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What changed in Tenon Medical, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Tenon Medical, 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.

+405 added−354 removedSource: 10-K (2026-03-27) vs 10-K (2025-03-26)

Top changes in Tenon Medical, Inc.'s 2025 10-K

405 paragraphs added · 354 removed · 289 edited across 4 sections

Item 1. Business

Business — how the company describes what it does

68 edited+40 added−16 removed100 unchanged
Biggest changeThe Catamaran System is distinct from other competitive offerings in the following ways: ● Transfixes the SI-Joint ● Inferior / Posterior Sacroiliac Fusion Approach ● Reduced Approach Morbidity ● Direct And Visualized Approach to the SI-Joint ● Single Implant Technique ● Insertion Trajectory Away from the Neural Foramen ● Insertion Trajectory Away from Major Lateral Vascular Structures ● Autologous Bone Grafting in the Ilium, Sacrum and Bridge ● Radiographic Confirmation of Bridging Bone Fusion of the SI-Joint The fixation device and its key features are shown below: Key Features “Pontoon” in the ilium “Pontoon” in the sacrum “Pontoons and Bridge” filled with autologous bone from drilling process Leading edge osteotome creates defect and facilitates ease of insertion The Catamaran System is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to address the SI-Joint with a single approach and implant.
Biggest changeThe Catamaran System is distinct from other competitive offerings in the following ways: ● Trans-articular placement across the SI Joint ● Inferior-posterior sacroiliac fusion approach ● Reduced approach morbidity ● Direct visualization to the SI Joint ● Single implant technique ● Insertion trajectory away from the neural foramen ● Insertion trajectory away from major lateral vascular structures ● Autologous bone grafting in the ilium, sacrum and bridge ● Radiographic confirmation of bridging bone fusion of the SI Joint The fixation device and its key features are shown below: Key Features ● Robust single titanium implant ● Incorporates fusion principles to facilitate long-term fixation ● Immediate stabilization along the long axis of the joint. ● Fenestrated pontoons designed to facilitate bony in-growth. ● “Pontoons and Bridge window” filled with autologous bone from drilling process ● Proprietary osteotome bridge designed to disrupt the joint in preparation for fusion The Catamaran System represents a novel less invasive approach to treat SI Joint dysfunction.
The FDA governs the following activities that we perform or that are performed on our behalf, to ensure that medical products distributed domestically or exported internationally are safe and effective for their intended uses: ● product design, development, and manufacture; ● product safety, testing, labeling, and storage; ● record keeping procedures; 10 ● product marketing, sales, distribution and export; and ● post-marketing surveillance, complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions, and repair or recall of products.
The FDA governs the following activities that we perform or that are performed on our behalf, to ensure that medical products distributed domestically or exported internationally are safe and effective for their intended uses: ● product design, development, and manufacture; ● product safety, testing, labeling, and storage; 10 ● record keeping procedures; ● product marketing, sales, distribution and export; and ● post-marketing surveillance, complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions, and repair or recall of products.
These estimates are driven by coding data for SI-Joint injections to treat pain and informed assumptions relative to surgical intervention candidacy 3 Based on public information, we believe that the largest clinical device supplier in this market does approximately 16,000 SI-Joint fixations a year representing the largest market share.
These estimates are driven by coding data for SI Joint injections to treat pain and informed assumptions relative to surgical intervention candidacy Based on public information, we believe that the largest clinical device supplier in this market does approximately 16,000 SI Joint fixations a year representing the largest market share.
All of our currently marketed products are Class II devices, subject to 510(k) clearance. 11 After a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending on the modification, PMA approval.
All of our currently marketed products are Class II devices, subject to 510(k) clearance. After a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending on the modification, PMA approval.
Additionally, to reach the broadest physician and patient audience on case study results from around the United States we plan to implement an active social media campaign incorporating Facebook, Instagram, YouTube, etc. 8 ● Invest in our independent sales representative network to ensure that all Tenon representatives have the latest in marketing and education tools to reduce the time from training to adoption. ● Remain true to our next generation product development strategy by continually bringing out new advancements in and around the SI-Joint and pelvic region. ● Continue to grow our existing intellectual property portfolio. ● Execute post-market clinical research to confirm the benefits of the distinct approach and implant.
Additionally, to reach the broadest physician and patient audience on case study results from around the United States we plan to implement an active social media campaign incorporating LinkedIn, Facebook, Instagram, YouTube, etc. ● Invest in our independent sales representative network to ensure that all Tenon representatives have the latest in marketing and education tools to reduce the time from training to adoption. ● Remain true to our next generation product development strategy by continually bringing out new advancements in and around the SI Joint and pelvic region. ● Continue to grow our existing intellectual property portfolio. ● Execute post-market clinical research to confirm the benefits of the distinct approach and implant.
Tenon uses best practices to secure and maintain regulatory compliance by engaging with suppliers and contract manufacturing firms that are ISO 13485 (or equivalent) compliant and by periodically performing internal, external, and third-party inspections and audits of the facilities and systems to assess compliance. FDA Premarket Clearance and Approval Requirements.
Tenon uses best practices to secure and maintain regulatory compliance by engaging with suppliers and contract manufacturing firms that are ISO 13485 (or equivalent) compliant and by periodically performing internal, external, and third-party inspections and audits of the facilities and systems to assess compliance. 11 FDA Premarket Clearance and Approval Requirements.
The past 10 years has seen an acceleration in recognition and discussion of the SI-Joint as a cause of pain that can be treated. However, adoption has been hindered by complexity of the procedure as evidenced by the significant number of reported Medical Device Records (MDR’s).
The past 10 years have seen an acceleration in recognition and discussion of the SI Joint as a cause of pain that can be treated. However, adoption has been hindered by complexity of the procedure as evidenced by the significant number of reported Medical Device Records (MDR’s).
Coverage and Reimbursement When a Tenon procedure utilizing The Catamaran System is performed, the healthcare facility, either a hospital (inpatient or outpatient clinic), and the clinician submit claims for reimbursement to the patient’s insurer. Generally, the facility obtains a lump sum payment, or facility fee, for SI-Joint fusions.
Coverage and Reimbursement When a Tenon procedure utilizing The Catamaran System or The SImmetry + System is performed, the healthcare facility, either a hospital (inpatient or outpatient clinic), and the clinician submit claims for reimbursement to the patient’s insurer. Generally, the facility obtains a lump sum payment, or facility fee, for SI Joint fusions.
The SI-Joint The SI-Joint is a strong weight bearing synovial joint situated between the lumbar spine and the pelvis and is aligned along the longitudinal load bearing axis of the human spine when in an upright posture.
The SI Joint 2 The SI Joint is a strong weight bearing synovial joint situated between the lumbar spine and the pelvis and is aligned along the longitudinal load bearing axis of the human spine when in an upright posture.
Tenon has a robust Supplier Qualification and Audit process as part of our quality system that ensures contract manufacturers, and their suppliers meet all requirements. An FDA pre-approval inspection is not required for The Catamaran System due to its lower device classification, class II versus the higher class III.
Tenon has a robust Supplier Qualification and Audit process as part of our quality system that ensures contract manufacturers, and their suppliers meet all requirements. An FDA pre-approval inspection is not required for The Catamaran System or The SImmetry + System due to its lower device classification, class II versus the higher class III.
Our goals are simple but impactful and as such we plan on the following: ● Educate and inform physicians and other healthcare providers, payors, and patients about the growing body of evidence supporting what we believe is the safety, durable clinical effectiveness, economic benefit, and reduction in opioid use associated with SI-Joint fixation and The Catamaran System procedure. ● Utilize the most effective means of training via video and in-person labs demonstrating the ease of use with 2D and 3D navigation.
Our goals are simple but impactful and as such we plan on the following: ● Educate and inform physicians and other healthcare providers, payors, and patients about the growing body of evidence supporting what we believe is the safety, durable clinical effectiveness, economic benefit, and reduction in opioid use associated with SI Joint fixation and The Catamaran System and The SImmetry + System procedures. ● Utilize the most effective means of training via video and in-person labs demonstrating the ease of use with 2D and 3D navigation.
We believe that this beneficial advantage along with a simpler, safer, and less painful procedure will make this the procedure of choice for most physicians. Tenon has initiated post market, IRB controlled clinical trials to demonstrate this technology delivers on these advantages.
We believe that this beneficial advantage along with a simpler, safer, and less painful procedure will make this the procedure of choice for most physicians. Tenon has initiated a post market, IRB controlled clinical trial to demonstrate this technology delivers on these advantages.
Product Liability and Insurance The manufacture and sale of our products subjects us to the risk of financial exposure to product liability claims. Our products are used in situations in which there is a risk of serious injury or death. We carry insurance policies which we believe to be customary for similar companies in our industry.
Product Liability and Insurance The manufacture and sale of our products subject us to the risk of financial exposure to product liability claims. Our products are used in situations in which there is a risk of serious injury or death. We carry insurance policies which we believe to be customary for similar companies in our industry.
We believe that insurer payments to facilities are generally adequate for these facilities to offer The Catamaran System procedure. Physicians are reimbursed separately for their professional time and effort to perform a surgical procedure.
We believe that insurer payments to facilities are generally adequate for these facilities to offer The Catamaran System and The SImmetry + System procedures. Physicians are reimbursed separately for their professional time and effort to perform a surgical procedure.
In the United States, the product we sell is required to be manufactured in compliance with the QSR, which covers the methods used in, and the facilities used for, the design, testing, control, manufacturing, labelling, quality assurance, packaging, storage, and shipping. We are required to demonstrate continuing compliance with applicable regulatory requirements and will be subject to FDA inspections.
In the United States, the products we sell are required to be manufactured in compliance with the QSR, which covers the methods used in, and the facilities used for, the design, testing, control, manufacturing, labelling, quality assurance, packaging, storage, and shipping. We are required to demonstrate continuing compliance with applicable regulatory requirements and will be subject to FDA inspections.
To our knowledge, no other competitive product incorporates these Next Generation features: ● Dual Pontoon implant that transfixes the targeted joint; ● Open cell design designed for utilizing the patient’s own autologous bone for promotion of fusion; ● Bridge design between the dual pontoons for enhanced strength; ● Leading edge of the implant designed to function as an osteotome providing a self-creating defect feature not available with competitive systems; ● Single implant designed with varying pontoon sizes to ensure a robust fixation based on anatomy; and ● Additional smaller Catamaran designed for smaller anatomy and/or revision surgery.
To our knowledge, no other competitive product incorporates the following next generation features: ● Dual Pontoon implant that trans-articulates across the targeted joint; ● Open cell design designed for utilizing the patient’s own autologous bone for promotion of fusion; ● Bridge design between the dual pontoons for enhanced strength; ● Leading edge of the implant designed to function as an osteotome providing a self-creating defect feature not available with competitive systems; ● Single implant designed with varying pontoon sizes to ensure a robust fixation based on anatomy; and ● Additional smaller Catamaran designed for smaller anatomy and/or revision surgery.
Since many physicians have already been trained but have not incorporated SI-Joint fixation into their practices we will work with these physicians to reengage and train them on the Next Generation of an SI-Joint implant which incorporates a safer and simpler approach. ● Utilize the best approaches of direct-to-consumer outreach to educate patients that there is a safe solution to help them improve their quality of life.
Since many physicians have already been trained but have not incorporated SI Joint fixation into their practices we will work with these physicians to reengage and train them on the next generation of SI Joint implants which incorporate a safer and simpler approach. ● Utilize the best approaches of direct-to-consumer outreach to educate patients that there is a safe solution to help them improve their quality of life.
As of March 26, 2025, we also have priority rights in and to several significant trademarks that support our products and brand, including seven registered U.S. trademarks, twelve U.S. trademark applications and six foreign trademark applications in the European Community (excluding the United Kingdom), Australia and Japan. Regulation Domestic Regulation of Our Products and Business.
As of March 27, 2026, we also have priority rights in and to several significant trademarks that support our products and brand, including seven registered U.S. trademarks, twelve U.S. trademark applications and six foreign trademark applications in the European Community (excluding the United Kingdom), Australia and Japan. Regulation Domestic Regulation of Our Products and Business.
For patients whose chronic lower back pain stems from the Sacroiliac Joint (“SI-Joint”), our experience in both clinical trials and commercial settings indicates the system to be introduced by Tenon could be beneficial for patients who are properly diagnosed and screened for surgery by trained healthcare providers.
For patients whose chronic lower back pain stems from the SI Joint, our experience in both clinical trials and commercial settings indicates the system to be introduced by Tenon could be beneficial for patients who are properly diagnosed and screened for surgery by trained healthcare providers.
Food and Drug Administration (“FDA”) clearance in 2018 for The Catamaran System and is currently focused on the US market.
Food and Drug Administration (“FDA”) clearance in 2018 for The Catamaran System and are currently focused on the US market.
Tenon has received IRB approval for two post-market trials, including a 50 patient, 10 center multi-center trial and a prospective CT trial to demonstrate fusion in patient who have already been treated with The Catamaran System.
Tenon has received IRB approval for two post-market trials, including a 50 patient, 10 center multi-center trial and a prospective CT trial (the Mainsail Study) to demonstrate fusion in patients who have been treated with The Catamaran System.
Such trials for implanted devices such as the Catamaran SIJ Fixation Device generally require an investigational device exemption application, or IDE, approved in advance by the FDA for a specified number of subjects and study sites, unless the product is deemed a nonsignificant risk device eligible for more abbreviated IDE requirements.
Such trials for implanted devices such as devices included in The Catamaran System and The SImmetry+ System generally require an investigational device exemption application, or IDE, approved in advance by the FDA for a specified number of subjects and study sites, unless the product is deemed a nonsignificant risk device eligible for more abbreviated IDE requirements.
Human Capital Resources As of March 26, 2025, we have a total of 27 employees, all of whom are full-time, and four senior consulting advisors of various specialty including product development, general administrative and accounting. None of our employees is subject to a collective bargaining agreement, and we consider our relationship with our employees to be good.
Human Capital Resources As of March 27, 2026, we have a total of 26 employees, all of whom are full-time, and nine senior consulting advisors of various specialty including product development, general administrative and quality control. None of our employees is subject to a collective bargaining agreement, and we consider our relationship with our employees to be good.
Our development plan is to expand The Catamaran System offering by introducing a series of progressively longer pontoons so that the clinician has a full complement of sized implants to choose from depending on the patient’s anatomy. These product enhancements will enable the clinician to optimize the size of each implant to ensure full fixation based on anatomy.
Our development plan is to expand The Catamaran System offering by introducing various sizes in length and width so that the clinician has a full complement of sized implants to choose from depending on the patient’s anatomy. These product enhancements will enable the clinician to optimize the size of each implant to ensure full fixation based on anatomy.
The second prospective, multi-center, Catamaran study will evaluate 6-to-12-month radiographic outcomes to assess fusion of patients that have already undergone treatment with The Catamaran System. In addition, retrospective and prospective clinical outcomes will be evaluated.
The second prospective, multi-center, Catamaran study will evaluate 6-to-12-month radiographic outcomes to assess fusion of patients that have already undergone treatment with The Catamaran System.
The Company is a medical device company that has developed The Catamaran™ SI Joint Fusion System (“The Catamaran System”) that offers a novel, less invasive approach to the sacroiliac joint (the “SI Joint”) using a single, robust, titanium implant for treatment of the most common types of SI Joint disorders that cause lower back pain. The Company received U.S.
We have developed The Catamaran ® ™ SI Joint Fusion System (“The Catamaran System”) that offers a novel, less invasive approach to the SI Joint using a single, robust, titanium implant for treatment of the most common types of SI Joint disorders that cause lower back pain. We received U.S.
We also have thirteen registered trademarks (seven U.S. and six foreign) and twelve pending trademark applications in the U.S. Our utility patents and patent applications are directed to several different aspects of our sacroiliac (SI) joint stabilization technology and related patent platform.
We also have 14 registered U.S. trademarks and 6 foreign trademarks and 1 pending trademark application in the U.S. Our utility patents and patent applications are directed to several different aspects of our SI Joint stabilization technology and related patent platform.
Non-surgical treatments include: ● Drug Therapy : including opiates and non-steroidal anti-inflammatory medications. ● Intra-Articular Injections of Steroid Medications : which are typically performed by physicians who specialize in pain treatment or anesthesia. ● Radiofrequency Ablation : or the cauterizing of the lateral branches of the sacral nerve roots.
Non-surgical treatments include: ● Physical Therapy. ● Drug Therapy : including opiates and non-steroidal anti-inflammatory medications. ● Intra-Articular Injections of Steroid Medications : which are typically performed by physicians who specialize in pain treatment or anesthesia.
Published clinical studies have shown that 15% to 30% of all chronic lower back pain is associated with the SI-Joint.
The Opportunity We estimate that over 30 million American adults have chronic lower back pain. Published clinical studies have shown that 15% to 30% of all chronic lower back pain is associated with the SI Joint.
Due to its invasiveness, post-operative pain, and muscle disruption along with a difficult procedure overall, the open SI-Joint fusion procedure was rarely taught in these settings. The emergence of various SI-Joint surgical technologies has generated a renewed discussion of SI-Joint issues. Of particular focus is the diagnostic protocol utilized to properly select patients for SI-Joint surgery.
Due to its invasiveness, post-operative pain, and muscle disruption along with a difficult procedure overall, the open SI Joint fusion procedure was rarely taught in these settings. The emergence of various less invasive SI Joint surgical technologies has generated a renewed discussion of SI Joint issues.
Post-Op fluoroscopic image of implant spanning the SI-Joint 6-Month CT-Scan showing clear bridging bone fusion A preliminary 18 case series (Michael Joseph Chaparro, MD, F.A.A.N.S., F.A.C.S.) has documented that The Catamaran System does in fact promote fusion across the SI-Joint, which many of our competitors have not been able to demonstrate.
A preliminary 18 case series (Michael Joseph Chaparro, MD, F.A.A.N.S., F.A.C.S.) has documented that The Catamaran System does in fact promote fusion across the SI Joint, which many of our competitors have not been able to demonstrate.
We believe that some clinicians view the current Medicare reimbursement amount as insufficient for current SI-Joint procedures, given the work effort involved with the procedure, including the time to diagnose the patient and obtain prior authorization from the patient’s health insurer when necessary. Many private payors require extensive documentation of a multi-step diagnosis before authorizing SI-Joint fusion for a patient.
We believe that some clinicians view the current Medicare reimbursement amount as insufficient for current SI Joint procedures, given the work effort involved with the procedure, including the time to diagnose the patient and obtain prior authorization from the patient’s health insurer when necessary.
Tenon believes that refined approaches and improved implant design will open the door to enhanced adoption and further penetration of this important market. The Catamaran™ SI-Joint Fusion System Solution Until October 2022, Tenon sold The Catamaran System to a limited number of clinician advisors to refine the product for a full commercial launch.
Tenon believes providing physicians innovative SI Joint system choices, backed by clinical outcomes, will open the door to enhanced adoption and further penetration of this important market. The Catamaran ® ™ SI Joint Fusion System Solution Until October 2022, Tenon sold The Catamaran System to a limited number of clinician advisors to refine the product for a full commercial launch.
Tenon believes the surgical approach and implant design it has developed, along with the 2D and 3D protocols for proper implantation will be received well by the clinician community who have been looking for a next generation device.
Below is a fluoroscopic image of an implanted Catamaran Fixation Device spanning the SI Joint. 6 Tenon believes the surgical approach and implant design it has developed, along with the 2D and 3D protocols for proper implantation will be received well by the clinician community who have been looking for a next generation device.
Note the trajectory used in the Inferior Posterior approach: The following are the primary factors on which companies compete in our industry: ● product and clinical procedure effectiveness; ● ease of surgical technique and use of associated instruments; ● safety; ● published clinical outcomes and evidence; ● sales force knowledge and service levels; ● product support and service, and customer service; ● comprehensive training, including disease, anatomy, diagnosis, and treatment; 4 ● product innovation and the speed of innovation; ● intellectual property; ● accountability and responsiveness to customers’ demands; ● pricing and reimbursement; ● scientific (biomechanics) data; and ● attracting and retaining key personnel.
In our view, this differentiated market position strengthens our ability to drive adoption, increase procedure volumes, and capture a larger share of this rapidly expanding market The following are the primary factors on which companies compete in our industry: ● product and clinical procedure effectiveness; ● ease of surgical technique and use of associated instruments; ● safety; ● published clinical outcomes and evidence; ● sales force knowledge and service levels; ● product support and service, and customer service; ● comprehensive training, including disease, anatomy, diagnosis, and treatment; ● product innovation and the speed of innovation; ● intellectual property; 5 ● accountability and responsiveness to customers’ demands; ● pricing and reimbursement; ● scientific (biomechanics) data; and ● attracting and retaining key personnel.
Since the national launch of The Catamaran System in October 2022, the Company is focused on three commercial opportunities: 1) Primary SI Joint procedures, 2) Revision procedures of failed SI Joint implants and 3) SI Joint fusion adjunct to a spine fusion construct. The Opportunity We estimate that over 30 million American adults have chronic lower back pain.
Since the national launch of The Catamaran System in October 2022, we have been focused on three commercial opportunities: 1) Primary SI Joint procedures, 2) Revision procedures of failed SI Joint implants and 3) SI Joint fusion adjunct to a spine fusion construct.
If these costs exceed the facility reimbursement, the facility’s managers may discourage or restrict clinicians from performing the procedure in the facility or using certain technologies, such as The Catamaran System, to perform the procedure.
If these costs exceed the facility reimbursement, the facility’s managers may discourage or restrict clinicians from performing the procedure in the facility or using certain technologies, such as The Catamaran System or The SImmetry + System, to perform the procedure. The Medicare 2025 national average hospital outpatient clinic payment was $17,914.
Our target customer base includes approximately 12,000 physicians who perform spine and/or pelvic surgical procedures. We provide general sales and marketing training to our independent sales representative along with comprehensive, hands-on cadaveric and dry-lab training sessions focusing on the clinical benefits of The Catamaran System and the importance of using the 2D and 3D protocols we have developed.
We provide general sales and marketing training to our independent sales representative along with comprehensive, hands-on cadaveric and dry-lab training sessions focusing on the clinical benefits of The Catamaran System and The SImmetry + System and the importance of using the 2D and 3D protocols we have developed.
We believe the manufacturing operations of our contract manufacturers, and those of the suppliers of our manufacturers, comply with regulations mandated by the FDA, as well as Medical Devices Directive regulations in the EEA.
The Company does not believe its relationship with any one contract manufacturer is material to its business. We believe the manufacturing operations of our contract manufacturers, and those of the suppliers of our manufacturers, comply with regulations mandated by the FDA, as well as Medical Devices Directive regulations in the EEA.
Each SI-Joint is approximately 2-4mm wide and irregularly shaped. Motion of the SI-Joint features vertical shear and rotation. Although the rotational forces about the SI-Joint are relatively low, repetitive motions created by daily activities such as walking, jogging, twisting at the hips, and jumping can increase the stresses on the SI-Joint.
Although the rotational forces about the SI Joint are relatively low, repetitive motions created by daily activities such as walking, jogging, twisting at the hips, and jumping can increase the stresses on the SI Joint.
We believe The Catamaran System will address a large market opportunity with a superior product and is distinct from other competitive offerings in the following ways: ● Transfixes the SI joint ● Inferior-Posterior Sacroiliac Fusion Approach ● Reduced Approach Morbidity ● Direct And Visualized Approach to the SI-Joint ● Single Implant Technique ● Insertion Trajectory Away from the Neural Foramen ● Insertion Trajectory Away from Major Vascular Structures ● Autologous Bone Grafting in the Ilium, Sacrum and Bridge ● Radiographic Confirmation of Bridging Bone Fusion of the SI-Joint The fixation device and its key features are shown below: Key Features “Pontoon” in the ilium “Pontoon” in the sacrum “Pontoons and Bridge” filled with autologous bone from drilling process Leading edge osteotome creates defect and facilitates ease of insertion The Catamaran System is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to transfix the SI-Joint with a single approach and implant.
We believe The Catamaran System will address a large market opportunity with a superior product and is distinct from other competitive offerings in the following ways: ● Trans-articular placement across the SI Joint ● Inferior-posterior sacroiliac fusion approach ● Less invasive surgical approach ● Direct visualization to the SI Joint ● Single implant technique ● Insertion trajectory away from the neural foramen ● Insertion trajectory away from major vascular structures ● Autologous bone grafting in the ilium, sacrum and bridge ● Radiographic confirmation of bridging bone fusion of the SI Joint The Catamaran System is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to transfix the SI Joint with a single approach and implant.
We believe, based on literature searches of prior SI-Joint fixation technologies, that adverse event incidence where the implant has loosened or been misplaced thereby requiring a revision surgery could reach 20%. We believe that our ability to make The Catamaran System a specifically sized fixation device will benefit many patients requiring a revision surgery.
We believe, based on literature searches of prior SI Joint fixation technologies, that adverse event incidence where the implant has loosened or been mal-placed thereby requiring a revision surgery could reach 20%.
Item 1. Business Introduction Tenon Medical, Inc. (the “Company”), was incorporated in the State of Delaware on June 19, 2012 and was headquartered in San Ramon, California until June 2021 when it relocated to Los Gatos, California.
Item 1. Business Introduction Tenon Medical, Inc. (“we” or the “Company”) was incorporated in the State of Delaware on June 19, 2012 and was headquartered in San Ramon, California until June 2021 when it relocated to Los Gatos, California. We are a medical device company dedicated to transforming care for patients with certain sacro-pelvic disorders.
The Catamaran System is designed specially to resist vertical shear and rotation of the joint in which it was implanted, helping stabilize the joint in preparation for eventual fusion.
The Catamaran System is designed specially to resist vertical shear and rotation of the joint in which it was implanted, helping stabilize the joint in preparation for eventual fusion. The instruments we have developed are proprietary to The Catamaran System and specifically designed to facilitate an Inferior Posterior approach that is unique to the system.
The Procedure We believe The Catamaran System and its differentiated characteristics allow for an efficient and effective procedure designed to deliver short-term stabilization and long-term fusion that can be confirmed radiographically.
The Procedure We believe The Catamaran System and its differentiated characteristics allow for an efficient and effective procedure designed to deliver short-term stabilization and long-term fusion that can be confirmed radiographically. Shown below is an illustration demonstrating the unique placement of The Catamaran System inserted Inferior-Posterior and coming directly down to and transfixing the joint.
Shown below is an illustration demonstrating the unique placement of The Catamaran System inserted Inferior-Posterior and coming directly down to and transfixing the joint 6 The Catamaran System procedure is typically performed under general anesthesia using a specially designed instrument set we provide to prepare for the Inferior-Posterior access to the SI-Joint.
The Catamaran System procedure is typically performed under general anesthesia using a specially designed instrument set we provide to prepare for the Inferior-Posterior access to the SI Joint.
Depending on the surgical approach, the incision size, type and extent of imaging guidance, indication for procedure, and the insurer, The Catamaran System procedure may be reported by the physician using any one of the applicable following CPT® codes 27279, 27280, 27299. The Medicare 2022 national average payment for CPT® 27279 is $807 and $1,352 for 27280.
Depending on the surgical approach, the incision size, type and extent of imaging guidance, indication for procedure, and the insurer, The Catamaran System and The SImmetry + System procedures may be reported by the physician using CPT® codes 27279 and 27280. The Medicare 2026 payment rates for CPT® codes 27279 and 27280 are $759 and $1,284, respectively.
Due to the high invasiveness and associated morbidity, the use of this procedure is limited to cases involving significant trauma, tumor, etc. Less invasive surgical options along with implant design began to emerge over the past 15 years. These options feature a variety of approaches and implant designs and have been met with varying degrees of adoption.
The open procedure uses plates and screws, requires a 6 to 12-inch incision and is extremely invasive. Due to the high invasiveness and associated morbidity, the use of this procedure is limited to cases involving significant trauma, tumor, etc. Less invasive surgical options along with implant design began to emerge over the past 15 years.
Patients with low back pain typically start with primary care physicians who often refer to pain specialists. Here, the patient will undergo traditional physical therapy combined with oral medications (anti-inflammatory, narcotic, etc.). If the patient fails to respond to these steps the pain specialist may move to therapeutic injections of the SI-Joint.
Of particular focus is the diagnostic protocol utilized to properly select patients for SI Joint surgery. Patients with low back pain typically start with primary care physicians who often refer to pain specialists. Here, the patient will undergo traditional physical therapy combined with oral medications (anti-inflammatory, narcotic, etc.).
A series of provocative tests in clinic, combined with a specific injection protocol to isolate the SI-Joint as the pain generator is then utilized to confirm the need for surgical intervention. Published literature has shown this technique to be a very effective step to determine the best treatment to alleviate pain.
In this case the patient is often referred to a clinician to determine if the patient may be a candidate for surgical intervention. A series of provocative tests in clinic, combined with a specific injection protocol to isolate the SI Joint as the pain generator is then utilized to confirm the need for surgical intervention.
As of March 26, 2025, we own eight issued U.S. utility patents, 21 pending U.S. utility patent applications, four issued foreign utility patents in Australia, Canada, Japan and Israel, and two pending foreign utility patent applications in the European Community, Brazil and Japan.
As of March 27, 2026, we own 31 issued U.S. utility patents, 13 pending U.S. utility patent applications, 9 issued foreign utility patents in Australia, Canada, Japan and Israel, and 19 pending foreign utility patent applications in the European Community, Brazil and Japan. We have 1 licensed U.S. patent.
Statistical analysis plans may be designed to demonstrate non-inferiority to historical control, as reported in published literature, which may be used for submission to peer reviewed articles / posters / presentations and the like. Intellectual Property Developing and maintaining a strong intellectual property position is an important element of our business.
Statistical analysis plans may be designed to demonstrate non-inferiority to historical control, as reported in published literature, which may be used for submission to peer reviewed articles, posters and presentations, etc.
It functions as a force transfer conduit where it transfers axial loads bi-directionally from the spine to the pelvis and lower extremities and allows forces to be transmitted from the extremities to the spine.
It functions as a force transfer conduit where it transfers axial loads bi-directionally from the spine to the pelvis and lower extremities and allows forces to be transmitted from the extremities to the spine. It also provides load sharing between the hip and spine to contribute towards attenuation of impact shock and stress from activities of daily living.
The implant features a patented dual pontoon open cell design which enables the clinician to pack the pontoons with the patient’s own autologous bone designed to promote bone fusion across the joint.
In addition, the inferior-posterior approach is designed to be direct to the joint and through limited anatomical structures which may minimize the morbidity of the approach. The implant features a patented dual pontoon open cell design which enables the clinician to pack the pontoons with the patient’s own autologous bone designed to promote bone fusion across the joint.
Regulatory Status We have received FDA 510(k) clearance to market and sell The Catamaran System for sacroiliac joint fusion for conditions including sacroiliac joint disruptions and degenerative sacroiliitis. Research & Development Our initial development of The Catamaran System has incorporated several differentiating features which we believe will make an important contribution for many patients suffering from SI-Joint pain.
Research & Development Our initial development of The Catamaran System has incorporated several differentiating features which we believe will make an important contribution for many patients suffering from SI Joint pain.
The majority of our instruments have a secondary manufacturing supplier, and we continually work with additional manufacturers to establish secondary manufacturing suppliers. Our contract manufacturers source and purchase all raw materials used in the manufacture of The Catamaran System which includes mainly stainless steel and aluminum for our instruments and sterilization cases and titanium for our implants.
Our contract manufacturers source and purchase all raw materials used in the manufacture of The Catamaran System and The SImmetry + System which includes mainly stainless steel and aluminum for our instruments and sterilization cases and titanium for our implants. 14 We do not currently have manufacturing agreements with any of our contract manufacturers and orders are controlled through purchase orders.
We believe many clinicians have already been trained using one of the alternative products but have not been satisfied with the approach and technology. This provides us with an opportunity to demonstrate to an already-trained-clinician the unique attributes of The Catamaran System. Our business objective is to introduce the Next Generation Implant for SI-Joint Fixation.
This provides us with an opportunity to demonstrate to an already-trained-clinician the unique attributes of The Catamaran System and The SImmetry + System. 8 Our business objective is to introduce the next generation of implants for SI Joint fixation and fusion.
We believe that some private payors apply their own coverage policies and criteria inconsistently, and clinicians may experience difficulties in securing approval and coverage for sacroiliac fusion procedures. Additionally, many private payors limit coverage for open SI-Joint fusion to trauma, tumors or extensive spine fusion procedures involving multiple levels.
Many private payors require extensive documentation of a multi-step diagnosis before authorizing SI Joint fusion for a patient. We believe that some private payors apply their own coverage policies and criteria inconsistently, and clinicians may experience difficulties in securing approval and coverage for sacroiliac fusion procedures.
Limitations of Existing Treatment Options Surgical fixation and fusion of the SI-Joint with an open surgical technique was first reported in 1908, with further reports in the 1920s. The open procedure uses plates and screws, requires a 6 to 12-inch incision and is extremely invasive.
Published literature has shown this technique to be a very effective step to determine the best treatment to alleviate pain. Limitations of Existing Treatment Options Surgical fixation and fusion of the SI Joint with an open surgical technique was first reported in 1908, with further reports in the 1920s.
The Catamaran System shown below has been cleared by the FDA for commercialization. This patented titanium implant incorporates the Catamaran SI-Joint Fixation Device pontoon design and the open cell configuration which we believe, when filled with the patient’s autologous bone, promotes fusion.
The Catamaran System’s patented titanium implant incorporates the Catamaran SI Joint Fixation Device pontoon design and the open cell configuration which we believe, when filled with the patient’s autologous bone, promotes fusion. Our mission continues to be developing enhancements to The Catamaran System and its instrument system to meet our customers’ changing needs and to improve the surgery’s effectiveness.
These features are designed to create an ideal environment for bone ingrowth and fusion. Below is a fluoroscopic image of an implanted Catamaran Fixation Device spanning the SI-Joint.
These features are designed to create an ideal environment for bone ingrowth and fusion.
Lack of a standard and accepted diagnostic approach, complexity of approach, high morbidity of approach, abnormally high complication rates and inability to radiographically confirm fusion have all been cited as reasons for low adoption of these technologies. 2 Commercialization Tenon initiated its national commercial launch of The Catamaran System in October 2022 to address what we believe is a large market opportunity.
These options feature a variety of approaches and implant designs and have been met with varying degrees of adoption. Lack of a standard and accepted diagnostic approach, complexity of approach, high morbidity of approach, abnormally high complication rates and inability to radiographically confirm fusion have all been cited as reasons for low adoption of these technologies.
We take our data protection obligations seriously, as any improper disclosure, particularly with regard to our customers’ sensitive personal data, could negatively impact our business and/or our reputation. 14 Manufacturing and Supply We do not manufacture any products or component parts and currently use five contract manufacturers to produce all of our instruments, implants and sterilization cases.
Manufacturing and Supply We do not manufacture any products or component parts and currently use five contract manufacturers to produce all of our instruments, implants and sterilization cases. The majority of our instruments have a secondary manufacturing supplier, and we continually work with additional manufacturers to establish secondary manufacturing suppliers.
These injections may serve to lessen inflammation to the point that the patient is satisfied. However, the impact from these injections is often transient. In this case the patient is often referred to a clinician to determine if the patient may be a candidate for surgical intervention.
If the patient fails to respond to these steps the pain specialist may move to therapeutic injections of the SI Joint. These injections may serve to lessen inflammation to the point that the patient is satisfied. However, the impact from these injections is often transient.
These Tenon advancements are intended to further enhance the safety of the procedure and encourage more physicians to adopt the procedure.
Tenon also has developed a proprietary 2D radiographic placement protocol as well as a protocol for 3D navigation utilizing the latest techniques in spine surgery. These Tenon advancements are intended to further enhance the safety and ease of the procedure and encourage more physicians to adopt the procedure.
It also provides load sharing between the hip and spine to contribute towards attenuation of impact shock and stress from activities of daily living. 1 The SI-Joint is a relatively immobile joint that connects the sacrum (the spinal segment that is attached to the base of the lumbar spine at the L5 vertebra) and the ilium of the pelvis.
The SI Joint is a relatively immobile joint that connects the sacrum (the spinal segment that is attached to the base of the lumbar spine at the L5 vertebra) and the ilium of the pelvis. Each SI Joint is approximately 2-4mm wide and irregularly shaped. Motion of the SI Joint features vertical shear and rotation.
This contrasts with several competitive implant systems that require multiple approach pathways and implants to achieve fixation. In addition, the Inferior-Posterior approach is designed to be direct to the joint and through limited anatomical structures which may minimize the morbidity of the approach.
The Catamaran System is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to address the SI Joint with a single, less invasive approach and implant. This contrasts with several competitive implant systems that require multiple approach pathways and implants to achieve fixation.
Where we transfer personal data outside the EEA, we do so in compliance with the relevant data export requirements.
Where we transfer personal data outside the EEA, we do so in compliance with the relevant data export requirements. We take our data protection obligations seriously, as any improper disclosure, particularly with regard to our customers’ sensitive personal data, could negatively impact our business and/or our reputation.
Removed
The Market Based on market research and internal estimates, Tenon believes the potential market for surgical intervention of the SI-Joint to be 279,000 procedures annually in the U.S. alone, for a potential annual market of approximately $2.0 billion.
Added
We currently offer two systems to treat a diseased sacroiliac joint (the “SI Joint”).
Removed
Competitive Landscape We believe Tenon is the first company to develop and manufacture a novel Inferior-Posterior approach featuring a dual pontoon fixation technology cleared by the FDA expressly for SI-Joint fusion. The approach, referred to as Inferior Posterior Sacroiliac Fusion is focused on these critical aspects of the surgical procedure: 1.
Added
In August 2025, we acquired substantially all of the assets of SiVantage, Inc. and SIMPL Medical, LLC, including the SImmetry +® SI Joint Fusion System (“The SImmetry + System”) that treats disorders of the SI Joint through minimally invasive lateral access solution that incorporates well-established orthopedic fusion principles-including joint decortication, bone graft placement, and rigid fixation-with the goal of achieving a true biological fusion across the SI Joint.
Removed
Designed for Safety : the approach trajectory and angle are away from the neural foramen and major vascular structures. 2.
Added
Recent Developments March 2026 Financing On March 11, 2026, we entered into securities purchase agreements with certain accredited investors pursuant to which we issued and sold in a private placement 20% original issue discount senior convertible promissory notes (the “Convertible Promissory Notes”) in an aggregate principal amount of approximately $5.2 million for aggregate gross proceeds of approximately $4.3 million.
Removed
Focus on Efficiency : the approach is designed to be direct to the SI-Joint, which allows for visualization of the joint and is designed to pass through minimal muscle structures, which may result in a faster and more efficient surgical procedure and reduced post-op pain for the patient. 3.
Added
The Convertible Promissory Notes have a maturity date of September 11, 2026, which, at our option, can be extended to December 11, 2026.
Removed
Targeted Anatomy : the approach places the implant in the aspect of the SI-Joint with the densest bone, designed to provide maximum fixation and resistance to vertical shear.
Added
Following the 6-month anniversary of the issuance date, the Convertible Promissory Notes will be convertible at any time at the option of the holder into shares of our common stock at a conversion price per share equal to the greater of 80% of the VWAP for the three trading days immediately prior to the date of conversion and $0.1567, subject to adjustment for stock splits and pro rata distributions as provided in the Convertible Promissory Notes.
Removed
This is designed to provide a secure press fit of the implant, reducing the incidence of revision surgery due to implant loosening, which we believe is the reason for many competitive device failures as reported to the FDA Medical Device Reporting (MDR).
Added
If the maturity date of the Convertible Promissory Notes is extended, their outstanding principal amount will be increased by 5%. Any prepayment of the Convertible Promissory Notes will be paid at 102.5% of the principal amount being prepaid.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe issuance of shares of common stock upon the conversion of such shares of preferred stock or exercise of any of such warrants would dilute the percentage ownership interest of holders of our common stock, dilute the book value per share of our common stock, and increase the number of our publicly traded shares, which could further depress the market price of our common stock.
Biggest changeThe Series C Warrants were exercisable and their exercise period commenced when approval by our stockholders was received on September 18, 2025. ● On March 26, 2025, in connection with a securities purchase agreement, we issued warrants to purchase up to 733,500 shares of our common stock at an exercise price of $2.00 per share (the “Series D Warrants”), which were exercisable upon issuance, and will expire five years following the date of issuance. ● On March 27, 2025, in connection with a securities purchase agreement, we issued warrants to purchase up to 1,271,500 shares of our common stock at an exercise price of $2.00 per share (the “Series E Warrants”), which were exercisable upon issuance, and will expire five years following the date of issuance. ● On November 11, 2025, in connection with the PIPE, we issued warrants to purchase 2,217,904 shares of our common stock at an exercise price of $1.16 per share, with an expiration date of 3 years from the date of issuance (the “PIPE Warrants”). 41 The issuance of shares of common stock upon the conversion of such shares of preferred stock or exercise of any of our outstanding warrants would dilute the percentage ownership interest of holders of our common stock, dilute the book value per share of our common stock, and increase the number of our publicly traded shares, which could further depress the market price of our common stock.
At any time, these or other industry participants may develop alternative treatments, products or procedures for the treatment of the SI-Joint that compete directly or indirectly with our product. If alternative treatments are, or are perceived to be, superior to our product, sales of our product and our results of operations could be negatively affected.
At any time, these or other industry participants may develop alternative treatments, products or procedures for the treatment of the SI Joint that compete directly or indirectly with our product. If alternative treatments are, or are perceived to be, superior to our product, sales of our products and our results of operations could be negatively affected.
These risks include our inability to: ● obtain coverage by third-party, private, and government payors; ● establish and increase awareness of our brand and strengthen customer loyalty; ● attract and retain qualified personnel; ● find and develop relationships with contract manufacturers that can manufacture the necessary volume of product; ● manage our independent sales representatives to achieve our sales growth objectives; ● commercialize new products and enhance our existing product; ● manage rapidly changing and expanding operations; ● implement and successfully execute our business and marketing strategy; ● respond effectively to competitive pressures and developments.
These risks include our inability to: ● obtain coverage by third-party, private, and government payors; ● establish and increase awareness of our brand and strengthen customer loyalty; ● attract and retain qualified personnel; ● find and develop relationships with contract manufacturers that can manufacture the necessary volume of product; ● manage our independent sales representatives to achieve our sales growth objectives; ● commercialize new products and enhance our existing product; ● manage rapidly changing and expanding operations; ● implement and successfully execute our business and marketing strategy; and ● respond effectively to competitive pressures and developments.
Various factors outside our direct control may adversely affect manufacturing and distribution of our product. The manufacture and distribution of our product is challenging. Changes that our contract manufacturers may make outside the purview of our direct control can have an impact on our processes, quality of our product, and the successful delivery of products to our customers.
Various factors outside our direct control may adversely affect manufacturing and distribution of our product. The manufacture and distribution of our products is challenging. Changes that our contract manufacturers may make outside the purview of our direct control can have an impact on our processes, quality of our product, and the successful delivery of products to our customers.
If we enter into in-bound intellectual property license agreements, we may not be able to fully protect the licensed intellectual property rights or maintain those licenses.
If we enter into in-bound intellectual property license agreements, we may not be able to fully protect the licensed intellectual property rights or maintain those licenses.
Future licensors could retain the right to prosecute and defend the intellectual property rights licensed to us, in which case we would depend on the ability of our licensors to obtain, maintain, and enforce intellectual property protection for the licensed intellectual property.
Future licensors could retain the right to prosecute and defend the intellectual property rights licensed to us, in which case we would depend on the ability of our licensors to obtain, maintain, and enforce intellectual property protection for the licensed intellectual property.
These licensors may determine not to pursue litigation against other companies or may pursue such litigation less aggressively than we would. Further, entering into such license agreements could impose various diligence, commercialization, royalty, or other obligations on us.
These licensors may determine not to pursue litigation against other companies or may pursue such litigation less aggressively than we would. Further, entering into such license agreements could impose various diligence, commercialization, royalty, or other obligations on us.
Our dependence on such a limited number of contract manufacturers exposes us to risks, including, among other things: ● contract manufacturers may fail to comply with regulatory requirements or make errors in manufacturing that could negatively affect the safety or effectiveness of our product or cause delays in shipments of our product; ● some of our contract manufacturers have long lead times of 12 to 16 weeks and we may not be able to respond to unanticipated changes in customer orders, and if orders do not match forecasts, we or our contract manufacturers may have excess or inadequate inventory of materials and components; ● our contract manufacturers may be subject to price fluctuations due to a lack of long-term supply arrangements for key components; 22 ● our contract manufacturers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly and shipment of our product; ● we may experience delays in delivery by our contract manufacturers due to changes in demand from us or their other customers; ● fluctuations in demand for products that our contract manufacturers manufacture for others may affect their ability or willingness to deliver our product to us in a timely manner; ● our contract manufacturers may wish to discontinue supplying products or services to us for risk management reasons; ● we may not be able to find new or alternative contract manufacturers in a timely manner if our current contract manufacturers stop producing products; and ● our contract manufacturers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfil our orders and meet our requirements.
Our dependence on such a limited number of contract manufacturers exposes us to risks, including, among other things: ● contract manufacturers may fail to comply with regulatory requirements or make errors in manufacturing that could negatively affect the safety or effectiveness of our products or cause delays in shipments of our product; ● some of our contract manufacturers have long lead times of 12 to 16 weeks and we may not be able to respond to unanticipated changes in customer orders, and if orders do not match forecasts, we or our contract manufacturers may have excess or inadequate inventory of materials and components; ● our contract manufacturers may be subject to price fluctuations due to a lack of long-term supply arrangements for key components; ● our contract manufacturers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly and shipment of our product; ● we may experience delays in delivery by our contract manufacturers due to changes in demand from us or their other customers; ● fluctuations in demand for products that our contract manufacturers manufacture for others may affect their ability or willingness to deliver our products to us in a timely manner; ● our contract manufacturers may wish to discontinue supplying products or services to us for risk management reasons; ● we may not be able to find new or alternative contract manufacturers in a timely manner if our current contract manufacturers stop producing products; and ● our contract manufacturers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfil our orders and meet our requirements.
Our sales and results of operations will be affected by numerous factors, including, among other things: ● payor coverage and reimbursement; ● maintaining our training schedule with clinicians; ● the number of procedures performed in the quarter and our ability to drive increased sales of our product; ● our ability to identify and sign-up independent sales representatives and their performance; ● pricing pressure applicable to our product, including adverse third-party coverage and reimbursement outcomes; ● timing of new product offerings, acquisitions, licenses or other significant events by us or our competitors; ● our ability to find and develop relationships with contract manufacturers and their ability to timely provide us with an adequate supply of products; ● the evolving product offerings of our competitors; ● the demand for, and pricing of, our product and the products of our competitors; ● factors that may affect the sale of our product, including seasonality and budgets of our customers; ● interruption in the manufacturing or distribution of our product; ● the effect of competing technological, industry and market developments; ● our ability to expand the geographic reach of our sales and marketing efforts; ● the costs of maintaining adequate insurance coverage, including product liability insurance; ● the availability and cost of components and materials needed by our contract manufacturers; ● the number of selling days in the quarter; and ● impairment and other special charges.
Our sales and results of operations will be affected by numerous factors, including, among other things: ● payor coverage and reimbursement; ● maintaining our training schedule with clinicians; ● the number of procedures performed in the quarter and our ability to drive increased sales of our product; ● our ability to identify and sign-up independent sales representatives and their performance; ● pricing pressure applicable to our product, including adverse third-party coverage and reimbursement outcomes; ● timing of new product offerings, acquisitions, licenses or other significant events by us or our competitors; ● our ability to find and develop relationships with contract manufacturers and their ability to timely provide us with an adequate supply of products; ● the evolving product offerings of our competitors; 20 ● the demand for, and pricing of, our products and the products of our competitors; ● factors that may affect the sale of our product, including seasonality and budgets of our customers; ● interruption in the manufacturing or distribution of our product; ● the effect of competing technological, industry and market developments; ● our ability to expand the geographic reach of our sales and marketing efforts; ● the costs of maintaining adequate insurance coverage, including product liability insurance; ● the availability and cost of components and materials needed by our contract manufacturers; ● the number of selling days in the quarter; and ● impairment and other special charges.
The FDA and other U.S. and foreign governmental agencies regulate, among other things, with respect to medical devices: ● design, development, and manufacturing; ● testing, labeling, content, and language of instructions for use and storage; ● clinical trials; ● product safety; ● marketing, sales, and distribution; ● premarket clearance and approval; ● conformity assessment procedures; ● record keeping procedures; ● advertising and promotion; ● compliance with good manufacturing practices requirements; ● recalls and field safety corrective actions; ● post-market surveillance, including reporting of deaths or serious injuries and malfunctions that, if they were to recur, could lead to death or serious injury; ● post-market approval studies; and ● product import and export.
The FDA and other U.S. and foreign governmental agencies regulate, among other things, with respect to medical devices: ● design, development, and manufacturing; ● testing, labeling, content, and language of instructions for use and storage; ● clinical trials; ● product safety; ● marketing, sales, and distribution; ● premarket clearance and approval; ● conformity assessment procedures; ● record keeping procedures; ● advertising and promotion; ● compliance with good manufacturing practices requirements; ● recalls and field safety corrective actions; ● post-market surveillance, including reporting of deaths or serious injuries and malfunctions that, if they were to recur, could lead to death or serious injury; 26 ● post-market approval studies; and ● product import and export.
Some of these risks include: ● failure to manufacture in compliance with the required regulatory standards; ● transportation risk; ● the cost and availability of components and supplies required by our contract manufacturers to manufacture our products; ● delays in analytical results or failure of analytical techniques that we will depend on for quality control and release of products; ● natural disasters, labor disputes, financial distress, raw material availability, issues with facilities and equipment, or other forms of disruption to business operations affecting our manufacturers or their suppliers; and ● latent defects that may become apparent after products have been released and that may result in a recall of such products.
Some of these risks include: ● failure to manufacture in compliance with the required regulatory standards; ● transportation risk; ● the cost and availability of components and supplies required by our contract manufacturers to manufacture our products; ● delays in analytical results or failure of analytical techniques that we will depend on for quality control and release of products; 21 ● natural disasters, labor disputes, financial distress, raw material availability, issues with facilities and equipment, or other forms of disruption to business operations affecting our manufacturers or their suppliers; and ● latent defects that may become apparent after products have been released and that may result in a recall of such products.
We may be unable to sell our products on a profitable basis if third-party payors deny coverage, continue to deny coverage or reduce their current levels of payment, or if our costs for the product increase faster than increases in reimbursement levels. 16 Many private payors refer to coverage decisions and payment amounts determined by the Centers for Medicare and Medicaid Services, or CMS, which administers the Medicare program, as guidelines for setting their coverage and reimbursement policies.
We may be unable to sell our products on a profitable basis if third-party payors deny coverage, continue to deny coverage or reduce their current levels of payment, or if our costs for the products increase faster than increases in reimbursement levels. 16 Many private payors refer to coverage decisions and payment amounts determined by the Centers for Medicare and Medicaid Services, or CMS, which administers the Medicare program, as guidelines for setting their coverage and reimbursement policies.
Failure to comply with applicable regulations could jeopardize our ability to sell our product and result in enforcement actions such as: ● warning letters; ● fines; ● injunctions; ● civil penalties; ● termination of distribution; ● recalls or seizures of products; ● delays in the introduction of products into the market; ● total or partial suspension of production; ● facility closures; ● refusal of the FDA other regulators to grant future clearances or approvals; or ● in the most serious cases, criminal penalties.
Failure to comply with applicable regulations could jeopardize our ability to sell our products and result in enforcement actions such as: ● warning letters; ● fines; ● injunctions; ● civil penalties; ● termination of distribution; ● recalls or seizures of products; ● delays in the introduction of products into the market; ● total or partial suspension of production; ● facility closures; ● refusal of the FDA other regulators to grant future clearances or approvals; or ● in the most serious cases, criminal penalties.
In addition, the Series A Warrants, Series B Warrants and the Note Warrants contain weighted average anti-dilution provisions which, subject to limited exceptions, would increase the number of shares issuable upon exercise of such securities (by reducing the exercise price) in the event that we in the future issue common stock, or securities convertible into or exercisable to purchase common stock, at a price per share lower than the exercise price then in effect.
In addition, the Series A Preferred Stock, the Series B Preferred Stock, the Series A Warrants, the Series B Warrants and the Note Warrants contain weighted average anti-dilution provisions which, subject to limited exceptions, would increase the number of shares issuable upon exercise of such securities (by reducing the exercise price) in the event that we in the future issue common stock, or securities convertible into or exercisable to purchase common stock, at a price per share lower than the exercise price then in effect.
If the FDA disagrees with our determination and requires us to submit new 510(k) clearances or PMAs for modifications to our previously cleared products for which we have concluded that new clearances or approvals are unnecessary, we may be required to cease marketing or to recall the modified product until we obtain clearance or approval, and we may be subject to significant enforcement action, regulatory fines, or penalties.
If the FDA disagrees with our determination and requires us to submit new 510(k) clearances or PMAs for modifications to our previously cleared products for which we have concluded that new clearances or approvals are unnecessary, we may be required to cease marketing or to recall the modified products until we obtain clearance or approval, and we may be subject to significant enforcement action, regulatory fines, or penalties.
Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns. We are an “emerging growth company” under the JOBS Act of 2012 and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns. 44 We are an “emerging growth company” under the JOBS Act of 2012 and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
If any of our trade secrets, know-how or other technologies not protected by a patent were to be disclosed to or independently developed by a competitor, our business, financial condition, and results of operations could be materially adversely affected. 36 In the future, we may enter into licensing agreements to maintain our competitive position.
If any of our trade secrets, know-how or other technologies not protected by a patent were to be disclosed to or independently developed by a competitor, our business, financial condition, and results of operations could be materially adversely affected. In the future, we may enter into licensing agreements to maintain our competitive position.
Factors that could cause fluctuations in the trading price of our common stock include the following: ● actual or anticipated fluctuations in our financial condition and operating results; ● actual or anticipated changes in our growth rate relative to our competitors; ● commercial success and market acceptance of our product; ● success of our competitors in developing or commercializing products; ● ability to commercialize or obtain regulatory approvals for our product, or delays in commercializing or obtaining regulatory approvals; ● strategic transactions undertaken by us; ● additions or departures of key personnel; ● product liability claims; 40 ● prevailing economic conditions; ● disputes concerning our intellectual property or other proprietary rights; ● FDA or other U.S. or foreign regulatory actions affecting us or the healthcare industry; ● healthcare reform measures in the United States; ● sales of our common stock by our officers, directors or significant stockholders; ● future sales or issuances of equity or debt securities by us; ● business disruptions caused by earthquakes, fires or other natural disasters; ● the exercise and sale of any outstanding warrants or options; ● issuance of new or changed securities analysts’ reports or recommendations regarding us; ● changes in our capital structure, such as future issuances of debt or equity securities; ● short sales, hedging and other derivative transactions involving our capital stock; and ● general economic and geopolitical conditions, including the current or anticipated impact of military conflict and related sanctions imposed on Russia by the United States and other countries due to Russia’s recent invasion of Ukraine.
Factors that could cause fluctuations in the trading price of our common stock include the following: ● actual or anticipated fluctuations in our financial condition and operating results; ● actual or anticipated changes in our growth rate relative to our competitors; ● commercial success and market acceptance of our product; ● success of our competitors in developing or commercializing products; ● ability to commercialize or obtain regulatory approvals for our product, or delays in commercializing or obtaining regulatory approvals; ● strategic transactions undertaken by us; ● additions or departures of key personnel; ● product liability claims; ● prevailing economic conditions; ● disputes concerning our intellectual property or other proprietary rights; ● FDA or other U.S. or foreign regulatory actions affecting us or the healthcare industry; ● healthcare reform measures in the United States; 42 ● sales of our common stock by our officers, directors or significant stockholders; ● future sales or issuances of equity or debt securities by us; ● business disruptions caused by earthquakes, fires or other natural disasters; ● the exercise and sale of any outstanding warrants or options; ● issuance of new or changed securities analysts’ reports or recommendations regarding us; ● changes in our capital structure, such as future issuances of debt or equity securities; ● short sales, hedging and other derivative transactions involving our capital stock; and ● general economic and geopolitical conditions, including the current or anticipated impact of military conflict and related sanctions imposed on Russia by the United States and other countries due to Russia’s invasion of Ukraine.
If we fail to report these events to the FDA within the required timeframes, or at all, FDA could take enforcement action against us. Any such adverse event involving our product or repeated product malfunctions may result in a voluntary or involuntary corrective actions, such as recalls or customer notifications, or agency action, such as inspection or enforcement action.
If we fail to report these events to the FDA within the required timeframes, or at all, FDA could take enforcement action against us. Any such adverse event involving our products or repeated product malfunctions may result in a voluntary or involuntary corrective actions, such as recalls or customer notifications, or agency action, such as inspection or enforcement action.
We are dependent on a limited number of contract manufacturers, some of them single-source and some of them in single locations, for our product, and the loss of any of these contract manufacturers, or their inability to provide us with an adequate supply of products in a timely and cost-effective manner, could materially adversely affect our business.
We are dependent on a limited number of contract manufacturers, some of them single-source and some of them in single locations, for our products, and the loss of any of these contract manufacturers, or their inability to provide us with an adequate supply of products in a timely and cost-effective manner, could materially adversely affect our business.
In addition, if longer-term patient results and experience indicates that our product or any component of such product cause tissue damage, motor impairment, or other adverse effects, we could be subject to significant liability. Clinicians may misuse or ineffectively use our product, which may result in unsatisfactory patient outcomes or patient injury.
In addition, if longer-term patient results and experience indicates that our products or any component of such products cause tissue damage, motor impairment, or other adverse effects, we could be subject to significant liability. Clinicians may misuse or ineffectively use our product, which may result in unsatisfactory patient outcomes or patient injury.
If we fail to obtain any required licenses or make any necessary changes to our product or technologies, we may have to withdraw our existing product from the market or may be unable to commercialize one or more of our future products, all of which could have a material adverse effect on our business, results of operations, and financial condition.
If we fail to obtain any required licenses or make any necessary changes to our products or technologies, we may have to withdraw our existing products from the market or may be unable to commercialize one or more of our future products, all of which could have a material adverse effect on our business, results of operations, and financial condition.
The laws that may affect our ability to operate include: ● the federal Anti-Kickback Statute, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, items or services for which payment may be made, in whole or in part, under federal healthcare programs, such as the Medicare and Medicaid programs; 29 ● the federal False Claims Act, which prohibits, among other things, individuals or entities from knowingly presenting, or causing to be presented, false or fraudulent claims for payment of government funds; knowingly making, using, or causing to be made or used, a false record or statement to get a false claim paid or to avoid, decrease, or conceal an obligation to pay money to the federal government.
The laws that may affect our ability to operate include: ● the federal Anti-Kickback Statute, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, items or services for which payment may be made, in whole or in part, under federal healthcare programs, such as the Medicare and Medicaid programs; 28 ● the federal False Claims Act, which prohibits, among other things, individuals or entities from knowingly presenting, or causing to be presented, false or fraudulent claims for payment of government funds; knowingly making, using, or causing to be made or used, a false record or statement to get a false claim paid or to avoid, decrease, or conceal an obligation to pay money to the federal government.
Many of our competitors are major medical device companies that have substantially greater financial, technical, and marketing resources than we do, and they may succeed in developing products that would render our product obsolete or non-competitive. In addition, many of these competitors have significantly longer operating histories and more established reputations than we do.
Many of our competitors are major medical device companies that have substantially greater financial, technical, and marketing resources than we do, and they may succeed in developing products that would render our products obsolete or non-competitive. In addition, many of these competitors have significantly longer operating histories and more established reputations than we do.
Additional information about these laws is provided in “ Business—Regulation .” We have entered into consulting agreements with clinicians who are also customers. We anticipate entering into additional agreements with clinicians who use our product as we continue to commercialize our product. The primary mission of these clinician advisors is research and development and clinician education.
Additional information about these laws is provided in “ Business—Regulation .” We have entered into consulting agreements with clinicians who are also customers. We anticipate entering into additional agreements with clinicians who use our products as we continue to commercialize our product. The primary mission of these clinician advisors is research and development and clinician education.
In particular, we and our contract manufacturers are required to comply with FDA’s Quality System Regulations (“QSR”) for the manufacture of our product and other regulations which cover the methods and documentation of the design, testing, production, control, quality assurance, labeling, packaging, storage, and shipping of any product for which we obtain regulatory clearance or approval.
In particular, we and our contract manufacturers are required to comply with FDA’s Quality System Regulations (“QSR”) for the manufacture of our products and other regulations which cover the methods and documentation of the design, testing, production, control, quality assurance, labeling, packaging, storage, and shipping of any product for which we obtain regulatory clearance or approval.
If we are unable to satisfy commercial demand for our product in a timely manner, our ability to generate revenue would be impaired, market acceptance of our product could be adversely affected, and customers may instead purchase or use our competitors’ products. Additionally, we could be forced to seek alternative sources of supply.
If we are unable to satisfy commercial demand for our products in a timely manner, our ability to generate revenue would be impaired, market acceptance of our products could be adversely affected, and customers may instead purchase or use our competitors’ products. Additionally, we could be forced to seek alternative sources of supply.
We plan to rely on our trademarks, trade names and brand names to distinguish our product from the products of our competitors and have registered or applied to register many of these trademarks. We cannot assure you that our trademark applications will be approved. Third parties may also oppose our trademark applications, or otherwise challenge our use of the trademarks.
We plan to rely on our trademarks, trade names and brand names to distinguish our products from the products of our competitors and have registered or applied to register many of these trademarks. We cannot assure you that our trademark applications will be approved. Third parties may also oppose our trademark applications, or otherwise challenge our use of the trademarks.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees. Risks Related to the Ownership of our Common Stock and Warrants An active trading market for our shares may not be sustained.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees. 38 Risks Related to the Ownership of our Common Stock and Warrants An active trading market for our shares may not be sustained.
To become profitable, our contract manufactures must manufacture our product in adequate quantities in compliance with regulatory requirements and at an acceptable cost. Increasing their capacity to manufacture and inspect our product may require them to improve internal efficiencies or require us to re-design or change the specifications of our product.
To become profitable, our contract manufactures must manufacture our products in adequate quantities in compliance with regulatory requirements and at an acceptable cost. Increasing their capacity to manufacture and inspect our products may require them to improve internal efficiencies or require us to re-design or change the specifications of our product.
Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting, disclosure of management’s assessment of our internal controls over financial reporting or disclosure of our public accounting firm’s attestation to our report on management’s assessment of our internal controls over financial reporting may have an adverse impact on the price of our common stock.
Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting, disclosure of management’s assessment of our internal control over financial reporting or disclosure of our public accounting firm’s attestation to our report on management’s assessment of our internal control over financial reporting may have an adverse impact on the price of our common stock.
Our contract manufacturers may encounter several difficulties in increasing this capacity, including: ● managing production yields; ● maintaining quality control and assurance; ● providing component and service availability; 23 ● maintaining adequate control policies and procedures; ● hiring and retaining qualified personnel; and ● complying with state, federal, and foreign regulations.
Our contract manufacturers may encounter several difficulties in increasing this capacity, including: ● managing production yields; ● maintaining quality control and assurance; ● providing component and service availability; ● maintaining adequate control policies and procedures; ● hiring and retaining qualified personnel; and ● complying with state, federal, and foreign regulations.
Our failure to maintain effective internal controls over financial reporting could have an adverse impact on us . We are required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely impact our public disclosures regarding our business, financial condition, or results of operations.
Our failure to maintain effective internal control over financial reporting could have an adverse impact on us . We are required to establish and maintain appropriate internal control over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely impact our public disclosures regarding our business, financial condition, or results of operations.
The actual incidence of lower back pain, and the actual demand for our product or competitive products, could differ materially from our projections if our assumptions and estimates are incorrect. As a result, our estimates of the size and future growth in the market for our product may prove to be incorrect.
The actual incidence of lower back pain, and the actual demand for our products or competitive products, could differ materially from our projections if our assumptions and estimates are incorrect. As a result, our estimates of the size and future growth in the market for our products may prove to be incorrect.
In that event, our reputation could be damaged, and adoption of the product would be impaired. Although our policy is to refrain from statements that could be considered off-label promotion of our product, the FDA or another regulatory agency could disagree and conclude that we have engaged in off-label promotion.
In that event, our reputation could be damaged, and adoption of our products would be impaired. Although our policy is to refrain from statements that could be considered off-label promotion of our product, the FDA or another regulatory agency could disagree and conclude that we have engaged in off-label promotion.
In addition, the entry of multiple new products and competitors may lead some of our competitors to employ pricing strategies that could adversely affect the pricing of our product and pricing in the market generally. As a result, without the timely introduction of new products and enhancements, our product may become obsolete over time.
In addition, the entry of multiple new products and competitors may lead some of our competitors to employ pricing strategies that could adversely affect the pricing of our products and pricing in the market generally. As a result, without the timely introduction of new products and enhancements, our products may become obsolete over time.
We rely on contract manufacturers to supply our product. For us to be successful, our contract manufacturers must be able to provide us with product in substantial quantities, in compliance with regulatory requirements, in accordance with agreed upon specifications, at acceptable prices, and on a timely basis.
We rely on contract manufacturers to supply our products. For us to be successful, our contract manufacturers must be able to provide us with product in substantial quantities, in compliance with regulatory requirements, in accordance with agreed upon specifications, at acceptable prices, and on a timely basis.
In addition, the off-label use of our product may increase the risk of injury to patients, and, in turn, the risk of product liability claims. Product liability claims are expensive to defend and could divert our management’s attention, result in substantial damage awards against us and harm our reputation.
In addition, the off-label use of our products may increase the risk of injury to patients, and, in turn, the risk of product liability claims. Product liability claims are expensive to defend and could divert our management’s attention, result in substantial damage awards against us and harm our reputation.
As a result of this volatility, you may not be able to sell your common stock at or above the public offering price and you may lose some or all of your investment. 39 Our Series A Preferred Stock and Series B Preferred Stock rank senior to our common stock.
As a result of this volatility, you may not be able to sell your common stock at or above the public offering price and you may lose some or all of your investment. Our Series A Preferred Stock and Series B Preferred Stock rank senior to our common stock.
These products may compete with our product and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions.
These products may compete with our products and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions.
In order for us to sell The Catamaran System successfully, we must convince clinicians through education and training that treatment with The Catamaran System is beneficial, safe, and cost-effective for patients as compared to our competitors’ products.
In order for us to sell The Catamaran System and The SImmetry + System successfully, we must convince clinicians through education and training that treatment with The Catamaran System and The SImmetry + System is beneficial, safe, and cost-effective for patients as compared to our competitors’ products.
From time to time, we expect to consider opportunities to acquire or make investments in other technologies, products, and businesses that may enhance our capabilities, complement our current product, or expand the breadth of our markets or customer base.
From time to time, we expect to consider further opportunities to acquire or make investments in other technologies, products, and businesses that may enhance our capabilities, complement our current product, or expand the breadth of our markets or customer base.
If we are not successful in convincing clinicians of the merits of The Catamaran System, they may not use our product, and we will be unable to increase our sales and achieve or grow profitability.
If we are not successful in convincing clinicians of the merits of The Catamaran System and The SImmetry + System, they may not use our product, and we will be unable to increase our sales and achieve or grow profitability.
Because of the nature of our internal quality control requirements, regulatory requirements, and the custom and proprietary nature of our product, we may not be able to quickly engage additional or replacement contract manufacturers for our product and accessories.
Because of the nature of our internal quality control requirements, regulatory requirements, and the custom and proprietary nature of our product, we may not be able to quickly engage additional or replacement contract manufacturers for our products and accessories.
However, if the FDA determines that our promotional materials or training constitutes promotion of an off-label use, it could request that we modify our training or promotional materials, require us to stop promoting our product for those specific procedures until we obtain FDA clearance or approval for them, or subject us to regulatory or enforcement actions, including the issuance of an untitled letter, a warning letter, injunction, seizure, civil fines, and criminal penalties.
However, if the FDA determines that our promotional materials or training constitutes promotion of an off-label use, it could request that we modify our training or promotional materials, require us to stop promoting our products for those specific procedures until we obtain FDA clearance or approval for them, or subject us to regulatory or enforcement actions, including the issuance of an untitled letter, a warning letter, injunction, seizure, civil fines, and criminal penalties.
The frequent introduction by competitors of products that are or claim to be superior to our product or that are alternatives to our existing or planned products may make it difficult to differentiate the benefits of our product over competing products.
The frequent introduction by competitors of products that are or claim to be superior to our products or that are alternatives to our existing or planned products may make it difficult to differentiate the benefits of our products over competing products.
Regulatory enforcement or inquiries, or other increased scrutiny on us, could dissuade some clinicians from using our product and adversely affect our reputation and the perceived safety and effectiveness of our product.
Regulatory enforcement or inquiries, or other increased scrutiny on us, could dissuade some clinicians from using our products and adversely affect our reputation and the perceived safety and effectiveness of our product.
You should carefully consider the risks described below, together with all other information included in this Annual Report on Form 10-K, including our financial statements and related notes, before making an investment decision. If any of the adverse developments described in the following risk factors actually occurs, our business, financial condition, or results of operations could be harmed.
You should carefully consider the risks described below, together with all other information included in this Annual Report on Form 10-K, including our financial statements and related notes, before making an investment decision. If any of the adverse developments described in the following risk factors actually occur, our business, financial condition, or results of operations could be harmed.
We believe that educating clinicians and other healthcare professionals about the clinical merits and patient benefits of The Catamaran System is an important element of our growth.
We believe that educating clinicians and other healthcare professionals about the clinical merits and patient benefits of The Catamaran System and The SImmetry + System is an important element of our growth.
Any delay in, or failure to receive or maintain, clearance or approval for our product under development could prevent us from generating revenue from these products or achieving profitability.
Any delay in, or failure to receive or maintain, clearance or approval for our products under development could prevent us from generating revenue from these products or achieving profitability.
Adverse action by an applicable regulatory agency the FDA could result in inability to produce our product in a cost-effective and timely manner, or at all, decreased sales, higher prices, lower margins, additional unplanned costs or actions, damage to our reputation, and could have material adverse effect on our reputation, business, results of operations, and financial condition.
Adverse action by an applicable regulatory agency the FDA could result in inability to produce our products in a cost-effective and timely manner, or at all, decreased sales, higher prices, lower margins, additional unplanned costs or actions, damage to our reputation, and could have material adverse effect on our reputation, business, results of operations, and financial condition.
Our security measures may not prevent an employee or consultant from misappropriating our trade secrets and providing them to a competitor, and recourse we take against such misconduct may not provide an adequate remedy to protect our interests fully. Unauthorized parties may also attempt to copy or reverse engineer certain aspects of our product that we consider proprietary.
Our security measures may not prevent an employee or consultant from misappropriating our trade secrets and providing them to a competitor, and recourse we take against such misconduct may not provide an adequate remedy to protect our interests fully. Unauthorized parties may also attempt to copy or reverse engineer certain aspects of our products that we consider proprietary.
We cannot be certain that under current and future payment systems, in which healthcare providers may be reimbursed a set amount based on the type of procedure performed, such as those utilized by Medicare and in many privately managed care systems, the cost of our product will be justified and incorporated into the overall cost of the procedure.
We cannot be certain that under current and future payment systems, in which healthcare providers may be reimbursed a set amount based on the type of procedure performed, such as those utilized by Medicare and in many privately managed care systems, the cost of our products will be justified and incorporated into the overall cost of the procedure.
While we believe these factors have historically provided and may continue to provide us with effective tools in estimating the total market for our product and procedures and health cost savings, these estimates may not be correct and the conditions supporting our estimates may change at any time, thereby reducing the predictive accuracy of these underlying factors.
While we believe these factors have historically provided and may continue to provide us with effective tools in estimating the total market for our products and procedures and health cost savings, these estimates may not be correct and the conditions supporting our estimates may change at any time, thereby reducing the predictive accuracy of these underlying factors.
The perception by physicians that the reimbursement for SI-Joint fusion is insufficient to compensate them for the work required, including diagnosis, documentation, obtaining payor approval for the procedure, and burden on their office staff, may negatively affect the number of procedures performed and may therefore impede the growth of our revenues or cause them to decline. 17 We may not be able to convince physicians that The Catamaran System is an attractive alternative to our competitors’ products and that our procedure is an attractive alternative to existing surgical and non-surgical treatments of the SI-Joint.
The perception by physicians that the reimbursement for SI Joint fusion is insufficient to compensate them for the work required, including diagnosis, documentation, obtaining payor approval for the procedure, and burden on their office staff, may negatively affect the number of procedures performed and may therefore impede the growth of our revenues or cause them to decline. 17 We may not be able to convince physicians that The Catamaran System and The SImmetry + System are attractive alternatives to our competitors’ products and that our procedures are an attractive alternative to existing surgical and non-surgical treatments of the SI Joint.
This assessment must be based on clinical data, which can be obtained from (i) clinical studies conducted on the devices being assessed; (ii) scientific literature from similar devices whose equivalence with the assessed device can be demonstrated; or (iii) both clinical studies and scientific literature. 28 The FDA and other regulatory authorities have broad enforcement powers.
This assessment must be based on clinical data, which can be obtained from (i) clinical studies conducted on the devices being assessed; (ii) scientific literature from similar devices whose equivalence with the assessed device can be demonstrated; or (iii) both clinical studies and scientific literature. 27 The FDA and other regulatory authorities have broad enforcement powers.
If we are found to infringe the intellectual property rights of third parties, we could be required to pay substantial damages, including treble, or triple, damages if an infringement is found to be willful, and/or royalties and could be prevented from selling our product unless we obtain a license or are able to redesign our product to avoid infringement.
If we are found to infringe the intellectual property rights of third parties, we could be required to pay substantial damages, including treble, or triple, damages if an infringement is found to be willful, and/or royalties and could be prevented from selling our products unless we obtain a license or are able to redesign our products to avoid infringement.
The outcome of the Russia-Ukraine war and conflicts in the Middle East remain uncertain, and while it is difficult to predict the impact of any of the foregoing, the conflict and actions taken in response to the conflict could increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise additional capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition, and results of operations. 26 Inflation may adversely affect our operations and financial results.
The outcome of the Russia-Ukraine war and conflicts in the Middle East remain uncertain, and while it is difficult to predict the impact of any of the foregoing, the conflict and actions taken in response to the conflict could increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise additional capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition, and results of operations.
In addition, the FDA may change its clearance and approval policies, adopt additional regulations or revise existing regulations, or take other actions which may prevent or delay clearance or approval of our product under development or impact our ability to modify our currently approved or cleared product on a timely basis.
In addition, the FDA may change its clearance and approval policies, adopt additional regulations or revise existing regulations, or take other actions which may prevent or delay clearance or approval of our products under development or impact our ability to modify our currently approved or cleared products on a timely basis.
Companies are required to maintain certain records of recalls, even if they are not reportable to the FDA. We may initiate voluntary recalls involving our product in the future that we determine do not require notification of the FDA. If the FDA disagrees with our determinations, they could require us to report those actions as recalls.
Companies are required to maintain certain records of recalls, even if they are not reportable to the FDA. We may initiate voluntary recalls involving our products in the future that we determine do not require notification of the FDA. If the FDA disagrees with our determinations, they could require us to report those actions as recalls.
As a result, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the fiscal year ended, December 31, 2024, describing the existence of substantial doubt about our ability to continue as a going concern.
As a result, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the fiscal year ended, December 31, 2025, describing the existence of substantial doubt about our ability to continue as a going concern.
If competitive forces drive down the prices we are able to charge for our product, our profit margins will shrink, which will adversely affect our ability to invest in and grow our business. The SI-Joint fusion market has attracted numerous new companies and technologies.
If competitive forces drive down the prices we are able to charge for our products, our profit margins will shrink, which will adversely affect our ability to invest in and grow our business. The SI Joint fusion market has attracted numerous new companies and technologies.
In the case of the FDA, the authority to require a recall must be based on an FDA finding that there is an unreasonable risk of substantial public harm. In addition, foreign governmental bodies have the authority to require the recall of our product in the event of material deficiencies or defects in design or manufacture.
In the case of the FDA, the authority to require a recall must be based on an FDA finding that there is an unreasonable risk of substantial public harm. In addition, foreign governmental bodies have the authority to require the recall of our products in the event of material deficiencies or defects in design or manufacture.
Recalls of any of our product would divert managerial and financial resources and have an adverse effect on our reputation, results of operations, and financial condition, which could impair our ability to produce our product in a cost-effective and timely manner in order to meet our customers’ demands.
Recalls of any of our products would divert managerial and financial resources and have an adverse effect on our reputation, results of operations, and financial condition, which could impair our ability to produce our products in a cost-effective and timely manner in order to meet our customers’ demands.
Any such license may not be available on reasonable terms, if at all, and there can be no assurance that we would be able to redesign our product in a way that would not infringe the intellectual property rights of others.
Any such license may not be available on reasonable terms, if at all, and there can be no assurance that we would be able to redesign our products in a way that would not infringe the intellectual property rights of others.
Pricing pressure from our competitors, changes in third-party coverage and reimbursement, healthcare provider consolidation, payor consolidation and the proliferation of “physician-owned distributorships” may impact our ability to sell our product at prices necessary to support our current business strategies.
Pricing pressure from our competitors, changes in third-party coverage and reimbursement, healthcare provider consolidation, payor consolidation and the proliferation of “physician-owned distributorships” may impact our ability to sell our products at prices necessary to support our current business strategies.
Where we determine that modifications to our product require a new 510(k) clearance or premarket approval application, we may not be able to obtain those additional clearances or approvals for the modifications or additional indications in a timely manner, or at all.
Where we determine that modifications to our products require a new 510(k) clearance or premarket approval application, we may not be able to obtain those additional clearances or approvals for the modifications or additional indications in a timely manner, or at all.
As our sales grow, our contract manufacturers may encounter problems or delays in the manufacturing of our product or fail to meet certain regulatory requirements which could result in an adverse effect on our business and financial results.
As our sales grow, our contract manufacturers may encounter problems or delays in the manufacturing of our products or fail to meet certain regulatory requirements which could result in an adverse effect on our business and financial results.
Therefore, our estimates of the size and future growth in the market for The Catamaran System product, including cost savings to the economy overall, including patients and employers, and to the healthcare system and the number of people currently suffering from lower back pain who may benefit from and be amenable to our procedure, is based on a number of internal and third-party studies, surveys, reports, and estimates.
Therefore, our estimates of the size and future growth in the market for our products, including cost savings to the economy overall, including patients and employers, and to the healthcare system and the number of people currently suffering from lower back pain who may benefit from and be amenable to our procedure, is based on a number of internal and third-party studies, surveys, reports, and estimates.
We may also be required to assess any potential new contract manufacturer’s compliance with all applicable regulations and guidelines, which could further impede our ability to obtain our product in a timely manner.
We may also be required to assess any potential new contract manufacturer’s compliance with all applicable regulations and guidelines, which could further impede our ability to obtain our products in a timely manner.
Moreover, if the relevant laws and regulations change, or are interpreted and applied in a manner that is inconsistent with our data practices or the operation of our product, or if we expand into new regions and are required to comply with new requirements, we may need to expend resources in order to change our business operations, data practices, or the manner in which our product operates.
Moreover, if the relevant laws and regulations change, or are interpreted and applied in a manner that is inconsistent with our data practices or the operation of our product, or if we expand into new regions and are required to comply with new requirements, we may need to expend resources in order to change our business operations, data practices, or the manner in which our products operate.
In addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors.
In addition, management’s assessment of internal control over financial reporting may identify weaknesses and conditions that need to be addressed in our internal control over financial reporting or other matters that may raise concerns for investors.
Further, under the FDA’s medical device reporting regulations, we are required to report to the FDA any information that our product may have caused or contributed to a death or serious injury or in which our product malfunctioned and, if the malfunction were to recur, would likely cause or contribute to death or serious injury.
Under the FDA’s medical device reporting regulations, we are required to report to the FDA any information that our products may have caused or contributed to a death or serious injury or in which our products malfunctioned and, if the malfunction were to recur, would likely cause or contribute to death or serious injury.
In the United States, all of the components to The Catamaran System have either received premarket clearance under Section 510(k) of the FDCA or are exempt from premarket review.
In the United States, all of the components to The Catamaran System and The SImmetry+ System have either received premarket clearance under Section 510(k) of the FDCA or are exempt from premarket review.
The FDA can delay, limit or deny clearance or approval of a device for many reasons, including: ● we may not be able to demonstrate to the FDA’s satisfaction that our product is safe and effective for their intended users; ● the data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; and ● the manufacturing process or facilities we use may not meet applicable requirements.
The FDA can delay, limit or deny clearance or approval of a device for many reasons, including: ● we may not be able to demonstrate to the FDA’s satisfaction that our products are safe and effective for their intended users; ● the data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; and ● the manufacturing process or facilities we use may not meet applicable requirements.
We are required to report certain malfunctions, deaths, and serious injuries associated with our product, which can result in voluntary corrective actions or agency enforcement actions.
We are required to report certain malfunctions, deaths, and serious injuries associated with our products, which can result in voluntary corrective actions or agency enforcement actions.
In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933 (the “Securities Act”) for complying with new or revised accounting standards.
In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” 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.
Even the perception of privacy concerns, whether or not valid, may harm our reputation and inhibit adoption of our product. 31 Even if our product is approved by regulatory authorities if our contract manufacturers fail to comply with ongoing FDA, or if we experience unanticipated problems with our products, these products could be subject to restrictions or withdrawal from the market.
Even the perception of privacy concerns, whether or not valid, may harm our reputation and inhibit adoption of our product. 31 Even though our products are approved by regulatory authorities, if our contract manufacturers fail to comply with ongoing FDA requirements, or if we experience unanticipated problems with our products, these products could be subject to restrictions or withdrawal from the market.
It is not possible to predict the broader consequences of the conflict, including related geopolitical tensions, and the measures and retaliatory actions taken by the U.S. and other countries in respect thereof as well as any counter measures or retaliatory actions by Russia or Belarus in response, including, for example, potential cyberattacks or the disruption of energy exports, is likely to cause regional instability, geopolitical shifts, and could materially adversely affect global trade, currency exchange rates, regional economies and the global economy.
It is not possible to predict the broader consequences of these conflicts, including related geopolitical tensions, and the measures and retaliatory actions taken by the U.S. and other countries in respect thereof as well as any counter measures or retaliatory actions in response, including, for example, potential cyberattacks or the disruption of energy exports, is likely to cause regional instability, geopolitical shifts, and could materially adversely affect global trade, currency exchange rates, regional economies and the global economy.
Physicians may use our product off-label, as the FDA does not restrict or regulate a physician’s choice of treatment within the practice of medicine.
Physicians may use our products off-label, as the FDA does not restrict or regulate a physician’s choice of treatment within the practice of medicine.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+2 added−1 removed9 unchanged
Biggest changeWe also have outstanding as of March 26, 2025: ● 2,445,700 shares of our common stock issuable pursuant to the exercise of our Series C-1 Warrants at $1.25 per share; ● 1,222,850 shares of our common stock issuable pursuant to the exercise of our Series C-2 Warrants at $1.25 per share; ● 788,587 shares of our common stock issuable pursuant to conversion of our Series A Preferred Stock; ● 108,074 shares of our common stock issuable pursuant to conversion of our Series B Preferred Stock; ● 48,187 shares of our common stock issuable upon the exercise of warrants issued to investors of our Series A Preferred Stock at $4.28 per share; ● 16,214 shares of our common stock issuable upon the exercise of warrants issued to investors of our Series B Preferred Stock at $4.28 per share; ● 5,625 shares of our common stock issuable upon the exercise of warrants issued to investors in our November 2023 private placement at $15.52 per share; ● 207,484 shares of our common stock issuable upon the exercise of warrants issued to investors in our June 2023 public offering at $25.168 per share; ● 1,200 shares of our common stock issuable upon the exercise of warrants issued to the underwriters in our initial public offering that closed on April 29, 2022 at $400.00 per share; and ● 31,546 shares of our common stock issuable pursuant to options and restricted stock units granted pursuant to our equity incentive plan.
Biggest changeWe also have outstanding as of March 27, 2026: ● 1,200 shares of our common stock issuable upon the exercise of warrants issued to the underwriters in our initial public offering that closed on April 29, 2022 at $400.00 per share; ● 207,484 shares of our common stock issuable upon the exercise of warrants issued to investors in our June 2023 public offering at $25.168 per share; ● 5,625 shares of our common stock issuable upon the exercise of warrants issued to investors in our November 2023 private placement at $15.52 per share; ● 51,937 shares of our common stock issuable upon the exercise of warrants issued to investors of our Series A Preferred Stock at $4.28 per share; ● 16,214 shares of our common stock issuable upon the exercise of warrants issued to investors of our Series B Preferred Stock at $4.28 per share; ● 2,445,700 shares of our common stock issuable pursuant to the exercise of our Series C-1 Warrants at $1.25 per share; ● 1,222,850 shares of our common stock issuable pursuant to the exercise of our Series C-2 Warrants at $1.25 per share; ● 733,500 shares of our common stock issuable pursuant to the exercise of our Series D Warrants at $2.00 per share; ● 1,271,500 shares of our common stock issuable pursuant to the exercise of our Series E Warrants at $2.00 per share; ● 2,217,904 shares of our common stock issuable pursuant to the exercise of warrants issued to investors in our November 2025 private placement at $1.16 per share; ● 1,553,456 shares of our common stock issuable pursuant to conversion of our Series A Preferred Stock; ● 268,624 shares of our common stock issuable pursuant to conversion of our Series B Preferred Stock; and ● 935,119 shares of our common stock issuable pursuant to options and restricted stock units granted pursuant to our equity incentive plan.
Equity Compensation Plan Information The table below sets forth information as of December 31, 2024.
Equity Compensation Plan Information The table below sets forth information as of December 31, 2025.
The types of awards permitted under the Plans include nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other awards. Each option shall be exercisable at such times and subject to such terms and conditions as the Board may specify.
Such amendment became effective as of September 18, 2025. The types of awards permitted under the Plans include nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other awards. Each option shall be exercisable at such times and subject to such terms and conditions as the Board may specify.
Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 31,546 $ 20.79 135,971 Equity compensation plans not approved by security holders — $ — — Total 31,546 $ 20.79 135,971 Use of Proceeds from our Initial Public Offering of Common Stock Not applicable.
Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 935,119 $ 13.12 348,115 Equity compensation plans not approved by security holders — $ — — Total 935,119 $ 13.12 348,115 Use of Proceeds from our Initial Public Offering of Common Stock Not applicable.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is trading on the Nasdaq Capital Market under the symbol “TNON.” Holders As of March 26, 2025, we have issued and outstanding 5,584,965 shares of common stock issued and outstanding held by 61 stockholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is trading on the Nasdaq Capital Market under the symbol “TNON.” Holders As of March 27, 2026, we have issued and outstanding 11,296,378 shares of common stock issued and outstanding held by 142 stockholders of record.
(b) Option Grants. None. (c) Warrants. None. (d) Issuance of Notes. None. 46 Securities Authorized for Issuance under Equity Compensation Plans In January and February 2022, our Board and our shareholders approved our 2022 Equity Incentive Plan (the “2022 Plan,” together with the 2012 Plan, the “Plans”).
Recent Sales of Unregistered Securities Other than the issuances of unregistered securities described in our Current Reports on Form 8-K and in our Quarterly Reports on Form 10-Q filed with the SEC, there have been no unregistered equity securities issued and sold by us during our fiscal year ended December 31, 2025, which were not registered under the Securities Act of 1933. 48 Securities Authorized for Issuance under Equity Compensation Plans In January and February 2022, our Board and our shareholders approved our 2022 Equity Incentive Plan (the “2022 Plan,” together with the 2012 Plan, the “Plans”).
Removed
We do not expect to pay cash dividends in the foreseeable future. Recent Sales of Unregistered Securities Set forth below is information as to all of our equity securities sold by us during our fiscal year ended December 31, 2024, which was not registered under the Securities Act of 1933, as amended. (a) Issuance of Capital Stock. None.
Added
We do not expect to pay cash dividends in the foreseeable future.
Added
On September 18, 2025, at our annual meeting, our stockholders approved an amendment to 2022 Plan to (i) increase the number of shares of our common stock reserved for issuance under the 2022 Plan from 189,870 shares to 1,328,365 shares, and (ii) amend the 2022 Plan’s evergreen provision to increase the annual automatic increase in the number of shares of common stock reserved under the 2022 Plan, beginning with the fiscal year ending December 31, 2026, to equal, at the discretion of the 2022 Plan administrator, either (x) the greater of (A) 4% of the total number of shares of common stock outstanding on the last day of the prior fiscal year or (B) the number of shares that, when added to the number of shares reserved under the 2022 Plan on the last day of the prior fiscal year, will cause the number of shares reserved to equal 15% of the total shares of common stock outstanding on the last day of the prior fiscal year, or (y) a lesser number as determined by the 2022 Plan administrator.

Item 7. Management's Discussion & Analysis

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

42 edited+16 added−18 removed22 unchanged
Biggest changeOther Income (Expense), Net Other income and expenses have not been significant to date. 51 Results of Operations (in thousands, except percentages) Years Ended December 31, Consolidated Statements of Operations Data in Dollars: 2024 2023 Revenue $ 3,277 $ 2,928 Cost of goods sold 1,566 1,687 Gross profit 1,711 1,241 Operating expenses: Research and development 2,603 3,163 Sales and marketing 5,109 6,778 General and administrative 7,765 7,027 Total operating expenses 15,477 16,968 Loss from operations (13,766 ) (15,727 ) Interest and other income (expense), net: Gain on investments 183 167 Interest expense (34 ) (21 ) Other expense (56 ) — Net loss $ (13,673 ) $ (15,581 ) Years Ended December 31, Consolidated Statements of Operations Data as a Percent of Revenue: 2024 2023 Revenue 100 % 100 % Cost of goods sold 48 58 Gross profit 52 42 Operating expenses: Research and development 79 108 Sales and marketing 156 231 General and administrative 237 240 Total operating expenses 472 580 Loss from operations (420 ) (537 ) Interest and other income (expense), net: Gain on investments 6 6 Interest expense (1 ) (1 ) Other expense (2 ) — Net loss (417 )% (532 )% Comparison of the years ended December 31, 2024 and 2023 (in thousands, except percentages) Revenue, Cost of Goods Sold, Gross Profit, and Gross Margin Years Ended December 31, 2024 2023 $ Change % Change Revenue $ 3,277 $ 2,928 $ 349 12 % Cost of goods sold 1,566 1,687 (121 ) (7 )% Gross profit $ 1,711 $ 1,241 $ 470 38 % Gross profit percentage 52 % 42 % Revenue.
Biggest changeOther Income (Expense), Net Other income and expenses have not been significant to date. 52 Results of Operations (in thousands, except percentages) Years Ended December 31, Statements of Operations Data in Dollars: 2025 2024 Revenue $ 3,944 $ 3,277 Cost of goods sold 1,586 1,566 Gross profit 2,358 1,711 Operating expenses: Research and development 2,149 2,603 Sales and marketing 6,026 5,109 General and administrative 6,975 7,765 Total operating expenses 15,150 15,477 Loss from operations (12,792 ) (13,766 ) Interest and other income (expense), net: Gain on investments 236 183 Interest expense — (34 ) Other expense — (56 ) Net loss $ (12,556 ) $ (13,673 ) Years Ended December 31, Statements of Operations Data as a Percent of Revenue: 2025 2024 Revenue 100 % 100 % Cost of goods sold 40 48 Gross profit 60 52 Operating expenses: Research and development 54 79 Sales and marketing 153 156 General and administrative 177 237 Total operating expenses 384 472 Loss from operations (324 ) (420 ) Interest and other income (expense), net: Gain on investments 6 6 Interest expense — (1 ) Other expense — (2 ) Net loss (318 )% (417 )% Comparison of the years ended December 31, 2025 and 2024 (in thousands, except percentages) Revenue, Cost of Goods Sold, Gross Profit, and Gross Margin Years Ended December 31, 2025 2024 $ Change % Change Revenue $ 3,944 $ 3,277 $ 667 20 % Cost of goods sold 1,586 1,566 20 1 % Gross profit $ 2,358 $ 1,711 $ 647 38 % Gross profit percentage 60 % 52 % Revenue.
On September 6, 2024, we effected a 1-for-8 reverse stock split (the “2024 Reverse Stock Split”) by filing an amendment to the our Amended and Restated Certificate of Incorporation, as amended, with the Delaware Secretary of State.
Reverse Stock Split On September 6, 2024, we effected a 1-for-8 reverse stock split (the “2024 Reverse Stock Split”) by filing an amendment to the our Amended and Restated Certificate of Incorporation, as amended, with the Delaware Secretary of State.
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the accounting policies discussed below are those that are most critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.
While our significant accounting policies are described in more detail in the notes to our financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the accounting policies discussed below are those that are most critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.
The accounting guidance provides a scope exception from classifying and measuring as a financial liability a contract that would otherwise meet the definition of a derivative if the contract is both (i) indexed to the entity’s own stock and (ii) classified in the stockholders’ deficit section of the consolidated balance sheet.
The accounting guidance provides a scope exception from classifying and measuring as a financial liability a contract that would otherwise meet the definition of a derivative if the contract is both (i) indexed to the entity’s own stock and (ii) classified in the stockholders’ deficit section of the balance sheet.
Doing so will likely harm our ability to execute our business plans. Due to the uncertainty in our ability to raise capital, management believes that there is substantial doubt in our ability to continue as a going concern for the next twelve months from the issuance of these consolidated financial statements.
Doing so will likely harm our ability to execute our business plans. Due to the uncertainty in our ability to raise capital, management believes that there is substantial doubt in our ability to continue as a going concern for the next twelve months from the issuance of these financial statements.
We expense research and development costs as they are incurred. We expect research and development expense to increase in absolute dollars as we improve The Catamaran System, develop new products, add research and development personnel, and undergo clinical activities that may be required for regulatory clearances of future products.
We expense research and development costs as they are incurred. We expect research and development expense to increase in absolute dollars as we improve The Catamaran System and The SImmetry + System, develop new products, add research and development personnel, and undergo clinical activities that may be required for regulatory clearances of future products.
We expect our sales and marketing expenses to increase in absolute dollars with the increased sales of The Catamaran System resulting in higher commissions and salaries, increased clinician and sales representative training, and the cost to complete our clinical study to gain wider clinician adoption of The Catamaran System.
We expect our sales and marketing expenses to increase in absolute dollars with the increased sales of The Catamaran System and The SImmetry + System resulting in higher commissions and salaries, increased clinician and sales representative training, and the cost to complete our clinical study to gain wider clinician adoption of The Catamaran System.
GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported results of operations during the reporting periods.
The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported results of operations during the reporting periods.
For more detail on our critical accounting policies, see Note 2 to our consolidated financial statements. Revenue Recognition Our revenue is derived from the sale of our products to medical groups and hospitals in the United States.
For more detail on our critical accounting policies, see Note 2 to our financial statements. Revenue Recognition Our revenue is derived from the sale of our products to medical groups and hospitals in the United States.
We anticipate that certain of our cost of goods sold will increase in absolute dollars as case levels increase. Our gross margins have been and will continue to be affected by a variety of factors, including the cost to have our product manufactured for us, pricing pressure from increasing competition, and the factors described above impacting our revenue.
We anticipate that certain of our cost of goods sold will increase in absolute dollars as case levels increase. Our gross margins have been and will continue to be affected by a variety of factors, including the cost to have our products manufactured for us, pricing pressure from increasing competition, and the factors described above impacting our revenue.
Off-Balance Sheet Arrangements As of December 31, 2024 and 2023, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
Off-Balance Sheet Arrangements As of December 31, 2025 and 2024, we did not have any relationships with organizations or financial partnerships, such as structured finance or special purpose entities that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
Cost of goods sold consists primarily of costs of the components of The Catamaran System implants and instruments, overhead related to operation personnel and facility costs, quality inspection, packaging, scrap and inventory obsolescence, as well as distribution-related expenses such as logistics and shipping costs.
Cost of goods sold consists primarily of costs of the components of The Catamaran System and The SImmetry + System implants and instruments, overhead related to operations personnel and facility costs, quality inspection, packaging, scrap and inventory obsolescence, as well as distribution-related expenses such as logistics and shipping costs.
Based upon our current operating plan, our existing cash and cash equivalents will not be sufficient to fund our operating expenses and working capital requirements through at least the next 12 months from the date these consolidated financial statements were available to be released.
Based upon our current operating plan, our existing cash and cash equivalents will not be sufficient to fund our operating expenses and working capital requirements through at least the next 12 months from the date these financial statements were filed.
Expected Volatility —Since we have only been publicly held since April 2022 and do not have any trading history for our common stock, the expected volatility was estimated based on the average volatility for comparable publicly traded companies over a period equal to the expected term of the stock option grants.
Expected Volatility —Since we have only been publicly held since April 2022 and did not have any trading history for our common stock prior to that date, the expected volatility was estimated based on the average volatility for comparable publicly traded companies over a period equal to the expected term of the stock option grants.
Other expense, net for the year ended December 31, 2024 was related to foreign exchange losses on the liquidation of our Swiss subsidiary. Liquidity and Capital Resources As of December 31, 2024, we had cash and cash equivalents of $6.5 million.
Other Expense, Net . Other expense, net for the year ended December 31, 2024 was related to foreign exchange losses on the liquidation of our Swiss subsidiary. Liquidity and Capital Resources As of December 31, 2025, we had cash and cash equivalents of $3.8 million.
We do not sell any warranties on a standalone basis. Our warranty provides that our products are free of material defects and conform to specifications, and includes an offer to replace or refund the purchase price of defective products. This assurance does not constitute a service and is not considered a separate performance obligation.
Our warranty provides that our products are free of material defects and conform to specifications, and includes an offer to replace or refund the purchase price of defective products. This assurance does not constitute a service and is not considered a separate performance obligation.
We continue to face challenges and uncertainties and, as a result, our available capital resources may be consumed more rapidly than currently expected due to (a) the uncertainty of future revenues from The Catamaran System; (b) changes we may make to the business that affect ongoing operating expenses; (c) changes we may make in our business strategy; (d) regulatory developments affecting our existing products; (e) changes we may make in our research and development spending plans; and (f) other items affecting our forecasted level of expenditures and use of cash resources.
We continue to face challenges and uncertainties and, as a result, our available capital resources may be consumed more rapidly than currently expected due to (a) the uncertainty of future revenues; (b) changes we may make to the business that affect ongoing operating expenses; (c) changes we may make in our business strategy; (d) regulatory developments affecting our existing products; (e) changes we may make in our research and development spending plans; and (f) other items affecting our forecasted level of expenditures and use of cash resources. 54 As we attempt to raise additional capital to fund our operations, funding may not be available to us on acceptable terms, or at all.
As a result of many factors, including but not limited to those set forth under “Risk Factors,” our actual results may differ materially from those anticipated in these forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.” Overview Tenon Medical, Inc., a medical device company formed in 2012, has developed a proprietary, U.S.
As a result of many factors, including but not limited to those set forth under ‘‘Risk Factors,’’ our actual results may differ materially from those anticipated in these forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.” Overview Tenon Medical, Inc.
Cash used in investing activities for the year ended December 31, 2024 related to purchases of property and equipment ($186).
Cash used in investing activities for the year ended December 31, 2025 consisted of the cash payment for the SI Acquisition ($750) and purchases of property and equipment ($273). Cash used in investing activities for the year ended December 31, 2024 related to purchases of property and equipment ($186).
As of December 31, 2024, we had an accumulated deficit of approximately $68.7 million. To date, we have financed our operations primarily through public equity offerings, private placements of equity securities, certain debt-related financing arrangements, and sales of our product.
We have incurred net losses since our inception in 2012. As of December 31, 2025, we had an accumulated deficit of approximately $81.3 million. To date, we have financed our operations primarily through public equity offerings, private placements of equity securities, certain debt-related financing arrangements, and sales of our product.
The grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. 49 The Black-Scholes option-pricing model requires the use of subjective assumptions to determine the fair value of stock-based awards.
For stock options, we estimate the grant date fair value using the Black-Scholes option-pricing model. The grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards.
Gain on investments for the year ended December 31, 2024 increased as compared to 2023 due to interest on our higher amounts of investments in money market and corporate debt securities. Interest Expense. Interest expense for the year ended December 31, 2024 increased as compared to 2023 primarily due to the convertible debt. Other Expense, Net .
Gain on investments for the year ended December 31, 2025 increased as compared to 2024 due to interest on our higher amounts of investments in money market and corporate debt securities. Interest Expense. Interest expense for the year ended December 31, 2024 related to convertible debt, whose outstanding principal and interest were converted to common stock in 2024.
The increase in revenue for the year ended December 31, 2024 as compared to 2023 was primarily due to an increase in revenue per surgical procedure on a 0% change in the number of surgical procedures in which The Catamaran System was used. Cost of Goods Sold, Gross Profit, and Gross Margin.
The increase in revenue for the year ended December 31, 2025 as compared to 2024 was primarily due to an increase in the number of surgical procedures and the addition of revenue related to The SImmetry + System. Cost of Goods Sold, Gross Profit, and Gross Margin.
The change in cost of goods sold for the year ended December 31, 2024 as compared to 2023 was due to the absorption of production overhead costs into our standard cost and operating leverage created due to lower relative fixed costs. 52 Operating Expenses Years Ended December 31, 2024 2023 $ Change % Change Research and development $ 2,603 $ 3,163 $ (560 ) (18 )% Sales and marketing 5,109 6,778 (1,669 ) (25 )% General and administrative 7,765 7,027 738 11 % Total operating expenses $ 15,477 $ 16,968 $ (1,491 ) (9 )% Research and Development Expenses.
The change in cost of goods sold for the year ended December 31, 2025 as compared to 2024 was due to the absorption of production overhead costs into our standard cost and operating leverage created due to lower relative fixed costs and increased revenue volume. 53 Operating Expenses Years Ended December 31, 2025 2024 $ Change % Change Research and development $ 2,149 $ 2,603 $ (454 ) (17 )% Sales and marketing 6,026 5,109 917 18 % General and administrative 6,975 7,765 (790 ) (10 )% Total operating expenses $ 15,150 $ 15,477 $ (1,491 ) (9 )% Research and Development Expenses.
Since inception, we have financed our operations through private placements of preferred stock, debt financing arrangements, our initial public offering, additional stock offerings and the sale of our products. As of December 31, 2024, we had no outstanding debt. In March 2025, we raised net proceeds of $2.7 million from the exercise of warrants under an inducement agreement.
Since inception, we have financed our operations through private placements of preferred stock, debt financing arrangements, our initial public offering, additional stock offerings and the sale of our products. As of December 31, 2025, we had no outstanding debt.
Cash provided by financing activities for the year ended December 31, 2024 consisted primarily of net proceeds from the issuance of common stock and warrants ($3,846), the exercise of warrants under the inducement agreement ($4,306), the issuance of Series A Convertible Preferred Stock ($2,567) and Series B Convertible Preferred Stock ($489) and from issuances of common stock ($2,105).
Cash provided by financing activities for the year ended December 31, 2024 consisted of gross proceeds from the issuance of common stock and warrants ($4,500), the exercise of warrants under the inducement agreement ($4,648), the issuance of Series A Convertible Preferred Stock ($2,605) and Series B Convertible Preferred Stock ($550) and from issuances of common stock ($2,106) and the exercise of warrants ($812), net of total cash offering costs ($1,096).
We generate our revenue from the sale of products to hospitals or medical facilities where our products are delivered in advance of a procedure.
We generate our revenue from the sale of products to hospitals or medical facilities where our products are delivered in advance of a procedure. The performance obligation is the completion of the surgery and therefore, revenue is recognized upon completion of the surgery, net of rebates and price discounts.
The authorized number of shares and the par value per share of our common stock were not affected by the 2023 Reverse Stock Split or the 2024 Reverse Stock Split. 48 Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our audited consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles (“U.S.
Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our audited financial statements, which have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).
Gain on Investments, Interest Expense and Other Expense, Net Years Ended December 31, 2024 2023 $ Change % Change Gain on investments $ 183 $ 167 $ 16 10 % Interest expense (34 ) (21 ) (13 ) 62 % Other expense, net (56 ) — (56 ) Total operating expenses $ 93 $ 146 $ (53 ) Gain on Investments.
Gain on Investments, Interest Expense and Other Expense, Net Years Ended December 31, 2025 2024 $ Change % Change Gain on investments $ 236 $ 183 $ 53 29 % Interest expense — (34 ) 34 100 % Other expense, net — (56 ) 56 100 % Total operating expenses $ 236 $ 93 $ 143 154 % Gain on Investments.
Sales and marketing expenses for the year ended December 31, 2024 decreased as compared to 2023 primarily due to SpineSource transition fees in 2023 ($932), decreased payroll and employee expenses ($499), and consulting and professional fees ($178), partially offset by increased commission expense ($21) due to restructuring of our sales operations. General and Administrative Expenses .
Sales and marketing expenses for the year ended December 31, 2025 increased as compared to 2024 primarily due to increased commission expense ($544) related to our increased revenue and increased payroll and employee expenses ($174) and consulting and professional fees ($174), partially offset by decreased stock-based compensation ($13). General and Administrative Expenses .
All historical share and per share amounts reflected throughout this document have been adjusted to reflect the 2023 Reverse Stock Split and the 2024 Reverse Stock Split.
All historical share and per share amounts reflected throughout this document have been adjusted to reflect the 2024 Reverse Stock Split. The authorized number of shares and the par value per share of our common stock were not affected by the 2024 Reverse Stock Split.
Cash Flows (in thousands, except percentages) The following table sets forth the primary sources and uses of cash for each of the periods presented below: Years Ended December 31, 2024 2023 $ Change % Change Net cash (used in) provided by: Operating activities $ (9,878 ) $ (12,183 ) $ 2,305 19 % Investing activities (186 ) 6,142 (6,328 ) (103 )% Financing activities 14,125 6,302 7,823 124 % Effect of foreign currency translation on cash flow 46 38 8 21 % Net increase in cash and cash equivalents $ 4,107 $ 299 $ 3,808 1274 % The decrease in net cash used in operating activities for the year ended December 31, 2024 as compared to 2023 was primarily attributable to our decreased net loss ($1,908) and decreased prepaid expenses ($484) and increased depreciation and amortization ($209), partially offset increases in accounts receivable ($96) and decreases in non-cash stock-based compensation expenses ($300).
Cash Flows (in thousands, except percentages) The following table sets forth the primary sources and uses of cash for each of the periods presented below: Years Ended December 31, 2025 2024 $ Change % Change Net cash (used in) provided by: Operating activities $ (10,745 ) $ (9,878 ) $ (867 ) 9 % Investing activities (1,023 ) (186 ) (837 ) 450 % Financing activities 8,989 14,125 (5,136 ) (36 )% Effect of foreign currency translation on cash flow — 46 (46 ) (100 )% Net change in cash and cash equivalents $ (2,779 ) $ 4,107 $ (6,886 ) (168 )% The increase in net cash used in operating activities for the year ended December 31, 2025 as compared to 2024 was primarily attributable to decreases in stock-based compensation ($2,154) and increased accounts receivable ($465) and prepaid expenses ($218), partially offset by a decrease in net loss ($1,117) and increases in accrued expenses ($819) and accounts payable ($550).
Pursuant to the agreements, we received proceeds, net of financial advisor fees and other transaction expenses, of $2,290. 53 As of December 31, 2024, we had an accumulated deficit of $68.7 million and we expect to incur additional losses in the future. We have not achieved positive cash flow from operations to date.
As of December 31, 2025, we had an accumulated deficit of $81.3 million and we expect to incur additional losses in the future. We have not achieved positive cash flow from operations to date.
These assumptions include: Expected Term —The expected term represents the period that stock-based awards are expected to be outstanding. The expected term for option grants is determined using the simplified method. The simplified method deems the expected term to be the midpoint between the vesting date and the contractual life of the stock-based awards.
The Black-Scholes option-pricing model requires the use of subjective assumptions to determine the fair value of stock-based awards. These assumptions include: Expected Term —The expected term represents the period that stock-based awards are expected to be outstanding. The expected term for option grants is determined using the simplified method.
Research and development expenses for the year ended December 31, 2024 decreased as compared to 2023 primarily due to decreased professional fees ($528), stock-based compensation ($73) and payroll expenses ($39) as we move our focus from research to sustaining our Catamaran portfolio. Sales and Marketing Expenses.
Research and development expenses for the year ended December 31, 2025 decreased as compared to 2024 primarily due to decreased stock-based compensation ($772) and payroll expenses ($1), partially offset by increased professional fees ($206). Sales and Marketing Expenses.
Revenue from sales of The Catamaran System fluctuates based on volume of cases (procedures performed), discounts, rebates, and the number of implants used for a particular patient. Similar to other orthopedic companies, our revenue can also fluctuate from quarter to quarter due to a variety of factors, including reimbursement, changes in independent sales representatives and physician activities.
Similar to other orthopedic companies, our revenue can also fluctuate from quarter to quarter due to a variety of factors, including reimbursement, changes in independent sales representatives and physician activities. Cost of Goods Sold, Gross Profit, and Gross Margin We utilize contract manufacturers for production of The Catamaran System and The SImmetry + System implants and tray sets.
Sales prices are specified prior to the transfer of control to the customer, via either the customer contract, agreed price list, purchase order, or written communication with the customer. For direct sales to end-user customers, our standard payment terms are generally net 30 days. We offer our standard warranty to all customers.
We account for rebates and price discounts as a reduction to revenue. Sales prices are specified prior to the transfer of control to the customer, via either the customer contract, agreed price list, purchase order, or written communication with the customer.
General and administrative expenses for the year ended December 31, 2024 increased as compared to 2023 primarily due to increased insurance costs ($331), legal and professional service fees ($289), payroll and employee expenses ($146), and bad debt expense ($41), partially offset by decreases in stock-based compensation ($147) due to continued operating expenses.
General and administrative expenses for the year ended December 31, 2025 decreased as compared to 2024 primarily due to decreased stock-based compensation ($1,367), insurance costs ($614) and professional service fees ($87), partially offset by acquisition expenses ($778) and increases in employee expenses ($321) and other fees and expenses ($206).
Warrants classified as equity are recorded as additional paid-in capital on the consolidated balance sheet and no further adjustments to their valuation are made after the issuance of the warrants. 50 Financial Operations Overview Revenue We derive substantially all our revenue from sales of The Catamaran System to a limited number of clinicians.
We estimate the fair value of our warrants for shares of common stock by using the Black-Scholes option pricing model. Warrants classified as equity are recorded as additional paid-in capital on the balance sheet and no further adjustments to their valuation are made after the issuance of the warrants.
Food and Drug Administration (“FDA”) approved surgical implant-system, which we call The Catamaran™ SI Joint Fusion System (“The Catamaran System”). The Catamaran System offers a novel, less invasive inferior-posterior approach to the sacroiliac joint (“SI Joint”) using a single, robust titanium implant to treat SI Joint dysfunction that often causes severe lower back pain.
The Company has developed The Catamaran®™ SI Joint Fusion System (“The Catamaran System”) that offers a novel, less invasive approach to the SI Joint using a single, robust, titanium implant for treatment of the most common types of SI Joint disorders that cause lower back pain. The Company received U.S.
We have devoted substantially all of our resources to research and development, regulatory matters and sales and marketing of our product. Reverse Stock Splits On November 2, 2023, we effected a 1-for-10 reverse stock split (the “2023 Reverse Stock Split”) by filing an amendment to our Amended and Restated Certificate of Incorporation, as amended, with the Delaware Secretary of State.
We have devoted substantially all of our resources to research and development, regulatory matters and sales and marketing of our product.
Cash provided by financing activities for the year ended December 31, 2023 consisted of the net proceeds received from our offerings of stock in 2023 ($5,303) in addition to proceeds from the issuance of the Convertible Notes ($1,250).
Cash provided by financing activities for the year ended December 31, 2025 consisted of gross proceeds from the issuance of common stock from our securities purchase agreements ($4,010), the exercise of warrants under the inducement agreement ($3,057) and the issuance of common stock and warrants ($2,850), net of total cash offering costs ($928).
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The system features the Catamaran™ Fixation Device which passes through both the axial and sagittal planes of the ilium and sacrum, transfixing the SI Joint along its longitudinal axis. Published clinical studies have shown that 15% to 30% of all chronic lower back pain is associated with the SI Joint.
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(the “Company”) was incorporated in the State of Delaware on June 19, 2012 and was headquartered in San Ramon, California until June 2021 when it relocated to Los Gatos, California. The Company is a medical device company dedicated to transforming care for patients with certain sacro-pelvic disorders. The Company currently offers two systems to treat a diseased SI Joint.
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With an entry similar to the SI Joint injection, the surgical approach is direct to the joint. The angle and trajectory of the inferior-posterior approach is designed to point away from critical neural and vascular structures and into the strongest cortical bone.
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Food and Drug Administration (“FDA”) clearance in 2018 for The Catamaran System and is currently focused on the US market.
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Joined by a patented osteotome bridge, the implant design consists of two hollow fenestrated pontoons with an open framework to facilitate bony in-growth through the SI Joint. One pontoon fixates into the ilium and the other into the sacrum. The osteotome is designed to disrupt the articular portion of the joint to help facilitate a fusion response.
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Since the national launch of The Catamaran System in October 2022, the Company is focused on three commercial opportunities: 1) primary SI Joint procedures, 2) revision procedures of failed SI Joint implants and 3) SI Joint fusion adjunct to a spine fusion construct.
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Our initial clinical results indicate that the Catamaran System implant is promoting fusion across the joint as evidenced by computerized tomography (CT) scans which is the gold standard widely accepted by the clinical community.
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In August 2025, the Company acquired substantially all of the assets of SiVantage, Inc. and SIMPL Medical, LLC, including the SImmetry +® SI Joint Fusion System (“The SImmetry + System”) that treats disorders of the SI Joint through minimally invasive lateral access solution that incorporates well-established orthopedic fusion principles-including joint decortication, bone graft placement, and rigid fixation-with the goal of achieving a true biological fusion across the SI Joint.
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We had our national launch of The Catamaran System in October 2022 and are building a sales and marketing infrastructure to market our product and address the greatly underserved market opportunity that exists.
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For direct sales to end-user customers, our standard payment terms are generally net 30 days. 50 We offer our standard warranty to all customers. We do not sell any warranties on a standalone basis.
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We believe that the implant design and procedure we have developed, along with the 2D and 3D protocols for proper implantation will be received well by the clinician community who have been looking for a next generation device. We have incurred net losses since our inception in 2012.
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The simplified method deems the expected term to be the midpoint between the vesting date and the contractual life of the stock-based awards.
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The 2023 Reverse Stock Split combined every ten shares of our common stock issued and outstanding immediately prior to effecting the 2023 Reverse Stock Split into one share of common stock. No fractional shares were issued in connection with the 2023 Reverse Stock Split.
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Business Combinations We account for business combinations in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations , which requires that assets acquired and liabilities assumed be recorded at their respective fair values on the date of acquisition.
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The performance obligation is the delivery of the products along with the completion of the surgery and therefore, revenue is recognized upon delivery to the customers and completion of the surgery, net of rebates and price discounts. We account for rebates and price discounts as a reduction to revenue.
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The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded to goodwill. Intangible assets acquired are amortized over the expected life of the asset.
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For stock options, we estimate the grant date fair value using the Black-Scholes option-pricing model.
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Fair value determinations and useful life estimates are based on, among other factors, estimates of expected future cash flows, estimates of appropriate discount rates, estimated useful lives of the intangible assets acquired and other factors. Although we believe the assumptions and estimates made have been reasonable and appropriate, actual results may vary significantly from estimated results.
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We estimate the fair value of our warrants for shares of common stock by using the Black-Scholes option pricing model.
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Our assumptions and estimates are subject to refinement and, as a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. 51 Financial Operations Overview Revenue We derive substantially all our revenue from sales of The Catamaran System and The SImmetry + System to a limited number of clinicians.
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Cost of Goods Sold, Gross Profit, and Gross Margin We utilize contract manufacturers for production of The Catamaran System implants and Catamaran Tray Sets.
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Revenue from sales of The Catamaran System and The SImmetry + System fluctuates based on volume of cases (procedures performed), discounts, rebates, and the number of implants used for a particular patient.
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Under the inducement agreement, the holder of the existing warrants to purchase an aggregate of 2,445,700 agreed to exercise the warrants at a reduced exercise price of $1.25 per share in consideration for our agreement to issue new unregistered five-year warrants to purchase up to an aggregate of 2,445,700 shares of common stock at an exercise price of $1.25 per share and new unregistered three-year warrants to purchase up to an aggregate of 1,222,850 shares of common stock at an exercise price of $1.25 per share.
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On March 11, 2026, we entered into securities purchase agreements with certain accredited investors pursuant to which the Company issued and sold in a private placement 20% original issue discount senior convertible promissory notes in an aggregate principal amount of approximately $5.2 million for aggregate gross proceeds of approximately $4.3 million (the “Convertible Promissory Notes”).
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On March 25, 2025, we entered into a securities purchase agreement for the issuance of 733,500 shares of our common stock (or common stock equivalents in lieu thereof) in a registered direct offering at a purchase price of $2.00 per share.
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The Convertible Promissory Notes have a maturity date of September 11, 2026, which at the option of the Company can be extended to December 11, 2026.
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In a concurrent private placement, we also agreed to issue to the same investor warrants to purchase up to 733,500 shares of our common stock at an exercise price of $2.00 per share, which will be exercisable immediately, and will expire five years following the date of issuance.
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Following the 6-month anniversary of the issuance date, the Convertible Promissory Notes will be convertible any time at the option of the holder into shares of our common stock at a conversion price per share equal to the greater of 80% of the VWAP for the three trading days immediately prior to the date of conversion and $0.1567, subject to adjustment for stock splits and pro rata distributions as provided in the Convertible Promissory Notes.
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Pursuant to the agreements, we received proceeds, net of financial advisor fees and other transaction expenses, of $1,234. Also on March 25, 2025, we entered into a securities purchase agreement for the issuance of 1,271,500 shares of our common stock (or common stock equivalents in lieu thereof) in a registered direct offering at a purchase price of $2.00 per share.
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If the maturity date of the Convertible Promissory Notes is extended their outstanding principal amount will be increased by 5%. Any prepayment of the Convertible Promissory Notes will be paid at 102.5% of the principal amount being prepaid.
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In a concurrent private placement, we also agreed to issue to the same investor warrants to purchase up to 1,271,500 shares of our common stock at an exercise price of $2.00 per share, which will be exercisable immediately, and will expire five years following the date of issuance.
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In addition, we are required to prepay the Convertible Promissory Notes from 15% of the net proceeds we may receive from future securities financing transactions less certain amounts attributable to the original issue discount.
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As we attempt to raise additional capital to fund our operations, funding may not be available to us on acceptable terms, or at all.
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Cash provided by investing activities for the year ended December 31, 2023 consisted primarily of the net sales of short-term investments ($6,503) to fund operations, partially offset by purchases of property and equipment ($361) as we acquired the components for our surgical tray sets.

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