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What changed in Newton Golf Company, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Newton Golf Company, 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.

+396 added−340 removedSource: 10-K (2026-03-31) vs 10-K (2025-04-04)

Top changes in Newton Golf Company, Inc.'s 2025 10-K

396 paragraphs added · 340 removed · 149 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changePatents We currently hold the following patents: ● US D874589 S (Series 18 design patent) ● US D874592 S (Series 54 design patent) ● US D867494 S (Series 39 design patent) ● US 11,123,614 B2 (Magnesium Golf Clubhead Insert) ● Ultra Low Balance Point Utility Patent: ○ US 8,608,586 ○ Australia Patent No. 2012/301755 ○ Canada Patent No. 2,846,882 ○ China Patent App No. 2012/80042114.1 ○ European Patent App.
Biggest changeThe Company currently holds the following U.S. patents: ● US D874589 S (Series 18 design patent) ● US D874592 S (Series 54 design patent) ● US D867494 S (Series 39 design patent) ● US 11,123,614 B2 (Magnesium Golf Clubhead Insert) 8 The Company also holds intellectual property rights relating to its Ultra-Low Balance Point technology, which is protected through patents and patent applications in multiple jurisdictions, including the U.S., Australia, Canada, China, Europe, Japan, South Korea, and South Africa., The Ultra-Low Balance Point patent rights described above were licensed to the Company by Parcks Designs, LLC on July 24, 2018.
On March 4, 2025, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to affect a reverse stock split of the Company’s common stock at a ratio of 1-for-30 shares (the “Second Reverse Stock Split”). The Second Reverse Stock Split became effective as of 12:01 a.m.
On March 4, 2025, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to effect a 1-for-30 reverse stock split of the Company’s common stock (the “Second Reverse Stock Split”). The Second Reverse Stock Split became effective at 12:01 a.m.
Eastern Time on March 17, 2025 and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol. All shares and per share amounts and information presented herein have been retroactively adjusted to reflect the reverse stock splits for all periods presented.
Eastern Time on March 17, 2025, and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol. All share amounts and per-share information presented in this Annual Report have been retroactively adjusted to reflect both reverse stock splits for all periods presented.
Pursuant to our Plan of Conversion, on March 17, 2025, all of the outstanding ownership interests in Sacks Parente Golf, Inc., and rights to receive such interest were converted into and exchanged for shares of capital stock of the newly formed Delaware corporation. We retroactively reflected the conversion as of the earliest periods presented herein.
Pursuant to the Company’s plan of conversion, on March 17, 2025, all outstanding ownership interests in Sacks Parente Golf, Inc., and rights to receive such interests, were converted into and exchanged for shares of capital stock of the newly formed Delaware corporation. The conversion has been retroactively reflected in the accompanying financial statements for all periods presented.
Environmental Matters We are subject to federal, state and local environmental laws and regulations that impose limitations on the discharge of pollutants into the environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage and disposal of certain materials, substances and wastes and the remediation of environmental contaminants (collectively, “Environmental Laws”).
Environmental Matters The Company is subject to federal, state, and local environmental laws and regulations that impose requirements related to the discharge of pollutants into the environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage, and disposal of certain materials, substances, and wastes, as well as the remediation of environmental contamination (collectively, “Environmental Laws”).
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at the following address: http://www.sec.gov.
The SEC maintains a website that contains reports, proxy statements, information statements, and other information regarding issuers that file electronically with the SEC. These materials are available at www.sec.gov .
The First Reverse Stock Split became effective as of 12:01 a.m. Eastern Time on July 30, 2024 and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol.
Eastern Time on July 30, 2024, and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol.
On December 12, 2024, we entered into an underwriting agreement with Aegis Capital Corp. as the sole underwriter relating to the sale of up to 233,333 Common Units, each consisting of one (1) share of Common Stock, one (1) Series A Common Warrant to purchase one (1) share of Common Stock per warrant, and one (1) Series B Common Warrant to purchase one (1) share of Common Stock per warrant.
On December 12, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp. as sole underwriter for the sale of 233,333 common units (“Common Units”) of the Company each consisting of (i) one share of common stock, (ii) one Series A common warrant of the Company (“Series A Warrant”), and (iii) one Series B common warrant of the Company (“Series B Warrant”).
The net proceeds to the Company for the offering were $467,000, after deducting the underwriting discounts and commissions and estimated offering expenses.
The offering closed on October 10, 2024, generating net proceeds to the Company of approximately $467,000, after deducting underwriting discounts, commissions, and estimated offering expenses.
On October 8, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp. as the sole underwriter relating to the offering, issuance and sale of up to 12,200 shares of the Company’s common stock at a public offering price of $60.00 per share. The offering closed on October 10, 2024.
The Company received net proceeds of approximately $11.0 million after deducting underwriting discounts, commissions, and offering expenses of approximately $565,000. On October 8, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp. as sole underwriter for the sale of 12,200 shares of common stock at a public offering price of $60.00 per share.
The initial exercise price of each Series B Common Warrant is $72.00 per share of Common Stock or pursuant to an alternative cashless exercise option. The Series B Common Warrants are exercisable following stockholder approval and expire 30 months thereafter. The offering closed on December 13, 2024.
The Series A Warrants have an initial exercise price of $72.00 per share, are exercisable following stockholder approval, and expire 60 months thereafter. 2 The Series B Warrants have an initial exercise price of $72.00 per share or may be exercised pursuant to an alternative cashless exercise feature, are exercisable following stockholder approval, and expire 30 months thereafter.
In addition, we routinely post on the “Investors” page of our website news releases, announcements and other statements about our business and results of operations, some of which may contain information that may be deemed material to investors. Therefore, we encourage investors to monitor the “Investors” page of our website and review the information we post on that page.
In addition, the Company routinely posts on the “Investors” section of its website news releases, announcements, and other information about the Company’s business and results of operations, some of which may be considered material information for investors. Accordingly, the Company encourages investors to monitor the Investors section of its website for important information about the Company.
The net proceeds to us for the offering were approximately $7,326,000, after deducting underwriting discounts and commissions and estimated offering expenses. 1 Reverse Stock Splits On July 18, 2024, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to affect a reverse stock split of the Company’s common stock at a ratio of 1-for-10 shares (the “First Reverse Stock Split”).
Reverse Stock Splits On July 18, 2024, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to effect a 1-for-10 reverse stock split of the Company’s common stock (the “First Reverse Stock Split”). The First Reverse Stock Split became effective at 12:01 a.m.
In the ordinary course of our manufacturing processes, we use paints, chemical solvents and other materials, and generate waste by-products that are subject to these Environmental Laws. We endeavor to adhere to all applicable Environmental Laws and act as necessary to comply with these laws. We maintain an environmental and safety program at our facilities.
In the ordinary course of its manufacturing and product assembly processes, the Company uses paints, coatings, chemical solvents, and other materials and generates waste by-products that are subject to these Environmental Laws. The Company maintains environmental and safety programs at its facilities designed to support compliance with applicable Environmental Laws.
Product Portfolio Characteristics We design our golf products to fit golfers of all skill levels, amateur and professional, and our products are designed with the goal of conforming to the Rules of Golf as published by the United States Golf Association (“USGA”) and the ruling authority (“The R&A”).
Product Portfolio Characteristics The Company designs and develops golf equipment intended for golfers of all skill levels, from amateur to professional. The Company seeks to design its products to conform to the Rules of Golf as established by the United States Golf Association (“USGA”) and the R&A, the governing bodies responsible for establishing and interpreting the rules of golf equipment.
In the offering, the Company sold 10,667 shares of common stock, at a price of $1,200.00 per share. The offering closed on August 17, 2023, and total proceeds received, net of fees, were $11,594,000 including an underwriting discount of 7% and a non-accountable expenses allowance of 1% based on the aggregate proceeds of the offering.
Public Offerings On August 14, 2023, the Company entered into an underwriting agreement with The Benchmark Company in connection with its initial public offering. In the offering, the Company sold 10,667 shares of common stock at a price of $1,200 per share. The offering closed on August 17, 2023, generating gross proceeds of approximately $11.6 million.
No fractional shares were issued in connection with the First Reverse Stock Split, as all fractional shares were rounded up to the next whole share.
No fractional shares were issued in connection with the reverse stock splits, as all fractional shares were rounded up to the next whole share. Industry Overview The global golf equipment industry includes golf clubs, shafts, balls, and related accessories sold through golf retailers, professional club fitters, distributors, and direct-to-consumer channels.
Historical Development We were formed in 2018 as Sacks Parente Golf, Inc., a Delaware limited liability company. On March 17, 2025 we converted into a Delaware corporation named Newton Golf Company, Inc.
In July 2018, the corporation converted from a corporation to a limited liability company. In March 2022, the limited liability company converted back to a corporation. On March 17, 2025, the Company changed its name to Newton Golf Company, Inc.
We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the Securities and Exchange Commission (“SEC”) in accordance with the Securities Exchange Act of 1934, as amended (“Exchange Act”).
Securities and Exchange Commission (“SEC”) pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These include the Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy and information statements, and any amendments to those reports or statements.
On May 25, 2022, we and Parcks Designs entered into a Consulting Agreement whereby Parcks Designs will perform club and shaft testing and analysis, putter head design consulting and other services as may be agreed upon from time to time.
On May 25, 2022, the Company and Parcks Designs entered into a consulting agreement under which Parcks Designs provides club and shaft testing and analysis, putter head design consulting, and related technical services. Consulting fees under this agreement were initially nominal and increased to $2,000 per month beginning June 1, 2024. On August 7, 2018, Richard E.
Confidentiality provisions are also present in consulting agreements and supplier agreements in certain cases where the consultant or supplier may be exposed to confidential information. Trademarks The following marks and phrases, among others, are trademarks of the Company: ● USPTO Reg. No. 5,783,037 (Veni Vidi Vici) ● USPTO Reg No. 5,822,719 (Sacks Parente) ● South Korea Reg.
These trademarks are registered in the United States and certain international jurisdictions. ● USPTO Reg. No. 5,783,037 (Veni Vidi Vici) ● USPTO Reg No. 5,822,719 (Sacks Parente) ● South Korea Reg. No. 40-1820381 (Sacks Parente) The Company also uses various trademarks, trade names, and brand identifiers in connection with its products and marketing activities.
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Item 1. Business Overview We are a technology-forward golf company, with a growing portfolio of golf products, including putting instruments, golf shafts, golf grips, and other golf-related products.
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Item 1. Business Company Overview Newton Golf Company, Inc. (the “Company,” “Newton,” “we,” “us,” or “our”) designs, manufactures, and sells performance golf equipment, including premium golf shafts and putters, and focuses on developing technology-driven golf products intended to enhance player performance.
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In consideration of its growth opportunities in shaft technologies, in April of 2022, we expanded our manufacturing business to include advanced premium golf shafts by opening a new shaft manufacturing facility in St. Joseph, Missouri. It is our intent to manufacture and assemble substantially all products in the United States as is economically feasible.
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The Company’s Newton Motion™ shaft product line represents a core component of its product strategy and has contributed significantly to recent revenue growth. In April 2022, the Company expanded its manufacturing capabilities by opening a shaft manufacturing facility in St. Joseph, Missouri to support the production of advanced carbon fiber golf shafts.
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We anticipate expansion into golf apparel and other golf-related product lines to enhance its growth. Our future expansions may include broadening its offerings through mergers, acquisitions or internal developments of product lines that are complementary to its premium brand. We currently sell our products through our websites, resellers, and distributors in the United States, Japan, and South Korea.
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The Company seeks to manufacture and assemble substantially all of its products in the United States where economically feasible, which management believes provides supply chain advantages and supports product quality, engineering control, and operational flexibility.
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On August 14, 2023, the Company entered into an underwriting agreement with The Benchmark Company for the purchase of shares of the Company’s common stock, in an offering of securities registered under an effective registration statement filed with the Securities and Exchange Commission.
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The Company sells its products through a combination of direct-to-consumer channels, including its websites, as well as through resellers, professional club fitters, distributors, and golf retailers. The Company currently distributes products primarily in the United States, with additional distribution in international markets including Japan and South Korea.
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The Company incurred expenses of $565,000 associated with our initial public offering, resulting in net proceeds for the Company of $11,029,000.
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The Company continues to expand its relationships with professional club fitters and retail partners as adoption of its shaft products increases. Growing awareness of the Newton brand among professional golfers, club fitters, and retail partners may create opportunities to expand distribution of other Newton-branded products.
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The public offering price per Common Unit is $36.00. The initial exercise price of each Series A Common Warrant is $72.00 per share of Common Stock. The Series A Common Warrants are exercisable following stockholder approval and expire 60 months thereafter.
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The Company believes its technology-driven shaft platform and domestic manufacturing capabilities position it to scale production efficiently as demand for premium performance golf equipment increases. Management believes the Company is in the early stages of scaling its Newton shaft platform and that continued adoption by golfers, professional club fitters, and retail partners may support significant long-term revenue growth.
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As a result of the First Reverse Split, every ten shares of common stock were automatically combined into one share of common stock. The authorized number of shares of common stock was not affected by the First Reverse Stock Split.
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Over time, the Company may expand its product offerings through internal product development or strategic acquisitions of complementary golf-related product lines or technologies.
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Name Change On March 11, 2025, the Company’s Board of Directors approved and, by written consent dated February 26, 2025, the holders of a majority of our common stock approved an amendment to our Certificate of Incorporation to change our name from Sacks Parente Golf, Inc. to Newton Golf Company, Inc. to better reflect its commitment to revolutionizing golf through advanced physics and precision engineering.
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In addition, the Company may explore opportunities to collaborate with other golf equipment manufacturers or industry partners where its shaft technologies and manufacturing capabilities may complement broader equipment platforms. 1 Historical Development The Company was formed in March 2018 as Sacks Parente Golf, Inc., a Delaware corporation.
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The change to Newton Golf Company, Inc. became effective on March 17, 2025. Going Concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.
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The public offering price per Common Unit was $36.00.
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As reflected in the accompanying financial statements, during the year ended December 31, 2024, the Company incurred a net loss of $11,752,000 and used cash in operations of $4,929,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the financial statements being issued.
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Industry reports estimate that the global golf equipment market is estimated to be $8.55 billion in 2025 and is expected to grow at a mid-single-digit annual rate over the next several years. Golf participation increased significantly during the COVID-19 pandemic as the sport was widely viewed as a socially distanced outdoor activity.
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At December 31, 2024, the Company had cash and cash equivalents on hand in the amount of $7,650,000. The Company expects its cash on hand on December 31, 2024, will last for at least the next 12 months.
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Although the initial pandemic-driven surge has moderated, participation levels have remained elevated relative to historical levels, and industry organizations have reported continued engagement among both new and returning golfers. 3 According to Grand View Research, in addition to traditional golf participation, off-course golf experiences and indoor golf technologies have expanded opportunities for consumers to engage with the sport.
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Should the Company need additional debt or equity financing in the future, no assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company.
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Golf entertainment venues such as Topgolf and the increasing availability of golf simulators and indoor golf facilities allow consumers to participate in golf-related activities in non-traditional environments and in regions where weather conditions may limit outdoor play during portions of the year.
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Even if the Company is able to obtain additional financing, it may contain undue restrictions on operations, in the case of debt financing or cause substantial dilution for stockholders, in case or equity financing.
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The golf equipment market is highly competitive and driven in part by product innovation, equipment fitting, and brand recognition among professional golfers, club fitters, and retailers. Many golfers seek equipment designed to improve performance, including customized clubs and high-performance components such as premium shafts. International markets represent an important component of the golf equipment industry.
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Industry Overview The golf equipment market size is estimated at USD 13.32 billion in 2023, and is expected to reach USD 17.64 billion by 2028, growing at a CAGR of 5.78% during the forecast period (2023-2028). In recent years, there has been an increase in young golfers, causing equipment sales to rise.
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Countries such as Japan and South Korea have well-established golf markets with strong demand for premium equipment, while other regions continue to experience increasing participation and investment in golf-related infrastructure. The Company believes these industry trends, including increasing demand for premium equipment and the growing importance of professional club fitting, support the long-term opportunity for technology-driven golf equipment manufacturers.
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It is one of the significant factors driving golf equipment sales. The growing middle-class income and the increasing number of professional golfers over the last few years are contributing to the substantial increase in demand. The participation rate in pro-golf tournaments is increasing, especially among millennials, further boosting golf equipment sales worldwide.
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The Company’s product development philosophy emphasizes the application of engineering principles and physics to golf equipment design. Through research and development activities, the Company seeks to develop products that differentiate themselves through materials engineering, weight distribution, and structural performance characteristics. The Company focuses its research and development efforts on composite shaft technologies and other engineering-driven golf equipment innovations.
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Based on a survey by the National Golf Foundation in 2021, golf is now played in 206 out of the 251 countries. There are around 38,000 golf courses in over 82% of countries worldwide. Globally, millions of people of all ages are attracted to golf, participating in the International Golf Federation’s programs and events.
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To support product development, the Company utilizes computer-aided design software, finite element analysis tools, structural optimization techniques, and various testing technologies. These include robotics, launch monitor systems, and other testing equipment used to evaluate performance characteristics of golf equipment products.
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Including golf in the Olympic Games has contributed to a sudden increase in golfers worldwide. The market is highly impacted by product innovations carried out by key players and considerable investments in marketing and promotional activities to reach a broad customer base.
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Newton Shafts In November 2023, the Company expanded its product portfolio through the introduction of the Newton Motion driver shaft, marking the Company’s entry into the premium composite golf shaft market. In April 2024, the Company expanded its shaft product line with the introduction of the Newton Motion fairway wood shaft.
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With the substantial growth of the golf tourism industry, the market is anticipated to have a positive outlook in the coming years. European countries are investing heavily in Infrastructural developments of the game and hosting many international golf events and competitions.
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These products are manufactured at the Company’s shaft manufacturing facility in St. Joseph, Missouri. The Company’s ability to manufacture composite shafts domestically allows it to control production processes and support ongoing product development activities. The Newton shaft product family includes two primary driver shaft models: Motion and Fast Motion.
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For instance, in October 2022, several golf courses in Portugal invested heavily in improvements, with some new courses opening and others being upgraded.
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The Fast Motion driver shaft was introduced in 2025 and has become the Company’s best-selling shaft product. The Fast Motion driver shaft incorporates higher modulus carbon fiber materials and lighter composite construction designed to reduce overall shaft weight while maintaining structural stability.
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Such investments in golf courses are further anticipated to boost the inflow of sports tourists and influence the market positively during the study period. 2 Rise in Demand for Golf Equipment from Asia-Pacific The Asia-Pacific golf equipment market is driven by the rising popularity of golf in Japan, China, South Korea, and Thailand, among other countries.
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The Motion shaft utilizes a different composite construction intended to provide alternative performance characteristics for golfers with varying swing profiles. The Newton Motion shafts utilize carbon fiber composite materials and proprietary shaft construction techniques designed to influence key performance characteristics such as stability, energy transfer, and weight distribution during the golf swing.
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There has been phenomenal growth in the Asia-Pacific golf industry. During the next few years, the golf clothing and equipment market in the Asia-Pacific region is expected to grow, with major countries such as China, India, Australia, and Japan contributing to the market growth.
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The Company manufactures its shafts using proprietary mandrels and composite wrapping processes developed for the Newton Motion shaft product line. 4 Unlike many traditional shaft designs that are used across multiple club types, the Company develops shafts tailored to the performance characteristics of specific clubs, including drivers, fairway woods, and hybrid clubs.
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Japan is one of the major countries in the Asia-Pacific region in terms of the number of golf players, owing to the rising awareness about golf and an increase in the golfer population in the country.
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The Company believes that shafts designed specifically for individual club types may improve launch conditions, consistency, and overall club performance. The Newton Motion shaft product line also incorporates the Company’s proprietary “DOT” system, which replaces traditional shaft flex designations with a numerical system ranging from one to seven dots.
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According to the Ministry of Economy, Trade, and Industry (METI), the golfing population in Japan increased from 8.93 million in 2018 to approximately 10.3 million in 2021. As the population becomes more aware of sports and the disposable income of individuals rises, there is a strong likelihood that the regional market will continue to grow.
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This system is intended to provide golfers with a more precise method for selecting shaft stiffness and to allow golfers to match shaft characteristics across driver, fairway wood, and hybrid clubs. The Company continues to expand the Newton Motion shaft product line through ongoing product development.
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In addition to already established international brands, the market in the region is being driven by a rise in the participation of gold tournaments and spending money and time on sports activities. Increasing media exposure to international golf events has aided the rise in the popularity of golf among the masses.
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During 2026, the Company expects to introduce additional shaft products including a Fast Motion fairway wood shaft, Fast Motion hybrid shaft, and Motion hybrid shaft as part of the continued expansion of the Newton Motion product family. Golf shafts play an important role in the club fitting process and are often selected independently of the golf club head.
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This trend encourages the youth to play such sports, further boosting the sales of golf equipment in the region. Source: https://www.mordorintelligence.com/industry-reports/golf-equipment-market Markets Our products are sold in the Americas, Asia and Europe.
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As a result, shaft manufacturers frequently work closely with professional club fitters and golf retailers who recommend shaft products to golfers during the fitting process. The Company believes that the growing adoption of its shaft products among golfers, professional club fitters, and retailers may create additional opportunities to expand distribution of other Newton-branded golf equipment products over time.
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We sell our golf equipment products in the United States and internationally, directly via e-commerce, through distribution or subsidiaries, to wholesale customers, including pro-shops at golf courses and off-course retailers, sporting goods retailers, on-line retailers, third-party distributors, and through Club Champion Golf, the international leader in golf club fitting with strategic locations across the U.S. and internationally.
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The Company’s shaft product development is supported by in-house engineering capabilities, including computer-aided design, structural modeling, and product testing. These capabilities allow the Company to develop composite shaft designs using proprietary manufacturing processes and specialized composite materials. The Company’s shafts are used by professional golfers across several professional tours, including the PGA TOUR Champions and other international tours.
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We sell certain products to mass merchants, as well as directly to consumers through retail locations in Japan and have recently begun selling products in South Korea. We offer custom fitting programs online to help consumers find the best fit for their personal specifications. In addition, we sell to corporate customers who want certain customizations of our golf equipment.
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The Company believes that professional adoption provides visibility for its products among golfers, club fitters, and retailers. Newton Gravity Putters The Company also offers golf putting instruments marketed under the Newton Gravity brand. These products incorporate certain proprietary design characteristics, including ultra-low balance point technology intended to influence the distribution of weight within the putter.
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Advertising and Marketing Our marketing campaigns in connection with the NWTG brand are aimed to increase consumer awareness of the products and support our overall growth strategy.
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Ultra-low balance point technology refers to a shaft balance point positioned closer to the putter head, which shifts the relative weight distribution toward the head of the putter. The Company achieves this balance profile through the use of lightweight shaft and grip components rather than increasing the mass of the putter head.
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We will focus our advertising efforts mainly on television commercials, primarily on The Golf Channel and web-based digital, social media advertising, and printed advertisements in national magazines, such as Golf Magazine and Golf Digest, as well as in-store advertising.
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Gravity putters are manufactured using a variety of materials, including steel, aluminum, carbon fiber, tungsten, magnesium components, and other materials. These products incorporate proprietary face and shaft technologies intended to influence feel, weight distribution, and stroke characteristics.
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We also establish relationships with professional athletes and personalities, including members of various professional golf tours as well as other athletes and personalities, in order to promote our golf equipment product lines.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

91 edited+49 added−38 removed131 unchanged
Biggest changeThese risks include the following: ●Adverse changes in foreign currency exchange rates can have a significant effect upon our results of operations, financial condition and cash flows; ●Increased difficulty in protecting our intellectual property rights and trade secrets; ●Unexpected government action or changes in legal or regulatory requirements; ●Social, economic or political instability; ●The effects of any anti-American sentiments on our brand or sales of our products; ●Increased difficulty in ensuring compliance by employees, agents and contractors with our policies as well as with the laws of multiple jurisdictions, including but not limited to the U.S.
Biggest changeThese risks include the following: ●Adverse changes in foreign currency exchange rates can have a significant effect upon our results of operations, financial condition and cash flows; ●Increased difficulty in protecting our intellectual property rights and trade secrets; ●Unexpected government action or changes in legal or regulatory requirements; ●Social, economic or political instability; ●The effects of any anti-American sentiments on our brand or sales of our products; ●Increased difficulty in ensuring compliance by employees, agents and contractors with our policies as well as with the laws of multiple jurisdictions, including but not limited to the FCPA, international environmental, health and safety laws, and increasingly complex regulations relating to the conduct of international commerce, including import/export laws and regulations, economic sanctions laws and regulations and trade controls, including tariffs; ●changes in international labor costs and other costs of doing business internationally; ●Increased difficulty in controlling and monitoring foreign vendor operations from the United States, including increased difficulty in identifying and recruiting qualified personnel for our foreign operations; and ●Increased exposure to interruptions in land based, air carrier or ocean shipping services.
We currently generate our revenue from the sale of golf putters, golf shafts, golf grips and related gear. The demand for golf-related products in general, as well as the demand for golf-related soft goods, is directly related to the number of golf participants and the number of rounds of golf being played by these participants.
We currently generate our revenue from the sale of golf shafts, golf putters, golf grips and related gear. The demand for golf-related products in general, as well as the demand for golf-related soft goods, is directly related to the number of golf participants and the number of rounds of golf being played by these participants.
If we face labor shortages or increased labor costs because of inflation, increased competition for employees, higher employee turnover rates, the impact of pandemics, increases in the federally-mandated or state-mandated minimum wage, changes in exempt and non-exempt status, or other employee benefits costs (including costs associated with health insurance coverage or workers’ compensation insurance), our operating expenses could increase and our growth could be adversely affected.
If we face labor shortages or increased labor costs because of inflation, increased competition for employees, higher employee turnover rates, increases in the federally-mandated or state-mandated minimum wage, changes in exempt and non-exempt status, the impact of pandemics, or other employee benefits costs (including costs associated with health insurance coverage or workers’ compensation insurance), our operating expenses could increase and our growth could be adversely affected.
Our golf putting instruments, golf shaft products, grips and other products exist in a highly competitive marketplace that is served by a number of well-established and well-financed companies with recognized brand names. In particular four major competitors enjoy the majority of U.S. market share in golf.
Our golf shaft products, golf putting instruments, grips and other products exist in a highly competitive marketplace that is served by a number of well-established and well-financed companies with recognized brand names. In particular four major competitors enjoy the majority of U.S. market share in golf.
We anticipate as we continue to grow our presence in existing markets and expansion into new markets, further developing our brand may become increasingly difficult and expensive. If we are unable to maintain or further develop the image of our brand, it could materially adversely affect business, financial condition and results of our operations.
We anticipate as we continue to grow our presence in existing markets and expansion into new markets, further developing our brand may become increasingly difficult and expensive. If we are unable to maintain or further develop the image of our brand, it could materially adversely affect our business, financial condition and results of operations.
If our suppliers experienced a significant disruption in their business as a result of a natural disaster or other emergency, our ability to obtain the necessary components to make products could be significantly adversely affected.
If our suppliers experienced a significant disruption in their business as a result of a natural disaster or other emergency, our ability to obtain the necessary components to make our products could be significantly adversely affected.
Unfavorable weather conditions generally result in fewer golf rounds played, which generally results in reduced demand for all golf products. Furthermore, catastrophic storms can negatively affect golf rounds played both during the storms and afterward, as storm damaged golf courses are repaired and golfers focus on repairing the damage to their homes, businesses and communities.
Unfavorable weather conditions generally result in fewer golf rounds played, which generally results in reduced demand for all golf products. Furthermore, catastrophic storms can negatively affect golf rounds played both during the storms and afterward, as storm damaged golf courses are repaired and golfers focus on repairing damage to their homes, businesses and communities.
Changes in equipment standards under applicable Rules of Golf could adversely affect our business. We seek to have all our putting instruments, grips and shafts meet the standards published by the USGA and The R&A in the Rules of Golf because these standards are generally followed by golfers, both professional and amateur, within their respective jurisdictions.
Changes in equipment standards under applicable Rules of Golf could adversely affect our business. We seek to have all our shafts, putting instruments, and grips meet the standards published by the USGA and the R&A in the Rules of Golf because these standards are generally followed by golfers, both professional and amateur, within their respective jurisdictions.
We believe that professional usage of our golf putting instruments, golf shafts and golf grips contributes to retail sales. We therefore spend a significant amount of money to secure professional usage of our products. Many other companies, however, also aggressively seek the patronage of these professionals and offer many inducements, including significant cash incentives and specially designed products.
We believe that professional usage of our golf shafts, golf putting instruments, and golf grips contributes to retail sales. We therefore spend a significant amount of money to secure professional usage of our products. Many other companies, however, also aggressively seek the patronage of these professionals and offer many inducements, including significant cash incentives and specially designed products.
The materials and components that we use, and that are used by our suppliers, involve raw materials, including aluminum, magnesium, stainless steel, carbon steel, synthetic rubbers, thermoplastics, and carbon fiber for the manufacturing of our golf shafts, titanium alloys, and other materials, epoxy resins for the assembly of our golf equipment, can experience significant price fluctuations or shortages.
The materials and components that we use, and that are used by our suppliers, involve raw materials, including aluminum, magnesium, stainless steel, carbon steel, synthetic rubbers, thermoplastics, and carbon fiber for the manufacturing of our golf shafts, titanium alloys, and epoxy resins and other materials for the assembly of our golf equipment, can experience significant price fluctuations or shortages.
If we are unable to find ways to finance the manufacturing and development of products to scale the business on acceptable terms or at all, or we or our financing partners default on our respective obligations to fund such costs, we could be required to delay, significantly curtail or eliminate planned products or marketing programs which could have a material adverse effect on our business, financial condition and results of operations.
If we are unable to find ways to finance our operations and the manufacturing and development of products to scale the business on acceptable terms or at all, or if we or our financing partners default on our respective obligations to fund such costs, we could be required to delay, significantly curtail or eliminate planned products or marketing programs, which could have a material adverse effect on our business, financial condition and results of operations.
Overall, there are various factors, many of which are beyond our control, that could negatively affect the market price of our Common Stock or result in fluctuations in the price or trading volume of our Common Stock, including: ● actual or anticipated variations in our annual or quarterly results of operations, including our earnings estimates and whether we meet market expectations with regard to our earnings; ● our current inability to pay dividends or other distributions; ● changes in market valuations of similar companies; ● market reaction to any additional equity, debt or other securities that we may issue in the future, and which may or may not dilute the holdings of our existing stockholders; ● additions or departures of key personnel; ● actions by institutional or significant stockholders; ● short interest in our stock and the market response to such short interest; ● the dramatic increase in the number of individual holders of our stock and their participation in social media platforms targeted at speculative investing; ● speculation in the press or investment community about our company or industry; ● strategic actions by us or our competitors, such as acquisitions or other investments; ● legislative, administrative, regulatory or other actions affecting our business, our industry, including positions taken by the Internal Revenue Service (“IRS”); ● investigations, proceedings, or litigation that involve or affect us; ● the occurrence of any of the other risk factors included in this Annual Report on Form 10-K; and ● general market and economic conditions.
Overall, there are various factors, many of which are beyond our control, that could negatively affect the market price of our common stock or result in fluctuations in the price or trading volume of our common stock, including: ● actual or anticipated variations in our annual or quarterly results of operations, including our earnings estimates and whether we meet market expectations with regard to our earnings; ● our current inability to pay dividends or other distributions; ● changes in market valuations of similar companies; ● market reaction to any additional equity, debt or other securities that we may issue in the future, and which may or may not dilute the holdings of our existing stockholders; ● additions or departures of key personnel; ● actions by institutional or significant stockholders; ● short interest in our stock and the market response to such short interest; ● the dramatic increase in the number of individual holders of our stock and their participation in social media platforms targeted at speculative investing; 26 ● speculation in the press or investment community about our company or industry; ● strategic actions by us or our competitors, such as acquisitions or other investments; ● legislative, administrative, regulatory or other actions affecting our business, our industry, including positions taken by the Internal Revenue Service (“IRS”); ● investigations, proceedings, or litigation that involve or affect us; ● the occurrence of any of the other risk factors included in this Annual Report on Form 10-K; and ● general market and economic conditions.
Internationally, many jurisdictions in which we operate have established or enhanced their own data security and privacy legal framework with which we or our customers must comply, including but not limited to, the European Union’s General Data Protection Regulation (“GDPR”), which imposes stringent operational requirements, including, for example, requiring expanded disclosures about how personal information is used, limitations on retention of information, mandatory data breach notification obligations, and higher standards for obtaining consent to process personal information.
Internationally, many jurisdictions in which we operate have established or enhanced their own data security and privacy legal framework with which we or our customers must comply, including but not limited to, the European Union’s (the “EU”) General Data Protection Regulation (“GDPR”), which imposes stringent operational requirements, including, for example, requiring expanded disclosures about how personal information is used, limitations on retention of information, mandatory data breach notification obligations, and higher standards for obtaining consent to process personal information.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to revenue recognition; allowance for doubtful accounts; inventories; long-lived assets, goodwill and non-amortizing intangible assets; warranty policy; income taxes and provisional estimates due to the Tax Cuts and Jobs Act (the “Tax Act”) enacted in December 2017; share-based compensation; and foreign currency translation.
Significant assumptions and estimates used in preparing our financial statements include those related to revenue recognition; allowance for doubtful accounts; inventories; long-lived assets, goodwill and non-amortizing intangible assets; warranty policy; income taxes and provisional estimates due to the Tax Cuts and Jobs Act (the “Tax Act”) enacted in December 2017; share-based compensation; and foreign currency translation.
Further, the Telephone Consumer Protection Act (TCPA) restricts telemarketing and the use of technologies that enable automatic calling and/or messaging without proper customer consent, and is a particularly highly litigated issue. Many states in the United States have recently enacted statutes and rules governing the ways in which businesses may collect, use, and retain personal information.
Further, the Telephone Consumer Protection Act (TCPA) restricts telemarketing and the use of technologies that enable automatic calling and/or messaging without proper customer consent, and is a particularly highly litigated issue. Many states in the United States have enacted statutes and rules governing the ways in which businesses may collect, use, and retain personal information.
Extreme fluctuations in the market price of our Common Stock may occur in response to strong and atypical retail investor interest, including on social media and online forums, the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our Common Stock and any related hedging and other trading factors.
Extreme fluctuations in the market price of our common stock may occur in response to strong and atypical retail investor interest, including on social media and online forums, direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our common stock, access to margin debt, trading in options and other derivatives on our common stock and any related hedging and other trading factors.
Furthermore, additional financings may not be available on terms economically favorable, especially during periods of adverse economic conditions, could make it more difficult or impossible for us to obtain funding for the operation of our business, for making additional investments in product development and for repaying outstanding indebtedness.
Furthermore, additional financings may not be available on economically favorable terms, especially during periods of adverse economic conditions, which could make it more difficult or impossible for us to obtain funding for the operation of our business, for making additional investments in product development and for repaying outstanding indebtedness.
As a result, we could experience manufacturing delays, increased manufacturing and shipping costs and lost sales as a result of missed delivery deadlines and product demand cycles. Any significant interruption in UPS or other carrier services, air carrier services, ship services or at airports or shipping ports could have a material adverse effect on our business.
As a result, we could experience manufacturing delays, increased manufacturing and shipping costs and lost sales as a result of missed delivery deadlines and product demand cycles. Any significant interruption in FedEx, UPS or other carrier services, air carrier services, ship services or at airports or shipping ports could have a material adverse effect on our business.
The GDPR provides that EU member states may make their own additional laws and regulations in relation to certain data processing activities. Recent legal developments in the EU have created complexity and uncertainty regarding transfers of personal information from the EU to “third countries,” especially the United States.
The GDPR provides that EU member states may make their own additional laws and regulations in relation to certain data processing activities. Legal developments in the EU have created complexity and uncertainty regarding transfers of personal information from the EU to “third countries,” especially the United States.
If we fail to realize the expected benefits from a transaction, whether as a result of unidentified risks, integration difficulties, complexities associated with managing the combined business, performance shortfalls at one or both of the companies as a result of the diversion of management’s attention caused by completing the transaction and integrating the companies’ operations, litigation with current or former employees and other events, our business, financial condition and results of operations could be adversely affected. 16 If we inaccurately forecast demand for our products, we may manufacture either insufficient or excess quantities, which, in either case, could adversely affect our financial performance.
If we fail to realize the expected benefits from a transaction, whether as a result of unidentified risks, integration difficulties, complexities associated with managing the combined business, performance shortfalls at one or both of the companies as a result of the diversion of management’s attention caused by completing the transaction and integrating the companies’ operations, litigation with current or former employees and other events, our business, financial condition and results of operations could be adversely affected. 19 If we inaccurately forecast demand for our products, we may manufacture either insufficient or excess quantities, which, in either case, could adversely affect our financial performance.
This exclusive forum provision would not apply to suits brought to enforce a duty or liability created by the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive jurisdiction.
This exclusive forum provision would not apply to suits brought to enforce a duty or liability created by the Securities Act of 1933, as amended, the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction.
Recently, the market prices and trading volume of shares of common stock of other small publicly traded companies with a limited number of shares available to purchasers have experienced rapid and substantial price volatility unrelated to the financial performance of those companies.
Recently, the market prices and trading volume of shares of our common stock and of other small publicly traded companies with a limited number of shares available to purchasers have experienced rapid and substantial price volatility unrelated to the financial performance of those companies.
Because our products are sold to fitters/retailers for broader consumer distribution and/or to customers/distributors who buy in large quantities, there could be significant costs associated with such product warranty claims, including the potential for customer dissatisfaction that may adversely affect our reputation and relationships with customers, which may result in lost or reduced sales. 18 Our growth initiatives require significant capital investments and there can be no assurance we will realize a positive return on these investments.
Because our products are sold to fitters/retailers for broader consumer distribution and/or to customers/distributors who buy in large quantities, there could be significant costs associated with such product warranty claims, including the potential for customer dissatisfaction that may adversely affect our reputation and relationships with customers, which may result in lost or reduced sales. 21 Our growth initiatives require significant capital investments and there can be no assurance we will realize a positive return on these investments.
We rely upon experts in various fields to work with us to develop materials, processes, components that give our products performance advantages over our competition. We also depend on others who test the performance of our products.
We rely upon experts in various fields to work with us to develop materials, processes, and components that give our products performance advantages over our competition. We also depend on others who test the performance of our products.
With respect to golf shaft sales, our competitors do incur significant costs in the areas of advertising, tour and other promotional support. We believe to be competitive; we also will incur significant expenses in tour, advertising and promotional support.
With respect to golf shaft sales, our competitors do incur significant costs in the areas of advertising, tour and other promotional support. To be competitive, we believe we also will need to incur significant expenses in tour, advertising and promotional support.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.
Concerns over medical epidemics, energy costs, geopolitical issues, the U.S. mortgage market and a deteriorating real estate market, unstable global credit markets and financial conditions, and volatile oil prices have led to periods of significant economic instability, diminished liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth, increased unemployment rates, and increased credit defaults in recent years.
Concerns over energy costs, geopolitical issues, the U.S. mortgage market and a deteriorating real estate market, unstable global credit markets and financial conditions, volatile oil prices and medical epidemics have led to periods of significant economic instability, diminished liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth, increased unemployment rates, and increased credit defaults.
Our business could be adversely impacted if we fail to achieve any of these objectives or if the brand reputation or image of any of our products is tarnished or receives negative publicity. 11 In addition, adverse publicity about regulatory or legal action against us could damage our reputation and brand image, undermine consumer confidence and reduce demand for our products, even if the regulatory or legal action is unfounded or not material to our operations.
Our business could be adversely impacted if we fail to achieve any of these objectives or if the brand reputation or image of any of our products is tarnished or receives negative publicity. 14 In addition, adverse publicity about regulatory or legal action against us could damage our reputation and brand image, undermine consumer confidence and reduce demand for our products, even if the regulatory or legal action is unfounded or not material to our operations.
With respect to golf equipment sales, new product introductions, price reductions, consignment sales, extended payment terms, “close outs”, tour and advertising spending by competitors continue to generate intense market competition. Furthermore, downward pressure on pricing in the market for products like ours could have a significant adverse effect on our business.
With respect to golf equipment sales, new product introductions, price reductions, consignment sales, extended payment terms, “close outs”, tour and advertising spending by competitors continues to generate intense market competition. Furthermore, downward pressure on pricing in the market for products like ours could have a significant adverse effect on our business.
If such events disrupt domestic or international air, ground or sea shipments, or the operation of our manufacturing facilities, our ability to obtain the materials and components necessary to manufacture products and to deliver customer orders would be harmed, which would have a significant adverse effect on our results of operations, financial condition and cash flows.
If such events disrupt domestic or international air, ground or sea shipments, or the operation of our manufacturing facilities, our ability to obtain the materials and components necessary to manufacture products and to deliver customer orders would be harmed, which would have a material adverse effect on our results of operations, financial condition and cash flows.
However, in the future, intellectual property claims could force us to alter existing products or withdraw them from the market or could delay the introduction of new products. 14 Various patents have been issued to our competitors in the golf industry and these competitors may assert that our golf products infringe their patent or other proprietary rights.
However, in the future, intellectual property claims could force us to alter existing products or withdraw them from the market or could delay the introduction of new products. 17 Various patents have been issued to our competitors in the golf industry, and these competitors may assert that our golf products infringe their patent or other proprietary rights.
Accordingly, if we are unable to recruit and retain sufficiently qualified individuals, our business, results of operations, financial condition and growth prospects could be materially and adversely affected. 9 In addition, immigration reform continues to attract significant attention in the public arena and the U.S. Congress.
Accordingly, if we are unable to recruit and retain sufficiently qualified individuals, our business, results of operations, financial condition and growth prospects could be materially and adversely affected. 12 In addition, immigration reform continues to attract significant attention in the public arena and the U.S. Congress.
A severe or prolonged economic downturn could adversely affect our wholesale customers’ financial condition, their levels of business activity and their ability to pay trade obligations. We primarily sell our products to consumers online, retailers and wholesalers directly, through distribution and certain other outlets, like golf fitters.
A severe or prolonged economic downturn could adversely affect our wholesale customers’ financial condition, their levels of business activity and their ability to pay trade obligations. We primarily sell our products to consumers online, through retailers and wholesalers, and through certain other outlets, like golf fitters.
Any significant adverse change in these and other circumstances or conditions relating to international operations could have a significant adverse effect on our operations, financial performance and condition. 15 We have international sales and international supply chains where unfavorable changes in foreign currency exchange rates could have a significant negative impact on our results of operations.
Any significant adverse change in these and other circumstances or conditions relating to international operations could have a significant adverse effect on our operations, financial performance and condition. 18 We have international sales and international supply chains where unfavorable changes in foreign currency exchange rates could have a significant negative impact on our results of operations.
Such deferments could have a material adverse effect on sales of current products or result in closeout sales at reduced prices. 12 In addition, due to the seasonality of our business, our business can be significantly adversely affected by unusual or severe weather conditions.
Such deferments could have a material adverse effect on sales of current products or result in closeout sales at reduced prices. 15 In addition, due to the seasonality of our business, our business can be significantly adversely affected by unusual or severe weather conditions.
Second, our research and development, third- party design and prototyping services and external suppliers will face constant pressures to design, develop, source and supply new products that perform better than the predecessors, many of which incorporate new or otherwise untested technology, suppliers or materials.
Second, our research and development, third-party design and prototyping services and external suppliers will face constant pressures to design, develop, source and supply new products that perform better than their predecessors, many of which incorporate new or otherwise untested technology, suppliers or materials.
Any actual or perceived deterioration or weakness in general, regional or local economic conditions, unemployment levels, the job or housing markets, consumer debt levels or consumer confidence, as well as other adverse economic or market conditions due to a pandemic, inflation, or otherwise may lead to customers having less discretionary income to spend on entertainment and recreational activities, and may result in significant fluctuations and spending patterns year to year.
Any actual or perceived deterioration or weakness in general, regional or local economic conditions, unemployment levels, the job or housing markets, consumer debt levels or consumer confidence, as well as other adverse economic or market conditions due to a pandemic, inflation, tariffs, geopolitical conflicts or otherwise may lead to customers having less discretionary income to spend on entertainment and recreational activities, and may result in significant fluctuations and spending patterns year to year.
As part of our efforts to acquire companies, businesses or products or to enter into other significant transactions, we will conduct business, legal and financial due diligence with the goal of identifying and evaluating material risks involved in such transactions.
As part of our efforts to acquire companies, businesses or products or to enter into other significant transactions, we intend to conduct business, legal and financial due diligence with the goal of identifying and evaluating material risks involved in such transactions.
We have and will establish relationships with professional athletes, celebrities and other endorsers in order to evaluate and promote our branded products. We have currently and will in the future enter into endorsement arrangements with members of the world’s various professional tours.
We have and intend in the future to establish relationships with professional athletes, celebrities and other endorsers in order to evaluate and promote our branded products. We have currently and intend in the future to enter into endorsement arrangements with members of the world’s various professional tours.
Any perceived or actual unauthorized or inadvertent disclosure of personally-identifiable information, whether through a compromise of our own or our third party vendors’ networks by an unauthorized party, employee theft, misuse or error or otherwise, could harm our reputation, impair our ability to attract website visitors, require us to notify payment processors, if payment card information is accessed or compromised, compel us to comply with federal and/or state breach notification laws and foreign equivalents, subject us to costly mandatory corrective action, or subject us to claims or litigation arising from damages suffered by consumers, all of which could adversely affect our operations, financial performance and condition.
Any perceived or actual unauthorized or inadvertent disclosure of personally-identifiable information, whether through a compromise of our own or our third party vendors’ networks by an unauthorized party, employee theft, misuse or error or otherwise, could harm our reputation, impair our ability to attract website visitors, require us to notify payment processors, compel us to comply with federal and/or state breach notification laws and foreign equivalents, subject us to costly mandatory corrective action, or subject us to claims or litigation arising from damages suffered by consumers, all of which could adversely affect our operations, financial performance and condition.
Risks Related to Operations, Manufacturing, and Technology We are exposed to risks associated with doing business globally and manufacturing in the USA. Currently we sell and distribute products in markets around the world, such as the Americas, Asia and Europe. These activities have and will continue to result in investments in inventory, accounts receivable, employees, corporate infrastructure and manufacturing facilities.
Risks Related to Operations, Manufacturing, and Technology We are exposed to risks associated with doing business globally and manufacturing in the U.S. Currently we sell and distribute products in markets around the world, such as the Americas, Asia and Europe. These activities have and will continue to result in investments in inventory, accounts receivable, employees, corporate infrastructure and manufacturing facilities.
We have evaluated and would evaluate any such claims and, where appropriate, would seek to obtained licenses or other business arrangements. To date, there have been no interruptions in our business as a result of any claims of infringement, and we do not believe that we infringe the intellectual property rights of third parties.
We have evaluated and would evaluate any such claims and, where appropriate, would seek to obtain licenses or other business arrangements. To date, there have been no interruptions in our business as a result of any claims of infringement, and we do not believe that we materially infringe the intellectual property rights of third parties.
We rely on information systems that assist in the management of our manufacturing, inventory, distribution, engineering, sales and other functions. If our information systems were to fail to perform these functions adequately or if we experienced an interruption in operation, including a breach in cyber security, our business and results of operations could suffer.
We rely on information systems that assist in the management of our manufacturing, inventory, distribution, engineering, sales and other functions. If our information systems were to fail to perform these functions adequately or if we experienced an interruption in operation, including a cybersecurity breach, our business and results of operations could suffer.
Our financial condition and results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the price of our common stock.
Our financial condition and results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the price of our common stock. 28 Item 1B.
Terrorist activities and armed conflicts, such as Ukraine and the Middle East, including escalation of hostilities arising out of any global conflict, could have an adverse effect on the United States or worldwide economy and could cause decreased demand for our products as consumers’ attention and interests are diverted from golf and become focused on issues relating to these events.
Terrorist activities and armed conflicts, such as in Ukraine and the Middle East, including escalation of hostilities arising out of any global conflict, could have an adverse effect on the United States or worldwide economy and could decrease demand for our products as consumers’ attention and interests are diverted from golf and become focused on issues relating to these events.
Furthermore, if the cost of delivery or shipping services were to increase significantly and the additional costs could not be covered by product pricing, our operating results could be materially adversely affected. The costs and availability of finished products, product components and raw materials could affect our operating results.
Furthermore, if the cost of delivery or shipping services were to increase significantly and the additional costs could not be covered by product pricing, our results of operations and financial position could be materially adversely affected. The costs and availability of finished products, product components and raw materials could affect our operating results.
Expansion of business processes or facilities, including a significant expansion or technical upgrades for our golf shaft manufacturing facility in St Joseph, MO, all require significant capital investment.
Expansion of business processes or facilities, including a significant expansion or technical upgrades for our golf shaft manufacturing facility in St Joseph, Missouri, all require significant capital investment.
The diversion of management’s attention and any delay or difficulties encountered in connection with any such acquisitions could result in the disruption of on-going business or inconsistencies in standards and controls that could negatively affect our ability to maintain third-party relationships.
The diversion of management’s attention and any delay or difficulties encountered in connection with any such acquisitions could result in the disruption of ongoing business or inconsistencies in standards and controls that could negatively affect our ability to maintain third-party relationships.
We use United Parcel Service (“UPS”) for substantially all ground shipments of products to U.S. customers. We have and will continue to consider other carriers for domestic shipments, and we use air carriers, ocean shipping services and the like, for our international shipments of products.
We use FedEx Corporation (“FedEx”) and United Parcel Service (“UPS”) for substantially all ground shipments of products to U.S. customers. We have and will continue to consider other carriers for domestic shipments, and we use air carriers, ocean shipping services and the like, for our international shipments of products.
One such example is the California Consumer Privacy Act (“CCPA”), which came into effect in 2020. In addition, the California Privacy Rights Act (“CPRA”) was passed in November 2020, which significantly modifies the CCPA, including by creating a new state agency that will be vested with authority to implement and enforce the CCPA and CPRA.
One such example is the California Consumer Privacy Act (“CCPA”), which came into effect in 2020. In addition, the California Privacy Rights Act (“CPRA”) was passed in November 2020, which significantly modified the CCPA, including by creating a new state agency that is vested with authority to implement and enforce the CCPA and CPRA.
These tours are known as the PGA Champions Tour, the PGA Tour, the LPGA Tour, the PGA European Tour, the Japan Golf Tour, the Korn Ferry Tour, the Epson Tour, The PGA Latin America Tour. We will also enter into endorsements with celebrities to promote our brand.
These tours are known as the PGA Champions Tour, the PGA Tour, the LPGA Tour, the PGA European Tour, the Japan Golf Tour, the Korn Ferry Tour, the Epson Tour, and The PGA Latin America Tour. We also expect to enter into endorsements with celebrities to promote our brand.
There are a limited number of suppliers for the manufacturer of components in the United States, and we are dependent on these suppliers and vendors. We have some components provided by vendors located outside of the United States and if these components were unavailable, it could have a materially adverse effect on our operations, financial performance and condition.
There are a limited number of suppliers that manufacture components in the United States, and we are dependent on these suppliers and vendors. We have some components provided by vendors located outside of the United States and if these components were unavailable, it could have a materially adverse effect on our operations, financial performance and condition.
We do not expect that significant additional capital will be needed in the future to continue our planned operations, including increased marketing, hiring new personnel, commercializing our product, and continuing activities as an operating public company. If additional capital is needed, to the extent we raise additional capital by issuing equity securities, our stockholders may experience substantial dilution.
We expect that additional capital will be needed in the future to continue our planned operations, including increased marketing, hiring new personnel, commercializing our product, and continuing activities as an operating public company. To the extent we raise additional capital by issuing equity securities, our stockholders may experience substantial dilution.
Unfavorable economic conditions, including future pandemics, inflation or otherwise, could have a negative impact on consumer discretionary spending and therefore negatively impact our results of operations, financial condition and cash flows. Our products are recreational in nature and are therefore discretionary purchases for consumers.
Unfavorable economic conditions, including due to future pandemics, inflation, tariffs, geopolitical conflicts or otherwise, could have a negative impact on consumer discretionary spending and therefore negatively impact our results of operations, financial condition and cash flows. Our products are recreational in nature and are therefore discretionary purchases for consumers.
This international attention, by the management team and other employees who would otherwise be solely focused on the core USA business, creates significant risk.
This international attention by the management team and other employees who would otherwise be solely focused on the core U.S. business creates significant risk.
While we believe we are developing and creating the very best innovations for our products, if we fail to continue to introduce technical innovation in our products, or if we are unable to effectively utilize new technologies, and materials, consumer demand for our products could fail to materialize, or decline, and if we experience problems with the quality of our products, we may incur substantial brand damage and expense to remedy the problems, any of which could materially adversely affect our business, financial condition and results of operations.
If we fail to continue to introduce technical innovation in our products, or if we are unable to effectively utilize new technologies and materials, consumer demand for our products could fail to materialize, or decline, and if we experience problems with the quality of our products, we may incur substantial brand damage and expense to remedy the problems, any of which could materially adversely affect our business, financial condition and results of operations.
We subject to federal, state, local and foreign laws and regulations, as well as other statutory and regulatory requirements. ● the ADA and similar state laws; ●data privacy and cybersecurity laws; ●environmental, health and human safety laws and regulations; ●FCPA and other similar anti-bribery and anti-kickback laws; and ● laws regarding sweepstakes and promotional contests.
We subject to federal, state, local and foreign laws and regulations, as well as other statutory and regulatory requirements. ● the Americans with Disabilities Act and similar state laws; ●data privacy and cybersecurity laws; ●environmental, health and human safety laws and regulations; ●FCPA and other similar anti-bribery and anti-kickback laws; and ● laws regarding sweepstakes and promotional contests.
Moreover, other states, including Nevada, Virginia and Colorado, have passed and may continue to pass similar privacy-related laws whose restrictions and requirements differ from those of California, which could require us to design, implement and maintain different types of state-based, privacy-related compliance controls and programs simultaneously in multiple states.
Moreover, many other states have passed and may continue to pass similar privacy-related laws whose restrictions and requirements differ from those of California, which have required, and likely will continue to require, us to design, implement and maintain different types of state-based, privacy-related compliance controls and programs simultaneously in multiple states.
The occurrence of a natural disaster, such as an earthquake, tornado, tsunami, fire, flood or hurricane, or the further outbreak of a pandemic disease, could significantly adversely affect our business.
Our business could be harmed by the occurrence of natural disasters, pandemic diseases, or other emergencies. The occurrence of a natural disaster, such as an earthquake, tornado, tsunami, fire, flood or hurricane, or the further outbreak of a pandemic disease, could significantly adversely affect our business.
In 2022, we have already experienced increases in the cost of specific materials, such as aluminum, brass, stainless/carbon steel, and tungsten. Although these increases have had minimal effect to date, if the current inflationary trend were to continue it could affect our margins and retail pricing.
In 2025, we have already experienced increases in the cost of specific materials, such as aluminum, brass, stainless/carbon steel, and tungsten. Although these increases have not had a material impact on our results of operations to date, if the current inflationary trend were to continue, it could affect our margins and retail pricing.
Depending on the product, it is considered typical, within the industry, that revenue from a new product rises and peaks within a three-year period, with sales occurring at a higher rate in the first two years than in the third.
Our golf products, like those of our competitors, generally have a life cycle. Depending on the product, it is considered typical within the industry that revenue from a new product rises and peaks within a three-year period, with sales occurring at a higher rate in the first two years than in the third.
In particular, escalating political tensions could adversely impact macroeconomic conditions, give rise to regional instability and result in heightened economic sanctions from the U.S. and the international community in a manner that adversely affects our business. Our business could be harmed by the occurrence of natural disasters, pandemic diseases, or other emergencies.
In particular, escalating political tensions could adversely impact macroeconomic conditions, give rise to regional instability and result in heightened economic sanctions from the U.S. and the international community in a manner that adversely affects our business.
Therefore, opportunities for additional market share may be limited given the challenging competitive nature of the golf industry, and the overall dollar volume of worldwide sales of golf equipment or golf shafts may not grow or may decline.
Therefore, opportunities for additional market share may be limited given the challenging competitive nature of the golf industry, and the overall dollar volume of worldwide sales of golf equipment or golf shafts may not grow or may decline. We are in the early stages of scaling our business, and our growth strategy may not be successful.
On the other hand, if actual demand is less than the forecasted demand for a product or products, we could produce excess quantities, resulting in excess inventories and related obsolescence charges that could adversely affect our financial performance. Our planned international business expansions could adversely affect results if they fail to successfully transition and grow revenue.
On the other hand, if actual demand is less than the forecasted demand for a product or products, we could produce excess quantities, resulting in excess inventories and related obsolescence charges that could adversely affect our financial performance. If we inaccurately forecast demand or fail to manage inventory effectively, our financial results could be adversely affected.
In addition, we have invested, and may continue to invest in the future, significant capital into upgrades in our manufacturing and assembly facilities, including our new golf shaft manufacturing facility in St. Joseph, MO to remain on the forefront of technological and competitive innovation.
In addition, we have invested, and may continue to invest in the future, significant capital into upgrades in our manufacturing and assembly facilities, including our golf shaft manufacturing facility in St. Joseph, Missouri, to maintain what we believe to be our technological and competitive advantage.
Our independent auditor has expressed substantial doubt about our ability to continue as a going concern. We have experienced recurring operating losses and negative operating cash flows since our inception, and we may not be able to generate sufficient funds from our future operations to meet our cash flow requirements.
We have experienced recurring operating losses and negative operating cash flows since our inception, and we may not be able to generate sufficient funds from our future operations to meet our cash flow requirements.
Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing. Risks Related to Our Intellectual Property Failure to adequately enforce our intellectual property rights could adversely affect our reputation and sales.
Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing. A reduction in the number of rounds of golf played or in the number of golf participants could adversely affect sales.
Should we not successfully manage the frequent introduction of new products that satisfy consumer demand, our results of operations, financial condition and cash flows could be significantly adversely affected. Our golf equipment, golf gear and other related golf business products could have a concentrated customer base. The loss of a major customer could have a significant effect on our sales.
Should we not successfully manage the frequent introduction of new products that satisfy consumer demand, our results of operations, financial condition and cash flows could be significantly adversely affected. Our revenue could become concentrated among a limited number of customers, and the loss of a significant customer could adversely affect our business.
Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance, and share price and could require us to delay or abandon development or commercialization plans. 23 If securities or industry analysts do not publish research or reports, or publish unfavorable research or reports about our business, our stock price and trading volume may decline.
Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance, and share price and could require us to delay or abandon development or commercialization plans.
The golf industry, in general, has been characterized by widespread imitation of designs, or technological improvements. We have an active program of monitoring, investigating and enforcing our proprietary rights against companies and individuals who market or manufacture counterfeits and “knockoff” products or copy intellectual property. We will assert our rights against infringers of our patents, copyrights, trademarks and trade dress.
We have an active program of monitoring, investigating and enforcing our proprietary rights against companies and individuals who market or manufacture counterfeits and “knockoff” products or copy intellectual property. We will assert our rights against infringers of our patents, copyrights, trademarks and trade dress. However, these efforts may not be successful in reducing sales of golf products by these infringers.
Any damage or significant disruption in the operation of any of our information systems, the failure of our IT vendors’ to perform as expected, the failure to successfully integrate the information technology systems of a businesses that we may acquire or any security breach to any of our information systems (including financial or credit/payment frauds) would disrupt our business, which may result in decreased sales, increased overhead costs, excess inventory and product shortages and otherwise adversely affect our reputation, operations, financial performance and condition. 19 Cyber-attacks, unauthorized access to, or accidental disclosure of, consumer personally-identifiable information, that we or our vendors collect through our websites or stores on servers may result in significant expense and negatively impact our reputation and business.
Any damage or significant disruption in the operation of any of our information systems, the failure of our IT vendors to perform as expected, the failure to successfully integrate the information technology systems of a businesses that we may acquire or any cybersecurity breach to any of our information systems (including financial or credit/payment frauds) would disrupt our business, which may result in decreased sales, increased overhead costs, excess inventory and product shortages and otherwise adversely affect our reputation, operations, financial performance and condition. 22 We rely in part on e-commerce platforms and online systems to generate sales, and disruptions to these systems could adversely affect our business.
Difficulties in implementing new or upgraded technology or operational systems, could disrupt our operations and could materially and adversely affect our financial condition, results of operations or cash flows. 17 A disruption in the service or a significant increase in the cost of our primary delivery and shipping services for our products and component parts or a significant disruption at shipping ports could have a material adverse effect on our business.
A disruption in the service or a significant increase in the cost of our primary delivery and shipping services for our products and component parts or a significant disruption at shipping ports could have a material adverse effect on our business.
Any inability or perceived inability to adequately address data privacy and security concerns, even if unfounded, or comply with applicable data privacy and data security laws, regulations, and policies, could result in additional compliance costs, penalties and liability costs, damage to our reputation and adversely affect our business. 21 Risks Related to Tax and Financial Matters Changes in tax laws and unanticipated tax liabilities could adversely affect our effective income tax rate and profitability.
Any inability or perceived inability to adequately address data privacy and security concerns, even if unfounded, or comply with applicable data privacy and data security laws, regulations, and policies, could result in additional compliance costs, penalties and liability costs, damage to our reputation and adversely affect our business. 24 Risks Related to Tax and Financial Matters We expect to need to raise additional funds from time to time through public or private debt or equity financings in order to implement our business plan.
Any significant changes in U.S. trade or other policies that block, or restrict imports or increase import tariffs could have a material adverse effect on results of operations. Some of our components are manufactured in foreign nations.
Any significant changes in U.S. trade or other policies that block or restrict imports or increase import tariffs could have a material adverse effect on results of operations. Although the majority of our products are sourced or manufactured in the United States, certain components used in our products, including grips and shaft adapters, are sourced from suppliers in China.
Although the Company has enough cash on hand for our current operation for a minimum of 12 months, depending on the Company’s growth plan, there may be reason to raise additional funds from time to time in order to implement our business plan, take advantage of opportunities, including the expansion of our business or the acquisition of complementary products, technologies or businesses; develop new products or expand existing lines of business, including the launching of new products or responding to competitive pressures.
We expect to need to raise additional funds from time to time in order to implement our business plan, take advantage of opportunities, including the expansion of our business or the acquisition of complementary products, technologies or businesses; develop new products or expand existing lines of business, including the launching of new products or responding to competitive pressures.
Should we secure any business loan(s), increases in interest rates would increase the cost of servicing our indebtedness and could materially reduce our profitability and cash flows. An increase in interest rates could also make it difficult for us to obtain financing at attractive rates, which could adversely impact our ability to execute our growth strategy or future acquisitions.
An increase in interest rates could also make it difficult for us to obtain financing at attractive rates, which could adversely impact our ability to execute our growth strategy or future acquisitions.
If we are unable to successfully manage the introduction of new products that perform and satisfy changing consumer preferences, it could significantly and adversely impact financial performance and prospects for future growth. Our golf products, like those of our competitors, generally have a life cycle.
Unless there is a change in competitive conditions, these competitive pressures and increased costs could adversely affect our results of operations and financial position. 13 If we are unable to successfully manage the introduction of new products that perform and satisfy changing consumer preferences, it could significantly and adversely impact financial performance and prospects for future growth.
Should we be unable to scale and or generate enough positive cashflow to offset the costs of being a public company, the effect could have an adverse effect on our business. 22 Risks Related to Our Common Stock The market prices and trading volume of our shares of Common Stock may experience rapid and substantial price volatility which could cause purchasers of our Common Stock to incur substantial losses.
Additionally, rising interest rates could have a dampening effect on overall economic activity, which could have an adverse effect on our business. 25 Risks Related to Our Common Stock The market prices and trading volume of our shares of common stock may experience rapid and substantial price volatility which could cause purchasers of our common stock to incur substantial losses.
Regulations related to “conflict minerals” require us to incur additional expenses and could limit the supply and increase the cost of certain metals used in manufacturing our products.
Regulations related to “conflict minerals” require us to incur additional expenses and could limit the supply and increase the cost of certain metals used in manufacturing our products. We design and contract for the manufacture of certain products, including putters, that may contain metals such as tungsten, tin, tantalum, or gold, which are considered “conflict minerals” under SEC regulations.
For the moment, we are able to maintain the price point of all of our products without material reduction in margins. Furthermore, the successful operation of our business depends upon the ability to attract, motivate and retain a sufficient number of qualified executives, managers and skilled employees.
Furthermore, the successful operation of our business depends upon the ability to attract, motivate and retain a sufficient number of qualified executives, managers and skilled employees. From time to time, there may be a shortage of skilled labor in certain of the communities in which we operate.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Removed
Item 1C. Cybersecurity Risk Management and Strategy We have established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
Added
Item 1C. Cybersecurity Risk Management and Strategy The Company maintains policies and processes designed to identify, assess, and manage cybersecurity risks that could affect its information systems and business operations. Cybersecurity risk management is integrated into the Company’s overall risk management processes and is considered as part of its broader operational and strategic decision-making.
Removed
We routinely assess material risks from cybersecurity threats, including any potential unauthorized occurrence on or conducted through our information and email systems that may result in adverse effects on the confidentiality, integrity, or availability of our information and email systems or any information residing therein.
Added
The Company’s processes include periodic assessments of potential cybersecurity threats, evaluation of vulnerabilities, and implementation of safeguards designed to protect the confidentiality, integrity, and availability of its information systems and data. These activities are informed by industry practices and may include the use of internal resources as well as third-party service providers.
Removed
We conduct periodic risk assessments to identify cybersecurity threats, as well as assessments in the event of a material change in our business practices that may affect information systems that are vulnerable to such cybersecurity threats.
Added
The Company relies on third-party platforms and service providers, including e-commerce, payment processing, and cloud-based systems, and considers risks associated with such providers as part of its cybersecurity risk management processes. The Company evaluates third-party service providers, where appropriate, and monitors for potential risks arising from such relationships.
Removed
These risk assessments include identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
Added
The Company may engage external consultants or service providers from time to time to assist with evaluating cybersecurity risks, implementing security measures, and responding to potential incidents.
Removed
Following these risk assessments, we will redesign, implement, and maintain reasonable safeguards to minimize identified risks; reasonably address any identified gaps in existing safeguards; and regularly monitor the effectiveness of our safeguards. Primary responsibility for assessing, monitoring and managing our cybersecurity risks rests with the Chief Financial Officer, to manage the risk assessment and mitigation process.
Added
While the Company has not identified cybersecurity risks that have materially affected its business, results of operations, or financial condition, it cannot provide assurance that such risks will not have a material impact in the future. The Company maintains policies and processes designed to identify, assess, and manage cybersecurity risks that could affect its information systems and business operations.
Removed
As part of our overall risk management system, we monitor and periodically evaluate our safeguards and advise our executives on these safeguards. We engage consultants or other third parties in connection with our risk assessment processes. These service providers assist us to design and implement our cybersecurity policies and procedures, as well as to monitor and test our safeguards.
Added
These processes include periodic reviews of potential cybersecurity threats and evaluation of safeguards designed to protect the confidentiality, integrity , and availability of the Company’s information systems. The Company may engage third-party consultants or service providers to assist with evaluating cybersecurity risks and implementing appropriate security measures.
Removed
In the future, we intend to require each significant third-party service provider to certify that they have the ability to implement and maintain appropriate security measures, consistent with all applicable laws, to implement and maintain reasonable security measures in connection with their work with us, and to promptly report any suspected breach of its security measures that may affect us.
Added
The Company has no t experienced any cybersecurity incidents and has not identified any risks from cybersecurity threats that have materially affected, or are reasonably likely to materially affect, its business strategy, results of operations, or financial condition. 29 Governance The Company’s Board of Directors has oversight responsibility for cybersecurity risk as part of its overall risk oversight function.
Removed
We have not encountered cybersecurity challenges that have materially impaired our operations or financial condition . 26 Governance One of the functions of our Board of Directors is informed oversight of our risk management process, including risks from cybersecurity threats.
Added
The Board of Directors receives periodic updates from management regarding cybersecurity risks, including potential threats, mitigation efforts, and the status of the Company’s information security controls. The Company’s Chief Financial Officer is responsible for overseeing the Company’s cybersecurity risk management processes, including monitoring cybersecurity risks, coordinating mitigation efforts, and engaging third-party service providers, as appropriate.
Removed
Our Board of Directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible for the day-to-day management of the material risks that we face. Our Board of Directors administers its cybersecurity risk oversight function directly as a whole, as well as through the audit committee .
Added
The Chief Financial Officer reports to the Board of Directors periodically on cybersecurity matters as part of the Company’s broader risk management framework. The Company’s executive management team, including the Chief Financial Officer, periodically reviews cybersecurity risks and the effectiveness of related safeguards.
Removed
Our Chief Financial Officer is primarily responsible to assess and manage our material risks from cybersecurity threats with assistance from third-party service providers . Our Chief Financial Officer oversees our cybersecurity policies and processes, including those described above at “Risk Management and Strategy”.
Added
While the Company does not maintain a dedicated cybersecurity committee, cybersecurity risks are considered as part of the Board’s and management’s ongoing oversight of enterprise risk. The Company’s leadership has experience managing financial, operational, and technology-related risks, including oversight of third-party service providers and information systems.
Removed
The cybersecurity risk management program includes tools and activities to prevent, detect, and analyze current and emerging cybersecurity threats, and plans and strategies to address threats and incidents.
Added
In addition, the Company may engage external consultants or advisors with relevant cybersecurity expertise to assist in evaluating risks and implementing appropriate safeguards.
Removed
Our Chief Financial Officer provides periodic briefings to the audit committee regarding the Company’s cybersecurity risks and activities, including any recent cybersecurity incidents and related responses, cybersecurity systems testing, activities of third parties, and similar issues. Our audit committee provides regular updates to the Board of Directors on such reports.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings There are no legal proceedings that are pending against the Company or that involve the Company that, in the opinion of management, could reasonably be expected to have a material adverse effect on the Company’s business or financial condition. Item 4. Mine Safety Disclosures Not applicable. 27 PART II
Biggest changeItem 3. Legal Proceedings There are no legal proceedings that are pending against the Company or that involve the Company that, in the opinion of management, could reasonably be expected to have a material adverse effect on the Company’s business or financial condition. Item 4. Mine Safety Disclosures Not applicable. 30 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOn March 11, 2025, the Company’s Board of Directors approved and, by written consent dated February 26, 2025, the holders of a majority of our common stock approved an amendment to our Certificate of Incorporation to change our name from Sacks Parente Golf, Inc. to Newton Golf Company, Inc. to better reflect its commitment to revolutionizing golf through advanced physics and precision engineering.
Biggest changeEffective March 17, 2025, the Company’s name was changed from Sacks Parente Golf, Inc. to Newton Golf Company, Inc. to better reflect its commitment to revolutionizing golf through advanced physics and precision engineering.
Removed
The change to Newton Golf Company, Inc. became effective on March 17, 2025. As of March 31, 2025, there was 4,287,902 outstanding shares of common stock. We currently have no expectation of paying cash dividends to holders of our common stock in the foreseeable future. Unregistered Sales of Equity Securities None.
Added
In connection with the name change, the Company’s Nasdaq ticker symbol was changed from “SPGC” to “NWTG.” Holders of Common Stock As of March 26, 2025, there were approximately 28 holders of record of our common stock.
Removed
Equity Compensation Plans Pursuant to the SEC’s Regulation S-K Compliance and Disclosure Interpretation 106.01, the information required by this Item pursuant to Item 201(d) of Regulation S-K relating to securities authorized for issuance under the Corporation’s equity compensation plans is located in Item 12 of Part III of this Annual Report and is incorporated herein by reference. Item 6. [Reserved]
Added
These holders of record include depositories that hold shares of stock for brokerage firms which, in turn, hold shares of stock for numerous beneficial owners. Dividend Policy We have never declared or paid any cash dividends on our capital stock.
Added
We currently intend to retain future earnings, if any, to finance the operation of our business and do not anticipate paying any cash dividends on our capital stock in the foreseeable future.
Added
Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition, results of operations, current and anticipated capital requirements, business prospects, and other factors our board of directors deems relevant, and subject to applicable laws and the restrictions contained in any future financing instruments.
Added
Unregistered Sales of Equity Securities On October 29, 2025, the Company issued 102,041 restricted stock units to a vendor for services to be rendered with a fair value of $150,000. The shares were valued based on the market value of the Company’s common stock price on the grant date.
Added
The issuance was recorded as pre-paid expense in the accompanying statements of operations and balance sheets. The pre-paid expense related to issuances of restricted stock units will be amortized over the remaining service period and charged to selling, general and administrative expense.
Added
The Company relied upon the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering. On December 16, 2025, the Company issued 40,000 restricted stock units to a vendor for services to be rendered with a fair value of $57,000.
Added
The shares were valued based on the market value of the Company’s common stock price on the grant date. The issuance was recorded as pre-paid expense in the accompanying statements of operations and balance sheets.
Added
The pre-paid expense related to issuances of restricted stock units will be amortized over the remaining service period and charged to selling, general and administrative expense. The Company relied upon the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering. 31 Item 6. [Reserved]

Item 7. Management's Discussion & Analysis

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

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Biggest changeFor so long as we are an emerging growth company, we will not be required to: ● comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); ● have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; ● submit certain executive compensation matters to stockholder advisory votes, such as “say-on-pay,” “say-on-frequency” and pay ratio; and ● disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. 34 In addition, Section 107 of the JOBS Act also provides that an EGC can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.
Biggest changeAs an emerging growth company, we are not required to: ● comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act regarding internal control over financial reporting; ● comply with any requirement that may be adopted by the Public Company Accounting Oversight Board (PCAOB) regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); ● provide certain executive compensation disclosures required of larger public companies; or ● hold advisory votes on executive compensation matters, such as “say-on-pay,” “say-on-frequency,” and “say-on-golden parachutes.” In addition, Section 107 of the JOBS Act provides that an emerging growth company may take advantage of an extended transition period for complying with new or revised accounting standards.
These estimates are based on amounts earned or expected to be claimed by customers on the related sales, and are therefore recorded to the respective net revenue, trade accounts receivable, and sales program liability accounts. We may offer short-term sales program incentives, which include sell-through promotions and price concessions or price reductions.
These estimates are based on amounts earned or expected to be claimed by customers on the related sales, and are therefore recorded to the respective net revenue, trade accounts receivable, and sales program liability accounts. We may offer short-term sales incentives, which include sell-through promotions and price concessions or price reductions.
The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, stockholders’ equity, revenues and expenses, as well as related disclosures of contingent assets and liabilities. We base our estimates on historical experience and various other assumptions that management believes to be reasonable under the circumstances.
The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, stockholders’ equity, revenues, and expenses, as well as the related disclosures of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that management believes to be reasonable under the circumstances.
In addition, the Company’s independent registered public accounting firm, in its report on the Company’s consolidated financial statements for the year ended December 31, 2024, expressed substantial doubt about the Company’s ability to continue as a going concern. At December 31, 2024, we had cash and cash equivalents on hand in the amount of $7.7 million.
In addition, the Company’s independent registered public accounting firm expressed substantial doubt about the Company’s ability to continue as a going concern in its report on the Company’s financial statements for the year ended December 31, 2025. At December 31, 2025, the Company had approximately $1.3 million of cash and cash equivalents.
Critical Accounting Policies and Estimates Our discussion and analysis of our results of operations, financial condition and liquidity are based upon our consolidated financial statements, which have been prepared and audited in accordance with GAAP.
Critical Accounting Policies and Estimates Our discussion and analysis of our results of operations, financial condition, and liquidity are based upon our financial statements, which have been prepared and audited in accordance with U.S. generally accepted accounting principles (“GAAP”).
The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the warrants and the guidance provided by the Financial Accounting Standards Board (FASB) in ASC 480, Distinguishing Liabilities from Equity (ASC 480) and ASC 815, Derivatives and Hedging (ASC 815).
Warrant Accounting The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an evaluation of the specific terms of the warrants and the applicable guidance in ASC 480, Distinguishing Liabilities from Equity, and ASC 815, Derivatives and Hedging.
The increase in net sales was from the introduction of our Newton Motion driver shaft product line in November 2023, and our Newton Motion fairway shaft product line in April 2024.
The increase in net sales was primarily driven by the introduction and expansion of the Newton Motion shaft product line. The Company launched the Newton Motion driver shaft in November 2023 and the Newton Motion fairway wood shaft in April 2024.
We would cease to be an emerging growth company upon the earliest of: (i) the last day of the first fiscal year in which our annual gross revenues are $1.07 billion or more; (ii) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year; or (iii) the date on which we have, during the previous three-year period, issued more than $1.07 billion in non-convertible debt securities.
We will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year in which our annual gross revenues exceed $1.235 billion; (ii) the last day of the fiscal year in which the market value of our common stock held by non-affiliates exceeds $700 million as of the end of the second quarter of that fiscal year; (iii) the date on which we have issued more than $1.0 billion in non-convertible debt during the previous three-year period; or (iv) the last day of the fiscal year following the fifth anniversary of our initial public offering.
We may record a return reserve for anticipated returns related to these sales programs at the time of the sale based on the terms of the sales program. 35 Stock-Based Compensation The Company periodically issues stock options to employees and non-employees in non-capital raising transactions for services and for financing costs.
We may record a return reserve for anticipated returns related to these sales programs at the time of the sale based on the terms of the sales program. 43 Stock-Based Compensation The Company periodically grants restricted stock units (“RSUs”) and stock options to employees, directors, and consultants as compensation for services.
These estimates and assumptions include a number of objective and subjective factors, including external market conditions, guideline public company information, the prices at which the Company sold its common stock to third parties in arms’ length transactions, the rights and preferences of securities senior to the Company’s common stock at the time, and the likelihood of achieving a liquidity event such as an initial public offering or sale.
These valuations incorporated various objective and subjective factors, including external market conditions, guideline public company information, arm’s-length transactions involving the Company’s securities, the rights and preferences of securities senior to the Company’s common stock, and the probability of achieving a liquidity event such as an initial public offering or sale of the Company.
The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation whereby the value of the award is measured on the date of grant and recognized for employees as compensation expense on the straight-line basis over the vesting period.
The Company accounts for these awards in accordance with ASC 718, Compensation—Stock Compensation, whereby the fair value of the award is measured on the grant date and recognized as compensation expense on a straight-line basis over the vesting period. Stock-based compensation expense is recorded within the Company’s consolidated statements of operations based on the nature of the services rendered.
As a result, the Company may adopt new or revised accounting standards by the date private companies are required to comply. Off-Balance Sheet Arrangements At December 31, 2024 and 2023, the Company did not have any transactions, obligations or relationships that could be considered off-balance sheet arrangements.
Off-Balance Sheet Arrangements At December 31, 2025 and 2024, the Company did not have any transactions, obligations or relationships that could be considered off-balance sheet arrangements.
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.
Going Concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. 41 As reflected in the accompanying financial statements, during the year ended December 31, 2025, the Company incurred a net loss of $6,020,000 and used cash in operations of $5,166,000.
The decrease in net cash used in operations for the year ended December 31, 2024, was primarily related to cash used to repay our accrued payroll to officers. Investing Activities Net cash used in investing activities for the year ended December 31, 2024 totalled $502,000, and was for the purchase of property and equipment.
Investing Activities Net cash used in investing activities for the year ended December 31, 2025 totaled $469,000, primarily related to purchases of property and equipment associated with the expansion and support of the Company’s manufacturing operations. Net cash used in investing activities for the year ended December 31, 2024 totaled $502,000, also related primarily to purchases of property and equipment.
Comparison of the Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Our sales, cost of goods sold, operating expenses, and net loss from operations for the year ended December 31, 2024, as compared to the year ended December 31, 2023 were as follows (amounts are rounded to nearest thousands): Year Ended December 31, 2024 Year Ended December 31, 2023 % Change Net Sales $ 3,445,000 $ 349,000 887 % Cost of goods sold 1,171,000 227,000 416 % Gross profit 2,274,000 122,000 1,764 % Operating expenses: Selling, general and administrative 6,509,000 4,497,000 45 % Research and development 743,000 258,000 188 % Total operating expenses 7,252,000 4,755,000 53 % Loss from operations (4,978,000 ) (4,633,000 ) 7 % Interest income (expense), net 161,000 8,000 1,900 % Financing costs (6,913,000 ) - 100 % Change in fair value of warrant liability (22,000 ) - 100 % Net loss $ (11,752,000 ) $ (4,625,000 ) 154 % 31 Net Sales Our net sales increased $3.1 million, or 887%, to approximately $3.5 million during the year ended December 31, 2024, compared to $349,000 during the year ended December 31, 2023.
Comparison of the Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 Our sales, cost of goods sold, operating expenses, and net loss from operations for the year ended December 31, 2025, as compared to the year ended December 31, 2024 were as follows (amounts are rounded to nearest thousands): Year Ended December 31, 2025 Year Ended December 31, 2024 $ Changes Net Sales $ 8,135,000 $ 3,445,000 $ 4,690,000 Cost of goods sold 3,581,000 1,171,000 2,410,000 Gross profit 4,554,000 2,274,000 2,280,000 Operating expenses: Selling, general and administrative 11,323,000 6,509,000 4,814,000 Research and development 779,000 743,000 36,000 Total operating expenses 12,102,000 7,252,000 4,850,000 Loss from operations (7,548,000 ) (4,978,000 ) (2,570,000 ) Interest income, net 99,000 161,000 (62,000 ) Financing costs - (6,913,000 ) 6,913,000 Change in fair value of warrant liability 1,429,000 (22,000 ) 1,451,000 Net loss $ (6,020,000 ) $ (11,752,000 ) $ 5,732,000 Overview of Operating Results The Company’s operating results for the year ended December 31, 2025 were primarily driven by the following factors: ● Expansion of the Newton Motion shaft product line.
Management expects its cash on hand on December 31, 2024, to last for at least the next 12 months. The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow.
Management currently expects that its existing cash resources will fund operations for a limited period and that additional financing will be required to support ongoing operations. The continuation of the Company as a going concern is dependent upon its ability to obtain additional debt or equity financing until it begins generating positive cash flow.
Emerging Growth Company We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act.
Emerging Growth Company We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As an emerging growth company, we are eligible to take advantage of certain exemptions from various reporting requirements applicable to other public companies.
Liquidity and Capital Resources The following table summarizes our cash flows for the periods indicated (amounts are rounded to nearest thousands): Year Ended December 31, 2024 2023 Net cash provided by (used in): Operating activities $ (4,929,000 ) $ (5,047,000 ) Investing activities (502,000 ) (289,000 ) Financing activities 7,743,000 10,503,000 Net increase in cash $ 2,312,000 $ 5,167,000 Operating Activities Net cash used in operating activities for the year ended December 31, 2024 totalled $4,929,000, compared to net cash used in operating activities for the year ended December 31, 2023 of $5,047,000.
The Company expects that only modest capital investments may be required to enhance production capacity and operational efficiency as demand for Newton products continues to grow. 40 The following table summarizes our cash flows for the periods indicated (amounts are rounded to nearest thousands): Year Ended December 31, 2025 2024 Net cash (used in) provided by: Operating activities $ (5,166,000 ) $ (4,929,000 ) Investing activities (469,000 ) (502,000 ) Financing activities (717,000 ) 7,743,000 Net (decrease) increase in cash $ (6,352,000 ) $ 2,312,000 Operating Activities Net cash used in operating activities for the year ended December 31, 2025 was $5,166,000, compared to $4,929,000 for the year ended December 31, 2024.
For the year ended December 31, 2024, we generated $2.9 million of net sales from the Newton Motion shafts, and we generated approximately 84% of our net sales through our websites. Cost of goods sold Cost of goods sold represents primarily our material, labor, components, and changes in inventory reserves for slow-moving or potentially obsolete products.
Cost of goods sold Cost of goods sold consists primarily of materials, labor, components, and changes in inventory reserves for slow-moving or potentially obsolete products. Cost of goods sold increased by approximately $2.4 million to $3.6 million for the year ended December 31, 2025, compared to $1.2 million for the year ended December 31, 2024.
The expected dividend yield is zero, based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. Prior to August 14, 2023, the common shares of the Company were not publicly traded.
Treasury yield curve in effect at the time of grant for time periods approximately equal to the expected term of the award. The expected dividend yield is zero, based on the fact that the Company has never paid dividends and does not currently expect to pay dividends in the foreseeable future.
The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own stock and whether the holders of the warrants could potentially require net cash settlement in a circumstance outside of the Company’s control, among other conditions for equity classification.
In particular, the Company assesses whether the warrants are indexed to the Company’s own stock and whether the terms of the warrants could require net cash settlement in circumstances outside the Company’s control, among other conditions required for equity classification.
As reflected in the accompanying financial statements, during the year ended December 31, 2024, we incurred a net loss of $11,752,000 and used cash in operations of $4,929,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the financial statements being issued.
These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.
The expected term of stock options granted to non-employees is equal to the contractual term of the option award. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award.
The expected term of stock options granted to employees is determined using the “simplified method” for awards that qualify as plain-vanilla options. The expected term of stock options granted to non-employees is generally based on the contractual term of the award. The risk-free interest rate is determined by reference to the U.S.
No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company.
No assurance can be given that such financing will be available or, if available, that it will be on terms acceptable to the Company. Any additional financing may contain restrictive covenants, in the case of debt financing, or result in substantial dilution to existing stockholders, in the case of equity financing.
Impact of Inflation Recent inflationary trends have led to a moderate increase in some of the component parts used to manufacture our products. To date, we have not passed the increase in cost to our consumers.
Impact of Inflation Inflation has resulted in moderate increases in the cost of certain raw materials and component parts used in the manufacture of our products. To date, we have largely absorbed these increases and have not significantly raised prices.
Interest income, net was $161,000 for the year ended December 31, 2024, compared to interest income, net of $8,000 for the year ended December 31, 2023.
As revenue continues to scale, the Company expects to benefit from improved operating leverage over time. Other income (expense), net Interest income, net was $99,000 for the year ended December 31, 2025, compared to $161,000 for the year ended December 31, 2024.
Selling, general and administrative expenses include employee costs, legal and professional fees, sales and marketing expenses, stock-based compensation, public company expenses, rent, depreciation and other general expenses. Our selling, general and administrative expenses increased approximately $2.0 million to $6.5 million during the year ended December 31, 2024, compared to $4.5 million during the year ended December 31, 2023.
Selling, general and administrative expenses increased approximately $4.8 million to $11.3 million for the year ended December 31, 2025, compared to $6.5 million for the year ended December 31, 2024.
Loss from operations Loss from operations increased to $5.0 million for the year ended December 31, 2024, compared to $4.6 million for the year ended December 31, 2023. The increase in our net loss was due to our increased operating expenses, offset by increased gross profit, as discussed above.
Loss from operations Loss from operations increased approximately $2.5 million to $7.5 million for the year ended December 31, 2025, compared to $5.0 million for the year ended December 31, 2024.
This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. Recently Issued Accounting Pronouncements See Note 2 of the Notes to Condensed Financial Statements for a discussion of recent accounting pronouncements.
This assessment requires the use of professional judgment and is performed at the time of warrant issuance and reassessed at each reporting period while the warrants remains outstanding.
Net cash used in investing activities for the year ended December 31, 2023 totaled $289,000, and was for the purchase of property and equipment.
Financing Activities Net cash used in financing activities for the year ended December 31, 2025 was $717,000, compared to net cash provided by financing activities of $7,743,000 for the year ended December 31, 2024. The net cash used in financing activities during 2025 primarily reflected cash used for share repurchases and other financing-related activities during the year.
As such, during the period, the Company estimated the fair value of common stock using an appropriate valuation methodology, in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation. Each valuation methodology includes estimates and assumptions that require the Company’s judgment.
Prior to the Company’s initial public offering on August 14, 2023, the Company’s common stock was not publicly traded. As a result, the Company estimated the fair value of its common stock using valuation methodologies consistent with the framework outlined in the AICPA Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation.
On April 4, 2024, we announced another expansion of our product portfolio, the Newton Motion fairway wood shaft, which like the Newton Motion driver shaft discussed above, is a carbon fiber shaft designed to enhance a golfer’s performance by promoting straighter and longer shots with reduced effort.
The Newton Motion driver shaft is a carbon fiber golf shaft designed to improve performance and consistency for golfers. In April 2024, the Company further expanded its product line with the introduction of the Newton Motion fairway wood shaft.
Management believes the critical accounting estimates discussed below affect its more significant estimates and assumptions used in the preparation of its consolidated financial statements.
Management evaluates its estimates on an ongoing basis and adjusts those estimates when facts and circumstances change. Management believes the following accounting policies involve the most significant judgments and estimates used in the preparation of the Company’s financial statements.
Other income (expense), net During the year ended December 31, 2024, the Company recorded financing cost of $6,913,000 and a change in the fair value of warrant liabilities of $22,000 (see Note 8 of the accompanying financial statements), both of which did not occur in the prior year period.
During the year ended December 31, 2025, the Company recognized a $1.4 million gain related to the change in the fair value of warrant liabilities, compared to a $22,000 loss recognized during the year ended December 31, 2024.
Research and development costs include employee costs, consultants, licensing fees, and product design and development costs. Research and development expenses increased $485,000 to $742,000 during the year ended December 31, 2024, compared to $258,000 during the year ended December 31, 2023.
Research and development expenses increased approximately $0.04 million to $0.8 million, or 5%, for the year ended December 31, 2025, compared to $0.7 million for the year ended December 31, 2024.
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Company Overview We are a technology-forward golf company, with a growing portfolio of golf products, including putting instruments, golf shafts, golf grips, and other golf related products. In consideration of our growth opportunities in shaft technologies, in April of 2022, we expanded our manufacturing business to include advanced premium golf shafts by opening a new shaft manufacturing facility in St.
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Executive Summary During 2024, 2025 and early 2026, several factors influenced the Company’s operations and financial position, including: ● Expansion of the Newton Motion shaft product line.
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Joseph, MO. It is our intent to manufacture and assemble substantially all products in the United States. We anticipate expansion into golf apparel and other golf related product lines to enhance our growth. Our future expansions may include broadening our offerings through mergers, acquisitions or internal developments of product lines that are complementary to our premium brand.
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The Company continued to expand its premium shaft offerings, including the introduction of the Motion fairway wood shaft in 2024, the Fast Motion driver shaft in 2025, and additional product development across the fairway wood and hybrid shaft categories set to launch in 2026. ● Increased market adoption of Newton shafts.
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On August 14, 2023, we entered into an underwriting agreement with The Benchmark Company for the purchase of shares of the Company’s common stock, in an offering of securities registered under an effective registration statement filed with the Securities and Exchange Commission. In the offering, the Company sold 10,667 shares of common stock, at a price of $1,200.00 per share.
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More than 60 professional golfers have placed Newton shafts into tournament play across multiple professional tours, including the PGA TOUR Champions, contributing to increased awareness of the Newton brand and growth in shaft-related revenue. ● Capital raising activities.
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The offering closed on August 17, 2023, and total proceeds received, net of fees, were $11.6 million including an underwriting discount of 7% and a non-accountable expenses allowance of 1% based on the aggregate proceeds of the offering. 28 Recent Events Secondary Public Offering On October 8, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp. as the sole underwriter relating to the offering, issuance and sale of up to 12,200 shares of the Company’s common stock at a public offering price of $60.00 per share.
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On March 16, 2026, the Company issued to entities affiliated with and controlled by Brett Hoge, one of the Company’s directors, an unsecured convertible promissory note with an aggregate principal amount of $500,000, which bears interest at a rate of 10% per annum and matures in 18 months, along with a five-year warrant to purchase 50,000 shares of common stock at an exercise price of $1.75 per share.
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The offering closed on October 10, 2024. The net proceeds to the Company for the offering were $467,000, after deducting the underwriting discounts and commissions and estimated offering expenses.
Added
The convertible promissory note, including accrued interest, is convertible into shares of common stock at maturity at a conversion price of $1.60 per share.
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On December 12, 2024, we entered into an underwriting agreement with Aegis Capital Corp. as the sole underwriter relating to the sale of up to 233,333 Common Units, each consisting of one (1) share of Common Stock, one (1) Series A Common Warrant to purchase one (1) share of Common Stock per warrant, and one (1) Series B Common Warrant to purchase one (1) share of Common Stock per warrant.
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During 2024, the Company completed two public offerings generating approximately $7.8 million in net proceeds, strengthening liquidity and supporting product development, manufacturing expansion, and working capital. 32 Company Overview We design, manufacture, and sell performance golf equipment, including premium golf shafts and putters, and focus on developing technology-driven golf products intended to enhance player performance.
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The public offering price per Common Unit is $36.00. The initial exercise price of each Series A Common Warrant is $72.00 per share of Common Stock. The Series A Common Warrants are exercisable following stockholder approval and expire 60 months thereafter.
Added
Our Newton Motion™ shaft product line represents a core component of our product strategy and has contributed significantly to recent revenue growth. In April 2022, we expanded our manufacturing capabilities by opening a shaft manufacturing facility in St. Joseph, Missouri to support the production of advanced carbon fiber golf shafts.
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The initial exercise price of each Series B Common Warrant is $72.00 per share of Common Stock or pursuant to an alternative cashless exercise option. The Series B Common Warrants are exercisable following stockholder approval and expire 30 months thereafter. The offering closed on December 13, 2024.
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We seek to manufacture and assemble substantially all of our products in the United States where economically feasible, which management believes provides supply chain advantages and supports product quality, engineering control, and operational flexibility. We sell our products through a combination of direct-to-consumer channels, including our websites, as well as through resellers, professional club fitters, distributors, and golf retailers.
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The net proceeds to us for the offering were approximately $7,326,000, after deducting underwriting discounts and commissions and estimated offering expenses. Newton Motion Shafts On November 20, 2023, we announced a significant expansion of our product portfolio. We introduced “Newton,” the Company’s latest business division and the Company’s first foray into the world of golf club shafts.
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We currently distribute products primarily in the United States, with additional distribution in international markets including Japan and South Korea. Newton Motion Shafts Product Introduction In November 2023, the Company expanded its product portfolio through the introduction of the Newton Motion driver shaft, marking the Company’s entry into the premium golf shaft market.
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The Newton Motion driver shaft, the first Newton shaft to debut in the market, is a carbon fiber shaft designed to enhance a golfer’s performance by promoting straighter and longer shots with reduced effort.
Added
In April 2025, the Company introduced the Fast Motion driver shaft, an updated premium shaft design that expands the Company’s driver shaft product lineup. The drivers and fairway wood shafts are manufactured at the Company’s facility in St. Joseph, Missouri.
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The Newton Motion shafts are manufactured at our manufacturing and assembly facility in St. Joseph, Missouri Gravity Putters As part of the rebranding to Newton Golf Company, we introduced a new line of putters under the Newton Gravity brand.
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The Newton Motion shafts utilize the Company’s proprietary “DOT” system, which replaces traditional shaft flex categories with a numerical system ranging from one to seven dots designed to provide golfers with a more precise fit based on swing characteristics.
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Nasdaq Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard On December 5, 2023, the Company received a deficiency letter from the Listing Qualifications Department of The NASDAQ Stock Market LLC (“Nasdaq”) notifying the Company that, for the preceding 30 consecutive business days, the closing bid price of the Company’s common stock remained below the minimum $1.00 per share requirement for continued listing on The Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”).
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The Company believes this system simplifies shaft selection and allows golfers to match driver, fairway wood, and hybrid shafts across its product lines. Product Development and Pipeline The Company continues to refine and expand its shaft product lineup. In March 2026, the Company introduced an updated version of its Fast Motion Driver shaft.
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The Company was provided a compliance period of 180 calendar days from the date of the letter, or until June 3, 2024, to regain compliance with the Bid Price Requirement. 29 On June 4,2024, the Company received a staff determination letter (the “Determination Letter”) from the Staff notifying the Company that it had not regained compliance with the Bid Price Requirement by June 3, 2024, and is not eligible for a second 180-day period due to the Company’s failure to comply with the minimum stockholders’ equity initial listing requirement of The Nasdaq Capital Market.
Added
Updated versions of the Motion driver shaft and Motion fairway wood shaft are expected to be released in late March and April 2026.
Removed
Pursuant to the Determination Letter, the Company requested a hearing before a Hearings Panel (the “Panel”). The hearing request automatically stayed any suspension or delisting action pending the hearing and the expiration of any additional extension period granted by the Panel following the hearing.
Added
The Company is also developing additional shaft products, including a Fast Motion fairway wood shaft expected to launch in the second quarter of 2026 and hybrid shafts for both the Motion and Fast Motion product lines expected to launch during the second and third quarters of 2026.
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By letter dated June 24, 2024, the Company was notified that the Panel granted the Company a temporary exception to regain compliance with the Bid Price Requirement subject to the following milestones: (1) on or before July 31, 2024, the Company must effect a reverse stock split and, thereafter maintain a $1.00 closing bid price for a minimum of ten consecutive business days; and (2) on or before August 13,2024, the Company must demonstrate compliance with the Bid Price requirement by evidencing a closing bid price of $1.00 or more for a minimum of ten consecutive trading sessions.
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The Company has focused product development on shaft designs tailored to specific club types, including shafts designed specifically for fairway woods rather than using a single shaft design across both drivers and fairway woods. 33 Market Adoption Since the launch of the Newton Motion shaft line, the Company has seen increasing adoption among professional golfers across several tours, including the PGA TOUR Champions, Korn Ferry Tour, LPGA Tour, and other international tours.
Removed
As set forth below, the Company effected a reverse stock split on July 30, 2024. By letter dated August 13, 2024 from the Nasdaq Office of General Counsel, the Company was informed that it has regained compliance with the minimum bid price requirement of $1.00 per share under Nasdaq Listing Rule 5550(a)(2).
Added
More than 60 professionals have put Newton shafts in play in tournament competitions across these tours. The Company believes that professional adoption is an indicator of product performance, as professional golfers typically select equipment based on its ability to improve performance. During the 2025 golf season, Newton shafts were used in three tournament victories on the PGA TOUR Champions.
Removed
On January 29, 2025, the Company received a written notice (the “Notice”) from Nasdaq notifying the Company that it is not in compliance with the minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) due to the Company’s common stock not maintaining a closing bid price of at least $1.00 per share for a period of 30 consecutive business days.
Added
The expansion of the Newton Motion shaft product line has been a significant contributor to the Company’s recent revenue growth. The Company believes its premium golf-shaft products represent a core component of its long-term growth strategy.
Removed
The Notice has no immediate effect on the listing of the Company’s common stock on The Nasdaq Capital Market. Normally, a company would be afforded a 180-day calendar period to demonstrate compliance with the minimum bid price requirement.
Added
Increased adoption of Newton shafts by professional golfers, club fitters, and retail partners has expanded awareness of the Newton brand and helped facilitate broader distribution opportunities for the Company’s products. Newton Gravity Putters The Company also offers a line of putters under the Newton Gravity brand.
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However, pursuant to Nasdaq Listing Rule 5810(c)(3)(A)(iv), the Company is not eligible for any compliance period due to the fact that the Company has affected a reverse split within the prior one-year period. The Company requested a hearing a Panel, as provided in the Nasdaq Rules. The hearing request automatically stayed any suspension or delisting action pending the hearing.
Added
During 2025, the Company reduced marketing expenditures directed toward the direct-to-consumer channel after determining that the return on advertising spend did not meet internal targets. As a result, the Company has shifted its near-term focus toward expanding distribution through wholesale and retail channels, including professional club fitters and golf retailers.
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On March 11, 2025, the hearing was held and the Company requested an extension based on the reverse split occurring on March 17, 2025. The Panel has granted an extension to the Company to regain compliance.
Added
The Company’s growing presence in the premium golf shaft market has helped facilitate introductions to retail and fitter partners, which may create additional opportunities to expand distribution of other Newton-branded products. As the Company continues to develop these retail relationships, it expects the Gravity putter line to benefit from increased product visibility and broader distribution through these channels.
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Additionally, as of December 31, 2024, the Company had a negative Shareholders’ Equity of $4,4142,000 resulting from the derivative liability from the issuance of the Company’s Series A and Series B Warrants in December 2025 as part of the Company’s public offering.
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Key Factors Affecting Our Performance Seasonality and General Trends in Golf Participation Golf equipment sales are generally seasonal, with demand typically increasing during the spring and summer months when golf activity is highest in many regions.
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However, because most of the Series B Warrants were exercised on or before March 31, 2025, the issuance of the shares upon such exercise will be accounted for as additional paid-in capital.
Added
As a result, the Company historically experiences stronger sales during the second and third quarters of the year when weather conditions are more favorable for outdoor play. Conversely, sales may be lower during the first and fourth quarters when cold weather in certain regions reduces outdoor golf activity.
Removed
The effect of the exercised warrants and corresponding adjustment to the warrant liability and additional paid-in-capital on a pro forma basis, is that as of December 31, 2024, the stockholder’s equity is $6,653,000. Accordingly, as of March 31, 2025, the Company believes it will be in full compliance with the continuing listing requirement for stockholders’ equity.

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