accounts and better penetrate existing accounts and territories.
Most 510(k)s do not require supporting data from clinical trials, but the FDA may request such data. If the FDA agrees that the device is substantially equivalent, it will grant clearance to commercially market the device.
It may take less time depending on the type of device and it may take longer if the FDA requests additional information. Most 510(k)s do not require supporting data from clinical trials, but the FDA may request such data. If the FDA agrees that the device is substantially equivalent, it will grant clearance to commercially market the device.
On March 26, 2013, the OIG issued a Special Fraud Alert entitled “Physician-Owned Entities, in which the OIG concluded, among other things, that PODs are “inherently suspect under the anti-kickback statute” and that PODs present “substantial fraud and abuse risk and pose dangers of patient safety.” Since 2013, the OIG has further increased its scrutiny of PODs and the Department of Justice has brought several high-profile cases against physician owners. 14 Table of Contents The federal False Claims Act prohibits persons from knowingly filing or causing to be filed a false or fraudulent claim to, or the knowing use of false statements to obtain payment from, the federal government.
On March 26, 2013, the OIG issued a Special Fraud Alert entitled “Physician-Owned Entities, in which the OIG concluded, among other things, that PODs are “inherently suspect under the anti-kickback statute” and that PODs present “substantial fraud and abuse risk and pose dangers of patient safety.” Since 2013, the OIG has further increased its scrutiny of PODs and the Department of Justice has brought several high-profile cases against physician owners.
These changes include the Budget Control Act of 2011, which resulted in reductions to Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and will stay in effect through 2025 unless additional Congressional action is taken, as well as, the American Taxpayer Relief Act of 2012, which, among other things, further reduced Medicare payments to several types of providers, including hospitals and imaging centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
These changes include the Budget Control Act of 2011, which resulted in reductions to Medicare payments to providers of 2% per fiscal year, subject to periodic modification or extension by Congress, as well as, the American Taxpayer Relief Act of 2012, which, among other things, further reduced Medicare payments to several types of providers, including hospitals and imaging centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
Many states have anti-kickback laws that are similar to the federal law, some of which apply to the referral of patients for healthcare items or services reimbursed by any source, and may also result in penalties, fines, sanctions for violations, and exclusions from state or commercial programs.
Many states have anti-kickback laws that are similar to the federal law, some of which apply to the referral of patients for healthcare items or services reimbursed by any source, and may also result in penalties, fines, sanctions for violations, and exclusions from state or commercial programs. 13 Table of Contents We have entered into various agreements with certain surgeons that perform services for us, including some who make clinical decisions to use our products.
We also acquired and integrated SafeOp ™ , proprietary, know-how-backed technology that integrates with our approaches to provide real-time information about both the location and the health of nerves and motor pathways intra-operatively. SafeOp became the informational foundation of the Prone TransPsoas (“PTP”) approach, which we developed and launched in 2020 to advance first-generation lateral spine surgery.
We also acquired and integrated SafeOp™, proprietary, know-how-backed technology that integrates with our approaches to provide real-time information about both the location and the health of nerves and motor pathways intra-operatively.
Additionally, outsourcing provides expertise and capacity necessary to scale up or down based on demand. We select our suppliers to ensure that all of our products are safe, effective, adhere to all applicable regulations, are of the highest quality, and meet our supply needs.
We select our suppliers to ensure that all of our products are safe, effective, adhere to all applicable regulations, are of the highest quality, and meet our supply needs.
Each bony segment of the spine is referred to as a vertebra (two or more are called vertebrae).
A column of 33 vertebrae protects the spinal cord and provides the main support for the body. Each bony segment of the spine is referred to as a vertebra (two or more are called vertebrae).
We believe that our lateral franchise boasts unparalleled optionality and has the capacity to meet the clinical requirements for every pathology and surgeon preference regardless of patient position. The lateral sophistication that we have created is earning surgeons’ confidence and loyalty, and that is fueling portfolio-wide utilization of even our most conventional procedures.
We believe that our lateral franchise boasts unparalleled optionality and has the capacity to meet the clinical requirements for every pathology and surgeon preference regardless of patient position.
Key features include bi-lateral structural support to minimize patient movement, adjustable side paddle position to accommodate varying patient habitus, an integrated bed-rail system and compatibility with the Jackson frame.
Designed to maximize the positional effects of having the patient in a prone position while streamlining operating room setup, PTP enables a single-position surgery. Key features include bi-lateral structural support to minimize patient movement, adjustable side paddle position to accommodate varying patient habitus, an integrated bed-rail system and compatibility with the Jackson frame.
We frequently review these arrangements to determine whether they are in compliance with applicable laws and regulations. In addition, physician-owned distribution companies (“PODs”) have become decreasingly involved in the sale and distribution of medical devices, including products for the surgical treatment of spine disorders.
In addition, physician-owned distribution companies (“PODs”) have become decreasingly involved in the sale and distribution of medical devices, including products for the surgical treatment of spine disorders.
We offer several split-blade retractors which allow for direct, illuminated visualization and freedom of maneuverability within the operative corridor. Our retractors also provide for stable positioning by attaching directly to the surgical table.
Access Systems We have differentiated surgical access instruments that are designed to maximize patient outcomes through enhanced visibility and rigidity, intuitive orthogonality, and approach-specific exposure. We offer several split-blade retractors which allow for direct, illuminated visualization and freedom of maneuverability within the operative corridor. Our retractors also provide for stable positioning by attaching directly to the surgical table.
Invictus is our next-generation comprehensive spinal fixation solution, designed to treat the range of pathologies, with intraoperative adaptability and surgical predictability through an open, minimally invasive, or hybrid approach. Biologics We have a variety of biologics designed to facilitate the process of spinal fusion.
We also offer several standalone implants designed to provide for height restoration and stabilization in one integrated solution. Invictus is our next-generation comprehensive spinal fixation solution, designed to treat the range of pathologies, with intraoperative adaptability and surgical predictability through an open, minimally invasive, or hybrid approach.
An expansion in government’s role in the U.S. healthcare industry may lower reimbursements for procedures using our products, reduce medical procedure volumes, and adversely affect our business and results of operations, possibly materially.
An expansion in government’s role in the U.S. healthcare industry may lower reimbursements for procedures using our products, reduce medical procedure volumes, and adversely affect our business and results of operations, possibly materially. 15 Table of Contents We believe that the overall escalating cost of medical products and services has led to, and will continue to lead to, increased pressures on the healthcare industry to reduce the costs of products and services.
In addition, it is possible that future legislation, regulation, or reimbursement policies of third-party payors will adversely affect the demand for procedures using our products or our ability to sell our products on a profitable basis. The unavailability or inadequacy of third-party payor coverage or reimbursement could have a significant adverse effect on our business, operating results, and financial condition.
We cannot assure that government or private third-party payors will cover and provide adequate payment for the procedures using our products. In addition, it is possible that future legislation, regulation, or reimbursement policies of third-party payors will adversely affect the demand for procedures using our products or our ability to sell our products on a profitable basis.
We cannot completely eliminate the risk of contamination or injury resulting from hazardous materials, and we may incur material liability as a result of any contamination or injury. 13 Table of Contents Compliance with Certain Applicable Statutes We are subject to various federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback laws, false claims laws, criminal health care fraud laws, physician payment transparency laws, data privacy and security laws, and foreign corrupt practice laws.
Compliance with Certain Applicable Statutes We are subject to various federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback laws, false claims laws, criminal health care fraud laws, physician payment transparency laws, data privacy and security laws, and foreign corrupt practice laws.
Sales training programs are a platform for learning and organizational development, ensuring the sales force is clinically competitive and considered an essential resource to all stakeholders.
Sales training programs are a platform for learning and organizational development, ensuring the sales force is clinically competitive and considered an essential resource to all stakeholders. We focus on cross-functional collaboration and alignment to deliver timely and relevant programs to meet surgeon and representative needs and positively impact the business.
There are various state laws and initiatives that require device manufacturers to disclose to the appropriate regulatory agency certain payments or other transfers of value made to physicians, and in certain cases prohibit some forms of these payments, with the risk of fines for any violation of such requirements.
There are various state laws and initiatives that require device manufacturers to disclose to the appropriate regulatory agency certain payments or other transfers of value made to physicians, and in certain cases prohibit some forms of these payments, with the risk of fines for any violation of such requirements. 14 Table of Contents HIPAA also includes privacy and security provisions designed to regulate the use and disclosure of “protected health information” (“PHI”), which is health information that identifies a patient and that is held by a health care provider, a health plan or health care clearinghouse.
Insight, an organically developed end-to-end spine care software platform, built around the foundation of EOS Edge™ imaging, was released in 2024. Insight allows surgeons to more effectively and efficiently assess patients’ full-body alignment, establish surgical objectives, bend patient-specific rods pre-operatively, reconcile to surgical objectives intra-operatively, and determine whether surgical objectives were met post-operatively.
Insight allows surgeons to more effectively and efficiently assess patients’ full-body alignment, establish surgical objectives, bend patient-specific rods pre-operatively, reconcile to surgical objectives intra-operatively, and determine whether surgical objectives were met post-operatively. Our SafeOp Neural InformatiX System was the first reflection of the IX product platform.
We believe that surgeons, independent sales agents, and direct sales representatives will learn of the merits and distinguishing features of our products through our training and education programs, and that such exposure will increase the use and promotion of our products. We expect our focus on the entire procedure to build awareness of the breadth of our product offering.
We believe this is an effective way to increase overall surgeon adoption of our new products. 7 Table of Contents We believe that surgeons, independent sales agents, and direct sales representatives will learn of the merits and distinguishing features of our products through our training and education programs, and that such exposure will increase the use and promotion of our products.
PTP is designed to leverage the benefits achieved by lateral spinal fusion procedures, such as reduced blood loss, shorter hospital stays, and quicker recovery times and safely treats a wide range of patient pathologies. 4 Table of Contents Compared to a standard lateral procedure, the PTP approach positions the patient in a prone (face down) position, allowing simultaneous access to the spine laterally (from the side) and posteriorly (from the back), all while in a position that is more familiar to surgeons and offering a more streamlined, more orthogonal approach.
Compared to a standard lateral procedure, the PTP approach positions the patient in a prone (face down) position, allowing simultaneous access to the spine laterally (from the side) and posteriorly (from the back), all while in a position that is more familiar to surgeons and offering a more streamlined, more orthogonal approach.
If any of our operations are found to have violated or be in violation of any of the laws described above and other applicable state and federal fraud and abuse laws, we may be subject to penalties, among them being civil and criminal penalties, damages, fines, exclusion from government healthcare programs, and the curtailment or restructuring of our operations. 15 Table of Contents Third-Party Reimbursement In the U.S., healthcare providers generally rely on third-party payors, principally private insurers, and governmental payors such as Medicare and Medicaid, to cover and pay for all or part of the cost of a spine surgery in which our medical devices are used.
If any of our operations are found to have violated or be in violation of any of the laws described above and other applicable state and federal fraud and abuse laws, we may be subject to penalties, among them being civil and criminal penalties, damages, fines, exclusion from government healthcare programs, and the curtailment or restructuring of our operations.
The number of filings of qui tam actions has increased significantly in recent years, causing more healthcare companies to have to defend a False Claim Act action.
These individuals, sometimes known as “relators” or, more commonly, as “whistleblowers,” may share in any amounts paid by the entity to the government in fines or settlement. The number of filings of qui tam actions has increased significantly in recent years, causing more healthcare companies to have to defend a False Claim Act action.
In addition, the system’s ultra-radiolucent carbon fiber frame is designed to help enhance fluoroscopic visibility and its coronal bending mechanism is designed to create reproducible access to L4-5 and upper lumbar regions. Access Systems We have differentiated surgical access instruments that are designed to maximize patient outcomes through enhanced visibility and rigidity, intuitive orthogonality, and approach-specific exposure.
In addition, the system’s ultra-radiolucent carbon fiber frame is designed to help enhance fluoroscopic visibility and its coronal bending mechanism is designed to create reproducible access to L4-5 and upper lumbar regions. We are currently developing and plan to launch procedure-specific positioners for other procedures in the future.
We offer NanoTec ™ surface enhancements to our interbody systems to increase the surface area for cell adhesion and proliferation. Spinal alignment can be further achieved with our lordotic expandable intervertebral body fusion systems. We also offer several standalone implants designed to provide for height restoration and stabilization in one integrated solution.
Available in varying shapes, sizes, and lordosis options, our spinal implants are made from various materials, including allograft, PEEK, porous titanium and 3D printed titanium. We offer NanoTec™ surface enhancements to our interbody systems to increase the surface area for cell adhesion and proliferation. Spinal alignment can be further achieved with our lordotic expandable intervertebral body fusion systems.
The FDA’s goal is to review and act on each 510(k) within 90 days of submission, but on average the process usually takes approximately six months. It may take less time depending on the type of device and it may take longer if the FDA requests additional information.
Clinical data is sometimes required to support substantial equivalence. 10 Table of Contents The FDA’s goal is to review and act on each 510(k) within 90 days of submission, but on average the process usually takes approximately six months.
Our goal is to create a sustainable competitive advantage for our organization by providing surgeon education programs along with a comprehensive and growing sales training platform. Manufacture and Supply We rely on third-party suppliers for the manufacture of all our implants and instruments. Outsourcing implant manufacturing reduces our need for capital investment and reduces operational expense.
We expect our focus on the entire procedure to build awareness of the breadth of our product offering. Our goal is to create a sustainable competitive advantage for our organization by providing surgeon education programs along with a comprehensive and growing sales training platform.
Insight incorporates those measures into a surgical plan that integrates a 3D model of the patient’s spine with our interbodies, including, if necessary, patient-specific contoured rods. In the operating room, Insight measures key parameters and enables direct comparison to the pre-operative plan. Post-operatively, the standardized images that Insight generates facilitate individual case reviews and comprehensive practice assessments.
In the operating room, Insight measures key parameters and enables direct comparison to the pre-operative plan. Post-operatively, the standardized images that Insight generates facilitate individual case reviews and comprehensive practice assessments. Ultimately, the images and data that Insight is accumulating can inform the first predictive care in spine.
In addition, these companies may have more established distribution networks, entrenched relationships with physicians and greater experience in developing, launching, marketing, distributing, and selling spinal implant products. Some of our competitors also provide non-operative therapies for spine disorder conditions.
We believe that our most significant competitors are Medtronic (Sofamor Danek), Johnson & Johnson (DePuy Spine), Globus Medical, and others, many of which have substantially greater financial resources than we do. In addition, these companies may have more established distribution networks, entrenched relationships with physicians and experience in developing, launching, marketing, distributing, and selling spinal implant products.
In 2024, we launched EOS Insight ™ ("Insight"), a ground-breaking software platform powered by EOS imaging, designed to elevate spine patient care from pre-operative planning to post-operative assessment. Shortly after an EOS scan, Insight automates the calculation of alignment measures, the aspect of surgical planning most crucial to 2 Table of Contents successful long-term outcomes.
The lateral sophistication that we have created is earning surgeons’ confidence and loyalty, and that is fueling portfolio-wide utilization of even our most conventional procedures. 2 Table of Contents In 2024, we launched EOS Insight ™ ("Insight"), a ground-breaking software platform powered by EOS imaging, designed to elevate spine patient care from pre-operative planning to post-operative assessment.
Over time, we expect surgeon utilization to consistently increase as we cultivate relationships, partnering with our customers in an increasing number of surgeries and fostering training to inspire partnership in increasingly complex surgeries. 3 Table of Contents 3. Elevate Distribution We market and sell our products through a strategic network of independent sales agents and direct sales representatives.
The ATEC Experience drove 20% growth in our surgeon user base in 2025. We expect surgeon utilization to continue to increase as we cultivate relationships, partnering with our customers in an increasing number of surgeries and fostering training to inspire partnership in increasingly complex surgeries. 3.
We have entered into various agreements with certain surgeons that perform services for us, including some who make clinical decisions to use our products. Some of our referring surgeons own our stock, which they may have received from us as consideration for product development services performed.
Some of our referring surgeons own our stock, which they may have received from us as consideration for product development services performed. We frequently review these arrangements to determine whether they are in compliance with applicable laws and regulations.
In 2022, we partnered with surgeons to treat our first patients in Australia and New Zealand, and late in 2024, the first LTP surgery was completed in Japan. Looking forward, we intend to gradually expand our footprint in the select geographies.
In 2022, we partnered with surgeons to treat our first patients in Australia and New Zealand, and late in 2024, the first LTP surgery was completed in Japan. Spine Anatomy and Treatment The spine is the core of the human skeleton, providing important structural support and alignment while remaining flexible to allow movement.
Further development is aimed at integrating the technology into our lateral procedures for improved surgical predictability, reduced radiation exposure and enhanced intra-operative precision. 5 Table of Contents Positioners We have developed approach-specific patient positioning systems that integrate with our other access systems, providing for a more rigid construct and enhanced reproducibility.
Positioners We have developed approach-specific patient positioning systems that integrate with our other access systems, providing for a more rigid construct and enhanced reproducibility. The PTP Patient Positioning System™, for example, was developed specifically for the PTP procedure as an adjunct to the Sigma™ PTP Access System.
Human Capital As of December 31, 2024, we had 867 employees worldwide. Approximately 681 employees were located in the U.S. and 186 employees were located outside of the U.S.
The unavailability or inadequacy of third-party payor coverage or reimbursement could have a significant adverse effect on our business, operating results, and financial condition. Human Capital As of December 31, 2025, we had 913 employees worldwide. Approximately 706 employees were located in the U.S. and 207 employees were located outside of the U.S.
Implants and Fixation Systems Our portfolio of specialized spinal implants and fixation systems are designed to specifically meet the requirements of each approach. Available in varying shapes, sizes, and lordosis options, our spinal implants are made from various materials, including allograft, PEEK, and porous titanium.
Our current offering includes procedure-specific access systems for PTP, LTP, ALIF, ACDF and TLIF procedures. Implants and Fixation Systems Our portfolio of specialized spinal implants and fixation systems are designed to specifically meet the requirements of each approach.
We focus on cross-functional collaboration and alignment to deliver timely and relevant programs to meet surgeon and representative needs and positively impact the business. 7 Table of Contents Our training and education programs are designed to support new product introductions to the market as well as ongoing portfolio advancement.
Our training and education programs are designed to support new product introductions to the market as well as ongoing portfolio advancement. Our resources are nimble and responsive and include field-based engagements to supplement our core curriculum.
We achieved regulatory clearance to place Invictus® screws through the system late in 2023.
We achieved regulatory clearance to place Invictus® screws through the system late in 2023. Further development is aimed at integrating the technology into our lateral procedures for improved surgical predictability, reduced radiation exposure and enhanced intra-operative precision.
Our procedural offerings are designed to treat the various spine pathologies by better achieving the three goals of surgery including: (1) decompression, (2) stabilization, and (3) alignment. We believe there is vast opportunity to create value by innovating to improve surgical outcomes in spine.
Our procedural offerings are designed to address the underlying causes of spinal pathology by advancing the three fundamental objectives of spine surgery: (1) decompression of neural elements, (2) stabilization of spinal segments, and (3) restoration and maintenance of proper spinal alignment.
Our procedures seamlessly incorporate technology engendered by that thesis, including an expanding informatic ecosystem designed to automatically and objectively inform spine patient care before, during and after surgery, as well as approach-specific, ergonomic patient positioning and surgical access technology.
Rather than concentrating primarily on individual implant components, we invest across the broader procedural ecosystem. We focus on developing and integrating technologies intended to enhance clinical predictability and reproducibility, including an expanding informatics platform designed to inform patient care before, during, and after surgery, as well as approach-specific patient positioning and surgical access technologies.
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Ultimately, the images and data that Insight is accumulating can inform the first predictive care in spine. Even before we acquired EOS, the technology was highly influential among prestigious academic and deformity treatment centers worldwide.
Added
SafeOp became the informational foundation of the Prone TransPsoas (“PTP”) approach, which we developed and launched in 2020 as an advancement designed to address the limitations of first-generation lateral spine surgery.
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That adoption-driven validation has been the source of industry-leading market share expansion since our transformation commenced in 2018. Strategy Our vision is to be the standard bearer in spine.
Added
Shortly after an EOS scan, Insight automates the calculation of alignment measures, the aspect of surgical planning most crucial to successful long-term outcomes. Insight incorporates those measures into a surgical plan that integrates a 3D model of the patient’s spine with our interbodies, including, if necessary, patient-specific contoured rods.
Removed
Spine Anatomy and Treatment The spine is the core of the human skeleton, providing important structural support and alignment while remaining flexible to allow movement. A column of 33 vertebrae, it protects the spinal cord and provides the main support for the body.
Added
In 2025, the EOS Insight platform introduced additional capabilities, including 3D pediatric modeling for detailed assessment of idiopathic scoliosis cases and AutoDensity, an EOS based bone density assessment driven by the EOS Edge imaging and accessed through the EOS Insight portal. Even before we acquired EOS, the technology was highly influential among prestigious academic and deformity treatment centers worldwide.
Removed
Strong muscles and bones, flexible tendons and ligaments, and sensitive nerves contribute to a healthy spine. Pain can be caused when any of the spine’s structures is affected by strain, injury, or disease, and spine surgery seeks to alleviate that pain.
Added
In addition to our differentiated procedural platforms, including PTP, LTP, EOS and deformity solutions, we have developed comprehensive procedural offerings across cervical, biologics and other traditional spine applications, allowing us to offer a broad portfolio of solutions to our surgeon partners. Since our transformation began in 2018, these efforts have supported continued market share expansion.
Removed
While the spine has been surgically intervened upon for decades, research demonstrates that surgical outcomes in spine are generally inferior to surgical outcomes delivered by most other orthopedic specialties, particularly in terms of durability, predictability and reproducibility.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe operate in a highly competitive market segment, face competition from large, well-established medical device companies with significant resources, and may not be able to compete effectively. The market in which we operate is highly competitive, subject to rapid technological change and affected by new products and market activities of industry participants.
Biggest changeIn that case, the trading price of our common stock could decline, and you may lose some or all of your investment. Risks Related to Our Business and Industry We operate in a highly competitive market segment, face competition from large, well-established medical device companies with significant resources, and may not be able to compete effectively.
If our indebtedness under the Revolving Credit Facility, the Braidwell Term Loan or the 2026 Notes were to be accelerated, if the amount of interest owing under such debt or, in the case of the Revolving Credit Facility, if MidCap refuses to make further extensions of credit to us, we may not have sufficient cash available to repay the amounts due, and we may be forced to seek an amendment to the applicable loan terms or obtain alternative financing, which may not be available to us on acceptable terms, if at all.
If our indebtedness under the Revolving Credit Facility, the Braidwell Term Loan or the 2026 Notes and 2030 Notes were to be accelerated, if the amount of interest owing under such debt or, in the case of the Revolving Credit Facility, if MidCap refuses to make further extensions of credit to us, we may not have sufficient cash available to repay the amounts due, and we may be forced to seek an amendment to the applicable loan terms or obtain alternative financing, which may not be available to us on acceptable terms, if at all.
Healthcare fraud and abuse, health information privacy and security, and disclosure laws potentially applicable to our operations include: • the federal Anti-Kickback Statute, as well as state analogs, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering or providing remuneration, intended to induce the purchase or recommendation of an item or service reimbursable under a federal (or state or commercial) healthcare program (such as the Medicare or Medicaid programs); • federal and state bans on physician self-referrals, which prohibits, subject to exceptions, physician referrals of Medicare and Medicaid patients to an entity providing certain “designated health services” if the physician or its immediate family member has any financial relationship with the entity; • false claims laws that prohibit, among other things, knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent; • HIPAA, and its implementing regulations, which created federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • the state and federal laws “sunshine” provisions that require detailed reporting and disclosures to the CMS and applicable states of any payments or “transfer of value” made or distributed to prescribers and other health care providers, and for certain states prohibit some forms of these payments, require the adoption of marketing codes of conduct, require the reporting of marketing expenditures and pricing information and constrain relationships with physicians and other referral sources; • the HITECH, which impose restrictions on uses and disclosures of protected health information and civil and criminal penalties for non-compliance and require the reporting of breaches to affected individuals, the government and in some cases the media in the event of a violation; and • a variety of state-imposed privacy and data security laws which require the protection of personal information beyond health information and which require reporting to state officials in the event of breach or violation and which impose both civil and criminal penalties.
Healthcare fraud and abuse, health information privacy and security, and disclosure laws potentially applicable to our operations include: • the federal Anti-Kickback Statute, as well as state analogs, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering or providing remuneration, intended to induce the purchase or recommendation of an item or service reimbursable under a federal (or state or commercial) healthcare program (such as the Medicare or Medicaid programs); • federal and state bans on physician self-referrals, which prohibits, subject to exceptions, physician referrals of Medicare and Medicaid patients to an entity providing certain “designated health services” if the physician or its immediate family member has any financial relationship with the entity; • false claims laws that prohibit, among other things, knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent; • HIPAA, and its implementing regulations, which created federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • the state and federal laws “sunshine” provisions that require detailed reporting and disclosures to the CMS and applicable states of any payments or “transfer of value” made or distributed to prescribers and other health care providers, and for certain states prohibit some forms of these payments, require the adoption of marketing codes of conduct, require the reporting of marketing expenditures and pricing information and constrain relationships with physicians and other referral sources; • the HITECH, which impose restrictions on uses and disclosures of protected health information and civil and criminal penalties for non-compliance and require the reporting of breaches to affected individuals, the government and in some cases the media in the event of a violation; and 22 Table of Contents • a variety of state-imposed privacy and data security laws which require the protection of personal information beyond health information and which require reporting to state officials in the event of breach or violation and which impose both civil and criminal penalties.
The level of our revenues and results of operations at any given time will be based primarily on the following factors: • acceptance of our products by spine surgeons, patients, hospitals and third-party payers; • demand and pricing of our products, and the mix of our products sold, because profit margins differ among our products; • timing of new product offerings, acquisitions, licenses or other significant events by us or our competitors; • our ability to grow and maintain a productive sales and marketing organization and independent sales agent network; • regulatory approvals and legislative changes affecting the products we may offer or those of our competitors; • successful integration of newly acquired businesses, technology and personnel into our business operations; • the effect of competing technological and market developments; • levels of third-party reimbursement for our products; 26 Table of Contents • interruption in the manufacturing or distribution of our products or our ability to produce or obtain products of satisfactory quality or in sufficient quantities to meet demand; and • changes in our ability to obtain FDA, state and international approval or clearance for our products.
The level of our revenues and results of operations at any given time will be based primarily on the following factors: • acceptance of our products by spine surgeons, patients, hospitals and third-party payers; • demand and pricing of our products, and the mix of our products sold, because profit margins differ among our products; • timing of new product offerings, acquisitions, licenses or other significant events by us or our competitors; • our ability to grow and maintain a productive sales and marketing organization and independent sales agent network; • regulatory approvals and legislative changes affecting the products we may offer or those of our competitors; • successful integration of newly acquired businesses, technology and personnel into our business operations; 27 Table of Contents • the effect of competing technological and market developments; • levels of third-party reimbursement for our products; • interruption in the manufacturing or distribution of our products or our ability to produce or obtain products of satisfactory quality or in sufficient quantities to meet demand; and • changes in our ability to obtain FDA, state and international approval or clearance for our products.
The market price of our common stock is likely to be highly volatile and may fluctuate substantially due to many factors, including those described elsewhere in this “Risk Factors” section and the following: • volume and timing of orders for our products; • quarterly variations in our or our competitors’ results of operations; • our announcement or our competitors’ announcements regarding new or enhanced products, product enhancements, significant contracts, number of sales agents, number of hospitals and spine surgeons using products, acquisitions, and collaborative or strategic investments; • announcements of technological or medical innovations for the treatment of spine pathology; • changes in earnings estimates or recommendations by securities analysts; • our ability to develop, obtain regulatory clearance or approval for, and market new and enhanced products on a timely basis; • changes in healthcare policy in the U.S., including changes in governmental regulations or in the status of our regulatory approvals, clearances or applications, and changes in the availability of third-party reimbursement in the U.S.; • product liability claims or other litigation involving us, including disputes or other developments with respect to intellectual property rights; • sales of large blocks of our common stock, including sales by our executive officers, directors and significant stockholders; • changes in accounting principles; and • general market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.
The market price of our common stock is likely to be highly volatile and may fluctuate substantially due to many factors, including those described elsewhere in this “Risk Factors” section and the following: • volume and timing of orders for our products; • quarterly variations in our or our competitors’ results of operations; • our announcement or our competitors’ announcements regarding new or enhanced products, product enhancements, significant contracts, number of sales agents, number of hospitals and spine surgeons using products, acquisitions, and collaborative or strategic investments; • announcements of technological or medical innovations for the treatment of spine pathology; • changes in earnings estimates or recommendations by securities analysts; 28 Table of Contents • our ability to develop, obtain regulatory clearance or approval for, and market new and enhanced products on a timely basis; • changes in healthcare policy in the U.S., including changes in governmental regulations or in the status of our regulatory approvals, clearances or applications, and changes in the availability of third-party reimbursement in the U.S.; • product liability claims or other litigation involving us, including disputes or other developments with respect to intellectual property rights; • sales of large blocks of our common stock, including sales by our executive officers, directors and significant stockholders; • changes in accounting principles; and • general market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.
The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") contain certain affirmative, operating or financial covenants.
The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") and our outstanding 0.75% Convertible Senior Notes due 2030 (the "2030 Notes") contain certain affirmative, operating or financial covenants.
Our capital requirements will depend on many factors, including: • the revenues generated by sales of our products; • the costs associated with expanding our sales and marketing efforts; • the expenses that we incur from the manufacture of our products by third parties and that we incur from selling our products; • the costs of developing new products or technologies; • the cost of obtaining and maintaining FDA or other regulatory approval or clearance for our products and products in development; • the cost of filing and prosecuting patent applications and defending and enforcing our patent and other intellectual property rights; • the number and timing of acquisitions and other strategic transactions; • the costs and any payments we may make related to our pending litigation matters; • the costs associated with increased capital expenditures; and • the costs associated with our employee retention programs and related benefits.
Our capital requirements will depend on many factors, including: • the revenues generated by sales of our products; • the costs associated with expanding our sales and marketing efforts; • the expenses that we incur from the manufacture of our products by third parties and that we incur from selling our products; • the costs of developing new products or technologies; • the cost of obtaining and maintaining FDA or other regulatory approval or clearance for our products and products in development; • the cost of filing and prosecuting patent applications and defending and enforcing our patent and other intellectual property rights; • the number and timing of acquisitions and other strategic transactions; • the costs and any payments we may make related to our pending litigation matters; • the costs associated with increased capital expenditures; and 26 Table of Contents • the costs associated with our employee retention programs and related benefits.
Item 1A. Ri sk Factors Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors and all other information contained or incorporated by reference in this Annual Report on Form 10-K. The risks and uncertainties described below are not the only risks faced by the Company.
Item 1A. Risk Factors Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors and all other information contained or incorporated by reference in this Annual Report on Form 10-K. The risks and uncertainties described below are not the only risks faced by the Company.
These covenants could adversely affect our ability to operate our business, our liquidity or our results of operations, and our inability to comply with any of these covenants could result in a default under the applicable loan agreement or indenture, which could result in an increase the applicable interest rate or all amounts borrowed under the applicable debt instrument, together with accrued interest and other fees, to become due and payable or, with respect to our Revolving Credit Facility, could result in MidCap 25 Table of Contents refusing to make further extensions of credit to us.
These covenants could adversely affect our ability to operate our business, our liquidity or our results of operations, and our inability to comply with any of these covenants could result in a default under the applicable loan agreement or indenture, which could result in an increase the applicable interest rate or all amounts borrowed under the applicable debt instrument, together with accrued interest and other fees, to become due and payable or, with respect to our Revolving Credit Facility, could result in MidCap refusing to make further extensions of credit to us.
Our quarterly financial results could fluctuate significantly. Our quarterly financial results are difficult to predict and may fluctuate significantly from period to period, particularly because our sales prospects are uncertain.
Our quarterly financial results are difficult to predict and may fluctuate significantly from period to period, particularly because our sales prospects are uncertain.
Even a meritless or unsuccessful product liability claim could harm our reputation in the industry, lead to significant legal fees and result in the diversion of management’s attention from managing our business. 28 Table of Contents Any claims relating to our improper handling, storage or disposal of biological, hazardous and radioactive materials could be time consuming and costly.
Even a meritless or unsuccessful product liability claim could harm our reputation in the industry, lead to significant legal fees and result in the diversion of management’s attention from managing our business. Any claims relating to our improper handling, storage or disposal of biological, hazardous and radioactive materials could be time consuming and costly.
Foreign Corrupt Practices Act and the trade sanctions laws and regulations administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control. Acts of terror or war may impair our ability to operate in particular countries or regions and may impede the flow of goods and services between countries.
Foreign Corrupt Practices Act and the trade sanctions laws and regulations administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control. Acts of terror or war may impair our ability to operate in particular 21 Table of Contents countries or regions and may impede the flow of goods and services between countries.
Our effective income tax rates have been, and could in the future be, adversely affected by changes in tax laws or interpretations of those tax laws; by stock-based compensation and other non-deductible expenses; by changes in the mix of earnings in countries with differing statutory tax rates; or by changes in the valuation of our deferred tax assets and liabilities.
Our effective income tax rates have been, and could in the future be, adversely 30 Table of Contents affected by changes in tax laws or interpretations of those tax laws; by stock-based compensation and other non-deductible expenses; by changes in the mix of earnings in countries with differing statutory tax rates; or by changes in the valuation of our deferred tax assets and liabilities.
These efforts could be expensive and time consuming, disrupt our ongoing business and distract management. If we are unable to integrate any future or recently acquired 22 Table of Contents businesses, products or technologies effectively, our business, financial condition and results of operations will be materially adversely affected.
These efforts could be expensive and time consuming, disrupt our ongoing business and distract management. If we are unable to integrate any future or recently acquired businesses, products or technologies effectively, our business, financial condition and results of operations will be materially adversely affected.
Because patent applications can take many years to issue, there may be applications now pending of which we are unaware, which may later result in issued patents that our products may infringe. There could 27 Table of Contents also be existing patents that one or more components of our products may be inadvertently infringing, of which we are unaware.
Because patent applications can take many years to issue, there may be applications now pending of which we are unaware, which may later result in issued patents that our products may infringe. There could also be existing patents that one or more components of our products may be inadvertently infringing, of which we are unaware.
Our competitors may assert that our products, components of those products, methods of using those products, or methods we employ to manufacture or process those products are covered by patents held by them. In addition, they may claim that their patents have priority over ours because their patents were filed first.
Our competitors may assert that our products, components 25 Table of Contents of those products, methods of using those products, or methods we employ to manufacture or process those products are covered by patents held by them. In addition, they may claim that their patents have priority over ours because their patents were filed first.
Our dependence on a single third-party PEEK supplier and the challenges we may face in obtaining adequate supplies of biologics products involve several risks, including limited control over pricing, availability, quality and delivery 19 Table of Contents schedules.
Our dependence on a single third-party PEEK supplier and the challenges we may face in obtaining adequate supplies of biologics products involve several risks, including limited control over pricing, availability, quality and delivery schedules.
Securities analysts may not provide research coverage of our common stock. The trading market for our common stock may be affected in part by the research and reports that analysts publish about our business. If one or more of the analysts who elects to cover us downgrades our stock, our stock price could likely decline rapidly.
The trading market for our common stock may be affected in part by the research and reports that analysts publish about our business. If one or more of the analysts who elects to cover us downgrades our stock, our stock price could likely decline rapidly.
A significant percentage of our revenues are derived from sales of our systems that include polyaxial pedicle screws. Net sales of our systems that include polyaxial pedicle screws represented approximately 40% and 41% our net sales for the years ended December 31, 2024 and 2023, respectively, and are expected to continue to be significant in the future.
A significant percentage of our revenues are derived from sales of our systems that include polyaxial pedicle screws. Net sales of our systems that include polyaxial pedicle screws represented approximately 38% and 40% our net sales for the years ended December 31, 2025 and 2024, respectively, and are expected to continue to be significant in the future.
At December 31, 2024, our principal sources of liquidity consisted of cash and cash equivalents of $138.8 million, accounts receivable, net, cash from operations and available borrowings under our revolving credit facility with entities affiliated with MidCap Financial Trust ("Revolving Credit Facility").
At December 31, 2025, our principal sources of liquidity consisted of cash and cash equivalents of $160.8 million, accounts receivable, net, cash from operations and available borrowings under our revolving credit facility with entities affiliated with MidCap Financial Trust ("Revolving Credit Facility").
Risks Related to Our Intellectual Property, Regulatory Penalties and Litigation If our patents and other intellectual property rights do not adequately protect our products, we may lose market share to our competitors and be unable to operate our business profitably. Our success depends significantly on our ability to protect our proprietary rights in the technologies used in our products.
If our patents and other intellectual property rights do not adequately protect our products, we may lose market share to our competitors and be unable to operate our business profitably. Our success depends significantly on our ability to protect our proprietary rights in the technologies used in our products.
Some of our agreements provide for accelerated vesting of benefits, including full vesting of restricted stock and options, upon a change of control, or extends the term of the agreement upon a change in control and make it more difficult for us or our successor to terminate the agreement.
Some of our agreements provide for accelerated vesting of benefits, including full vesting of restricted stock and options, upon a change of control, or extends the term of the agreement upon a change in control and make it more difficult for us or our successor to terminate the agreement. These provisions may discourage or prevent a change of control.
Governmental authorities can delay, limit or deny clearance or approval of a device for many reasons, including: • our inability to demonstrate to the satisfaction of the applicable regulatory authority that our products are safe or effective for their intended uses, or that the clinical and other benefits of the device outweigh the risks; • disagreement of the applicable regulatory authority with the design or implementation of our clinical trials or the interpretation of data from pre-clinical studies or clinical trials; • serious and unexpected adverse effects experienced by participants in our clinical trials; • data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; • our manufacturing process or facilities we use may not meet applicable requirements; or • approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval.
Governmental authorities can delay, limit or deny clearance or approval of a device for many reasons, including: • our inability to demonstrate to the satisfaction of the applicable regulatory authority that our products are safe or effective for their intended uses, or that the clinical and other benefits of the device outweigh the risks; • disagreement of the applicable regulatory authority with the design or implementation of our clinical trials or the interpretation of data from pre-clinical studies or clinical trials; • serious and unexpected adverse effects experienced by participants in our clinical trials; • data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; • our manufacturing process or facilities we use may not meet applicable requirements; • approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval; or • changes in regulatory policies, increased submission volumes, or reduced staffing and administrative capacity at regulatory agencies such as the FDA.
Any action against us for violation of these laws, even if we successfully defend against them, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business.
Any action against us for violation of these laws, even if we successfully defend against them, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. If we fail to properly manage our anticipated growth, our business could suffer.
Based on shares outstanding at February 19, 2025, our executive officers, directors and stockholders holding more than 5% of our outstanding common stock and their affiliates, in the aggregate, beneficially own approximately 30% of our outstanding common stock.
Based on shares outstanding at February 17, 2026, our executive officers, directors and stockholders holding more than 5% of our outstanding common stock and their affiliates, in the aggregate, beneficially own approximately 20% of our outstanding common stock.
We may be unable to find a sufficient alternative supply channel in a reasonable time period or on commercially reasonable terms, if at all, which would have a significant adverse effect on our business, financial condition and results of operations. If we or our suppliers fail to comply with applicable regulations, the manufacture of our products could be delayed.
We may be unable to find a sufficient alternative supply channel in a reasonable time period or on commercially reasonable terms, if at all, which would have a significant adverse effect on our business, financial condition and results of operations.
Any action that would prevent us from manufacturing, marketing and selling these systems or increase the costs associated with these systems would have a significant adverse effect on our business, financial condition and results of operations. Our reliance on sales agents could affect our ability to market our products efficiently and profitably.
Any action that would prevent us from manufacturing, marketing and selling these systems or increase the costs associated with these systems would have a significant adverse effect on our business, financial condition and results of operations.
The ability of Alphatec Spine, SafeOp, or EOS to make dividend and other payments to Alphatec Holdings is subject to the availability of funds after taking into account its subsidiaries’ funding requirements, the terms of its subsidiaries’ indebtedness and applicable state laws. If we fail to properly manage our anticipated growth, our business could suffer.
The ability of Alphatec Spine, SafeOp, or EOS to make dividend and other payments to Alphatec Holdings is subject to the availability of funds after taking into account its subsidiaries’ funding requirements, the terms of its subsidiaries’ indebtedness and applicable state laws.
We expect that market demand, government regulation, third-party reimbursement policies and societal pressures will continue to impact the worldwide healthcare industry, resulting in further business consolidations and alliances among our customers, which may reduce competition, exert further downward pressure on the prices of our products and may adversely impact our business, financial condition or results of operations.
We expect that market demand, government regulation, third-party reimbursement policies and societal pressures will continue to impact the worldwide healthcare industry, resulting in further business consolidations and alliances among our customers, which may reduce competition, exert further downward pressure on the prices of our products and may adversely impact our business, financial condition or results of operations. 20 Table of Contents Our business is dependent upon the effective operation of our information systems, software, or information security practices and those of our business partners or third-party service providers.
We rely on a limited number of third parties to manufacture and supply our products. Any problems experienced by these manufacturers could result in a delay or interruption in the supply of our products until such manufacturer cures the problem or until we locate and qualify an alternative source of supply.
Any problems experienced by these manufacturers could result in a delay or interruption in the supply of our products until such manufacturer cures the problem or until we locate and qualify an alternative source of supply. We rely on third party manufacturers of our implants, instruments, imaging equipment and spare parts.
Changes to our senior management team, sales and marketing team, engineering team and key surgeon advisors, or our inability to attract or retain other qualified personnel or advisors, could have a significant adverse effect on our business, financial condition and results of operations.
Changes to our senior management team, sales and marketing team, engineering team and key surgeon advisors, or our inability to attract or retain other qualified personnel or advisors, could have a significant adverse effect on our business, financial condition and results of operations. 19 Table of Contents We rely on a limited number of third parties to manufacture and supply our products.
We and our suppliers are subject to extensive regulation by the FDA and other regulatory agencies both inside and outside of the U.S. The FDA, and other regulatory agencies, audit compliance with some of these regulations.
If we or our suppliers fail to comply with applicable regulations, the manufacture of our products could be delayed. We and our suppliers are subject to extensive regulation by the FDA and other regulatory agencies both inside and outside of the U.S. The FDA, and other regulatory agencies, audit compliance with some of these regulations.
Any such claim, even those without merit, may cause us to incur substantial costs, and could place a significant strain on our financial resources, divert the attention of management from our core business and harm our reputation. If we become subject to product liability claims, we may be required to pay damages that exceed our insurance coverage.
Any such claim, even those without merit, may cause us to incur substantial costs, and could place a significant strain on our financial resources, divert the attention of management from our core business and harm our reputation.
If the healthcare providers, sales agents or other entities with which we do business are found to violate applicable laws, they may be subject to sanctions, which could also have a negative impact on us.
If the healthcare providers, sales agents or other entities with which we do business are found to violate applicable laws, they may be subject to sanctions, which could also have a negative impact on us. Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results.
Our business, financial condition and results of operations will be materially adversely affected if we do not attract and retain new sales agents or if the marketing and sales efforts of our sales agents are unsuccessful. To be commercially successful, we must convince the spine surgeon community that our products are an attractive alternative to competitive products.
Our business, financial condition and results of operations will be materially adversely affected if we do not attract and retain new sales agents or if the marketing and sales efforts of our sales agents are unsuccessful.
We may suffer losses as a result of business interruptions that exceed coverage under our manufacturer’s insurance policies. Other events beyond our control could also disrupt our product development and commercialization efforts until such events can be resolved or we can put in place third-party contract manufacturers to assume this manufacturing role.
Other events beyond our control could also disrupt our product development and commercialization efforts until such events can be resolved or we can put in place third-party contract manufacturers to assume this manufacturing role.
The development of biologics products entails the risk of transmitting disease to human recipients, and substantial product liability claims may be asserted against us. In addition, successful product liability claims made against one of our competitors could cause claims to be made against us or expose us to a perception that we are vulnerable to similar claims.
In addition, successful product liability claims made against one of our competitors could cause claims to be made against us or expose us to a perception that we are vulnerable to similar claims.
Our business exposes us to potential product liability claims that are inherent in the manufacture and sale of medical devices for spine surgery procedures. Spine surgery involves significant risk of serious complications, including paralysis and even death. We carry product liability insurance. However, our product liability insurance coverage may be inadequate to satisfy liabilities we might incur.
Spine surgery involves significant risk of serious complications, including paralysis and even death. We carry product liability insurance. However, our product liability insurance coverage may be inadequate to satisfy liabilities we might incur.
Anti-takeover provisions in our organizational documents and change of control provisions in some of our employment agreements and agreements with sales agents, and in some of our outstanding debt agreements, as well as the terms of our redeemable preferred stock, may discourage or prevent a change of control, even if an acquisition would be beneficial to our stockholders, which could affect our stock price adversely.
Anti-takeover provisions in our organizational documents and change of control provisions in some of our employment agreements and agreements with sales agents, and in some of our outstanding debt agreements, as well as the terms of our redeemable preferred stock, may discourage or prevent a change of control, even if an acquisition would be beneficial to our stockholders, which could affect our stock price adversely. 29 Table of Contents Certain provisions of our amended and restated certificate of incorporation and restated by-laws could discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which our stockholders might otherwise receive a premium for their shares.
We allocate resources based on assumptions about trends in the development of and treatment for spine disorders and the resulting demand for our products. Our assumptions may not be accurate.
Our business plan relies on certain assumptions pertaining to the market for our products that, if incorrect, may adversely affect our growth and profitability. We allocate resources based on assumptions about trends in the development of and treatment for spine disorders and the resulting demand for our products. Our assumptions may not be accurate.
If a product liability claim or series of claims is brought against us in excess of our insurance coverage limits, our business could suffer and our financial condition, results of operations and cash flow could be materially adversely impacted.
If a product liability claim or series of claims is brought against us in excess of our insurance coverage limits, our business could suffer and our financial condition, results of operations and cash flow could be materially adversely impacted. 24 Table of Contents Because biologics products entail a potential risk of communicable disease to human recipients, we may be the subject of product liability claims regarding our biologics products.
These provisions may discourage or prevent a change of control. 30 Table of Contents In addition, in the event of a change of control, we would be required to redeem all outstanding shares of our redeemable preferred stock for an aggregate of $29.9 million, at the price of $9.00 per share.
In addition, in the event of a change of control, we would be required to redeem all outstanding shares of our redeemable preferred stock for an aggregate of $29.9 million, at the price of $9.00 per share. Further, our amended and restated certificate of incorporation permits us to issue additional shares of preferred stock.
Any of these events could adversely affect our ability to achieve our development and commercialization goals and have a significant adverse effect on our business, financial condition and results of operations.
Any of these events could adversely affect our ability to achieve our development and commercialization goals and have a significant adverse effect on our business, financial condition and results of operations. We have a history of net losses, we expect to continue to incur net losses in the near future, and we may not achieve or maintain profitability.
Further, our insurance may not cover all claims made against us and could have high deductibles in any event, and defending a suit, regardless of its merit, could be costly and divert management attention. 23 Table of Contents Nearly all of our operations are currently conducted in locations that may be at risk of damage from fire, earthquakes or other natural disasters.
Further, our insurance may not cover all claims made against us and could have high deductibles in any event, and defending a suit, regardless of its merit, could be costly and divert management attention.
In order for us to sell our products, spine surgeons must be convinced that our products are superior to competing products.
To be commercially successful, we must convince the spine surgeon community that our products are an attractive alternative to competitive products. In order for us to sell our products, spine surgeons must be convinced that our products are superior to competing products.
Because of the complexity of our product and the patents we have licensed, determining the scope of the license and 18 Table of Contents related obligations can be difficult and can lead to disputes between us and the licensor.
Because of the complexity of our product and the patents we have licensed, determining the scope of the license and related obligations can be difficult and can lead to disputes between us and the licensor. An unfavorable resolution of such a dispute could lead to an increase in the royalties payable pursuant to the license or termination of the license.
Furthermore, a high percentage of our expenses, including those related to inventory, capital investments, and operating costs are generally fixed in nature in the short term. If we are not able to timely and appropriately adapt to changes resulting from a weak or uncertain economic environment, our business, financial condition, results of operations and cash flows could be adversely impacted.
If we are not able to timely and appropriately adapt to changes resulting from a weak or uncertain economic environment, our business, financial condition, results of operations and cash flows could be adversely impacted. Our quarterly financial results could fluctuate significantly.
In the past, following periods of volatility in the market price of a particular company’s securities, the company becomes subject to securities class action litigation. We may become involved in this type of litigation.
In the past, following periods of volatility in the market price of a particular company’s securities, the company becomes subject to securities class action litigation. We may become involved in this type of litigation. Litigation is often expensive and diverts management’s attention and resources, which could materially harm our financial condition, results of operations and business.
Failure to comply with the laws and regulations that affect our global operations could have an adverse effect on our business, financial condition, or results of operations. 20 Table of Contents Consolidation in the healthcare industry could lead to price concessions or exclusion of some suppliers from some markets, which could have an adverse effect on our business, financial condition or results of operations.
Consolidation in the healthcare industry could lead to price concessions or exclusion of some suppliers from some markets, which could have an adverse effect on our business, financial condition or results of operations. Continued consolidation in the healthcare industry is expected to increase competition among providers of products and services to industry participants.
Prosecutorial scrutiny and governmental oversight over the retention of healthcare professionals as consultants has affected and may continue to affect how medical device companies retain healthcare professionals as consultants.
Sales and marketing practices in the healthcare industry have been the subject of increased scrutiny from governmental agencies, and we believe that this trend will continue. Prosecutorial scrutiny and governmental oversight over the retention of healthcare professionals as consultants has affected and may continue to affect how medical device companies retain healthcare professionals as consultants.
We rely on third party manufacturers of our implants, instruments, imaging equipment and spare parts. We currently rely on a limited number of third parties and any prolonged disruption in the operations of our third-party suppliers could have a negative impact on our ability to supply products to customers.
We currently rely on a limited number of third parties and any prolonged disruption in the operations of our third-party suppliers could have a negative impact on our ability to supply products to customers. We may suffer losses as a result of business interruptions that exceed coverage under our manufacturer’s insurance policies.
Because biologics products entail a potential risk of communicable disease to human recipients, we may be the subject of product liability claims regarding our biologics products. Our biologics products may expose us to additional potential product liability claims.
Our biologics products may expose us to additional potential product liability claims. The development of biologics products entails the risk of transmitting disease to human recipients, and substantial product liability claims may be asserted against us.
In the future other types of crises, may create an environment of business uncertainty around the world, which may hinder sales and/or supplies of our products nationally and internationally. Alphatec Holdings is a holding company with no operations, and unless it receives dividends or other payments from its subsidiaries, it will be unable to fulfill its cash obligations.
Alphatec Holdings is a holding company with no operations, and unless it receives dividends or other payments from its subsidiaries, it will be unable to fulfill its cash obligations.
The PMA process is more costly and uncertain than the 510(k) clearance process. In addition, any modification to a 510(k)-cleared device that could significantly affect its safety or effectiveness, or that would constitute a major change in its intended use, design or manufacture, requires a new 510(k) clearance or possibly a PMA.
In addition, any modification to a 510(k)-cleared device that could significantly affect its safety or effectiveness, or that would constitute a major change in its intended use, design or manufacture, requires a new 510(k) clearance or possibly a PMA. 18 Table of Contents Commercial distribution and marketing of any of our products or product modifications will be delayed until regulatory clearance or approval is obtained which may take significantly longer than anticipated.
Further, our amended and restated certificate of incorporation permits us to issue additional shares of preferred stock. The terms of our redeemable preferred stock or any new preferred stock we may issue could have the effect of delaying, deterring or preventing a change in control.
The terms of our redeemable preferred stock or any new preferred stock we may issue could have the effect of delaying, deterring or preventing a change in control. Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
This may not occur and, unless and until it does, we will continue to need to raise additional capital. We may seek additional funds from public and private equity or debt financings, borrowings under new debt facilities or other sources to fund our projected operating requirements.
We may seek additional funds from public and private equity or debt financings, borrowings under new debt facilities or other sources to fund our projected operating requirements. However, we may not be able to obtain further financing on reasonable terms or at all.
A significant economic downturn or volatility in the economy in any market in which we operate could have a material adverse impact on our business, financial condition, results of operations, or cash flows. As a result of our domestic and global business operations, our revenues are impacted by changes in domestic and global macroeconomic conditions.
If we are unable to raise additional funds on a timely basis, or at all, we would be materially adversely affected. A significant economic downturn or volatility in the economy in any market in which we operate could have a material adverse impact on our business, financial condition, results of operations, or cash flows.
Further, the cost to comply with such laws or regulations, or decisions and/or guidance interpreting existing laws, could be significant and would increase our operating expenses, which could adversely affect our business, financial condition and results of operations. 24 Table of Contents Risks Related to Our Financial Results, Credit and Certain Financial Obligations and Need for Financing We may need to raise additional funds in the future and such funds may not be available on acceptable terms, if at all.
Risks Related to Our Financial Results, Credit and Certain Financial Obligations and Need for Financing We may need to raise additional funds in the future and such funds may not be available on acceptable terms, if at all.
For these reasons, we may not be able to compete successfully against our existing or potential competitors. Any such failure could lead us to further modify our strategy, lower our prices, increase our sales commissions and could have a significant adverse effect on our business, financial condition and results of operations.
Any such failure could lead us to further modify our strategy, lower our prices, increase our sales commissions and could have a significant adverse effect on our business, financial condition and results of operations. 17 Table of Contents Our reliance on sales agents could affect our ability to market our products efficiently and profitably.
Our competitors include numerous large and well-capitalized companies such as Medtronic Sofamor Danek, a subsidiary of Medtronic; Depuy Spine, a subsidiary of Johnson & Johnson; Stryker; Zimmer Biomet; and Globus Medical.
The market in which we operate is highly competitive, subject to rapid technological change and affected by new products and market activities of industry participants. Our competitors include numerous large and well-capitalized companies such as Medtronic Sofamor Danek, a subsidiary of Medtronic; Depuy Spine, a subsidiary of Johnson & Johnson; Zimmer Biomet; and Globus Medical.
We have incurred significant net losses since inception and have relied on our ability to fund our operations through revenues from the sale of our products and equity and debt financings. Successful transition to profitability is dependent upon achieving a level of revenues adequate to support our cost structure.
We have incurred net losses since our inception. As of December 31, 2025, we had an accumulated deficit of $1.4 billion. We have incurred significant net losses since inception and have relied on our ability to fund our operations through revenues from the sale of our products and equity and debt financings.
Further, changes in exchange rates may affect our net earnings, the book value of our assets outside the U.S. and our stockholders’ equity.
Further, changes in exchange rates may affect our net earnings, the book value of our assets outside the U.S. and our stockholders’ equity. Failure to comply with the laws and regulations that affect our global operations could have an adverse effect on our business, financial condition, or results of operations.
Litigation is often expensive and diverts management’s attention and resources, which could materially harm our financial condition, results of operations and business. 29 Table of Contents Securities analysts may not provide coverage of our common stock or may issue negative reports, which may have a negative impact on the market price of our common stock.
Securities analysts may not provide coverage of our common stock or may issue negative reports, which may have a negative impact on the market price of our common stock. Securities analysts may not provide research coverage of our common stock.
We conduct nearly all of our business activities in or near known wildfire areas and earthquake fault zones. We have taken precautions to safeguard our facilities, including obtaining property and casualty insurance, and implementing health and safety protocols. We have developed an information technology disaster recovery plan.
We have taken precautions to safeguard our facilities, including obtaining property and casualty insurance, and implementing health and safety protocols. We have developed an information technology disaster recovery plan. However, any future natural disaster could cause substantial delays in our operations, damage or destroy our equipment or inventory and cause us to incur additional expenses.
A weakening of economic conditions, including from a worsening of the ongoing labor shortage or rising in inflation, could lead to increased costs to our business and reductions in demand for our products. Weakened economic conditions or a recession could reduce the amounts that customers are willing or able to spend on our products.
As a result of our domestic and global business operations, our revenues are impacted by changes in domestic and global macroeconomic conditions. A weakening of economic conditions, including from labor market constraints and wage pressures, or rising in inflation, could lead to increased costs to our business and reductions in demand for our products.
However, any future natural disaster could cause substantial delays in our operations, damage or destroy our equipment or inventory and cause us to incur additional expenses. A disaster could seriously harm our business, financial condition and results of operations.
A disaster could seriously harm our business, financial condition and results of operations.
Our use of this technology could result in additional compliance costs, regulatory investigations and actions and lawsuits.
Our use of this technology could result in additional compliance costs, regulatory investigations and actions and lawsuits. Further, the cost to comply with such laws or regulations, or decisions and/or guidance interpreting existing laws, could be significant and would increase our operating expenses, which could adversely affect our business, financial condition and results of operations.
Removed
In that case, the trading price of our common stock could decline, and you may lose some or all of your investment. Risks Related to Our Business and Industry Our business plan relies on certain assumptions pertaining to the market for our products that, if incorrect, may adversely affect our growth and profitability.
Added
For these reasons, we may not be able to compete successfully against our existing or potential competitors.
Removed
An unfavorable resolution of such a dispute could lead to an increase in the royalties payable pursuant to the license or termination of the license.
Added
The PMA process is more costly and uncertain than the 510(k) clearance process.
Removed
Continued consolidation in the healthcare industry is expected to increase competition among providers of products and services to industry participants.
Added
Nearly all of our operations are currently conducted in locations that may be at risk of damage from fire, earthquakes or other natural disasters. We conduct nearly all of our business activities in or near known wildfire areas and earthquake fault zones.
Removed
Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results. 21 Table of Contents Sales and marketing practices in the healthcare industry have been the subject of increased scrutiny from governmental agencies, and we believe that this trend will continue.
Added
In the future other types of crises, may create an environment of business uncertainty around the world, which may hinder sales and/or supplies of our products nationally and internationally.
Removed
Commercial distribution and marketing of any of our products or product modifications will be delayed until regulatory clearance or approval is obtained which may take significantly longer than anticipated.
Added
Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments.
Removed
Our business is dependent upon the effective operation of our information systems, software, or information security practices and those of our business partners or third-party service providers.
Added
While most of our suppliers are based in the U.S., some of the materials we use to manufacture our products are directly affected by tariffs imposed on products imported into the U.S. Additionally, we are increasing our international sales, which may be subject to retaliatory measures by other countries.
Removed
We have a history of net losses, we expect to continue to incur net losses in the near future, and we may not achieve or maintain profitability. We have typically incurred net losses since our inception. As of December 31, 2024, we had an accumulated deficit of $1.3 billion.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe have not identified any risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
Biggest changeWe have not identified any risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. 31 Table of Contents Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee oversight over our information security and technology risks, including our information security, cybersecurity and related risk management programs.
To support data security, we have established an integrated risk management framework with practices that are derived from industry standards, including ISO 27001, HITRUST Common Security Framework (CSF) 11.2 certification, the NIST Cybersecurity Framework, and data privacy regulations, including HIPAA and the General Data Protection Regulation.
To support data security, we have established an integrated risk management framework with practices that are derived from industry standards, including ISO 27001, HITRUST Common Security Framework (CSF) 11.4 certification, the NIST Cybersecurity Framework, and data privacy regulations, including HIPAA and the General Data Protection Regulation.
Our management team oversees efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat intelligence and other information obtained from governmental, public, or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in the information technology environment. 32 Table of Contents
Our management team oversees efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat intelligence and other information obtained from governmental, public, or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in the information technology environment.
We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information.
We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our cybersecurity risk management program includes a cybersecurity incident response plan.
Our cybersecurity program includes annual review and assessment by external, independent third parties, who certify and report on these programs. As part of our enterprise risk management process, we assess the various cybersecurity risks that may impact our business and implement plans and initiatives that are intended to mitigate those risks.
As part of our enterprise risk management process, we assess the various cybersecurity risks that may impact our business and implement plans and initiatives that are intended to mitigate those risks.
Our cybersecurity risk management program includes a cybersecurity incident response plan. 31 Table of Contents We design and assess our program based on various cybersecurity frameworks, most prominently the Health Information Trust Alliance (“HITRUST”) Common Security Framework, and Service Organization Controls (“SOC”) 2, developed by the American Institute of CPAs.
We design and assess our program based on various cybersecurity frameworks, most prominently the Health Information Trust Alliance (“HITRUST”) Common Security Framework, and Service Organization Controls (“SOC”) 2, developed by the American Institute of CPAs. In 2025, our cybersecurity systems, supporting infrastructure and EOS products received HITRUST e1 certification as they met the HITRUST CSF v11.4.0 certification criteria.
In 2024, our cybersecurity systems, supporting infrastructure and EOS products received HITRUST e1 certification as they met the HITRUST CSF v11.20 certification criteria. We use this cybersecurity framework and information security controls as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
We use this cybersecurity framework and information security controls as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. Our cybersecurity program includes annual review and assessment by external, independent third parties, who certify and report on these programs.
Removed
Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee oversight over our information security and technology risks, including our information security, cybersecurity and related risk management programs.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. P roperties Our corporate office is located in Carlsbad, California. The table below provides selected information regarding the leased principal properties used in our operations. Location Use Approximate Square Footage Carlsbad, California Corporate headquarters 121,541 Memphis, Tennessee Distribution facility 75,643 Paris, France Office facilities 19,913
Biggest changeItem 2. P roperties Our corporate office is located in Carlsbad, California. The table below provides selected information regarding the leased principal properties used in our operations. Location Use Approximate Square Footage Carlsbad, California Corporate headquarters 121,541 Memphis, Tennessee Distribution facility 75,643 Paris, France Office facilities 23,946

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings For a description of our material legal proceedings, refer to Note 7 of our Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. Item 4. Mine Saf ety Disclosures Not applicable. 33 Table of Contents PART II
Biggest changeItem 3. Legal Proceedings For a description of our material legal proceedings, refer to Note 7 of our Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. Item 4. Mine Saf ety Disclosures Not applicable. 32 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 33 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34 Item 6. Reserved 35 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 36 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 46 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 32 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 33 Item 6. Reserved 34 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 35 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 45 Item 8.
Added
Financial Statements and Supplementary Data 45 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 45 Item 9A. Controls and Procedures 46 Item 9B. Other Information 47

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeUnregistered Sales of Equity Securities and Use of Proceeds During the three months ended December 31, 2024, the Company issued unregistered equity securities as described below: Date Issued Number of Shares Grant Date Fair Value per Share (4) October 1, 2024 129,333 (1) $ 5.27 October 1, 2024 2,753 (2) $ 5.27 October 1, 2024 625 (3) $ 5.27 October 15, 2024 1,887 (2) $ 5.30 November 12, 2024 1,250 (3) $ 9.28 December 2, 2024 11,667 (1) $ 10.21 (1) Pursuant to Development Service Agreements for the development of products and intellectual property.
Biggest changeUnregistered Sales of Equity Securities and Use of Proceeds During the three months ended December 31, 2025, the Company issued unregistered equity securities as described below: Date Issued Number of Shares Grant Date Fair Value per Share (5) October 1, 2025 1,725 (1) $ 13.97 October 1, 2025 625 (2) $ 13.97 October 10, 2025 3,334 (3) $ 13.14 October 20, 2025 31,000 (3) $ 15.50 November 12, 2025 1,250 (2) $ 20.75 November 14, 2025 8,333 (3) $ 19.74 November 20, 2025 8,333 (3) $ 19.61 November 21, 2025 8,333 (3) $ 20.31 November 24, 2025 216,665 (3) $ 20.63 November 26, 2025 57,261 (4) $ 22.59 December 8, 2025 4,167 (3) $ 20.96 (1) Consulting services rendered to the Company.
The graph assumes that $100 was invested on December 31, 2019 in our common stock and in each of the comparative indices, and the reinvestment of any dividends. The stock price performance on the following graph is not necessarily indicative of future stock price performance.
The graph assumes that $100 was invested on December 31, 2020 in our common stock and in each of the comparative indices, and the reinvestment of any dividends. The stock price performance on the following graph is not necessarily indicative of future stock price performance.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* AMONG ALPHATEC HOLDINGS, INC., THE NASDAQ COMPOSITE INDEX AND THE NASDAQ MEDICAL EQUIPMENT INDEX *$100 invested on December 31, 2019 in stock or index, including reinvestment of dividends.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* AMONG ALPHATEC HOLDINGS, INC., THE NASDAQ COMPOSITE INDEX AND THE NASDAQ MEDICAL EQUIPMENT INDEX *$100 invested on December 31, 2020 in stock or index, including reinvestment of dividends.
There were no repurchases of common stock during the year ended December 31, 2024. 34 Table of Contents Stock Performance Graph The following graph compares the cumulative total stockholder return data on our common stock with the cumulative return of two indices: (i) The Nasdaq Stock Market Composite Index, and (ii) The Nasdaq Medical Equipment Index over the five-year period ending December 31, 2024.
There were no repurchases of common stock during the year ended December 31, 2025. Stock Performance Graph The following graph compares the cumulative total stockholder return data on our common stock with the cumulative return of two indices: (i) The Nasdaq Stock Market Composite Index, and (ii) The Nasdaq Medical Equipment Index over the five-year period ending December 31, 2025.
Item 5. Market for Registrant’s Common Equity, Related Sto ckholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on The NASDAQ Global Select Market under the symbol “ATEC.” Stockholders As of February 19, 2025, there were approximately 425 holders of record of an aggregate 144,149,232 outstanding shares of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Sto ckholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on The NASDAQ Global Select Market under the symbol “ATEC.” Stockholders As of February 17, 2026, there were approximately 455 holders of record of an aggregate 151,356,620 outstanding shares of our common stock.
Purchases of Equity Securities Under the terms of our 2016 Equity Incentive Plan and our Amended and Restated 2005 Employee, Director and Consultant Stock Plan, as amended, which we refer to collectively as the Stock Plans, and prior to the expiration of the Stock Plans in May 2026, we are permitted to award shares of restricted stock to our employees, directors, and consultants.
The issuances of the foregoing securities were made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, as there was no general solicitation and the transactions did not involve a public offering. 33 Table of Contents Purchases of Equity Securities Under the terms of our 2016 Equity Incentive Plan and our Amended and Restated 2005 Employee, Director and Consultant Stock Plan, as amended, which we refer to collectively as the Stock Plans, and prior to the expiration of the Stock Plans in May 2026, we are permitted to award shares of restricted stock to our employees, directors, and consultants.
(2) Consulting services rendered to the Company. (3) Independent sales agent services rendered to the Company. (4) Based on the market price of common stock on the issuance date.
(2) Independent sales agent services rendered to the Company. (3) Pursuant to Development Service Agreements for the development of products and intellectual property. (4) Pursuant to purchase of assets from a third party (5) Based on the market price of common stock on the issuance date.
Removed
The issuances of the foregoing securities were made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, as there was no general solicitation and the transactions did not involve a public offering.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

48 edited+18 added−7 removed60 unchanged
Biggest changeSummary of Cash Flows The following is a summary of cash (used in) provided by operating, investing, and financing activities, the effect of exchange rate changes on cash and cash equivalents, and the net change in cash and cash equivalents: Year Ended December 31, 2024 2023 2022 Cash (used in) provided by: Operating activities $ (44,651 ) $ (78,485 ) $ (75,134 ) Investing activities (93,136 ) (141,975 ) (58,280 ) Financing activities 56,208 356,919 31,228 Effect of exchange rate changes on cash (551 ) (185 ) (366 ) Net change in cash and cash equivalents $ (82,130 ) $ 136,274 $ (102,552 ) 40 Table of Contents Operating Activities We used net cash of $44.7 million from operating activities for the year ended December 31, 2024.
Biggest changeWe believe that our existing funds, cash generated from our operations and our existing sources of and access to financing are adequate to satisfy our needs for working capital, capital expenditure, debt service requirements and other business initiatives we plan to strategically pursue. 39 Table of Contents Summary of Cash Flows The following is a summary of cash (used in) provided by operating, investing, and financing activities, the effect of exchange rate changes on cash and cash equivalents, and the net change in cash and cash equivalents: Year Ended December 31, 2025 2024 2023 Cash (used in) provided by: Operating activities $ 45,231 $ (44,651 ) $ (78,485 ) Investing activities (53,411 ) (93,136 ) (141,975 ) Financing activities 30,018 56,208 356,919 Effect of exchange rate changes on cash 128 (551 ) (185 ) Net change in cash and cash equivalents $ 21,966 $ (82,130 ) $ 136,274 Operating Activities Operating activities provided net cash of $45.2 million for the year ended December 31, 2025, which is primarily related to cash collections offset by costs associated with the continued expansion of our business and inventory purchases.
Restructuring expenses primarily consist of severance, social plan benefits and related tax costs incurred in connection with cost rationalization efforts, as well as costs associated with the opening or closing of office and warehouse facilities. Total interest and other expense, net .
Restructuring expenses primarily consist of severance, social plan benefits and related tax costs incurred in connection with cost rationalization efforts, as well as costs associated with the opening or closing of office and warehouse facilities. Total other expense, net .
That adoption-driven validation has been the source of industry-leading market share expansion, which has delivered an approximately 40% revenue compound annual growth rate since our transformation commenced in 2018. We market and sell our products through a network of independent sales agents and direct sales representatives.
That adoption-driven validation has been the source of industry-leading market share expansion, which has delivered an approximately 35% revenue compound annual growth rate since our transformation commenced in 2018. We market and sell our products through a network of independent sales agents and direct sales representatives.
Sales, general and administrative expenses consist primarily of salaries and related employee benefits, sales commissions and other variable costs, depreciation of our surgical instruments, regulatory affairs, quality assurance costs, professional service fees, travel, medical education, trade show and marketing costs, and insurance expenses. Litigation-related expenses. Litigation-related expenses are costs incurred for our ongoing and settled litigation. Amortization expense.
Sales, general and administrative expenses consist primarily of salaries and related employee benefits, sales commissions and other variable costs, depreciation of our surgical instruments, regulatory affairs, quality assurance costs, professional service fees, travel, medical education, trade show and marketing costs, and insurance expenses. Litigation-related expenses. Litigation-related expenses are costs incurred for our ongoing and settled litigation.
We believe the following accounting policies to be critical to the judgments and estimates used in the preparation of our consolidated financial statements. 42 Table of Contents Revenue Recognition We recognize revenue from product sales in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Revenue from Contracts with Customers (“Topic 606”).
We believe the following accounting policies to be critical to the judgments and estimates used in the preparation of our consolidated financial statements. 41 Table of Contents Revenue Recognition We recognize revenue from product sales in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Revenue from Contracts with Customers (“Topic 606”).
The use of alternative estimates could result in a different amount of revenue deferral. 43 Table of Contents Excess and Obsolete Inventory Most of our inventory is comprised of finished goods, and we primarily utilize third-party suppliers to produce our products.
The use of alternative estimates could result in a different amount of revenue deferral. 42 Table of Contents Excess and Obsolete Inventory Most of our inventory is comprised of finished goods, and we primarily utilize third-party suppliers to produce our products.
For discussion regarding our financial condition and the results of operations for 2023 compared to 2022, refer to Part II, Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.
For discussion regarding our financial condition and the results of operations for 2024 compared to 2023, refer to Part II, Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024.
By applying our unique, 100% spine focus and deep industry know-how, we aim to revolutionize spine surgery through clinical distinction. The sophisticated approaches that we create from the ground up integrate with our expanding Alpha InformatiX™ ("AIX") platform to objectively inform surgery and achieve the goals of spine surgery more predictably and more reproducibly.
By applying our unique, 100% spine focus and deep industry know-how, we aim to revolutionize spine surgery through clinical distinction. The sophisticated approaches that we create from the ground up integrate with our expanding InformatiX™ ("IX") platform to objectively inform surgery and achieve the goals of spine surgery more predictably and more reproducibly.
A discussion regarding our financial condition and results of operations for 2024 compared to 2023 is presented under “Results of Operations” further below in this Item 7.
A discussion regarding our financial condition and results of operations for 2025 compared to 2024 is presented under “Results of Operations” further below in this Item 7.
We incur royalties related to the technologies that we license from others and the products that are developed in part by surgeons with whom we collaborate in the product development process. 36 Table of Contents Research and development expenses . Research and development expenses consist of costs associated with the design, development, testing, and enhancement of our products.
We incur royalties related to the technologies that we license from others and the products that are developed in part by surgeons with whom we collaborate in the product development process. Research and development expenses . Research and development expenses consist of costs associated with the design, development, testing, and enhancement of our products.
If this assessment indicates that the intangible asset is not recoverable, based on the estimated undiscounted future cash flows of the asset over the remaining amortization period, we reduce the net carrying value of the related intangible asset to fair value and may adjust the remaining amortization period.
If this assessment indicates that the asset group is not recoverable, based on the estimated undiscounted future cash flows of the asset group, we reduce the net carrying value of the related intangible assets in the asset group to fair value and may adjust the remaining amortization period.
The fair value of equity instruments that are expected to vest is recognized and amortized over the requisite service period. We have granted awards with up to four year graded or cliff vesting terms.
The fair value of common stock that is expected to vest is recognized and amortized over the requisite service period. We have granted awards with up to four year graded or cliff vesting terms.
Investing Activities We used cash of $93.1 million in investing activities for the year ended December 31, 2024, which is primarily related to the purchase of surgical instruments to support the growth of our business and commercial launch of new products.
Investing Activities We used cash of $53.4 million in investing activities for the year ended December 31, 2025, which is primarily related to the purchase of surgical instruments to support the growth of our business and commercial launch of new products.
If this evaluation indicates that the value of the intangible asset may be impaired, we make an assessment of the recoverability of the net carrying value of the asset over its remaining useful life.
If this evaluation indicates that the value of the intangible asset may be impaired, we make an assessment of the recoverability of the net carrying value of the asset group in which the intangible asset resides over its remaining useful life of the primary asset in the asset group.
Treasury yield in effect at the time of grant. We have never declared or paid dividends and have no plans to do so in the foreseeable future. Awards to non-employees are accounted for under the same stock-based compensation provisions as employees, which require that the fair value of these instruments be recognized as an expense when earned.
We have never declared or paid dividends and have no plans to do so in the foreseeable future. 44 Table of Contents Awards to non-employees are accounted for under the same stock-based compensation provisions as employees, which require that the fair value of these instruments be recognized as an expense when earned.
Sales, general and administrative expenses. Sales, general and administrative expenses increased by $76.1 million, or 20%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase was primarily due to higher compensation-related costs and variable selling expenses associated with the increase in revenue, and our continued investment in building our strategic sales channel.
Sales, general and administrative expenses. Sales, general and administrative expenses increased by $48.3 million, or 11%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily due to higher compensation-related costs and variable selling expenses associated with the increase in revenue, and our continued investment in building our strategic sales channel.
Cash and cash equivalents were $138.8 million and $221.0 million at December 31, 2024 and December 31, 2023, respectively. We have available borrowings under the Revolving Credit Facility discussed above.
Cash and cash equivalents were $160.8 million and $138.8 million at December 31, 2025 and December 31, 2024, respectively. We have available borrowings under the Revolving Credit Facility discussed above.
(2) Includes inventory purchase commitments of $8.8 million. (3) Represents other debt. Off-Balance Sheet Arrangements As of December 31, 2024, we did not have any off-balance sheet arrangements.
(2) Includes inventory purchase commitments of $5.0 million. (3) Represents other debt. Off-Balance Sheet Arrangements As of December 31, 2025, we did not have any off-balance sheet arrangements.
Additionally, we have increased our investment in our sales and marketing functions by increasing headcount to support the growth of our business. Litigation-related expenses. Litigation-related expenses decreased by $12.5 million, or 56%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
Additionally, we have increased our investment in our sales and marketing functions by increasing headcount to support the growth of our business. 37 Table of Contents Litigation-related expenses. Litigation-related expenses increased by $14.0 million, or 143%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
To deliver consistent, predictable growth, we have added, and intend to continue to add, clinically astute and exclusive sales team members to reach untapped surgeons, hospitals, and national accounts and better penetrate existing accounts and territories. Revenue and Expense Components The following is a description of the primary components of our revenue and expenses: Revenue.
To deliver consistent, predictable growth, we have added, and intend to continue to add, clinically astute and exclusive sales team members to reach untapped surgeons, hospitals, and national accounts and better penetrate existing accounts and territories.
Total interest and other expense, net includes interest income, interest expense, gains and losses from foreign currency exchanges and other non-operating gains and losses. Income tax provision.
Total other expense, net includes interest income, interest expense, gains and losses from foreign currency exchanges, loss on debt extinguishment, gain on derivative liability, and other non-operating gains and losses. Income tax provision (benefit).
Research and development expenses increased by $10.6 million, or 15%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
Research and development expenses decreased by $4.5 million, or 6%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
As part of our liquidity strategy, we will continue to monitor our current level of spending and cash use as well as our ability to secure additional credit facilities, term loans, or other similar arrangements in light of our spending levels and general financial market conditions. 39 Table of Contents A substantial portion of our operations are in the U.S., and most of our net sales have been made in the U.S.
As part of our liquidity strategy, we will continue to monitor our current level of spending and cash use as well as our ability to secure additional credit facilities, term loans, or other similar arrangements in light of our spending levels and general financial market conditions.
The outstanding loans under the Braidwell Term Loan bear interest at the sum of SOFR plus 5.75% per annum. The Braidwell Term Loan matures on January 6, 2028. As of December 31, 2024, we had $63.3 million outstanding under the Revolving Credit Facility. The outstanding loans bear interest at the sum of SOFR plus 3.5% per annum.
Debt and Commitments As of December 31, 2025, we had $200.0 million outstanding under the Braidwell Term Loan. The outstanding loans under the Braidwell Term Loan bear interest at the sum of Term Secured Overnight Financing Rate ("SOFR") plus 5.75% per annum. The Braidwell Term Loan matures on January 6, 2028.
Accordingly, we do not have material exposures to foreign currency rate fluctuations from operations. However, as our business in markets outside of the U.S. continues to increase, we will be exposed to foreign currency exchange risk related to our foreign operations.
However, as our business in markets outside of the U.S. continues to increase, we will be exposed to foreign currency exchange risk related to our foreign operations. We do not have any material financial exposure to one customer or one country, outside the U.S., that would significantly hinder our liquidity.
We also periodically review the lives assigned to our intangible assets to ensure that our initial estimates do not exceed any revised estimated periods from which we expect to realize cash flows. If a change were to occur in any of the above-mentioned factors or estimates, the likelihood of a material change in our reported results would increase.
We also periodically review the lives assigned to our intangible assets to ensure that our initial estimates do not exceed any revised estimated periods from which we expect to realize cash flows.
The stock-based compensation expense is included in cost of sales or research and development expense on the consolidated statements of operations commensurate with the nature of services performed. Recent Accounting Pronouncements.
The stock-based compensation expense is included in cost of sales or research and development expense on the consolidated statements of operations commensurate with the nature of services performed. Recent Accounting Pronouncements. See “ Notes to Financial Statements - Note 1 - Recently Adopted and Issued Accounting Pronouncements ” included elsewhere in this Annual Report on Form 10-K.
Based on the terms, we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received. As of December 31, 2024, we had $3.0 million in other debts that are due in monthly and quarterly installments through maturity in 2027.
Based on the terms, we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received. As of December 31, 2025, we had $405.0 million outstanding under the 2030 Notes.
The decrease was primarily related to a decrease in legal fees associated with our previously settled litigation matters. Refer to Note 7 of our Notes to Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for further information regarding litigation matters. Amortization expense.
The increase was primarily related to a litigation settlement during the year ended December 31, 2025, and ongoing litigation matters. Refer to Note 7 of our Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for further information regarding litigation matters. Amortization of acquired intangible assets.
Restructuring expenses increased $2.5 million, or 352%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase in restructuring expenses is primarily due to costs associated with the relocation of office facilities in Paris, France, and severance and related tax costs incurred in connection with cost rationalization efforts.
The decrease in restructuring expenses is primarily due to costs associated with the relocation of office facilities in Paris, France, and severance and related tax costs incurred in connection with cost rationalization efforts in the prior year that did not recur.
We evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
If a change were to occur in any of the above-mentioned factors or estimates, the likelihood of a material change in our reported results would increase. 43 Table of Contents We evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
The increase was primarily due to an increase in personnel to support the expansion of our new product portfolio and an increase in stock-based compensation associated with Development Service Agreements (as described above), as the vesting conditions of certain of these amended awards, that met the requirements for presentation within research and development, were deemed probable during the year.
The decrease was primarily due to a decrease in stock-based compensation associated with Development Service Agreements for the development of a wide variety of potential products and intellectual property, as the vesting conditions for more of these awards that met the requirements for presentation within research and development, were deemed probable during the prior year than during the current year.
If our actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges. 44 Table of Contents In-process research and development ("IPR&D") and software in development have indefinite lives and are not amortized until the related products reach full commercial launch or when the projects are complete and their assets are ready for their intended use.
In-process research and development ("IPR&D") and software in development have indefinite lives and are not amortized until the related products reach full commercial launch or when the projects are complete and their assets are ready for their intended use.
The increase in other (expense) income, net, was primarily due to foreign currency rates and recognition of an employee retention credit during the year ended December 31, 2023.
The increase in other income (expense), net, was primarily due to foreign currency rates and recognition of an employee retention credit. 38 Table of Contents Income tax provision Year Ended December 31, Change (in thousands, except %) 2025 2024 $ % Income tax (benefit) provision $ (45 ) $ 50 $ (95 ) (190 )% Income tax provision for the year ended December 31, 2025 was negligible and remained consistent compared to the year ended December 31, 2024.
The increase in interest expense, net, was primarily due to drawing an additional $50.0 million on the Braidwell Term Loan in both September 2023 and October 2024. Other (expense) income, net, increased $4.1 million, or 133%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
The increase in interest expense, net, was primarily due to drawing an additional $50.0 million on the Braidwell Term Loan in October 2024, and the amortization of debt discount associated with the 2030 Notes. Net cash interest was $21.1 million and net non-cash interest was $24.8 million for the year ended December 31, 2025.
Transaction-related expenses decreased $1.9 million, or 90%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. The decrease in transaction-related expenses is due to the Valence acquisition in April 2023. Restructuring expenses .
Transaction-related expenses decreased $0.2 million, or 100%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The decrease in transaction-related expenses is due to the term debt amendment in the prior year that did not recur. Restructuring expenses .
Amortization expense includes amortization of acquired intangible assets and amortization of internally-developed software that has been placed in service. Amortization of acquired intangible assets consists of intangible assets acquired in business combinations and asset purchases. Transaction-related expenses. Transaction-related expenses consist of certain costs incurred related primarily to the acquisition and integration of Valence. Restructuring expenses .
Amortization of acquired intangible assets. Amortization of acquired intangible assets consists of intangible assets acquired in business combinations and asset acquisitions. Transaction-related expenses. Transaction-related expenses consist of certain costs incurred related primarily to our term loan amendment. Restructuring expenses .
We have an inventory purchase commitment agreement with a third-party supplier, where we are obligated to certain minimum purchase commitment requirements through December 2025.
As of December 31, 2025, we had $1.9 million in other debts that are due in monthly and quarterly installments through maturity in 2027. 40 Table of Contents We have an inventory purchase commitment agreement with a third-party supplier, where we are obligated to certain minimum purchase commitment requirements through December 2025.
Income tax provision primarily consists of an estimate of federal, state, and foreign income taxes based on enacted state and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws.
Income tax provision primarily consists of an estimate of federal, state, and foreign income taxes based on enacted state and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws. 36 Table of Contents Results of Operations Total revenue Year Ended December 31, Change (in thousands, except %) 2025 2024 $ % Revenue from products and services $ 764,155 $ 611,562 $ 152,593 25 % Revenue from products and services increased by $152.6 million, or 25%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
As of December 31, 2024, the remaining minimum purchase commitment under the agreement was $8.8 million. 41 Table of Contents Contractual obligations and commercial commitments Total contractual obligations and commercial commitments as of December 31, 2024 are summarized in the following table (in thousands): Payments Due by Period Total 1 Year or Less More than 1 Year 2026 Notes $ 316,250 $ — $ 316,250 Braidwell Term Loan, including final payment fee of $6,500 206,500 — 206,500 Interest expense (1) 65,759 22,807 42,952 Revolving Credit Facility 63,284 — 63,284 Facility lease obligations 42,329 7,112 35,217 Purchase commitments (2) 8,810 4,405 4,405 Other (3) 3,052 1,226 1,826 Development services plans 1,532 — 1,532 Total $ 707,516 $ 35,550 $ 671,966 (1) Represents interest expense from our debt that we expect to pay in the future.
Contractual obligations and commercial commitments Total contractual obligations and commercial commitments as of December 31, 2025 are summarized in the following table (in thousands): Payments Due by Period Total 1 Year or Less More than 1 Year 2030 Notes $ 405,000 $ — $ 405,000 Braidwell Term Loan, including final payment fee of $6,500 206,500 — 206,500 2026 Notes 63,250 63,250 — Interest expense (1) 56,113 24,790 31,323 Facility lease obligations 36,626 6,864 29,762 Revolving Credit Facility 15,000 — 15,000 Milestone payments 8,450 2,700 5,750 Purchase commitments (2) 4,978 4,978 — Other (3) 1,916 1,273 643 Total $ 797,833 $ 103,855 $ 693,978 (1) Represents interest expense from our debt that we expect to pay in the future.
Amortization expense increased $2.0 million, or 14%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase in amortization expense is primarily due to amortization of intangible assets acquired in the acquisition of Valence in April 2023 and internally-developed software placed in service during 2024. 38 Table of Contents Transaction-related expenses.
Amortization of acquired intangible assets decreased $1.2 million, or 7%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The decrease in amortization expense is primarily due to several acquired intangible assets becoming fully amortized during the year ended December 31, 2025. Transaction-related expenses.
The increase was primarily due to an increase in product volume that was due to the increase in our surgeon user base, continued expansion of our product portfolio, and increasing adoption of our technology. 37 Table of Contents Cost of sales Year Ended December 31, Change (in thousands, except %) 2024 2023 $ % Cost of sales $ 187,300 $ 172,059 $ 15,241 9 % Cost of sales increased by $15.2 million, or 9%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
The increase was primarily due to an increase in product volume that was due to the increase in our surgeon user base, continued expansion of our product portfolio, and increasing adoption of our technology.
Financing Activities Financing activities provided net cash of $56.2 million for the year ended December 31, 2024, which is primarily related to proceeds from our term loan and net draws on our revolving line of credit. Debt and Commitments As of December 31, 2024, we had $200.0 million outstanding under the Braidwell Term Loan.
Financing Activities Financing activities provided net cash of $30.0 million for the year ended December 31, 2025, which is primarily related to proceeds from our 2030 Notes offset by the repurchase of 80% of the 2026 Notes, the purchase of capped calls and the net repayment of our Revolving Credit Facility.
Operating expenses Year Ended December 31, Change (in thousands, except %) 2024 2023 $ % Operating expenses: Research and development $ 80,718 $ 70,115 $ 10,603 15 % Sales, general and administrative 450,199 374,080 76,119 20 % Litigation-related expenses 9,799 22,287 (12,488 ) (56 )% Amortization expense 16,258 14,284 1,974 14 % Transaction-related expenses 210 2,113 (1,903 ) (90 )% Restructuring expenses 3,247 719 2,528 352 % Total operating expenses $ 560,431 $ 483,598 $ 76,833 16 % Research and development expenses .
Operating expenses Year Ended December 31, Change (in thousands, except %) 2025 2024 $ % Operating expenses: Research and development $ 76,268 $ 80,718 $ (4,450 ) (6 )% Sales, general and administrative 498,526 450,199 48,327 11 % Litigation-related expenses 23,784 9,799 13,985 143 % Amortization of acquired intangible assets 15,060 16,258 (1,198 ) (7 )% Transaction-related expenses — 210 (210 ) (100 )% Restructuring expenses 378 3,247 (2,869 ) (88 )% Total operating expenses $ 614,016 $ 560,431 $ 53,585 10 % Research and development expenses .
The Revolving Credit Facility matures on the earlier of September 29, 2027, or 90 days prior to the final maturity date of any of our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes"). As of December 31, 2024, we had $316.3 million outstanding under the 2026 Notes.
As of December 31, 2025, we had $15.0 million outstanding under the Revolving Credit Facility. The outstanding loans bear interest at the sum of SOFR plus 3.5% per annum. The Revolving Credit Facility matures on September 29, 2027. As of December 31, 2025, we had $63.3 million outstanding under the 2026 Notes.
We do not have any material financial exposure to one customer or one country, outside the U.S., that would significantly hinder our liquidity. We are and may become involved in various legal proceedings arising from our business activities.
We are and may become involved in various legal proceedings arising from our business activities.
Results of Operations Total revenue Year Ended December 31, Change (in thousands, except %) 2024 2023 $ % Revenue from products and services $ 611,562 $ 482,262 $ 129,300 27 % Revenue from products and services increased by $129.3 million, or 27%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
Cost of sales Year Ended December 31, Change (in thousands, except %) 2025 2024 $ % Cost of sales $ 232,267 $ 187,300 $ 44,967 24 % Cost of sales increased by $45.0 million, or 24%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
Total interest and other expense, net Year Ended December 31, Change (in thousands, except %) 2024 2023 $ % Other expense, net: Interest expense, net $ (24,879 ) $ (16,641 ) $ (8,238 ) 50 % Other (expense) income, net (1,025 ) 3,121 (4,146 ) (133 )% Total other expense, net $ (25,904 ) $ (13,520 ) $ (12,384 ) 92 % Interest expense, net, increased $8.2 million, or 50%, during the year ended December 31, 2024, compared to the year ended December 31, 2023.
Total other expense, net Year Ended December 31, Change (in thousands, except %) 2025 2024 $ % Other expense, net: Interest expense, net $ (45,922 ) $ (24,879 ) $ (21,043 ) 85 % Loss on debt extinguishment (17,576 ) — (17,576 ) 100 % Gain on derivative liability 620 — 620 100 % Other income (expense), net 1,603 (1,025 ) 2,628 (256 )% Total other expense, net $ (61,275 ) $ (25,904 ) $ (35,371 ) 137 % Interest expense, net, increased $21.0 million, or 85%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
Removed
The increase was primarily due to an increase in product volume offset by a decrease in stock-based compensation. We have entered into Development Service Agreements for the development of a wide variety of potential products and intellectual property.
Added
Recent Developments 0.75% Senior Convertible Notes due 2030 In March 2025, we issued $405.0 million principal amount of unsecured senior convertible notes with a stated interest rate of 0.75% (the "2030 Notes"). The 2030 Notes began accruing interest immediately and interest is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2025.
Removed
Under these agreements, future royalty payments for product and/or intellectual property rights may be paid in either cash or restricted shares of our common stock at the election of the developer, depending on the terms of the agreement. Certain of these agreements were amended to remove the cash royalty option and require settlement in restricted shares of our common stock.
Added
The 2030 Notes are convertible into shares of our common stock based upon an initial conversion rate of 64.3407 shares of our common stock per $1,000 principal amount of 2030 Notes (equivalent to an initial conversion price of approximately $15.54 per share).
Removed
Stock-based compensation associated with these awards was higher during the year ended December 31, 2023 as the vesting conditions of certain of these amended awards that met the requirements for presentation within cost of sales were deemed probable at that time.
Added
The net proceeds from the sale of the 2030 Notes were approximately $392.9 million after deducting the offering expenses. The 2030 Notes will mature on March 15, 2030, unless earlier converted, redeemed, or repurchased. We used $42.5 million of the net proceeds from the 2030 Notes offering to enter into separate capped call instruments with certain financial institutions.
Removed
Income tax provision Year Ended December 31, Change (in thousands, except %) 2024 2023 $ % Income tax provision (benefit) $ 50 $ (277 ) $ 327 (118 )% Income tax provision for the year ended December 31, 2024 was negligible and remained consistent compared to the year ended December 31, 2023.
Added
The capped call transactions effectively limit the premium for conversion of the 2030 Notes to 100% and are generally expected to reduce potential dilution to our common stock upon any conversion of the 2030 Notes and/or offset any payments we make upon conversion. In addition, we repurchased 80% of our 2026 convertible notes (the "2026 Notes") for approximately $268.4 million.
Removed
We believe that our existing funds, cash generated from our operations and our existing sources of and access to financing are adequate to satisfy our needs for working capital, capital expenditure, debt service requirements and other business initiatives we plan to strategically pursue.
Added
We intend to use the remainder of the net proceeds from the 2030 Notes for general corporate purposes. 35 Table of Contents Revenue and Expense Components The following is a description of the primary components of our revenue and expenses: Revenue.
Removed
The cash used in operating activities primarily related to costs associated with the continued expansion of our business and inventory purchases, offset by the timing of cash payments and receipts.
Added
The increase was primarily due to an increase in product volume.
Removed
See “ Notes to Financial Statements - Note 1 - Recently Adopted and Issued Accounting Pronouncements ” included elsewhere in this Annual Report on Form 10-K. 45 Table of Contents
Added
Restructuring expenses decreased $2.9 million, or 88%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
Added
Loss on debt extinguishment increased $17.6 million, or 100%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase in loss on debt extinguishment relates to the redemption of 80% of the 2026 Notes.
Added
Gain on derivative liability increased $0.6 million, or 100%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
Added
The increase in gain on derivative liability relates to the change in the valuation of the derivative liability associated with 2030 Notes from inception to June 12, 2025, the date the conditions necessary for separate accounting of the conversion option as a derivative liability were no longer met.
Added
Other income (expense), net, increased $2.6 million, or 256%, during the year ended December 31, 2025, compared to the year ended December 31, 2024.
Added
A substantial portion of our operations are in the U.S., and most of our net sales have been made in the U.S. Accordingly, we do not have material exposures to foreign currency rate fluctuations from operations.
Added
The 2030 Notes accrue interest at a rate of 0.75%, payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2025. Prior to maturity in March 2030, the holders of the 2030 Notes may, under certain circumstances, choose to convert their notes into shares of our common stock.
Added
Based on the terms, we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received.
Added
As of December 31, 2025, the remaining minimum purchase commitment under the agreement was $5.0 million.
Added
The asset group is determined based on the lowest level for which identifiable cash flows can be identified.
Added
If our actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges.
Added
Treasury yield in effect at the time of grant.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed4 unchanged
Biggest changeA 10% change in commodity prices would not have had a material impact on our results of operations for the year ended December 31, 2024. 46 Table of Contents
Biggest changeA 10% change in commodity prices would not have had a material impact on our results of operations for the year ended December 31, 2025.
Item 7A. Quantitative and Qualita tive Disclosures About Market Risk Interest Rate Risk We are exposed to interest rate risks related to our cash, cash equivalents and borrowings. We had cash and cash equivalents of 138.8 million as of December 31, 2024, which consist of cash and money market funds.
Item 7A. Quantitative and Qualita tive Disclosures About Market Risk Interest Rate Risk We are exposed to interest rate risks related to our cash, cash equivalents and borrowings. We had cash and cash equivalents of 160.8 million as of December 31, 2025, which consist of cash and money market funds.
As of December 31, 2024, the outstanding balance under the Braidwell Term Loan and Revolving Credit Facility was $200.0 million and $63.3 million, respectively. The interest rates for the Braidwell Term Loan and Revolving Credit Facility as of December 31, 2024 were 10.4% and 8.2%, respectively.
As of December 31, 2025, the outstanding balance under the Braidwell Term Loan and Revolving Credit Facility was $200.0 million and $15.0 million, respectively. The interest rates for the Braidwell Term Loan and Revolving Credit Facility as of December 31, 2025 were 9.7% and 7.5%, respectively.

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