What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2026-03-10 compared with 2025-03-13 · 87 added, 101 removed, 187 unchanged (50% of the section changed)

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Executive Level Overview

We are a surgical aesthetic company with a passion for elevating people’s lives through innovative products, including our Helium Plasma Platform Technology products marketed and sold as Renuvion in the cosmetic surgery market and J-Plasma in the hospital surgical market.

We are a surgical aesthetics company with a passion for elevating people’s lives through innovative products, including its Helium Plasma Platform Technology products marketed and sold as Renuvion ® and the AYON Body Contouring System TM (“AYON”) in the cosmetic surgery market and J-Plasma® in the hospital surgical market.

Renuvion and J-Plasma offer surgeons a unique ability to provide controlled heat to tissue to achieve their desired results.

AYON is an FDA-cleared, surgeon-designed body contouring system that combines precision, versatility, and innovation in an all-in-one platform.

It seamlessly integrates fat removal, closed loop contouring, and Renuvion’s tissue contraction and electrosurgical capabilities, empowering surgeons to deliver comprehensive body contouring treatments for patients.

We also leverage our deep expertise and decades of experience in unique waveforms through OEM agreements with other medical device manufacturers.

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Studies have shown patients taking GLP-1’s have experienced a loss of body weight.

Currently, two GLP-1’s are cleared by the FDA for weight loss, but we anticipate a number of additional drug candidates will be cleared as well as, oral versions of these injectable medications.

Currently, two GLP-1’s are cleared by the FDA for weight loss and now oral versions have been approved and, we anticipate a number of additional drug candidates will be approved.

We believe the increased use of GLP-1’s has had an initial negative impact on the revenue for plastic and cosmetic surgeons and created uncertainty in the aesthetic space.

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workforce by nearly 25%.

We estimate the annualized future cost savings from the reduction in force to be approximately $4.3 million which we expect to contribute to our goal of decreasing losses and achieving cash-flow breakeven.

We estimated the annualized future cost savings from the reduction in force to be approximately $4.3 million.

We incurred pre-tax charges of approximately $0.6 million in the fourth quarter of 2024 representing, for the most part, one-time cash expenditures for severance and other employee termination benefits.

In addition to the reduction in force, we eliminated bonuses in 2024, reduced the size of the board of directors from eight to five members and reduced aggregate board cash compensation from $0.5 million annually to $0.1 million, while increasing board stock-based compensation.

In addition to the organizational changes, we have identified other direct cost savings we anticipate achieving in 2025.

The identified cost savings include reductions in professional fees, lower research and development costs as we complete the development of AYON, lower credit card fees and stock-based compensation.

We foresee, in totality, these cost savings will reduce our annual operating expenses below $40 million in 2025.

On November 22, 2022, we filed a shelf registration statement providing us the ability to register and sell our securities in the aggregate amount up to $100 million.

The shelf registration statement included an embedded ATM facility for up to $40 million.

To date we have not utilized this facility.

In addition to the organizational changes, we identified other direct cost savings we achieved in 2025.

The identified cost savings include reductions in professional fees, lower research and development costs, lower credit card fees and stock-based compensation.

These cost savings reduced our annual operating expenses below $40.0 million in 2025, as compared to $48.2 million and $53.7 million in 2024 and 2023, respectively.

APYX MEDICAL CORPORATION

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FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

On November 8, 2023, we entered into a Credit and Guaranty Agreement (the “Perceptive Credit Agreement”), by and among Apyx Medical (as borrower), Apyx China Holding Corp.

and Apyx Bulgaria EOOD, our wholly-owned subsidiaries (as subsidiary guarantors), and Perceptive Credit Holdings IV, LP (as initial lender and administrative agent) (“Perceptive”), and the lenders from time to time party thereto.

The Perceptive Credit Agreement provided for a facility of up to $45 million, consisting of senior secured term loans.

The Perceptive Credit Agreement provided for (i) an initial loan of $37.5 million and (ii) a delayed draw loan of $7.5 million.

Our ability to borrow the delayed draw loan of $7.5 million lapsed on December 31, 2024.

On November 7, 2024, we entered into an amendment to the Perceptive Credit Agreement.

The amendment reduced the financial covenant trailing twelve-month revenue targets relating to its Advanced Energy segment (tested quarterly), with amended year-end targets of $34.4 million, $37.0 million, $52.4 million and $60.3 million for 2024, 2025, 2026 and 2027, respectively.

The amendment reduced the financial covenant trailing twelve-month revenue targets relating to its Surgical Aesthetics segment (tested quarterly), with amended year-end targets of $37.0 million, $52.4 million and $60.3 million for 2025, 2026 and 2027, respectively.

The amendment also introduced a maximum operating expense financial covenant, with full year targets of $40.0 million and $45.0 million for 2025 and 2026, respectively.

The Perceptive Credit Agreement, as amended, continues to contain customary affirmative and negative covenants, including covenants limiting the ability of us and our subsidiaries, among other things, to incur debt, grant liens, make distributions, enter certain restrictive agreements, pay or modify subordinated debt, dispose of assets, make investments and acquisitions, enter into certain transactions with affiliates, and undergo certain fundamental changes, in each case, subject to limitations and exceptions set forth in the Perceptive Credit Agreement.

The Perceptive Credit Agreement, as amended, continues to contain customary affirmative and negative covenants, including covenants limiting our ability, and our subsidiaries to, among other things, to incur debt, grant liens, make distributions, enter certain restrictive agreements, pay or modify subordinated debt, dispose of assets, make investments and acquisitions, enter into certain transactions with affiliates, and undergo certain fundamental changes, in each case, subject to limitations and exceptions set forth in the Perceptive Credit Agreement.

Additionally, we must maintain a balance of $3.0 million in cash and cash equivalents during the term of the Perceptive Credit Agreement.

As of December 31, 2025, we were in compliance with the financial covenants contained within the Perceptive Credit Agreement, as amended.

Our continued compliance with covenants is subject to meeting or exceeding forecasted Advanced Energy revenues, as amended, and reducing operating expenses.

Our continued compliance with covenants is subject to meeting or exceeding forecasted Surgical Aesthetics revenues, as amended, and reducing operating expenses.

For a more in-depth description of the terms of the Perceptive Credit Agreement, as amended, see Note 10 in Item 8 of this Annual Report on Form 10-K.

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For a more in-depth description of the terms of the registered direct offering, see Note 12 in Item 8 of this Annual Report on Form 10-K.

On January 6, 2025, we announced that we had submitted a 510(k) premarket notification to the FDA for AYON.

On November 18, 2025, we entered into an underwriting agreement where we sold 2,762,431 shares of common stock at an offering price of $3.62.

After deducting incremental direct costs of the Offering, the our net proceeds were approximately $9.1 million.

For a more in-depth description of the terms of the offering, see Note 12 in Item 8 of this Annual Report on Form 10-K.

On December 1, 2025, we filed a shelf registration statement providing us the ability to register and sell our securities in the aggregate amount up to $100 million.

This shelf registration statement replaced our previous shelf registration statement that expired during December 2025.

On May 13, 2025, we announced that we had received 510(k) clearance from the U.S.

Food and Drug Administration (the “FDA”) for AYON.

We completed the soft launch of AYON, leveraging our relationships with key surgeons in critical geographies.

Additionally, we commenced the commercial launch of AYON in September 2025.

AYON was developed with a focus on versatility and innovation.

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Renuvion treatment to address loose and lax skin

During 2025, we plan to expand the indications with an additional 510(k) submission for AYON to include power assisted liposuction.

On October 13, 2025, we announced that we had submitted the 510(k) premarket notification to the FDA for the label expansion of AYON to include power liposuction.

We anticipate the clearance in the second quarter 2026.

On July 28, 2025, we announced the launch of Renuvion in China following receipt of initial market clearance from the National Medical Products Administration of China.

Other Matters

During 2024, we continued to drive sales in our Advanced Energy business by increasing the adoption and utilization of our handpieces in the U.S.

cosmetic surgery market and fulfilling demand from distributors in our international markets.

During 2025, we continued to accelerate sales growth in our Surgical Aesthetics business by launching AYON in the U.S.

aesthetic surgery market, beginning in September, and fulfilling demand from distributors for Renuvion in our international markets.

Management estimates that our products have been sold in more than 60 countries.

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In addition, we have invested in training programs and marketing-related activities to support accelerated adoption of our technology into surgeons' practices.

We believe that our continued investment and focus on the following strategic initiatives in 2025 and beyond will position the Company for long-term growth in the cosmetic surgery market:

We believe that our continued investment and focus on the following strategic initiatives in 2026 and beyond will position us for long-term growth in the cosmetic surgery market:

To provide enhanced physician and practice support for our cosmetic surgery customers

To expand our regulatory approvals to expand product availability in new markets worldwide

To execute our regulatory pathway for our AYON in the United States

To successfully launch AYON in the United States and eventually worldwide

To continue to execute our regulatory pathway for AYON in the United States

To continue the successful launch AYON in the United States and eventually worldwide

To generate consumer interest in the treatment of loose and lax skin through a focused direct-to-consumer advertising strategy, including as a result of the side effects of GLP-1's

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Asset information is not reviewed by the chief operating decision maker by segment and is not available by segment and, accordingly, we have not presented a measure of assets by reportable segment.

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

e operate in two business segments:

OEM and Advanced Energy.

The OEM segment is primarily development and manufacturing contract and product driven.

The Advanced Energy segment sells both capital equipment and consumables in the form of a single use handpiece.

We operate in two business segments:

Surgical Aesthetics and OEM.

The Surgical Aesthetics segment sells both capital equipment and consumables in the form of a single use handpiece.

Sales of handpiece units are a substantial portion of our business and for the years ended December 31, 2025 and 2024, we sold approximately 84,000 and 94,000 units, respectively.

During 2024, our single-use handpiece unit sales grew 8% overall and 15% in the United States and handpiece revenue currently accounts for more than 60% of our total Advanced Energy revenue.

Our single-use handpiece revenue accounts for approximately 50% and 63% of our total Surgical Aesthetics revenue for the years ended December 31, 2025 and 2024, respectively.

“Corporate & Other” includes certain unallocated corporate and administrative costs which are not specifically attributed to any reportable segment.

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Sales by Reportable Segment

Advanced Energy

Surgical Aesthetics

Sales by Domestic and International

International

Total revenue decreased by 8.1% or approximately $4.2 million for the year ended December 31, 2024 when compared with 2023.

Advanced Energy segment sales decreased 11.0% or approximately $4.8 million for the year ended December 31, 2024 when compared with 2023.

The Advanced Energy sales decrease was primarily due to lower sales of our generators in both domestic and certain international markets as a result of economic uncertainty in the capital equipment market that is being experienced in the aesthetic space and a lower average selling price of generators to domestic customers as a result of these market conditions.

These decreases were partially offset by increased volume of single-use handpieces globally and sales of Apyx One Console upgrades internationally.

Total revenue increased by 9.9% or approximately $4.7 million for the year ended December 31, 2025 when compared with 2024.

Surgical Aesthetics segment sales increased 17.4% or approximately $6.7 million for the year ended December 31, 2025 when compared with 2024.

The Surgical Aesthetics sales increase was driven by sales of AYON in the U.S., as we commenced our commercial launch during September 2025.

This increase was partially offset by decreases in domestic sales of generators, including upgrades to the Apyx One Console, where the purchase of AYON was not part of the sale, and decreased volume of single-use handpieces.

The OEM product line consists of proprietary products designed specifically for third party equipment manufacturers.

Revenue for this product line increased 5.9%, or approximately $0.5 million, when compared to 2023.

The increase in OEM sales was due to increases in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement.

Revenue for this product line decreased 20.9%, or approximately $2.0 million, when compared to 2024.

The decrease in OEM sales was due to decreases in sales volume to existing customers.

With the focus on Surgical Aesthetics, we anticipate that the OEM segment revenue will continue to decrease over time.

International sales represented approximately 26.6% and 29.3% of total revenues for the years ended December 31, 2025 and 2024, respectively.

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Percentage of sales

Our gross profit margin as a percentage of sales decreased by approximately 3.5% during the year ended December 31, 2024, compared with 2023.

The decrease in gross profit margins for the year ended December 31, 2024 from the prior year is primarily due to a decrease in the average selling price of generators to domestic customers, changes in the sales mix between our two segments, with our OEM segment comprising a higher percentage of total sales and geographic mix within our Advanced Energy segment, with international sales comprising a higher percentage of total sales.

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

Our gross profit margin as a percentage of sales increased by approximately 1.5% during the year ended December 31, 2025, compared with 2024.

The increase in gross profit margins for the year ended December 31, 2025 from the prior year is primarily due to mix between our two segments, with Surgical Aesthetics comprising a higher percentage of total sales and geographic mix, with domestic sales comprising a higher percentage of total sales.

These increases were partially offset by tariffs that began effecting us in the second half of 2025.

Other Costs and Expenses

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Our expenses for research and development related activities decreased by 33.6%, or approximately $1.7 million for the year ended December 31, 2025, compared with 2024.

This increase was primarily due to lower compensation and benefits costs from the prior year ($0.3 million) and lower spending on our product development initiatives and clinical studies ($0.1 million).

This decrease was primarily due to lower compensation and benefits costs from the prior year ($1.1 million) and lower spending on our product development initiatives and clinical studies ($0.6 million), as we complete the development of AYON.

Professional services

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Professional services expenses decreased 8.8%, or approximately $0.6 million for the year ended December 31, 2025, compared with 2024.

This decrease was primarily due to decreases in board of director’s stock-based compensation expense ($0.5 million), recruiting expenses ($0.4 million) and accounting and audit fees ($0.2 million).

These decreases were partially offset by increases in physician and marketing consulting ($0.6 million) and legal expenses ($0.4 million), as a result of the reversal of a legal loss contingency in the prior year.

This decrease was primarily due to decreases in physician and marketing consulting ($0.3 million), legal expenses ($0.3 million), accounting and audit fees ($0.1 million) and recruiting expenses ($0.1 million).

These decreases were partially offset by an increase in board of director’s stock-based compensation expense ($0.2 million), which was offset by lower board cash compensation included in selling, general and administrative expenses.

Salaries and related costs

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Salaries and related expenses decreased 19.3%, or approximately $3.3 million for the year ended December 31, 2025, compared to 2024.

The decrease was primarily due to a decrease in bonus expense ($1.0 million) as we reversed our entire annual bonus accrual during the third quarter because of economic uncertainty for capital equipment purchases in the aesthetics space.

The decrease was also the result of lower stock-based compensation expense ($0.5 million) and temporary labor expenses ($0.2 million).

The decrease was primarily due to a decrease in salaries and benefits ($2.9 million), which was due to lower headcount following our reduction in force in the fourth quarter of 2024 and lower stock-based compensation expense ($1.8 million).

These decreases were partially offset by increases in bonus expense ($1.3 million) as the compensation committee declared a discretionary bonus in 2025 based on our financial and operational results and temporary labor costs ($0.1 million).

Selling, general and administrative expenses

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Selling, general and administrative expense decreased by 16.2%, or approximately $3.1 million for the year ended December 31, 2025, compared with 2024.

The change is primarily due to decreases in commissions ($2.0 million), insurance expense, including claims on our policies ($1.4 million), advertising expense, including trade show fees and related costs ($0.5 million), travel expense ($0.4 million) and payment processing fees ($0.2 million).

These decreases were partially offset by higher meeting and training costs ($0.7 million), building lease expense ($0.2 million), allowances for credit losses ($0.1 million) and regulatory fees ($0.1 million).

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

Gain on sale-leaseback

(In thousands)

Gain on sale-leaseback

Percentage of sales

During the year ended December 31, 2023, gain on sale-leaseback was approximately $2.7 million as a result of the gain on the sale and leaseback of our Clearwater, FL facility in May 2023.

The change is primarily due to lower meeting and training costs ($1.0 million), travel expenses ($0.9 million), insurance expense, including claims on our policies ($0.6 million), regulatory and translation expenses ($0.4 million), board of directors cash compensation ($0.3 million), foreign currency gains and losses ($0.2 million), sales and property taxes ($0.1 million), payment processing fees ($0.1 million), software subscriptions ($0.1 million) and office supplies and shipping costs ($0.1 million).

These decreases were partially offset by higher commissions ($0.5 million) and advertising expense, including trade show fees and related costs ($0.3 million).

Interest Income (Expense)

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Percentage of sales

Interest income increased approximately $0.7 million for the year ended December 31, 2024, compared with 2023.

This increase is due to a higher average balance in on our investments in money market funds and U.S.

Treasury securities included in cash and cash equivalents.

Interest expense increased approximately $3.4 million for the year ended December 31, 2024, when compared with the prior year.

These increases are due to cash and noncash interest expense on the Perceptive Credit Agreement.

Interest income decreased approximately $0.5 million for the year ended December 31, 2025, compared with 2024.

This decrease is due to a lower average balance and lower average yield in on our cash equivalents in money market funds and U.S.

Treasury securities.

Interest expense decreased approximately $0.3 million for the year ended December 31, 2025, when compared with the prior year.

The decrease is primarily attributable to the write off of deferred costs allocated to the delayed draw term loan that expired in 2024.

Other Income (Loss), net

(In thousands)

Other (expense) income, net

Percentage of sales

Loss on extinguishment of debt

Other income (expense), net

Percentage of sales

Other (expense) income, net decreased approximately $0.8 million for the year ended December 31, 2024, compared with 2023.

This decrease was primarily due to the current year recording of a joint and several liability for sales taxes related to one customer ($0.2 million), a small insurance recovery in 2023 ($0.2 million) and the release of our joint and several payroll liability due to the lapse of the statute of limitations on a portion of the liability ($0.4 million) in 2023.

During the year ended December 31, 2023, loss on extinguishment of debt was approximately $3.1 million as a result of the extinguishment of the MidCap Credit Agreement upon execution of the Perceptive Credit Agreement.

Other income (expense), net increased approximately $0.3 million for the year ended December 31, 2025, compared with 2024.

This increase was primarily due to the prior year recording of a joint and several liability for sales taxes related to one customer ($0.2 million) and the current year reversal of a portion of this liability due to the statute of limitations lapsing ($0.1 million).

(In thousands)

Income tax expense (benefit)

Income tax expense

Effective tax rate

Income tax expense (benefit) was approximately $0.3 million and $(2.4 million), with effective tax rates of (1.1)% and 11.4%, respectively, for the years ended December 31, 2024 and 2023, respectively.

For the year ended December 31, 2024, the effective tax rate differs from the statutory rate primarily due to the valuation allowance on our Federal and state net operating losses (NOLs) and net deferred tax assets generated during the year.

For the year ended December 31, 2023, the effective tax rate differs from the statutory rate primarily due to the valuation allowance on our Federal and state net operating losses (NOLs) combined with the reversal of our uncertain tax positions upon completion of the IRS audit of our tax return for the 2018, 2019 and 2020 years in January 2023.

Income tax expense was approximately $0.3 million, with effective tax rates of (2.5)% and (1.1)%, respectively, for the years ended December 31, 2025 and 2024, respectively.

For each of the years ended December 31, 2025 and 2024, the effective tax rate differs from the statutory rate primarily due to the valuation allowance on our Federal and state net operating losses (NOLs) and net deferred tax assets generated during the year.

APYX MEDICAL CORPORATION

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Liquidity and Capital Resources

At December 31, 2024, we had approximately $31.7 million in cash and cash equivalents as compared to approximately $43.7 million in cash and cash equivalents at December 31, 2023.

At December 31, 2025 and 2024, we had approximately $31.7 million in cash and cash equivalents.

Our working capital at December 31, 2025 was approximately $46.8 million compared with $45.7 million at December 31, 2024.

For the year ended December 31, 2024, net cash used in operating activities was $18.0 million, which principally funded our loss from operations of $18.8 million, compared with net cash used in operating activities, exclusive of the receipt of our $8.1 million final income tax refund, of approximately $13.3 million for 2023.

The increase in cash used in operations is primarily due to the payment of accrued bonuses in the first quarter of 2024 (no bonuses were paid in 2023), higher accounts receivable, higher cash interest expense, net of interest income, and the increase in operating loss driven by lower Advanced Energy sales compared to the same period in the prior year.

These decreases were partially offset by improvements in our prepaid expenses and inventory positions.

For the year ended December 31, 2025, net cash used in operating activities was $8.0 million, which principally funded our loss from operations of $6.4 million, compared with net cash used in operating activities of approximately $18.0 million for 2024.

The decrease in cash used in operations is primarily due to the reduction in our operating loss, which is a result of the cost cutting measures implemented in the fourth quarter of 2024 combined with increased sales as we commenced the commercial launch of AYON during the second-half of 2025.

This reduction was partially offset by higher trade accounts receivable on our higher sales and cash used to procure inventory for our expanded product portfolio.

Net cash used in investing activities for the year ended December 31, 2025, was $1.1 million related to investments in property and equipment.

Net cash provided by investing activities for the year ended December 31, 2023, was $6.7 million related to the sale of our Clearwater, FL facility ($7.3 million), partially offset by investments in property and equipment ($0.5 million).

Net cash provided by investing activities for the year ended December 31, 2024, was $0.7 million related to investments in property and equipment.

Net cash provided by financing activities for the year ended December 31, 2025, was $9.6 million, which primarily related to proceeds received upon the closing of an underwriting agreement ($9.3 million) less costs incurred in the transaction ($0.2 million) as well as cash received upon stock option exercises ($0.5 million).

Net cash provided by financing activities for the year ended December 31, 2024, was $6.7 million, which primarily related to proceeds received upon the closing of a registered direct offering ($7.0 million) less costs incurred in the transaction ($0.2 million).

Net cash provided by financing activities for the year ended December 31, 2023, was $32.2 million, which primarily related to proceeds received upon the execution of the Perceptive Credit Agreement ($36.4 million) less debt issuance costs incurred in the transactions with both the Perceptive Credit Agreement and MidCap Credit Agreement ($3.1 million) and fees, premiums and costs to extinguish the MidCap Credit Agreement ($1.3 million).

On November 22, 2022, we filed a shelf registration statement providing us the ability to register and sell our securities in the aggregate amount up to $100 million.

The shelf registration included an embedded ATM facility for up to $40 million.

To date we have not utilized this facility.

During January 2023, we were notified that the IRS examination process of our 2018, 2019 and 2020 tax returns was complete and that our tax refunds were approved for approximately $0.2 million more than the amount recorded in the Company's Consolidated Balance Sheet at December 31, 2023.

On August 10, 2023, we received $8.1 million from the IRS, which included approximately $0.4 million of interest on the $7.7 million of income tax refunds.

On February 17, 2023, we entered into a Credit, Security and Guaranty Agreement (the “MidCap Credit Agreement”) with MidCap Funding IV Trust (as agent), and MidCap Financial Trust (as term loan servicer), and the lenders party thereto from time to time.

The MidCap Credit Agreement provided for an up to $35 million facility, consisting of senior secured term loans and a secured revolving facility.

The MidCap Credit Agreement provided for senior secured term loans of up to $25 million, comprised of (i) an initial tranche of $10 million, (ii) a second tranche of $5 million, and (iii) a third tranche of $10 million.

The secured revolving facility provided for loans in an aggregate principal amount of up to $10 million, subject to a borrowing base equal to certain percentages of the Company’s eligible accounts receivable and inventory, as determined in accordance with the terms of the MidCap Credit Agreement.

The MidCap Credit Agreement was extinguished when, on November 8, 2023, we entered into a Credit and Guaranty Agreement (the “Perceptive Credit Agreement”), by and among Apyx Medical (as borrower), Apyx China Holding Corp.

On November 8, 2023, we entered into a Credit and Guaranty Agreement (the “Perceptive Credit Agreement”), by and among Apyx Medical (as borrower), Apyx China Holding Corp.

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The Perceptive Credit Agreement provided for (i) an initial loan of $37.5 million and (ii) a delayed draw loan of $7.5 million.

The Company's ability to borrow the delayed draw loan of $7.5 million lapsed on December 31, 2024.

On February 27, 2023, our Board of Directors approved a plan to sell and leaseback our real property located in Clearwater, FL.

On March 14, 2023, we entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with VK Acquisitions VI, LLC (the “Purchaser”), for the sale of our facility located at 5115 Ulmerton Road, Clearwater, Florida, as more fully described in the Purchase Agreement (collectively, the “Property”) for a purchase price of $7,650,000.

On May 8, 2023, we closed the Purchase Agreement and concurrently executed a 10-year agreement to leaseback the underlying Property from the Purchaser.

For a more in-depth description of the terms of the Purchase Agreement see Notes 6 and 7 in Item 8 of this Annual Report on Form 10-K.

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

Our ability to borrow the delayed draw loan of $7.5 million lapsed on December 31, 2024.

On November 7, 2024, we entered into an amendment to the Perceptive Credit Agreement.

The amendment reduced the financial covenant trailing twelve-month revenue targets relating to our Surgical Aesthetics segment (tested quarterly), with amended year-end targets of $37.0 million, $52.4 million and $60.3 million for 2025, 2026 and 2027, respectively.

The amendment also introduced a maximum operating expense financial covenant, with full year targets of $40.0 million and $45.0 million for 2025 and 2026, respectively.

Additionally, we must maintain a balance of $3.0 million in cash and cash equivalents during the term of the Perceptive Credit Agreement.

As of December 31, 2024, we were in compliance with the financial covenants contained within the Perceptive Credit Agreement, as amended.

Our continued compliance with covenants is subject to meeting or exceeding forecasted Advanced Energy revenues, as amended and reducing operating expenses.

For a more in-depth description of the terms of the Midcap Credit Agreement and the Perceptive Credit Agreement, as amended, see Note 11 in Item 8 of this Annual Report on Form 10-K.

December 31, 2025, we were in compliance with the financial covenants contained within the Perceptive Credit Agreement, as amended.

Our continued compliance with covenants is subject to meeting or exceeding forecasted Surgical Aesthetics revenues, as amended, and reducing operating expenses.

For a more in-depth description of the terms of the Perceptive Credit Agreement, as amended, see Note 10 in Item 8 of this Annual Report on Form 10-K.

On November 7, 2024, we closed a $7.0 million registered direct offering with a healthcare-focused fund and issued 3,000,000 shares of common stock and 2,934,690 of pre-funded warrants to purchase common stock with an exercise price of $.001 per share.

For a more in-depth description of the terms of the registered direct offering, see Note 12 in Item 8 of this Annual Report on Form 10-K.

On November 18, 2025, we entered into an underwriting agreement where we sold 2,762,431 shares of common stock at an offering price of $3.62.

After deducting incremental direct costs of the Offering, our net proceeds were approximately $9.1 million.

For a more in-depth description of the terms of the offering, see Note 12 in Item 8 of this Annual Report on Form 10-K.

On December 1, 2025, we filed a shelf registration statement providing us the ability to register and sell our securities in the aggregate amount up to $100 million.

This shelf registration statement replaced our previous shelf registration statement that expired during December 2025.

At December 31, 2025, we had purchase commitments for inventories totaling approximately $4.9 million, all of which is expected to be purchased by the end of 2026.

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If the financial condition of our customers deteriorates, resulting in an inability to make payments, additional allowances may be required.

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

Litigation Contingencies

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It is at least reasonably possible that a change in the actual amount of loss will occur in the near term.

APYX MEDICAL CORPORATION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued

The consequences of global supply chain instability, inflationary cost increases, potential and actual tariffs, and their adverse impact to the global economy, continue to evolve.

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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 5. Market for Registrant’s Common Equity