−Removed: We operate in a rapidly changing environment that involves a number of risks that could materially affect our business, financial condition or future results, some of which are beyond our control.
+Added: We operate in a rapidly changing environment that involves many risks that could materially affect our business, financial condition or future results, and some of which are beyond our control.
The occurrence of any of these risks could harm our business, financial condition, results of operations and/or growth prospects or cause our actual results to differ materially from those contained in forward-looking statements we have made in this report and those we may make from time to time.
−Removed: In evaluating the Company and its business, you should carefully consider the information included under Part I, Item 1A “Risk Factors” in this Annual Report on Form 10-K for the fiscal year ended December 31, 2022.
+Added: In evaluating the Company and its business, you should carefully consider the information included under Part I, Item 1A “Risk Factors” in this Annual Report.
Risk Factors Summary
2 unchanged sentences
Risks Relating to Our Business and Financial Condition
−Removed: ● Pandemic or other public health crises.
+Added: ● The strict adherence to regulatory requirements governing medical devices during the manufacturing process and that of suppliers.
+Added: ● Successful development and commercialization of enhanced products or new products to remain competitive.
● Our dependence on a limited number of products, and disruptions in our ability to sell these products.
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● Securities class action litigation or derivative litigation.
−Removed: ● Sufficiency of our internal and external sources of liquidity.
−Removed: ● The strict adherence to regulatory requirements governing medical devices during the manufacturing process and that of suppliers.
● Our markets are very competitive, and we sell certain of our products in a mature market.
● We manufacture and store our products at a single facility in Florida.
−Removed: ● Our inability to collect on our accounts receivables held by customers.
−Removed: ● Failure to maintain relationships with integrated delivery healthcare systems and Group Purchasing Organizations.
+Added: ● Our inability to collect on our accounts receivables from our customers.
+Added: ● Failure to maintain relationships with Integrated Delivery Networks and Group Purchasing Organizations.
● Cost-containment efforts of our customers and purchasing groups.
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● The lengthy sales cycle for medical devices could delay our sales.
−Removed: ● Our reliance on distributors to sell our products outside of the U.S.
−Removed: ● Successful development and commercialization of enhanced products or new products to remain competitive.
+Added: ● Our reliance on distributors to sell our products outside the U.S.
● Our dependency on our founder, Chairman, President and Chief Executive Officer, Roger Susi.
● Failure to attract and retain the talent required for our business.
+Added: ● Sufficiency of our internal and external sources of liquidity.
● Inability to scale our operations or adequately manage generational upgrades to our own products.
−Removed: ● Our engagement in related party transactions.
● Difficulties associated with integrating acquisitions of technologies, products, and businesses.
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● Changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns.
+Added: ● Our engagement in related party transactions.
● We are subject to various privacy and consumer protection laws.
Risks Related to Our Industry
−Removed: ● Changes in government regulations could force us to make modifications to how we develop, manufacture, market, and price our products.
+Added: ● Changes in government regulations or U.S.
+Added: healthcare policy could force us to make modifications to how we develop, manufacture, market, and price our products.
● Failure to obtain, or experience significant delays in obtaining, FDA clearances or other necessary approvals to commercially distribute new products.
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● Our products or product types, or MR imaging could be subject to negative publicity.
−Removed: ● Impact of U.S.
−Removed: healthcare policy and changes thereto.
−Removed: ● Healthcare fraud and abuse regulations potentially result in significant liability, require us to change our business practices and restrict our operations in the future.
+Added: ● Healthcare fraud and abuse regulations could potentially result in significant liability, require us to change our business practices and/or restrict our operations in the future.
● Impact of violations of the U.S.
Foreign Corrupt Practices Act and similar worldwide anti-bribery laws.
−Removed: ● We and our suppliers and customers are required to obtain regulatory approvals to comply with regulations applicable to medical devices and infusion pumps.
−Removed: ● We and our suppliers and customers are required to maintain compliance with regulations applicable to medical devices and infusion pumps.
+Added: ● We and our suppliers and customers are required to obtain regulatory approvals and maintain compliance with regulations applicable to medical devices and infusion pumps.
● Our operations are subject to environmental laws and regulations.
1 unchanged sentence
● Protection of our intellectual property.
−Removed: ● Our unpatented trade secrets, know-how, confidential and proprietary information, and technology may be inadequately protected.
● Uncertainties associated with timely patent reviews and approvals.
−Removed: ● We may become involved in patent litigation or other intellectual property proceedings relating to our future product approvals.
−Removed: ● Disclosure of confidential or proprietary information.
+Added: ● We may become involved in patent litigation or other intellectual property proceedings relating to our current and future products.
+Added: ● Disclosure of confidential or proprietary information, unpatented trade secrets, know-how, confidential and proprietary technology.
Risks Related to Ownership of Our Common Stock
● Significant fluctuations and volatility of our common stock.
−Removed: ● Use of capital to repurchase shares of our common stock.
−Removed: ● Our need or choice to raise additional capital in the future.
−Removed: ● The ability of Roger Susi, who serves as our Chairman of the Board of Directors, President and Chief Executive Officer, to exert significant influence over matters subject to stockholder approval.
+Added: ● Use of capital to repurchase shares of our common stock and need or choice to raise additional capital in the future.
+Added: ● The ability of Roger Susi, who serves as our Chairman of the Board of Directors, President and Chief Executive Officer, to exert significant influence over matters subject to stockholder approval due to his significant minority ownership.
● Payment of dividends, or a reduction or cessation of expected dividends.
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● Impact of being a public company on our competitive environment and our risk of potential litigation.
−Removed: ● Impact from our involvement in securities class action litigation.
+Added: ● Impact from our involvement in securities class action litigation, if any.
● Impact of securities or industry analysts’ failing to initiate research coverage of our stock, downgrading our stock, or discontinuing coverage.
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Our current revenue and profitability are significantly dependent on the sale of the MRidium 3860+ MRI compatible IV infusion pump system, the 3880 MRI compatible patient vital signs monitoring system (both Class II medical devices) and the ongoing sale of related disposables and services.
−Removed: In the past, the FDA issued us a warning letter that impacted our ability to commercially distribute our MRidium 3860+ MRI compatible IV infusion pump system.
−Removed: Although we have resolved this warning letter and resumed commercial distribution of the MRidium 3860+ MRI compatible IV infusion pump system, there can be no guarantee that the FDA will not take similar action in the future.
+Added: There can be no guarantee that in the future, the FDA will not impact our ability to commercially distribute.
The FDA could require us to cease shipment of our products, notify health professionals and others that the devices present unreasonable risk or substantial harm to public health, order a recall, repair, replacement, or refund of the devices, detain or seize adulterated or misbranded medical devices, or ban the medical devices.
−Removed: The FDA may also issue further warning letters or untitled letters, refuse future requests for 510(k) submission or premarket approval, revoke existing 510(k) clearances or premarket approvals
−Removed: previously granted, impose operating restrictions, enjoin and restrain certain violations of applicable law pertaining to medical devices and assess civil or criminal penalties against our officers, employees, or us.
−Removed: As inflationary measures have affected the greater market in 2022, we have considered the effects of inflation on our business operations and financial results.
+Added: The FDA may also issue warning letters or untitled letters, refuse future requests for 510(k) submission or premarket approval, revoke existing 510(k) clearances or premarket approvals previously granted, impose operating restrictions, enjoin and restrain certain violations of applicable law pertaining to medical devices and assess civil or criminal penalties against our officers, employees, or us.
+Added: As inflationary measures have affected the greater market in the last two years, we have considered the effects of inflation on our business operations and financial results.
We have assessed that inflation has not had a material impact on our revenues, expenses, assets, liabilities, or cash flows for the current reporting period.
−Removed: We have also evaluated our exposure to future inflationary risk and concluded that it is not significant based on our current business model, market conditions, and hedging strategies.
+Added: We have also evaluated our exposure to future inflationary risk and concluded that it is not significant based on our current business model and market conditions.
We have mitigated the impact of inflation on our cost of goods sold by continued operational efficiency.
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● technological developments such as new imaging modalities which render MRI procedures obsolete or reduce the instances where MRI imaging is utilized;
−Removed: ● loss of key relationships with suppliers, integrated delivery healthcare systems, group purchasing organizations, or end-user customers;
+Added: ● loss of key relationships with suppliers, integrated delivery healthcare systems, group purchasing organizations, distributors, or direct end-user customers;
● manufacturing or supply interruptions;
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If this vendor fails to meet our volume requirements, which we anticipate will increase over time, or if the vendor becomes unable or unwilling to continue supplying motors to us, this would impact our ability to supply our devices to customers until a replacement source is secured.
−Removed: Our executed agreement with this vendor provides that the price at which we purchase products from the vendor is determined by agreement from time to time or should material costs change.
+Added: Our executed agreement with this vendor, which renewed in March 2024, provides that the price at which we purchase products from the vendor is determined by agreement from time to time or should material costs change.
Although we have had a long history of stable pricing with this supplier, this provision may make it difficult for us to continue to receive motors from this vendor on favorable terms or at all if we do not agree on pricing in the future.
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We have been subject to securities class action litigation and derivative litigation, and we may be subject to similar or other litigation in the future.
−Removed: In the past, following adverse action by the FDA or volatility in our stock price, securities class action litigation has been brought against us.
+Added: In 2014, following adverse action by the FDA or volatility in our stock price, securities class action litigation has been brought against us.
There can be no assurance that we will not face other securities litigation in the future.
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Accordingly, there is no assurance that cash flows from operations and other internal and external sources of liquidity will at all times be sufficient for our cash requirements.
−Removed: If necessary, we may need to consider actions and steps to improve our cash position and mitigate any potential liquidity shortfall, such as modifying our business plan, pursuing additional financing to the extent available, reducing capital expenditures, pursuing and evaluating other alternatives and opportunities to obtain additional sources of liquidity and other potential actions to reduce costs.
+Added: If necessary, we may need to consider actions and steps to improve our cash position and mitigate any potential liquidity shortfall, such as modifying our business plan, pursuing additional financing to the extent available, reducing capital expenditures, pursuing and evaluating other alternatives and opportunities to obtain additional sources of liquidity and other potential
+Added: actions to reduce costs.
There can be no assurance that any of these actions would be successful, sufficient or available on favorable terms.
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Our competitors may have certain advantages, which include the ability to devote greater resources to the development, promotion, and sale of their products.
−Removed: Consequently, we may
−Removed: need to increase our efforts, and related expenses for research and development, marketing, and selling to maintain or improve our position.
+Added: Consequently, we may need to increase our efforts, and related expenses for research and development, marketing, and selling to maintain or improve our position.
We may not realize the per unit revenue we have planned for and expect.
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If by reason of fire, hurricane, or other natural disaster, or for any other reason, the facility is destroyed or seriously damaged or our access to it is limited, our ability to provide products to our customers would be seriously interrupted or impaired completely and our operating results and financial condition would be materially and negatively affected.
−Removed: Our inability to collect on our accounts receivables held by customers may have an adverse effect on our business operations and financial condition.
+Added: Our inability to collect on our accounts receivables from customers may have an adverse effect on our business operations and financial condition.
We market our products to end users in the United States and to distributors internationally.
1 unchanged sentence
Management maintains an allowance for potential credit losses.
−Removed: From time to time, we have had, and may in the future have, accounts receivables from one or more customers that accounted for 10 percent or more of our gross accounts receivable.
+Added: From time to time, we have had, and may in the future have, accounts receivables from one or more affiliated customers that accounted for 10 percent or more of our gross accounts receivable.
As a result, we may be exposed to a certain level of concentration of credit risk.
1 unchanged sentence
Additionally, the recent health pandemic has and may continue to cause delays in payments from customers, which may adversely impact our future results of operations and liquidity.
−Removed: If we fail to maintain relationships with integrated delivery healthcare systems and Group Purchasing Organizations, sales of our products could decline.
+Added: If we fail to maintain relationships with Integrated Delivery Networks and Group Purchasing Organizations, sales of our products could decline.
Our ability to sell our products to U.S.
−Removed: hospitals, acute care facilities and outpatient imaging centers depends in part on our relationships with integrated delivery healthcare systems and Group Purchasing Organizations (“GPOs”).
+Added: hospitals, acute care facilities and outpatient imaging centers depends in part on our relationships with Integrated Delivery Networks and Group Purchasing Organizations (“GPOs”).
Many existing and potential customers for our products are members of GPOs.
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Any decrease in expenditures by these healthcare facilities could decrease demand for our products and related services and reduce our revenue.
−Removed: Additionally, changes to reimbursement policies by third-party payors could also decrease demand for our products and related services and reduce our revenue.
+Added: Additionally, changes to reimbursement policies by third-party payors could also decrease demand for MR procedures and hence also for our products and related services and reduce our revenue.
Any failure in our efforts to access and educate clinicians, anesthesiologists, radiologists, and hospital administrators regarding the advantages of our products could significantly limit our product sales.
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Our current and future operations could be adversely impacted if we were to lose his services.
−Removed: Accordingly, our success will be dependent on appropriately managing the risks related to maintaining his continued services.
+Added: Accordingly, our success will be dependent on appropriately managing the risks related to maintaining his continued services, including having a succession plan.
If we fail to attract and retain the talent required for our business, our business could be materially harmed.
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Our future success will also depend in part on our ability to identify, hire and retain additional personnel, including executives, skilled engineers to develop new products and sales and production staff.
−Removed: We may not be successful in attracting, integrating, or retaining qualified
−Removed: personnel to meet our current growth plans or future needs.
+Added: We may not be successful in attracting, integrating, or retaining qualified personnel to meet our current growth plans or future needs.
Our productivity may be adversely affected if we do not integrate and train our new employees quickly and effectively.
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If we are unable to respond to and manage changing business conditions, or the scale of our products, services, and operations, then the quality of our services, our ability to retain key personnel and our business could be harmed.
−Removed: In February 2023, we purchased 26 acres of land in which we plan to build an expanded facility to increase capacity.
−Removed: Any failure to successfully construct and operate such a facility expand might limit our ability to grow as we expect.
+Added: In February 2023, we purchased 26 acres of land in Orlando, Florida on which we plan to build an expanded facility to increase capacity.
+Added: Any failure to successfully construct and operate such a facility expansion might limit our ability to grow as we expect.
+Added: We do not plan to retain the current Winter Springs, Florida leased facility once the larger facility is fully operational.
We engage in related party transactions, which result in a conflict of interest involving our management.
We have engaged in the past, and continue to engage, in related party transactions, particularly between our company and Roger Susi and his affiliates.
−Removed: The only significant ongoing related party transaction is the lease agreement between our company and Susi, LLC, an affiliate of Roger Susi, with respect to our sole production and headquarters facility in Winter Springs, Florida.
−Removed: Related party transactions present difficult conflicts of interest, could result in disadvantages to our company, and may impair investor confidence, which could materially and adversely affect us.
+Added: The only significant ongoing related party transaction is the lease agreement between our company and Susi, LLC, an affiliate of Roger Susi, with respect to our current sole production and headquarters facility in Winter Springs, Florida.
+Added: Related party transactions that present difficult conflicts of interest, could result in disadvantages to our company, and may impair investor confidence, which could materially and adversely affect us.
Related party transactions could also cause us to become materially dependent on related parties in the ongoing conduct of our business, and related parties may be motivated by personal interests to pursue courses of action that are not necessarily in the best interests of our company and our stockholders.
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The environment in which we operate makes it difficult to accurately forecast our business performance.
−Removed: Significant changes and volatility in most aspects of the current business environment, including financial markets, consumer behavior, speed of technological, regulatory, and competitive changes, and the recent health pandemic, make it increasingly difficult for us to predict our revenues and earnings into the future.
+Added: Significant changes and volatility in most aspects of the current business environment, including financial markets, customer behavior, speed of technological, regulatory, and competitive changes, and the recent health pandemic, make it increasingly difficult for us to predict our revenues and earnings into the future.
Our quarterly sales and profits depend substantially on the volume and timing of orders fulfilled during the quarter, and such orders are difficult to forecast.
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Such assumptions and estimates include those related to revenue recognition, accruals for product returns, allowances for doubtful accounts, valuation of inventory, impairment of intangibles and long-lived assets, accounting for leases, accounting for income taxes and stock-based compensation and allowances for uncertainties.
−Removed: These factors are also influenced by regular changes to GAAP, some of which are material to most companies.
+Added: These factors are also influenced by regular changes to GAAP, some of which are material to many companies.
These changes introduce risk to our financial reporting processes due to implementation and internal control implications.
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Although we take steps to protect the security of our customers’ personal information, we may be required to expend significant resources to comply with data breach requirements if third parties improperly obtain and use the personal information of our customers or we otherwise experience a data loss with respect to customers’ personal information.
−Removed: A breach of our network security
−Removed: and systems could have negative consequences for our business and future prospects, including possible fines, penalties and damages, reduced customer demand for our products, and harm to our reputation and brand.
+Added: A breach of our network security and systems could have negative consequences for our business and future prospects, including possible fines, penalties and damages, reduced customer demand for our products, and harm to our reputation and brand.
Risks Related to Our Industry
5 unchanged sentences
In addition, our products are subject to pre-clearance requirements by the FDA and similar international agencies that govern a wide variety of product activities from design and development to labeling, manufacturing, promotion, sales, and distribution.
−Removed: Compliance with these regulations may be time consuming, burdensome, and expensive for us.
+Added: Compliance with these regulations is time consuming, burdensome, and expensive for us.
The failure to obtain, or the loss or suspension of any such pre-approval, would negatively affect our ability to sell our products and harm our anticipated revenues.
−Removed: Foreign governmental authorities that regulate the manufacture and sale of medical devices have become increasingly stringent and, to the extent we sell our products in foreign countries, we may be subject to rigorous regulation in the future.
+Added: Foreign governmental authorities that regulate the manufacture and sale of medical devices have become increasingly stringent and, to the extent we sell our products in foreign countries, we may be subject to more rigorous regulation in the future.
Regulatory changes could result in restrictions on our ability to carry on or expand our operations, higher than anticipated costs or lower than anticipated revenue.
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We are responsible for obtaining the applicable regulatory approval for the commercial distribution of our products.
−Removed: As part of our strategy, we plan to seek approvals for new MRI compatible products.
+Added: As part of our strategy, we plan to seek approvals for new or improved MRI compatible products.
The process of obtaining approvals is costly and time consuming, and there can be no assurance that we will obtain the required approvals on a timely basis, or at all.
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Sales to customers outside of the U.S.
−Removed: have historically comprised of approximately 17 percent of our net revenues and we expect that non-U.S.
+Added: have recently been approximately 20 percent of our net revenues and we expect that non-U.S.
sales will contribute to future growth.
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● failure to maintain relationships with distributors, especially those who have assisted with foreign regulatory or government clearances;
−Removed: ● changes in labor, environmental, health and safety laws;
+Added: ● uncertainties regarding judicial systems and procedures, changes in labor, environmental, health and safety laws;
● healthcare crises or epidemics;
2 unchanged sentences
federal tax laws;
−Removed: ● political instability and actual or anticipated military or political conflicts, including instability related to war and terrorist attacks and to political matters such as Russia’s invasion of Ukraine and Brexit;
+Added: ● political instability and actual or anticipated military or political conflicts, including instability related to war and terrorist attacks, such as Russia’s invasion of Ukraine, and to political matters, such as the U.K.’s Brexit;
● economic instability, inflation, deflation, recession or interest rate fluctuations;
−Removed: ● uncertainties regarding judicial systems and procedures;
+Added: ● potential disruption in supply chains;
● minimal or diminished protection of intellectual property.
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healthcare policy and changes thereto, including the Patient Protection and Affordable Care Act, may have a material adverse effect on our financial condition and results of operations.
−Removed: Changes in the healthcare industry in the U.S.
−Removed: and abroad could adversely affect the demand for our products and the way in which we conduct our business.
−Removed: For example, the Patient Protection and Affordable Care Act (“ACA”), enacted in 2010, required most individuals to have health insurance, established new regulations on health plans, created insurance-pooling mechanisms and reduced Medicare spending on services provided by hospitals and other providers.
−Removed: The long-term viability of the ACA, and its impact on our business and results of operations, remains uncertain.
−Removed: There have also been recent U.S.
−Removed: Congressional actions to repeal and replace the ACA, and future actions are expected.
−Removed: For example, the Tax Cuts and Jobs Act of 2017 (“TCJA”), among other things, eliminated the individual mandate requiring most Americans (other than those who qualify for a hardship exemption) to carry a minimum level of health coverage effective January 1, 2019.
−Removed: In December 2018, a federal district court judge in Texas found the ACA’s individual mandate to be unconstitutional;
−Removed: and therefore, the entire law to be invalid.
−Removed: In December 2019, the Fifth Circuit affirmed the ruling regarding the individual mandate but remanded the case to the district court for additional analysis of the question of severability and whether portions of the law remain valid.
−Removed: In June 2021, the U.S.
−Removed: Supreme Court held that the states and individuals that brought the lawsuit do not have standing to challenge the law, effectively ending the case without ruling on the constitutionality of the individual mandate.
−Removed: Although we cannot predict the ultimate content or timing of any healthcare reform legislation or other court challenges to the ACA, potential changes resulting from any amendment, repeal, replacement, or invalidation of these programs, including any reduction in the future availability of healthcare insurance benefits, may decrease the number of people who are insured, which could adversely affect our business and future results of operations.
Our medical devices and business activities are subject to rigorous regulation by the FDA and other federal, state and international governmental authorities.
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Even if we are able to obtain approval for introducing new products to the market, we and our suppliers may not be able to remain in compliance with applicable FDA and other material regulatory requirements once clearance or approval has been obtained for a product.
−Removed: These requirements include, among other things, regulations regarding manufacturing practices, product labeling, off-
−Removed: label marketing, advertising and post-marketing reporting, adverse event reports and field alerts.
+Added: These requirements include, among other things, regulations regarding manufacturing practices, product labeling, off-label marketing, advertising and post-marketing reporting, adverse event reports and field alerts.
Compliance with these FDA requirements is subject to continual review and is monitored through periodic inspections by the FDA.
−Removed: For example, the FDA conducted routine inspections of our facility in Winter Springs, Florida in July 2016.
−Removed: The FDA issued a Form 483 on July 18, 2016 resulting from an inspection of our facility between July 11 and July 18, 2016 that identified three observations.
−Removed: These observations were related to procedural and documentation issues associated with the CAPA (Corrective and Preventive Action) system, vendor requirements and complaint investigation.
−Removed: We submitted responses to the Form 483 in August 2016 and October 2016 in which we described our proposed corrective and preventative actions to address each of the observations.
−Removed: As part of our response, on October 13, 2016 we initiated a customer follow up to our August 2012 Safety Alert and made available an updated instruction card for customers.
−Removed: This Safety Alert was closed in August 2019.
−Removed: In addition, manufacturing flaws, component failures, design defects, off-label uses, or inadequate disclosure of product related information could result in an unsafe condition or the injury or death of a patient.
+Added: For example, the FDA conducted routine inspections of our facility in Winter Springs, Florida in June 2019.
+Added: The FDA issued a Form 483 on June17, 2019 resulting from an inspection of our facility between June 11 and June 17, 2019, that identified three observations.
+Added: These observations were related to procedural and documentation issues associate, vendor requirements and complaint investigation.
+Added: We submitted responses to the Form 483 in July 2019 in which we described our proposed corrective and preventative actions to address each of the observations.
+Added: We received an acknowledgement letter from the FDA, on October 1, 2019, noting the proposed corrective and preventative actions were reviewed and appeared adequate.
+Added: In addition, manufacturing flaws, component failures, design defects, off-label uses by practitioners, or inadequate disclosure of product related information could result in an unsafe condition or the injury or death of a patient.
All these events could harm our sales, margins and profitability in the affected periods and may have a material adverse effect on our business.
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laws, or at all.
−Removed: We may be unable to protect our rights in trade secrets and unpatented proprietary technology in these countries.
+Added: We may be unable to protect our rights in
+Added: trade secrets and unpatented proprietary technology in these countries.
If our trade secrets become known, we may lose our competitive advantages.
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We rely on unpatented trade secrets, know-how and technology.
−Removed: This intellectual property is difficult to protect, especially in the medical device industry, where much of the information about a product must be submitted to regulatory authorities during the regulatory approval process.
+Added: This intellectual property is difficult to protect, especially in the medical device industry, where much of the information about a product must be submitted to regulatory authorities during the clearance process.
We seek to protect trade secrets, confidential information, and proprietary information, in part, by entering into confidentiality and invention assignment agreements with employees, consultants, and others.
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If we fail to successfully commercialize our products due to the lack of intellectual property protection, we may be unable to generate sufficient revenues to meet or grow our business according to our expected goals and this may have a materially adverse effect on our profitability, financial condition, and operations.
−Removed: We may become involved in patent litigation or other intellectual property proceedings relating to our future product approvals, which could result in liability for damages or delay or stop our development and commercialization efforts.
+Added: We may become involved in patent litigation or other intellectual property proceedings relating to our current and future product clearances, which could result in liability for damages or delay or stop our development and commercialization efforts.
The medical device industry has been characterized by significant litigation and other proceedings regarding patents, patent applications, and other intellectual property rights.
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In the case of a willful infringement, the definition of which is subjective, such damages may be increased up to three times.
−Removed: An adverse decision could have a material adverse effect on our business, financial position and results of operations and could cause the market value of our common stock to decline.
+Added: An adverse decision could have a material adverse effect
+Added: on our business, financial position and results of operations and could cause the market value of our common stock to decline.
In addition, we may indemnify our customers and distributors with respect to infringement by our products of the proprietary rights of third parties.
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If we fail to meet or exceed such expectations, our business and stock price could be materially adversely affected.
−Removed: Any use of capital to repurchase shares of our common stock, or the election to pay a cash dividend, could have a material adverse effect on our stock price and our business.
+Added: Any use of capital to repurchase shares of our common stock, or the election to continue to pay a regular cash dividend, could have a material adverse effect on our stock price and our business.
Our Board of Directors has historically authorized stock repurchase programs and, pursuant to these authorizations, we have used a significant amount of cash to repurchase shares of common stock of our company.
2 unchanged sentences
Stock repurchases now are burdened with a Federal excise tax which diminishes their attraction to deliver returns to shareholders.
−Removed: In February 2023, our Board of Directors declared and paid a special cash dividend of $1.05 per common share, which reduced our cash balance by approximately $13.2 million.
−Removed: Similarly, in 2022 we paid a cash dividend of $1.00 per share which reduced our cash balance by approximately $12.6 million.
−Removed: In the future, the Board of Directors may elect to allocate capital based on our continued ability to generate cash from operations, our capital needs to support normal operations, and making investments that are aimed at supporting growth, rather than paying cash dividends.
+Added: In December 2023, our Board of Directors declared a special cash dividend of $0.48 per share and the initiation of a regular quarterly dividend of $0.15 per share.
+Added: The special cash dividend and the first quarterly dividend are payable on January 12, 2024, to shareholders of record at the close of business on December 18, 2023.
+Added: Even though our board of directors has approved the payment of a regular quarterly cash dividend on the Company’s common stock, there can be no assurance as to whether or when we may pay dividends on our common stock in the future.
+Added: Future dividends, if any, will be declared and paid at the discretion of the Company’s board of directors and will depend on a number of factors.
+Added: Similarly, on February 2, 2023, the Board of Directors declared a special cash dividend of $1.05 per share on the Company’s common stock.
+Added: On February 21, 2023, we paid $13,222,907 to shareholders of record at the close of business on February 13, 2023.
+Added: In the future, the Board of Directors may elect to allocate capital based on our continued ability to generate cash from operations, our capital needs to support normal operations, and making investments that are
+Added: aimed at supporting growth, rather than paying cash dividends.
These capital allocation decisions could have a material adverse effect on our stock price.
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This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.
−Removed: We may need to invest in additional resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities.
+Added: We may need to invest in additional
+Added: resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities.
If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate legal proceedings against us, and our business may be adversely affected.
We believe that being a public company and compliant with these rules and regulations has made it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage.
−Removed: These factors could also make it more difficult for us to attract and retain qualified members of our Board of Directors, particularly to serve on our audit committee and compensation committee, and qualified executive officers.
+Added: These factors could also make it more difficult for us to attract and retain qualified executive officers and qualified members of our Board of Directors, particularly to serve on the Board of Directors’ audit committee (the “Audit Committee”) and compensation committee (the “Compensation Committee”).
As a result of being a public company, we are obligated to establish and maintain adequate internal controls.
3 unchanged sentences
During the evaluation and testing process, if we identify one or more material weaknesses in our internal controls over financial reporting, we will be unable to assert that our internal controls are effective.
−Removed: We are required to disclose changes made in our internal controls and procedures on a quarterly basis.
+Added: We are required to disclose significant changes made in our internal controls and procedures on a quarterly basis.
Our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our controls are documented, designed, or operating.
24 unchanged sentences
This provision could have the effect of delaying or preventing a change of control, whether or not it is desired by or beneficial to our stockholders, which could also affect the price that some investors are willing to pay for our common stock.
−Removed: UNRESOLVED STAFF COMMENTS
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.