What changed in this filing

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Item 1. Business

2024-02-27 compared with 2023-03-10 · 60 added, 101 removed, 331 unchanged (33% of the section changed)

Unless otherwise indicated or the context otherwise requires, references in this Annual Report on Form 10-K to the “Company,” “Elite Body Sculpture,” “we,” “us” and “our” refer to AirSculpt Technologies, Inc.

Unless otherwise indicated or the context otherwise requires, references in this Annual Report on Form 10-K to the “Company,” “AirSculpt,” “we,” “us” and “our” refer to AirSculpt Technologies, Inc.

and its consolidated subsidiaries and the Professional Associations (as defined hereinafter).

Our Company is an experienced, fast-growing national provider of body contouring procedures delivering a premium consumer experience under our brand Elite Body Sculpture.

At Elite Body Sculpture, we provide custom body contouring using our proprietary AirSculpt ® method that removes unwanted fat in a minimally invasive procedure, producing dramatic results.

It is our mission to generate the best results for our patients.

We believe our treatment results and elite patient experience have positioned Elite Body Sculpture as a preferred body contouring brand.

AirSculpt is a next-generation body contouring treatment designed to optimize both comfort and precision, available exclusively at AirSculpt offices.

The minimally invasive procedure removes fat and tightens skin, while sculpting targeted areas of the body, allowing for quick healing with minimal bruising, tighter skin, and precise results.

We believe our treatment results and elite patient experience have positioned AirSculpt as a preferred body contouring brand.

We performed 14,932 body contouring procedures in 2023.

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We utilize celebrity and influencer endorsements, as well as word-of-mouth referrals, to drive new patient acquisition.

We deliver our body contouring procedures through a growing, nationwide footprint of 22 centers across 18 states and Canada as of March 10, 2023.

We deliver our body contouring procedures through a growing, nationwide footprint of 27 centers across 18 U.S.

states, Canada, and the United Kingdom as of February 27, 2024.

Our centers, located in metropolitan and suburban areas, offer a premium patient experience and luxurious, spa-like atmosphere.

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Under the stewardship of our founder and Executive Chairman of our board of directors, Dr.

Aaron Rollins, our director, Adam Feinstein, and the other management team members, we have built a results-driven culture.

Aaron Rollins, our Lead Independent Director, Adam Feinstein, and the other management team members, we have built a results-driven culture.

For the year ended December 31, 2023, we generated $195.9 million of revenue compared to $168.8 million for the year ended December 31, 2022, which represents approximately 16.1% growth.

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The global market for body fat reduction procedures was estimated to be in excess of $10 billion in 2021.

The recent regulatory approval, increased market acceptance, availability and customer awareness of weight-loss drugs has

negatively impacted demand in the market for body fat reduction procedures by causing some patients to reject surgical

options in favor of non-invasive and less expensive solutions.

It is difficult to predict the long-term outlook of the market

for weight-loss drugs, including their long-term efficacy and potential drawbacks.

As a result, we cannot be certain that the

market for body fat reduction procedures which we operate in will continue to grow and that it will not be reduced or

eliminated due to the growth of the market for weight-loss drugs.

Our Growth Drivers

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utility patents and one pending U.S.

utility patent applications, each of which we own directly.

utility patent application, each of which we own directly.

The tools we use to perform our fat removal and fat transfer procedures are purchased from third parties, and we do not own the proprietary rights to such tools.

Instead of protecting specific, individual liposuction components (such as a particular handpiece design), our issued patents and one of our pending applications relate to certain proprietary implementations of the process described in the section “Our Technique, Training and Equipment,” and the combination of multiple components to form proprietary systems that are specially configured for carrying out those proprietary processes.

Instead of protecting specific, individual liposuction components (such as a particular handpiece design), our issued patents and our pending application relate to certain proprietary implementations of the process described in the section “Our Technique, Training and Equipment,” and the combination of multiple components to form proprietary systems that are specially configured for carrying out those proprietary processes.

We believe the systems and methodologies claimed in our issued patents provide impressive results with less patient trauma relative to other systems and methods, such as liposuction and abdominoplasty (tummy tuck), that require more invasive surgical procedures.

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They are selected to join our nationwide practice because they are at the top of their profession, specialize in body sculpting, and have artistic skill.

Before working on Elite Body Sculpture patients, each surgeon completes extensive AirSculpt ® training to ensure the best results for every patient and treatment.

We offer our surgeons a compelling economic opportunity, with annual compensation for part-time work at Elite Body Sculpture often higher than the average full-time salary in a private practice.

By joining Elite Body Sculpture, surgeons are also able to grow their private practices by attracting Elite patients to their private practice for non-body contouring procedures, such as face lifts and injectables.

Before working on AirSculpt patients, each surgeon completes extensive AirSculpt ® training to ensure the best results for every patient and treatment.

We offer our surgeons a compelling economic opportunity, with annual compensation for part-time work at AirSculpt often higher than the average full-time salary in a private practice.

By joining AirSculpt, surgeons are also able to grow their private practices by attracting Elite patients to their private practice for non-body contouring procedures, such as face lifts and injectables.

Our surgeons are also featured on our social media platforms.

AirSculpt ® allows the surgeon to provide high quality outcomes to patients while being less physically demanding on the surgeon than traditional liposuction.

As AirSculpt ® is only available for use at Elite Body Sculpture centers, we protect our brand and are able to retain high quality surgeons.

As AirSculpt ® is only available for use at AirSculpt centers, we protect our brand and are able to retain high quality surgeons.

National and International Footprint Fueled by Attractive Unit Economics

We have a growing national footprint consisting of 22 centers across 18 states and Canada as of March 10, 2023.

Further, we opened our newest center in Toronto, Canada in December 2022, which is the Company's first international facility.

We have a growing national footprint consisting of 27 centers across 18 U.S.

states, Canada, and the United Kingdom as of February 27, 2024.

Our centers are located primarily in metropolitan cities near retail shops that our patients frequent and popular areas.

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Our centers generate highly attractive unit-level economics and require only a modest investment to open.

Given the consistently high level of demand for our services and the average price of our procedures, our centers typically achieve profitability within approximately three months, providing Elite Body Sculpture with a highly attractive and near-immediate return on invested capital.

Given the consistently high level of demand for our services and the average price of our procedures, our centers typically achieve profitability within approximately three months, providing AirSculpt with a highly attractive and near-immediate return on invested capital.

Scaled Platform and Consistent Demand Drives Attractive Growth and Free Cash Flow

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Rollins has been a licensed cosmetic surgeon since 2004.

In addition, our director, Adam Feinstein, who founded Vesey Street Capital Partners, L.L.C., our private equity sponsor (“Sponsor”), has 25 years of experience working with many of the leading healthcare services companies, including service as a director of public and private healthcare company boards.

They have partnered with our Chief Financial Officer, Dennis Dean, who has over 20 years of experience in the health care industry, including at Envision Healthcare and Surgery Partners.

Further, AirSculpt founder and former Chief Executive Officer, Dr.

Aaron Rollins, recently became Executive Chairman of the board of directors.

In addition, our Lead Independent Director, Adam Feinstein, who founded Vesey Street Capital Partners, L.L.C., our private equity sponsor (“Sponsor”), has 25 years of experience working with many of the leading healthcare services companies, including service as a member of public and private healthcare company board of directors.

Our Chief Financial Officer, Dennis Dean, who has over 20 years of experience in the healthcare industry, including at Envision Healthcare and Surgery Partners, joined the team in 2021 prior to our IPO.

Further, AirSculpt's founder and former Chief Executive Officer, Dr.

Aaron Rollins, serves as Executive Chairman of the board of directors.

Rollins is primarily focused on leading the Company’s overall vision and providing strategic guidance.

In addition, the Company recently appointed Todd Magazine as Chief Executive Officer.

Magazine assumed CEO responsibilities at the end of January 2023.

In addition, Todd Magazine became Chief Executive Officer at the end of January 2023.

Magazine brings to AirSculpt more than 30 years of experience in retail operations and brand-building.

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Our centers typically have two procedure rooms.

We have the opportunity to continue to both add procedure rooms and adapt our schedule from primarily open six days

to seven days a week in order to meet the strong demand from our patients for our services.

We have the opportunity to continue to both add procedure rooms and adapt our schedule from primarily open six days to seven days a week in order to meet the strong demand from our patients for our services.

Through referral and outreach, we plan to continue recruiting surgeons to operate on our growing number of patients and staff to conduct consultations and organize appointments.

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We have collected a catalog of over 215,000 “before and after” photos, showcasing our treatment outcomes.

Our AirSculpt ® TV program, featured on our Elite Body Sculpture Instagram page and website, provides a never-before seen transparency in our space, encouraging further growth.

Our AirSculpt ® TV program, featured on our AirSculpt Instagram page and website, provides a never-before seen transparency in our space, encouraging further growth.

We will continue to develop high quality digital content that highlights the transformative power of our minimally invasive procedures.

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• Expand Footprint by Opening New Centers in the United States:

We believe our track record of successfully opening new Elite Body Sculpture centers consistently generating strong unit-level economics validates our strategy across the United States and to domestically expand our footprint.

We believe our track record of successfully opening new AirSculpt centers consistently generating strong unit-level economics validates our strategy across the United States and to domestically expand our footprint.

In order to ensure our new centers are profitable, we follow the same business plan for each new center.

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Management uses a disciplined approach to choose potential markets, opening centers at minimal cost located near premium retail shops that our patients frequent.

We believe there is a significant domestic growth opportunity and will continue to opportunistically evaluate new center openings and target opening three to four centers each year.

there is a significant domestic growth opportunity and will continue to opportunistically evaluate new center openings and target opening three to four centers each year.

• Expand Internationally:

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We believe there is significant opportunity to open new centers in densely populated, affluent international metropolitan regions.

We opened our first international facility in Toronto, Canada in December 2022.

We opened our first international facility in Toronto, Canada in December 2022, and our second in London, United Kingdom in June 2023.

Our Technique, Training and Equipment

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We train our surgeons in the AirSculpt ® procedure, for which we possess a patent covering the process.

Our surgeons are contractually prohibited from performing Elite Body Sculpture’s proprietary procedures, including the AirSculpt ® procedure, if they leave Elite Body Sculpture.

Our surgeons are contractually prohibited from performing AirSculpt’s proprietary procedures, including the AirSculpt ® procedure, if they leave AirSculpt.

Pain Management

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Across our centers, we use a network of independent surgeons to perform the AirSculpt ® procedure.

We believe that the desire to be an Elite Body Sculpture surgeon has provided us with ready access to talented providers, making recruitment a selective process.

We believe that the desire to be an AirSculpt surgeon has provided us with ready access to talented providers, making recruitment a selective process.

Additionally, through referral and outreach, we plan to continue recruiting surgeons to perform procedures on our growing number of patients.

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If a prospective surgeon successfully completes the Elite Fellowship Program, they are permitted to conduct the AirSculpt ® method without restrictions.

Otherwise, they are observed in additional training procedures or are not chosen to join the Elite Body Sculpture team.

Otherwise, they are observed in additional training procedures or are not chosen to join the AirSculpt team.

Additionally, there is a comprehensive ongoing review process of all surgeons conducted by our experienced AirSculpt ® surgeons, which includes on-site visits at centers to help maintain quality standards, and feedback from other staff members, including members of our nursing team.

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In addition to monitoring and managing our social media presence, our team is focused on search engine optimization on our digital platform.

For the year ended December 31, 2022, our total advertising costs were $20.6 million, split 85% digital advertising and 15% other advertising platforms.

For the year ended December 31, 2023, our total advertising costs were $25.9 million, split approximately 85% digital advertising and 15% other advertising platforms.

Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel.

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Rather than making an in-office appointment, our patients are able to speak with our surgeons and qualified patient care consultants in the convenience of their own home or office typically within 24-72 hours.

We encourage a strong relationship between our patients and

surgeons, from initial consultation, through procedure, to after treatment.

Nearly all of our patient-facing consultants are former patients and can speak to their personal Elite experiences.

We encourage a strong relationship between our patients and surgeons, from initial consultation, through procedure, to after treatment.

Nearly all of our patient-facing consultants are

former patients and can speak to their personal AirSculpt experiences.

Based on these efforts, together with discussions with our surgeons, our patients elect to move forward and schedule a procedure date.

Many patients, satisfied with results and experience, return to Elite Body Sculpture to receive further AirSculpt ® treatments on additional body parts.

Our consultants provide patients pricing information the day of their consult and, if requested by the patient, assist patients with securing third-party financing from entities such as CareCredit, Alphaeon Credit and United Medical Credit, enabling consumers to more quickly schedule their procedures.

Many patients, satisfied with results and experience, return to AirSculpt to receive further AirSculpt ® treatments on additional body parts.

Our consultants provide patients pricing information the day of their consult and, if requested by the patient, assist patients with securing third-party financing from entities such as CareCredit, Cherry and Alphaeon, among others, enabling consumers to more quickly schedule their procedures.

We do not face any risk in default of payment under that financing arrangement, which is solely between the patient and third party financing vendor.

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utility patents and one pending U.S.

utility patent applications, each of which we own directly.

utility patent application, each of which we own directly.

The tools we use to perform our fat removal and fat transfer procedures are purchased from third parties and we do not own the proprietary rights to such tools.

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We expect our issued patents to expire in 2033 or later.

AirSculpt ® , AirSculpt+ ™ , AirSculpt Plus ™ , AirSculpt Smooth ™ , AirSculpt Slim ™ , No Needle, No Scalpel, No Stitches ® , If You Can Pinch It, We Can Take It ® , Power BBL ® , Tiny Tuck ® , 48 Hour Six Pack ® , AirSculpt is for Everybody ® , Cure for the Hip Dip ® , Hip Flip ® , CankCure ® , Next Generation Of Body Contouring, and our logo are U.S.

AirSculpt ® , AirSculpt+®, AirSculpting™, AirSculpt Plus ™ , Elite Body Sculpture®, RevisionSculpt®, AirSculpt Lift ™ , No Needle, No Scalpel, No Stitches ® , If You Can Pinch It, We Can Take It ® , Power BBL ® , Tiny Tuck ® , 48 Hour Six Pack ® , AirSculpt is for Everybody ® , Cure for the Hip Dip ® , Hip Flip ® , CankCure ® , Stubborn Fat, It’s All We Do®, The 48 Hour Difference™, What a Difference A Day Makes™, and our logo are U.S.

registered trademarks or trademarks for which registration is pending in the United States.

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Additionally, university and hospital systems, medical spas and centers and beauty and rejuvenation centers include the body contouring services in their offerings.

While we primarily operate in the body

contouring market, we also compete with companies that offer non-surgical methods of fat reduction, including weight-loss

drugs, and other non-invasive weight loss and obesity solutions.

Because of the high growth potential of the market for

weight loss and obesity solutions, existing and potential competitors have historically dedicated, and will continue to

dedicate, significant resources to aggressively develop and commercialize their products.

The areas in which we compete include:

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• Procedure Offering:

We compete with providers of liposuction, abdominoplasty (tummy tuck) and gastric bypass surgery, and non-surgical procedures that use cooling, injected medication or heat to reduce fat cells.

We compete with providers of liposuction, abdominoplasty (tummy tuck) and gastric bypass surgery, weight-loss drugs and non-surgical procedures that use cooling, injected medication or heat to reduce fat cells.

Many procedures can also involve significant pain and may require excess post-surgical recovery time.

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In accordance with applicable state laws, our surgeons have exclusive control and responsibility for all clinical decision-making and the provision of medical care to patients.

The Professional Associations are set up as legal entities, separate from Elite Body Sculpture, organized in accordance with applicable state laws regarding the types of entities that may operate a physician practice group.

The Professional Associations are set up as legal entities, separate from AirSculpt, organized in accordance with applicable state laws regarding the types of entities that may operate a physician practice group.

Each of the Professional Associations under which our affiliated surgeons operate is owned by a licensed, qualified physician.

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The Professional Associations are generally responsible for billing patients for services rendered by our surgeons.

Subject to applicable state laws governing enforceability of restrictive covenants relating to physicians, our surgeons contracted by the Professional Associations have agreed not to compete during the contracted period and have agreed not to use or disclose Elite Body Sculpture’s proprietary information, including the AirSculpt ® procedure, even after the terms of their respective contracts.

Subject to applicable state laws governing enforceability of restrictive covenants relating to physicians, our surgeons contracted by the Professional Associations have agreed not to compete during the contracted period and have agreed not to use or disclose AirSculpt’s proprietary information, including the AirSculpt ® procedure, even after the terms of their respective contracts.

Management Services Agreements

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Rollins and the other Surgeon Owners, whereby they are the sole directors, officers, and owners of the Professional Associations.

The Continuity Agreements (i) prohibit the Surgeon Owners from freely transferring or selling their interests in the Professional Associations, (ii) provide for the ability to add a second Surgeon Owner to help ensure continuity of the Professional Association, and (iii) provide that the ownership interests of the Surgeon Owners will automatically be transferred to another licensed professional designated by us in accordance with the terms of the Continuity Agreement upon the occurrence of certain events, which include, but is not limited to, the Surgeon Owner’s death, the termination of the Surgeon Owner’s employment, the Surgeon Owner’s license to practice medicine being revoked or terminated, the Surgeon Owner filing a petition for bankruptcy, the Surgeon Owner becoming indicted for or convicted of any felony or any misdemeanor offense involving moral turpitude, the Surgeon Owner breaching any provision of the Continuity Agreement, the Surgeon Owner’s gross negligence, willful misconduct or fraud with respect to the Professional Association, and the Surgeon Owner’s disability or incapacity.

The Continuity Agreements (i) prohibit the Surgeon Owners from freely transferring or selling their interests in the Professional Associations, (ii) provide for the ability to add a second Surgeon Owner to help ensure continuity of the Professional Association, and (iii) provide that the ownership interests of the Surgeon Owners will automatically be transferred to another licensed professional designated by us in accordance with the terms of the Continuity Agreement upon the occurrence of certain events, which include, but are not limited to, the Surgeon Owner’s death, the termination of the Surgeon Owner’s employment, the Surgeon Owner’s license to practice medicine being revoked or terminated, the Surgeon Owner filing a petition for bankruptcy, the Surgeon Owner becoming indicted for or convicted of any felony or any misdemeanor offense involving moral turpitude, the Surgeon Owner breaching any provision of the Continuity Agreement, the Surgeon Owner’s gross negligence, willful misconduct or fraud with respect to the Professional Association, and the Surgeon Owner’s disability or incapacity.

Each Continuity Agreement will remain in effect until it is terminated (i) by written agreement signed by or on behalf of each party, (ii) upon the 21-year anniversary of the death of the Surgeon Owner, or (iii) only by the manager (being our wholly-owned subsidiaries), upon at least 30 days prior written notice of such termination to the Professional Association.

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State Corporate Practice of Medicine and Fee-Splitting Laws

The laws in many of the states in which we operate or may in the future operate, prohibit entities owned by non-physicians from practicing medicine, exercising control over surgeons, employing surgeons or otherwise interfering with the independent professional judgment of surgeons.

independent professional judgment of surgeons.

This prohibition on the corporate practice of medicine, is intended to prevent unlicensed persons from interfering with the practice of medicine by licensed surgeons or interfering in any way with the independent professional judgment of physicians as it pertains to patient treatment and related clinical matters.

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In addition, these requirements are subject to broad interpretation and enforcement by state regulators.

Thus, regulatory authorities or other persons, including the Professional Associations’ contracted surgeons, may assert that, notwithstanding the careful structuring of our management arrangements, that we are engaged in the corporate practice of medicine or that the fees earned by us under our contractual arrangements with the Professional Associations constitute

unlawful fee splitting.

In such event, failure to comply could lead to adverse judicial or administrative action against us and/or our surgeons, civil, criminal or administrative penalties, receipt of cease and desist orders from state regulators, loss of provider licenses, the need to make changes to the terms of engagement with the Professional Associations (or their terms of engagement with their contracted surgeons), in each case that interfere with our business, our profitability and may have other materially adverse consequences.

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was incorporated in Delaware on June 30, 2021 and completed an IPO on October 28, 2021.

Our website address is www.elitebodysculpture.com and our investor relations website is located at https://investors.elitebodysculpture.com .

Our website address is www.airsculpt.com and our investor relations website is located at https://investors.elitebodysculpture.com .

The information posted on our website is not incorporated into this Annual Report.

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Securities and Exchange Commission (“SEC”).

Risk Factor Summary

We are providing the following summary of the risk factors contained in this Annual Report on Form 10-K to enhance the readability and accessibility of our risk factor disclosures.

We encourage you to carefully review the full risk factors contained in this Annual Report on Form 10-K in their entirety for additional information regarding the material factors that make an investment in our securities speculative or risky.

These risks and uncertainties include, but are not limited to, the following:

Risks Related to Our Business

• Macroeconomic trends including inflation and rising interest rates may adversely affect our financial condition and results of operations.

• We have a limited operating history and our past results may not be indicative of our future performance.

• Our success depends on our ability to maintain the value and reputation of the AirSculpt® brand.

• We have grown rapidly recently and have limited operating experience at our current scale of operations.

• Our financial results will be harmed if there is not sufficient patient demand for AirSculpt® procedures.

• Our success depends largely upon patient satisfaction with the effectiveness of the AirSculpt® procedure.

• We may fail to open and operate new centers in a timely and cost-effective manner.

• We may not be able to successfully continue to expand in markets outside of North America.

• We may not be able to compete or achieve significant market penetration.

• Our business, financial condition and results of operations could be adversely affected by disruptions in the global economy resulting from the ongoing military conflict between Russia and Ukraine.

• Changes in laws and regulations related to the internet, perceptions toward the use of social media and changes in internet infrastructure itself may diminish our ability to drive new customer acquisition.

• Regulations related to healthcare may hamper our availability to provide virtual consultations.

• We face competition for surgeons and other workers that provide our medspa and cosmetic services.

• We outsource the manufacturing of key elements of the tools we use for AirSculpt® procedures to a single third-party manufacturer, Euromi, who is dependent upon third-party suppliers.

• In some jurisdictions, we are precluded or limited in our ability to enter into non-compete agreements with our surgeons.

• Our centers and our affiliated Professional Associations may become subject to medical liability claims.

• Our revenue could decline due to changes in credit markets and decisions made by credit providers.

• We may be adversely affected if we lose any member of our senior management.

• The interests of our Sponsor may conflict with the interests of the Company and its other stockholders.

• Our leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and expose us to interest rate risk.

• Restrictive covenants in our debt instruments may adversely affect us.

• Any failure to meet our debt service obligations could have a material adverse effect on our business, prospects, results of operations and financial condition.

• We are a holding company with no operations of our own.

• Our management team has limited experience managing a public company.

• The COVID-19 global pandemic could negatively affect our operations, business and financial condition, and liquidity.

• Use and storage of paper medical records increases risk of loss, destruction and could increase human error with respect to documentation and patient care.

• Our internal computer systems, or those of any of our manufacturers, other contractors, consultants, or collaborators, may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data, or personal data.

Risks Related to Intellectual Property

• Our competitors could develop and commercialize procedures and products similar or identical to ours.

• We may become a party to intellectual property litigation or administrative proceedings that could be costly and could interfere with our ability to market and perform our services.

• If we are unable to protect the confidentiality of our other proprietary information, our business and competitive position may be harmed.

• We may not be able to protect our intellectual property rights throughout the world to the same extent as in the United States.

Risks Related to Government Regulations

• If we fail to comply with numerous laws and regulations relating to the operation of our centers, we could incur significant penalties or other costs or be required to make significant changes to our operations.

• AirSculpt® procedures may cause or contribute to adverse medical events that we are required to report to the FDA and if we fail to do so, we could be subject to sanctions that would materially harm our business.

• If laws governing the corporate practice of medicine or fee-splitting change, we may be required to restructure some of our relationships.

• We may be subject to various federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback, self-referral, false claims and fraud laws, and any violations by us of such laws could result in fines or other penalties.

• Certain risks are inherent in providing prescription and over the counter (“OTC”) treatments, and our insurance may not be adequate to cover any claims against us.

Risks Related to Ownership of Our Common Stock

• We are an “emerging growth company,” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

• Our stock price could be extremely volatile, and, as a result, you may not be able to resell your shares at or above the price you paid for them.

• There may be sales of a substantial amount of our common stock by our current stockholders, and these sales could cause the price of our common stock to fall.

• Provisions in our charter documents and Delaware law may deter takeover efforts that could be beneficial to stockholder value.

• We have no plans to pay cash dividends on our common stock for the foreseeable future.

• Our internal controls may not be effective.

• The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business.

• Our stock price and trading volume could decline if securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business.

• Operating metrics may fluctuate from quarter to quarter, which makes these metrics difficult to predict.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business