What changed in this filing

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Item 1A. Risk Factors

2026-03-10 compared with 2025-03-13 · 23 added, 21 removed, 298 unchanged (13% of the section changed)

9 unchanged sentences

Macroeconomic trends including inflation and higher interest rates may adversely affect our financial condition, results of operations and cash flows.

We are in an inflationary period in the United States and is expected to continue at an elevated level in the near-term.

Higher inflation and interest rates could have an adverse impact on our operating expenses and our credit facilities.

There is no guarantee we will be able to mitigate the impact of inflation.

The Federal Reserve has raised interest rates to combat inflation and restore price stability.

In recent years, the Federal Reserve (the “Fed”) executed an aggressive tightening cycle increasing rates above 5% in 2023.

For most of 2024, the Fed paused rated increases and at the end of 2024 and throughout 2025 implemented several rate cuts.

Increases in interest rates on any of our debt will result in higher debt service costs, which will adversely affect our cash flows.

2 unchanged sentences

Such future constraints could increase our borrowing costs, which would make it more difficult or expensive to obtain additional financing or refinance existing obligations and commitments, which could slow or deter future growth.

The health of the economy may affect consumer purchases of discretionary services, such as cosmetic services, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The health of the economy may affect consumer purchases of discretionary services, such as cosmetic and aesthetic services, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our results of operations may be materially affected by conditions in the capital and credit markets and the economy generally.

Uncertainty in the economy could adversely impact customer purchases of discretionary services, including cosmetic services.

Uncertainty in the economy could adversely impact customer purchases of discretionary services, including cosmetic and aesthetic services.

Factors that could affect customers’ willingness to make such discretionary purchases include general business conditions, levels of employment, interest rates, tax rates, the availability of consumer credit, consumer confidence in future economic conditions and risks, or the public perception of risks, related to epidemics or pandemics.

1 unchanged sentence

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

Historically, some doctors have financed their purchase of generators through third-party credit providers some of whom with which we have existing relationships.

Historically, some doctors have financed their purchase of capital equipment through third-party credit providers some of whom with which we have existing relationships.

If we are unable to maintain our relationships with our financing partners, there is no guarantee that we will be able to find replacement partners who will provide our doctor customers with financing on similar terms, and our revenue may be adversely affected.

Further, reductions in consumer lending and the availability of consumer credit could limit the number of patients with the financial means to afford the procedures where our products are used.

Higher interest rates could increase our costs or the monthly payments for consumer products financed through other sources of consumer financing.

Higher interest rates could increase our costs, decrease our selling price, or increase the monthly payments for consumer products financed through other sources of consumer financing.

In the future, we cannot be assured that third-party financing providers will continue to provide doctor customers or patients with access to credit or that available credit limits will not be reduced.

4 unchanged sentences

Due to our recurring net losses and the continued level of demand for the adoption and utilization of our technology, we may need to raise additional capital to fund our future operations.

Our cash needs will depend on numerous factors, including our revenues, successful completion of our FDA product clearance activities, our continued ability to commercialize our advanced energy products, and our ability to reduce and control costs.

Our cash needs will depend on numerous factors, including our revenues, successful completion of our FDA product clearance activities, our continued ability to commercialize our surgical aesthetics products, and our ability to reduce and control costs.

If we are unable to secure such additional financing on terms that are acceptable to us, it will have a material adverse effect on our business, and we may have to limit operations in a manner inconsistent with our growth strategy.

1 unchanged sentence

If we are unable to obtain the requisite amount of financing needed to fund our planned operations, it would have a material adverse effect on our business and ability to continue as a going concern.

Our indebtedness levels could impact our business.

Our indebtedness levels and achievement of covenants could impact our business.

Our ability to make payments on, and to refinance, our indebtedness will depend on our ability to generate cash from operations or other financings.

17 unchanged sentences

Even if we are successful in developing new, or enhancing our existing products, there are various circumstances that could prevent their successful commercialization.

Our ability to successfully commercialize our products, including AYON, which we expect to launch during 2025, will depend on a number of factors, any of which could delay or prevent commercialization, including:

Our ability to successfully commercialize our products, including AYON, which launched in September 2025, will depend on a number of factors, any of which could delay or prevent commercialization, including:

our inability to obtain the necessary regulatory clearances or approvals for expanded indications, new products, or product modifications;

12 unchanged sentences

The failure to successfully commercialize our products will have a material and adverse effect on the future growth of our business, financial condition, results of operations and cash flows.

The energy-based medical device industry in the aesthetics market is highly competitive and we may be unable to compete effectively.

The energy-based medical device industry for the aesthetics market is highly competitive and we may be unable to compete effectively.

The energy-based medical device industry for the aesthetics market is highly competitive.

Many competitors in this industry are well-established, do a substantially greater amount of business, and have greater financial resources and facilities than we do.

We have invested and continue to invest, substantial resources to develop and monetize our Renuvion technology into the cosmetic surgery market.

We have invested and continue to invest, substantial resources to develop and monetize our Renuvion and AYON technology into the aesthetic surgery market.

We believe we must continue to innovate and develop new applications for our products and obtain new indications for use in order to differentiate ourselves and stay competitive.

6 unchanged sentences

We have 11 pending patent applications in the United States and 21 pending foreign applications.

Our intellectual property portfolio for our Renuvion and J-Plasma products continues to grow on an annual basis.

Our intellectual property portfolio for our Renuvion, AYON and J-Plasma products continues to grow on an annual basis.

We intend to continue to seek legal protection, primarily through patents, for our proprietary technology.

20 unchanged sentences

In the opinion of management, we have meritorious defenses, and such claims are adequately covered by insurance, or are not expected, individually or in the aggregate, to result in a material, adverse effect on our financial condition, results of operations and cash flows.

However, in the event that damages exceed the aggregate coverage limits of our policy, or if our insurance carriers disclaim coverage, or if we are unable to continue to obtain coverage on commercially reasonable terms, we believe it is possible that costs associated with these claims could have a material adverse impact on our consolidated financial position, results of operations and cash flows (see below ITEM 3:

Legal Proceedings).

6 unchanged sentences

Our purchase order commitments are never more than one year in duration and are supported by our sales forecasts.

The majority of our raw materials are purchased from sole-source suppliers.

The majority of our raw materials are purchased from single-source suppliers.

While we believe we could ultimately procure other sources for these components, should we experience any significant disruptions in this key supply chain, there are no assurances that we could do so in a timely manner which could render us unable to meet the demands of our customers, resulting in a material and adverse effect on our business and results of operations.

11 unchanged sentences

the success of our direct to consumer sales and marketing efforts;

the impact of GLP-1 drugs on the consumer demand as a result of a reallocation of discretionary spend to the drugs, the delay in aesthetic procedures as a result of patients waiting to hit their ideal weight, or the redistribution of aesthetic procedures away from traditional liposuction; and

the education of our customers and their patients on the benefits and uses of our products, compared to competitors’ products and technologies.

39 unchanged sentences

These potential consequences, as well as any adverse outcome from government investigations, could have a material adverse effect on our business, results of operations, financial condition, and cash flows.

In addition, the FDA has taken the position that device manufacturers are prohibited from promoting their products other than for the uses and indications set forth in the cleared product labeling.

In addition, the FDA prohibits device manufacturers from promoting their products other than for the uses and indications set forth in the cleared product labeling.

Any failure to comply could subject us to significant civil or criminal exposure, administrative obligations and costs, other potential penalties from, and/or agreements with, the federal government.

58 unchanged sentences

Violations of the FCPA, OFAC restrictions, the Bribery Act or other export control, anti-corruption, anti-money laundering and anti-terrorism laws or regulations may result in severe criminal or civil sanctions, and we may be subject to other liabilities, which could have a material adverse effect on our reputation, financial condition, and results of operations.

We are subject to governmental export controls and economic sanctions that could impair our ability to compete in international markets due to licensing requirements and subject us to potential liability if we are not in compliance with applicable laws.

We are subject to governmental export controls and regulations that could impair our ability to compete in international markets due to licensing requirements and subject us to potential liability if we are not in compliance with applicable laws.

Any non-compliance could have a material adverse effect on our business, financial condition, results of operations and cash flows.

21 unchanged sentences

government regulation, governmental investigations, or audits related to us or to our products;

developments related to our patents or other proprietary rights or those of our competitors and

developments related to our patents or other proprietary rights or those of our competitors;

results of product liability claims or future claims; and

changes in the position of securities analysts with respect to our stock.

11 unchanged sentences

As of December 31, 2025, our outstanding stock options to our employees, officers, directors and consultants amounted to 7,579,377 shares of our common stock, representing approximately 18.1% of our outstanding common stock.

In connection with the execution of the MidCap Credit Agreement and the Perceptive Credit Agreement, we issued warrants to purchase 1,500,000 shares of our commons stock, representing approximately 4.0% of our outstanding common stock.

Additionally, in the registered direct offering that we completed in November 2024, we issued 2,934,690 pre-funded warrants which will have a dilutive effect on our common stock outstanding when exercised.

In connection with the execution of certain credit agreements, we issued warrants to purchase 1,500,000 shares of our commons stock, representing approximately 3.6% of our outstanding common stock.

Additionally, in the registered direct offering that we completed in November 2024, we issued 2,934,690 pre-funded warrants, of which 1,923,623 remain outstanding and unexercised, which will have a dilutive effect on our common stock outstanding when exercised.

As of the date of this annual report on Form 10-K, the dilution is 4.6%.

38 unchanged sentences

Changes in U.S.

trade policies could significantly increase the cost of imported goods into the United States, which may materially reduce our sales or profitability.

or foreign trade policies could significantly increase the cost of imported goods into the United States, which may materially reduce our sales or profitability.

Changes in U.S.

trade policy could trigger retaliatory actions by affected countries, resulting in "trade wars," in increased costs for goods imported into the United States, which may reduce customer demand for these products if the parties having to pay those tariffs increase their prices, or in trading partners limiting their trade with the United States.

or foreign trade policy could trigger retaliatory actions by affected countries, resulting in "trade wars," in increased costs for goods imported into the United States, which may reduce customer demand for these products if the parties having to pay those tariffs increase their prices, or in trading partners limiting their trade with the United States.

If these consequences are realized, the volume of economic activity in the United States, may be materially reduced.

2 unchanged sentences

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 1A. Risk Factors