What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-03-01 compared with 2023-03-02 · 119 added, 109 removed, 662 unchanged (26% of the section changed)

2 unchanged sentences

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

In accordance with Rule 13a-15(b) of the Exchange Act, as of the end of the period covered by this Annual Report on Form 10-K, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the

effectiveness of our disclosure controls and procedures.

Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures, as of the end of the period covered by this Annual Report on Form 10-K, were effective to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

15 unchanged sentences

OTHER INFORMATION

N o t a pplicable.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

The information required by this Item 10 will be included in the Proxy Statement to be filed within 120 days after the fiscal year covered by this annual report on Form 10-K and is incorporated herein by reference.

The information required by this Item 10 will be included in the Proxy Statement to be filed within 120 days after the fiscal year covered by this Form 10-K and is incorporated herein by reference.

EXECUTIVE COMPENSATION

4 unchanged sentences

The information required by this Item 13 will be included in the Proxy Statement, and such information is incorporated herein by reference.

PRINCIPAL ACCOUNTING FEES AND SERVICES

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this Item 14 will be included in the Proxy Statement, and such information is incorporated herein by reference.

29 unchanged sentences

Employment Agreement between the Registrant and Roger Susi, dated July 24, 2019

Employment Agreement between the Registrant and John (Jack) Glenn, dated May 21, 2022

S ale and Purchase Agreement between O PPOPERTY, LTD., a Florida limited partnership, and the Registrant, dated November 1, 2022

Reinstatement and Amendment to Sale and Purchase Agreement between O PROPERTY, LTD., a Florida limited partnership, and the Registrant, dated February2, 2023

2023 Equity Incentive Plan

Form of Restricted Stock Unit Award Agreement for Iradimed Corporation 2023 Equity Incentive Plan

Form of Restricted Stock Unit Award Agreement (Time-Vesting) for Iradimed Corporation 2023 Equity Incentive Plan

Form of Restricted Stock Unit Award Agreement (Performance-Vesting) for Iradimed Corporation 2023 Equity Incentive Plan

List of Subsidiaries

Consent of RSM US LLP, Independent Registered Public Accounting Firm

Power of Attorney (included on signature page)

Certification of Chief Executive Officer pursuant to Exchange Act Rule, 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

1 unchanged sentence

Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 I.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200

Iradimed Corporation Incentive-Based Compensation Recovery Policy

XBRL Instance Document

18 unchanged sentences

/s/ Roger Susi

Chairman of the Board, Chief Executive Officer and President (Principal Executive Officer)

Chairman of the Board, Chief Executive Officer and President

March 1, 2024

(Principal Executive Officer)

/s/ John Glenn

Chief Financial Officer and Secretary (Principal Financial and Accounting Officer)

Chief Financial Officer and Secretary

March 1, 2024

(Principal Financial and Accounting Officer)

/s/ Monty Allen

19 unchanged sentences

Report of Independent Registered Public Accounting Firm

To the Stockholders’ and the Board of Directors of IRADIMED CORPORATION

Stockholders’ and the Board of Directors of IRADIMED CORPORATION

Opinion on the Financial Statements

22 unchanged sentences

The Company records contract liabilities, or deferred revenue, when it has an obligation to provide a product or service to the customer and payment is received in advance.

Payments received on the sale of extended warranty agreements are deferred and recognized in revenue ratably over the agreement period, which is typically one to four years after control of the related product is transferred to the customer.

Payments received on the sale of extended warranty agreements are deferred and recognized in revenue ratably

over the agreement period, which is typically one to four years after control of the related product is transferred to the customer.

We identified deferred revenue recorded on the sale of extended warranties as a critical audit matter because of the complexities of the manual calculations performed by management in estimating the deferred revenue to recognize on the sale of extended warranties at year end.

5 unchanged sentences

● We tested the mathematical accuracy of management’s deferred revenue calculations and the timing of revenue recognized.

/s/ RSM US LLP

We have served as the Company’s auditor since 2013.

/s/ RSM US LLP

Orlando, Florida

4 unchanged sentences

Cash and cash equivalents

Accounts receivable, net

Accounts receivable, net of allowance for doubtful accounts of $ 368,835 as of December 31, 2023, and $ 160,498 as of December 31, 2022

Inventory, net

4 unchanged sentences

Intangible assets, net

Operating lease right-of-use asset, net

Operating lease right-of-use asset

Deferred tax asset, net

6 unchanged sentences

Deferred revenue

Current portion of operating lease liability

Other current liability

Dividend payable

Current portion of operating lease liabilities

Other current liabilities

Accrued income taxes

Total current liabilities

Deferred revenue

Operating lease liability, less current portion

Operating lease liabilities, less current portion

Total liabilities

Stockholders’ equity:

Common stock;

$ 0.0001 par value;

31,500,000 shares authorized;

12,660,313 shares issued and outstanding as of December 31, 2023, and 12,591,004 shares issued and outstanding as of December 31, 2022

Additional paid-in capital

Retained earnings

Accumulated other comprehensive income

Total Stockholders' Equity

3 unchanged sentences

STATEMENTS OF OPERATIONS

For the year ended December 31,

For the Year Ended

Cost of revenue

6 unchanged sentences

Other income, net

Income before income taxes

Income before provision for income taxes

Provision for income tax expense

4 unchanged sentences

STATEMENTS OF COMPREHENSIVE INCOME

For the Years Ended December 31,

Other comprehensive (loss):

Change in fair value of available-for-sale securities, net of tax expense (benefit) of $ 9,098 and $( 11,486 ), respectively

Realized gain on available-for-sale securities reclassified to net income, net of tax expense of $ 1,966 and $ 4,545 , respectively

For the Year Ended

Other comprehensive (loss) income:

Change in fair value of available-for-sale securities, net of tax expense (benefit) of $ 0 and $ 0 for the year ended December 31, 2023 and 2022, respectively and $ 0 and $ 9,098 for the year ended December 31, 2023 and 2022, respectively

Realized (gain) loss on available-for-sale securities reclassified to net income, net of tax expense (benefit) of $ 0 and $ 0 for the year ended December 31, 2023 and 2022, respectively, and $ 0 and $ 1,966 for the year ended December 31, 2023 and 2022, respectively

Other comprehensive loss

7 unchanged sentences

Balances, December 31, 2021

Dividends paid

( 12,559,127 )

Other comprehensive loss

3 unchanged sentences

Balances, December 31, 2022

Dividends paid

Dividends paid or accrued

( 21,198,904 )

Other comprehensive loss

Stock-based compensation

Stock-based compensation expense

Net share settlement of restricted stock units

Net share settlement of performance based stock units

Exercise of stock options

6 unchanged sentences

Adjustments to reconcile net income to net cash provided by operating activities:

Change in allowance for doubtful accounts

Change in provision for excess and obsolete inventory

Allowance for doubtful accounts

Provision for excess and obsolete inventory

Depreciation and amortization

Disposal of property and equipment

Loss (Gain) on disposal of property and equipment

Stock-based compensation

Deferred income taxes, net

Gain on maturity of investments

( 1,171,908 )

(Gain) on maturities of investments

Changes in operating assets and liabilities:

2 unchanged sentences

( 7,468,170 )

Prepaid expenses and other current assets

( 1,308,956 )

Prepaid expenses and other current assets

Accounts payable

7 unchanged sentences

Investing activities:

Proceeds from maturity of investments

Proceeds from maturities of investments

Purchases of property and equipment

( 7,440,510 )

Capitalized intangible assets

( 1,051,978 )

Net cash (used in) provided by investing activities

Net cash used in investing activities

( 8,007,167 )

( 1,374,997 )

Financing activities:

Dividends paid

( 13,222,907 )

Proceeds from stock option exercises

Taxes paid for net share settlement of restricted stock units

Net cash (used in) provided by financing activities

( 12,559,127 )

Net (decrease) increase in cash and cash equivalents

Proceeds from exercises of stock options

Taxes paid related to the net share settlement of equity awards

Net cash used in financing activities

( 13,656,511 )

Cash and cash equivalents, beginning of year

Cash and cash equivalents, end of year

( 12,706,400 )

Net decrease in cash and cash equivalents

( 8,198,666 )

( 4,038,686 )

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Supplemental disclosure of cash flow information:

Dividends declared not yet paid

Cash paid for income taxes

Right-of-use asset recognized in exchange for new lease obligation

Operating and short-term lease payments recorded within cash flow from operating activities

ROU asset recognized in exchange for new lease obligation

Operating and short-term lease payments recorded within cash flow provided by operating activities

See accompanying notes to financial statements.

79 unchanged sentences

As of December 31, 2023 and 2022, our allowance for doubtful accounts was $ 368,835 and $ 160,498 , respectively.

Our investments consisted of corporate debt securities and are considered available-for-sale.

The specific identification method is used to determine the cost basis of investments sold.

Our investments are recorded in our Balance Sheets at fair value.

Investments, held in the past, consisted of corporate debt securities and were considered available-for-sale.

The specific identification method was used to determine the cost basis of investments sold.

Our investments were recorded in our Balance Sheets at fair value.

We classified our investments as current based on the nature of the investments and their availability for use in current operations.

Unrealized gains and losses on our investments are included in accumulated other comprehensive income (loss), net of tax.

Realized gains or losses and impairment losses that are determined to be other-than-temporary are recorded in other income, net in our Statements of Operations.

We currently do not own any corporate bonds but should direct debt securities be utilized in the future, we would treat them as described above.

Unrealized gains and losses on our investments were included in accumulated other comprehensive income (loss), net of tax.

Realized gains or losses and impairment losses that were determined to be other-than-temporary were recorded in other income, net, in our Statements of Operations.

As of December 31, 2023, we do not own any corporate debt securities, but should direct debt securities be utilized in the future, we would treat them as described above.

Fair Value Measurements

31 unchanged sentences

Costs incurred in the research and development of new software components and enhancements to existing software components are expensed as incurred until technological feasibility has been established.

We capitalize software development costs when the project reaches technological feasibility and cease capitalization when the project is ready for release.

We capitalize software development costs when the product reaches technological feasibility and cease capitalization when the product is ready for commercial sale.

Capitalized software development costs are included in intangible assets and are amortized on a straight-line basis over the estimated useful life of the product and included in cost of revenue.

Amortization begins when the product is available for general release to the customer.

Amortization begins when the product is available for general sales to customers.

Long-lived Assets

2 unchanged sentences

Impairment is considered to have occurred when the estimated undiscounted future cash flows related to the asset groups are less than its carrying value.

Estimates of future cash flows involve consideration of many factors including the marketability of new products, product acceptance and lifecycle, competition, appropriate discount rates and operating

An impairment is recognized as the amount by which the carrying value is greater than the fair value of the asset or asset group.

15 unchanged sentences

For purposes of the LTIP, total shareholder return is calculated as the share price at the end of the performance period, which is three years, including the reinvestment of any dividends during the performance period, as compared to the share price at the beginning of the performance period.

The payout range for participants will be between 0 percent and 200 percent, depending on the Company’s performance.

The payout range for participants will be between 0 percent and 200 percent, depending on the Company’s relative total return performance.

The grant date fair value of our PSUs is based on a Monte Carlo simulation, the closing price of our common stock, and other pertinent factors on the grant date.

7 unchanged sentences

In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations.

A valuation allowance is recorded

to offset net deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

We recognize the tax benefit of uncertain tax positions in the financial statements based on the technical merits of the position.

A valuation allowance is recorded to offset net deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

We recognize the tax benefit of uncertain tax positions, if any, in the financial statements based on the technical merits of the position.

When the tax position is deemed more likely than not of being sustained, we recognize the largest amount of tax benefit that is greater than 50 percent likely of being ultimately realized upon settlement.

11 unchanged sentences

The following table presents the computation of basic and diluted net income per share:

For the Years Ended December 31,

For the Year Ended December 31,

Weighted-average shares outstanding — Basic

7 unchanged sentences

Stock options to purchase shares of our common stock and restricted stock units excluded from the calculation of diluted net income per share because the effect would have been anti-dilutive are as follows:

As of December 31,

Anti-dilutive stock options and restricted stock units

20 unchanged sentences

Accounting Pronouncements Implemented in 2023

Beginning in 2022, the Tax Cuts and Jobs Act of 2017 (“TCJA”) eliminated the option to deduct research and experimental expenditures in the current year and requires taxpayers to amortize them over five years pursuant to IRC Section 174.

This change is applied from 2022 onward prospectively and impacts the timing of the related cash tax payments as the deductions are disallowed for tax in the year incurred but allowed for tax purposes to be amortized and deducted over 5 years .

The mandatory capitalization requirement increases our deferred tax assets and cash tax liabilities by approximately $ 0.5 million .

and deducted over 5 years .

The mandatory capitalization requirement increased our deferred tax assets and cash tax liabilities by approximately $ 0.5 million as of and for the year ended December 31, 2023.

In the future, Congress may consider legislation that would defer the amortization requirement to later years, possibly with a retroactive effect.

In the meantime, we expect to continue to make additional Federal tax payments based on current Section 174 tax law.

The impact on Section 174 on our cash from operations depends on the amount of research and experimental expenditures incurred by the company and whether the IRS issues guidance on the provision which differs from current interpretation, among other things.

The impact of Section 174 on our cash from operations depends on the amount of research and experimental expenditures incurred by the company and whether the IRS issues guidance on the provision which differs from current interpretation, among other things.

Recently Issued Accounting Pronouncements to be Implemented

4 unchanged sentences

The previously mentioned ASUs are effective for fiscal years beginning after December 15, 2022, with early adoption permitted.

We do not expect the adoption of these ASUs to have a material impact on our financial condition, results of operations or cash flows.

The adoption of these ASUs did not have a material impact on our financial condition, results of operations or cash flows.

Disaggregation of Revenue

1 unchanged sentence

Revenue information by geographic region is as follows:

For the Years Ended December 31,

United States

2 unchanged sentences

Revenue information by type is as follows:

For the Years Ended December 31,

MRI compatible IV infusion pump system

MRI Compatible IV Infusion Pump Systems

MRI Compatible Patient Vital Signs Monitoring Systems

1 unchanged sentence

Total Devices revenue

Disposables, service and other

Disposables, services and other

Amortization of extended warranty agreements

2 unchanged sentences

Our contract liabilities consist of:

As of December 31,

Advance payments from customers

23 unchanged sentences

Property and equipment consist of:

As of December 31,

Computer software and hardware

2 unchanged sentences

Machinery and equipment

Tooling in-process

Fixed assets in-process

Accumulated depreciation

1 unchanged sentence

( 3,430,330 )

Depreciation and amortization expense of property and equipment was $ 569,551 and $ 532,275 for the years ended December 31, 2022 and 2021, respectively.

Depreciation expense of property and equipment was $ 648,133 and $ 569,551 for the year ended December 31, 2023 and 2022, respectively.

Property and equipment, net by geographic region is as follows:

As of December 31,

United States

4 unchanged sentences

The following table summarizes the components of intangible asset balances:

As of December 31,

Patents — in use

4 unchanged sentences

Accumulated amortization

Amortization expense of intangible assets was $ 101,122 and $ 101,735 for the two years ended December 31, 2022, and 2021, respectively.

Amortization expense of intangible assets was $ 117,047 and $ 101,122 for the year ended December 31, 2023, and 2022, respectively.

Expected annual amortization expense for the next five years related to intangible assets is as follows (excludes in-process intangible assets):

6 — Investments

Our investments consist of bonds that we have classified as available-for-sale and are summarized in the following tables:

As of December 31, 2022

As of December 31, 2021

7 — Fair Value Measurements

The fair value of our assets and liabilities subject to recurring fair value measurements are as follows:

Fair Value at December 31, 2022

Quoted Prices

Identical Assets

Fair Value at December 31, 2021

Quoted Prices

Identical Assets

Our corporate bonds are valued by the third-party custodian at closing prices from national exchanges or pricing vendors on the valuation date.

6 — Accumulated Other Comprehensive Income

The only component of accumulated other comprehensive income related to unrealized gains and (losses) on our investments was as follows:

Unrealized Gains

Unrealized (Losses)

Available-For-Sale

Balance at December 31, 2021

(Gain) Loss on available-for-sale securities, net

Reclassification realized in net earnings

Balance at December 31, 2022

(Gain) Loss on available-for-sale securities, net

Reclassification realized in net earnings

3 unchanged sentences

Upon adoption and approval of the 2014 Plan, the previous equity incentive plan was terminated and the remaining shares available for future awards were canceled.

The 2014 Plan initially reserved 1,000,000 shares of our common stock for awards of incentive stock options, non-qualified stock option, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and cash awards.

The 2014 Plan initially reserved 1,000,000 shares of our common stock for awards of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and cash awards.

On June 12, 2020, the shareholders approved an amendment to the 2014 Plan, which reserved an additional 1,000,000 shares of our common stock for the various equity awards mentioned above.

As of December 31, 2023, there were 969,303 shares available for future awards under the 2014 Plan.

The 2014 Plan expires in April 2024 and the remaining shares available for future awards will be cancelled.

On June 15, 2023, our Board of Directors adopted, and our shareholders approved the 2023 Equity Incentive Plan (“2023 Plan”).

The 2023 Plan reserves 1,500,000 shares of our common stock for awards of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based awards.

The 2023 Plan will expire on June 15, 2033, when any remaining shares available for future awards will be cancelled.

Stock-based compensation was recognized as follows in the Statements of Operations:

For the Years Ended December 31,

Cost of revenue

2 unchanged sentences

Research and development

Total stock-based compensation expense

Stock Options

33 unchanged sentences

For the year ended December 31, 2023, the Company recognized $ 17,779 in stock compensation expense related to the 13,160 PSUs granted in December 2023 compared to $ 12,249 in stock compensation expense for the same period recognized in 2022 related to the 18,819 PSUs granted in December 2022.

The fair value of the December 2022 grants will be calculated using a Monte-Carlo simulation model with a three-year term and an applicable risk-free interest rate.

The resulting difference in stock compensation expense is expected to be immaterial and will be recorded in the first quarter of 2023.

For the year ended December 31, 2023, the grant date fair value of the PSUs was $ 59.28 per unit, which was calculated using a Monte-Carlo simulation model with an expected term of three years and a risk-free interest rate of 4.36 %.

The Monte-Carlo simulation incorporated the volatility and dividend yield for the Company and each member of the peer group individually.

Peer group volatilities ranged from 38.4 % to 94.0 % and dividend yields ranged from 0.0 % to 1.1 %.

The Monte-Carlo simulation incorporated the volatility and dividend yield for the Company and the Nasdaq US Small Cap Medical Equipment Index.

Index volatility was 37.1 % and dividend yield was 1.0 %.

The volatility and dividend yield used for the Company was 49.7 % and 1.0 %, respectively.

6 unchanged sentences

Foreign currency exchange losses

Disposal of Assets

Total other income, net

5 unchanged sentences

Deferred taxes:

( 1,195,888 )

Total deferred tax expense

( 1,421,945 )

Provision for income tax expense

6 unchanged sentences

Reserves and allowances

Research and development credits carryforward

Net operating loss carryforward

Depreciation and amortization

Accrued expenses

Capitalized Research and Development

Total deferred income taxes, net

At December 31, 2022 the Company expects to fully utilize their carryforward net operating losses for state tax purposes.

Many states follow the 20 -year carryforward period for net operating losses;

however, a select few have a shorter expiration period.

A reconciliation of the statutory U.S.

4 unchanged sentences

CARES Act NOL carryback

Incentive stock options

Stock compensation expense and tax windfalls upon exercises and vesting

1 unchanged sentence

Permanent items

Provision to return adjustments

Compensation limitations

Foreign taxes

Provision to return adjustments, net

Foreign derived intangible income

11 unchanged sentences

Management has evaluated the need for a valuation allowance for deferred tax assets, considering the reversal of temporary differences, and believes it is more likely than not that the Company will realize the net deferred income tax assets as of December 31, 2023.

We have one material lease contract outstanding.

We have entered into operating lease contracts for our plant and office space and various office equipment.

We have three material lease contracts outstanding.

In January 2014, we entered into a non-cancelable operating lease, commencing July 1, 2014, for our manufacturing and headquarters facility in Winter Springs, Florida owned by Susi, LLC, an entity controlled by our President, Chief Executive Officer, and Chairman of the Board, Roger Susi.

6 unchanged sentences

This lease agreement does not contain any residual value guarantee or material restrictive covenants.

In February 2023, we entered into two , two-year , non-cancelable operating leases for approximately 5,400 square feet of additional office space in Winter Springs, Florida.

Pursuant to the lease terms the total monthly base rent is $ 10,055 .

For the twelve months ended December 31, 2023, and 2022, the Company paid $ 110,605 and $ 0 respectively.

Under the terms of the lease, we are responsible for insurance and maintenance expenses.

Pursuant to the contract terms, the leases will expire February 2025 and do not contain any residual value guarantee or material restrictive covenants.

Operating lease cost recognized in the Statements of Operations is as follows:

For the Years Ended

For the Year Ended

Cost of revenue

4 unchanged sentences

Maturity of Operating lease liability as of December 31, 2023, is as follows:

Three months ending December 31, 2023

Total lease payments

6 unchanged sentences

Employer matching contributions are determined by management and are discretionary.

Employer matching contributions were $ 479,155 and $ 434,904 , respectively, for the years ended December 31, 2022, and 2021.

Employer matching contributions were $ 540,503 and $ 479,155 for the year ended December 31, 2023, and 2022, respectively.

Employer contributions vest immediately.

40 unchanged sentences

14 — Subsequent Events

On February 2, 2023, the Board of Directors declared a special cash dividend of $ 1.05 per share on the Company’s common stock.

On February 21, 2023, we paid $ 13,222,907 to shareholders of record at the close of business on February 17, 2023.

On February 2, 2023, the Company entered into a reinstatement and amendment to the previously announced sale and purchase agreement with O Property, Ltd., a Florida limited partnership dated as of November 1, 2022, pursuant to which the parties agreed to consummate a sale of real property located in Orange County, Florida.

Pursuant to the terms of the Reinstatement, the parties consummated the sale of approximately 26.518 acres of land to the Company for a purchase price of $ 6,200,000 .

The property was acquired as a site for future office space development to accommodate our increased operations and anticipated growth.

On December 12, 2023, the 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 on the Company's outstanding common stock.

The payment of both declarations was made on January 12, 2024, when we paid $ 7,975,997 to shareholders of record at the close of business on December 18, 2023.

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 9A. Controls and Procedures