What changed in this filing

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Item 9A. Controls and Procedures

2025-03-06 compared with 2024-03-01 · 147 added, 188 removed, 593 unchanged (36% of the section changed)

1 unchanged sentence

Disclosure Controls and Procedures

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.

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) 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) under the Exchange Act, as of the end of the period covered by this Annual Report, 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, 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.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining a system of internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

generally accepted accounting principles (“U.S.

All internal control systems, no matter how well designed, have inherent limitations.

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Based on our assessment, management has concluded that our internal control over financial reporting was effective as of the end of the fiscal year to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S.

We reviewed the results of management’s assessment with the Audit Committee of our Board of Directors.

We reviewed the results of management’s assessment with the Audit Committee.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting - (as such term is defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended December 31, 2023 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

There were no changes in our internal control over financial reporting - (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended December 31, 2024 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Controls

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OTHER INFORMATION

N o t a pplicable.

During the three months ended December 31, 2024, none of our directors or "officers" (as such term is defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a " Rule 10b5-1 trading arrangement " or " non-Rule 10b5-1 trading arrangement " (as each term is defined in Item 408(a) of Regulation S-K).

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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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 Form 10-K and is incorporated herein by reference.

Other than as noted below, 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.

Insider Trading Policy

The Company has an Insider Trading Policy governing the purchase, sale and other dispositions of its securities by its directors, officers, and employees that is reasonably designed to promote compliance with insider trading laws, rules and regulations, and Nasdaq listing standards.

The Insider Trading Policy is filed with this Form 10-K as Exhibit 19.

EXECUTIVE COMPENSATION

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Financial Statements:

See “Index to Financial Statements” in Part II, Item 8 of this annual report on Form 10-K.

See “Index to Financial Statements” in Part II, Item 8 of this Form 10-K.

Financial Statement Schedule:

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Description of Registrant’s Securities

Form of Stock Option Agreement for Iradimed Corp.

2005 Incentive Stock Plan

Iradimed Corporation Amended and Restated 2014 Equity Incentive Plan

Form of Stock Option Agreement for Iradimed Corporation 2014 Equity Incentive Plan

Form of Restricted Stock Award Agreement for Iradimed Corporation 2014 Equity Incentive Plan

Form of Restricted Stock Unit Agreement (Time-Vesting) for Iradimed Corporation 2014 Equity Incentive Plan

Form of Restricted Stock Unit Agreement (Performance-Vesting) for Iradimed Corporation 2014 Equity Incentive Plan

Lease Agreement regarding 1025 Willa Springs Dr.

between Susi, LLC and the Registrant, dated January 17, 2014

Amendment to Susi, LLC Lease Agreement, dated May 29, 2024, by and between Iradimed Corporation and Susi, LLC

Employment Agreement between the Registrant and John F Glenn, dated May 21, 2022

Supply Agreement between the Registrant and Fukoku Co., Ltd.

entered into on January 26, 2014

Amendment Agreement to Supply Agreement between the Registrant and Fukoku Co., Ltd.

entered into on March 26, 2019

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

Employment Agreement between Ir adimed Corporation and Roger Susi, dated July 24, 2019

S ale and Purchase Agreement between O PROPERTY, 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 February 2, 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

Iradimed Corporation 2023 Equity Incentive Plan

Form of Restricted Stock Unit Award Agreement for Iradimed Corporation 2023 Equity Incentive Plan (4-year annual vest)

Form of Restricted Stock Unit Award Agreement for Iradimed Corporation 2023 Equity Incentive Plan (3-year annual vest)

Form of Restricted Stock Unit Award Agreement for Iradimed Corporation 2023 Equity Incentive Plan (2-year annual vest)

Form of Restricted Stock Unit Award Agreement (Time-Vesting) for Iradimed Corporation 2023 Equity Incentive Plan (3-year cliff vest)

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

Insider Trading Policy

List of Subsidiaries

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XBRL Taxonomy Extension Presentation Linkbase Document

Inline XBRL for the cover page of this Annual Report on Form 10-K, included as part of this Exhibit 101 inline XBRL Document set

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Indicates a management contract or compensatory plan or arrangement.

Confidential treatment has been granted for portions of this exhibit.

These portions have been omitted from the exhibit filed with the Securities and Exchange Commission and submitted separately to the Securities and Exchange Commission.

The certification attached as Exhibit 32.1 that accompanies this Form 10-K is not deemed filed with the SEC and is not to be incorporated by reference into any filing of Iradimed Corporation under the Securities Act or the Exchange Act, whether made before or after the date of this Form 10-K, irrespective of any general incorporation language contained in such filing.

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Statements of Operations

Statements of Comprehensive Income

Statements of Stockholders’ Equity

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Opinion on the Financial Statements

We have audited the accompanying balance sheets of IRADIMED CORPORATION (the Company) as of December 31, 2023 and 2022, the related statements of operations, comprehensive income, stockholders’ equity and cash flows for the years ended December 31, 2023 and 2022, and the related notes to the financial statements (collectively, the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years ended December 31, 2023 and 2022, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying balance sheets of IRADIMED CORPORATION (the Company) as of December 31, 2024 and 2023, the related statements of operations, stockholders’ equity and cash flows for the years then ended, and the related notes to the financial statements (collectively, the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

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The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Deferred Revenue Recorded on the Sale of Extended Warranties

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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.

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.

Auditing management’s estimates of deferred revenue to record on the sale of extended warranties required auditor judgment and an increase in audit effort due to the complexities of management’s manual calculations.

Our audit procedures related to deferred revenue recorded on the sale of extended warranties included the following, among others:

● We obtained an understanding of the relevant controls related to deferred revenue recorded on the sale of extended warranties and tested such controls for design and operating effectiveness, including controls related to management’s review of the manual calculations.

● We performed a test of details by agreeing a sample of extended warranty sales transactions to underlying customer contracts.

For each selection, we recalculated the revenue recognized for the year ended December 31, 2023, and the expected deferred revenue balance at year end.

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

Revenue related to extended warranty agreements is deferred and recognized over the warranty agreement period, which can range from one to four years, starting after the expiration of the initial one-year manufacturing

Management’s calculation of deferred revenue is based upon inputs, including the extended warranty sales price and the term of the extended warranty, which are derived from the underlying contract with the customer.

We identified the completeness and accuracy of the inputs used by management in the calculation of deferred revenue on the sale of extended warranties as a critical audit matter due to the impact these inputs have on the amount of revenue to be deferred at year end and the extent of audit effort required to audit those inputs.

Our audit procedures related to the completeness and accuracy of the inputs used by management in the calculation of deferred revenue on the sale of extended warranties included the following, among

● We selected a sample of additions to the deferred revenue at December 31, 2024 and tested the inputs for accuracy by performing the following procedures:

- We agreed the warranty sales price and warranty term to the underlying customer contracts.

- We recalculated both the revenue recognized for the year ended December 31, 2024, and the expected deferred revenue balance at year end based upon those inputs.

● We tested the completeness of the inputs used in the calculation of deferred revenue by selecting a sample of revenue recognized during the year on the sale of extended warranties and performing the following procedures:

- We agreed the warranty price and warranty term to the underlying customer contracts.

- We agreed the warranty sales price and warranty term to the deferred revenue calculation.

- We recalculated both the revenue recognized for the year ended December 31, 2024, and the expected deferred revenue balance at year end based on those inputs.

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

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Cash and cash equivalents

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

Accounts receivable, net of allowance for credit losses of $ 274,300 as of December 31, 2024, and $ 368,835 as of December 31, 2023

Inventory, net

Prepaid expenses and other current assets

Prepaid income taxes

Total current assets

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Total current liabilities

Deferred revenue

Operating lease liabilities, less current portion

Deferred revenue, non-current

Operating lease liabilities, non-current

Total liabilities

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Common stock;

$ 0.0001 par value;

$ 0.0001 par value per share;

31,500,000 shares authorized;

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STATEMENTS OF OPERATIONS

For the Year Ended

Cost of revenue

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IRADIMED CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME

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

Comprehensive income

See accompanying notes to financial statements.

IRADIMED CORPORATION

STATEMENTS OF STOCKHOLDERS’ EQUITY

Comprehensive

Stockholders’

(Loss) Income

Balances, December 31, 2022

Dividends paid

Dividends declared

( 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

Balances, December 31, 2023

Dividends paid or accrued

Dividends declared

( 5,701,429 )

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STATEMENTS OF CASH FLOWS

For the Years Ended December 31,

Operating activities:

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

Allowance for doubtful accounts

Allowance for credit losses

Provision for excess and obsolete inventory

Depreciation and amortization

Loss (Gain) on disposal of property and equipment

Depreciation & amortization

Loss on disposal of property and equipment

Stock-based compensation

1 unchanged sentence

( 1,171,908 )

(Gain) on maturities of investments

Changes in operating assets and liabilities:

1 unchanged sentence

( 7,468,170 )

( 1,308,956 )

Prepaid expenses and other current assets

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Investing activities:

Proceeds from maturities of investments

Purchases of property and equipment

( 8,005,033 )

Capitalized intangible assets

( 7,440,510 )

Capitalized intangible assets

Net cash used in investing activities

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( 13,656,511 )

Net decrease in cash and cash equivalents

( 8,198,666 )

Net increase (decrease) in cash and cash equivalents

( 8,198,666 )

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ROU asset recognized in exchange for new lease obligation

ROU asset and liability adjustment

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

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1 — Organization and Significant Accounting Policies

IRADIMED CORPORATION (“IRADIMED”, the “Company”, “we”, “our”) was incorporated in Oklahoma in July 1992 and reincorporated in Delaware in April 2014.

IRADIMED CORPORATION (“IRADIMED”, the “Company”, “we”, “our”) was originally incorporated in Oklahoma under the name IRI Development, Inc.

in 1992, and we merged our Oklahoma corporation into the newly formed Delaware corporation in April 2014.

We develop, manufacture, market and distribute a Magnetic Resonance Imaging (“MRI”) compatible intravenous (“IV”) infusion pump system and MRI compatible patient vital signs monitoring systems and related accessories, disposables and services.

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The features of the IRADIMED 3880 include:

wireless ECG with dynamic gradient filtering;

wireless SpO2 using Masimo® algorithms;

non-magnetic respiratory CO2;

wireless Electrocardiogram with dynamic gradient filtering;

wireless blood oxygen saturation monitoring using Masimo® algorithms;

non-magnetic respiratory carbon dioxide;

invasive and non-invasive blood pressure;

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The IRADIMED 3880 MRI compatible patient vital signs monitoring system has an easy-to-use design and allows for the effective communication of patient vital signs information to clinicians.

Our headquarters is located in Winter Springs, Florida.

Our principal executive offices are located in Winter Springs, Florida.

Use of Estimates

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GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities in the financial statements and the reported amount of revenue and expenses during the reporting period.

Such estimates include allowances for potentially uncollectible accounts receivable, valuation of inventory, intangible assets, stock-based compensation, deferred income taxes, reserves for warranty obligations, and the provision for income taxes.

Such estimates include allowances for potentially uncollectible accounts receivable, valuation of inventory, long lived assets, intangible assets, stock-based compensation, deferred income taxes, reserves for warranty obligations, and the provision for income taxes.

Actual results could differ from those estimates.

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Advance payments received from customers and shipments in-transit are recognized in revenue at the time control of the related products has been transferred to the customer or services have been delivered.

Amounts related to 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 products is transferred to the customer, as we believe this recognition pattern best depicts the transfer of services being provided.

Revenue related to extended warranty agreements is deferred and recognized over the warranty agreement period, which can range from one to four years , starting after the expiration of the initial one-year manufacturing warranty.

This recognition pattern best depicts the transfer of services being provided.

Deferred revenue is classified as current or long-term deferred revenue in our Balance Sheets, depending on the expected timing of satisfying the related performance obligations.

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All highly liquid instruments purchased with an original maturity of three months or less are classified as cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

We consider money market fund holdings to be cash equivalents.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable is recorded at the transaction price of the related products and services.

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When it is determined that an account receivable is uncollectible, it is written off and relieved from the allowance.

Any future determination that the allowance for estimated uncollectible accounts receivable is not properly stated could result in changes in operating expense and results of operations.

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

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 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.

Any future determination that the allowance for estimated uncollectible accounts receivable is not adequate could result in changes in operating expense and results of operations.

As of December 31, 2024 and 2023, our allowance for credit losses was $ 274,300 and $ 368,835 , respectively.

Fair Value Measurements

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Financial instruments include cash and cash equivalents, investments, accounts receivable, accounts payable and accrued expenses.

Cash and cash equivalents and investments are reported at their respective fair values on the balance sheet dates.

Cash and cash equivalents are reported at their respective fair values on the balance sheet dates.

The recorded carrying amount of accounts receivable, accounts payable and accrued expenses approximates their fair values due to their short-term nature.

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Long-lived Assets

Long-lived assets, including right-of-use assets, are tested for impairment whenever changes in circumstances indicate the carrying value of these assets may be impaired.

Long-lived assets, such as our property and equipment and including right-of-use assets, are tested for impairment whenever changes in circumstances indicate the carrying value of these assets may be impaired.

Impairment indicators include, but are not limited to, technological obsolescence, unfavorable court rulings, significant negative industry and economic trends, and significant underperformance relative to historical and projected future operating results.

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Stock-Based Compensation

Historically, we have granted three types of employee equity awards, stock options, restricted stock units and performance-based restricted stock units.

We recognize stock-based compensation expense associated with employee equity awards on a straight-line basis over the requisite service period for stock options and restricted stock units, which is generally four years for employees and two years for the board of directors.

Expense related to our performance-based restricted stock units is recognized straight-line over the requisite performance period, which is three years.

Historically, we have granted three types of employee equity awards, stock options, restricted stock units and performance-based restricted stock units (“PSUs”).

Expense related to our PSUs is recognized straight-line over the requisite performance period, which is three years .

The grant date fair value of our restricted stock units is based on the closing price of our common stock on the date of grant.

In December 2023 and 2022, the Company granted Performance-Based Restricted Stock Units (“PSUs”) to certain employees under the Company’s Long-Term Incentive Pan (“LTIP”), which was adopted under the Company’s Amended and Restated 2014 Equity Incentive Plan.

Payouts of the PSUs will be based on the Company’s total shareholder return compared to a peer group or index total shareholder return.

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.

In December 2024 and 2023, the Company granted PSUs to certain employees under the Company’s Long-Term Incentive Pan (“LTIP”), which was adopted under the Company’s Amended and Restated 2014 Equity Incentive Plan.

Payouts of the PSUs will be based on the Company’s total stockholder return compared to a peer group or index total stockholder return.

For purposes of the LTIP, total stockholder 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 relative total return performance.

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We record net deferred tax assets to the extent we believe these assets will more likely than not be realized.

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.

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.

5 unchanged sentences

Dollar and the Japanese Yen.

Comprehensive Income

Comprehensive income includes net income and other comprehensive income items that are excluded from net income under U.S.

Comprehensive income included unrealized gains and losses on our investments classified as available for sale while those investments were held.

Basic and Diluted Net Income per Share

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Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

The stock options, restricted stock units, and performance-based restricted stock units granted by us represent the only dilutive effect reflected in diluted weighted average shares outstanding.

The stock options, restricted stock units, and PSUs granted by us represent the only dilutive effect reflected in diluted weighted average shares outstanding.

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

For the Year Ended December 31,

Year Ended December 31,

Weighted-average shares outstanding — Basic

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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:

Anti-dilutive stock options and restricted stock units

Anti-dilutive restricted stock units

Certain Significant Risks and Uncertainties

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We have deposited our cash and cash equivalents with various financial institutions.

Our cash and cash equivalents balances exceed federally insured limits periodically throughout the year.

A substantial majority of our cash and cash equivalents balances exceed federally insured limits.

We have not incurred any losses related to these balances.

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Any disruption in the availability of these components would have a materially adverse impact on our business, results of operations and financial condition.

Pandemic Considerations

We continue to monitor developments associated with the recent evolving pandemic and its effects on our employees, customers, supply chain and distribution channels.

The ongoing impact of the recent and potential future pandemics depends on several factors including the severity and duration of the pandemic and the extent and severity of the impact on our customers, which is uncertain and unpredictable.

Our future results of operations and cash flows may suffer adverse effects from disruptions in our supply chain and manufacturing operations, delays in payments on outstanding accounts receivable, uncertain demand for our products, and effects of any actions we may take to address financial and operational challenges our customers may face.

Our future results may potentially be heavily determined by global vaccination rates, duration of the pandemic, its geographic spread, further business disruptions and the overall impact on the global economy.

We are actively managing our response to the recent pandemic and continue to work with our customers, distributors, vendors, and suppliers and assessing the potential effects to our financial position, results of operations and cash flows.

As of the date of the issuance of these financial statements, the extent to which a pandemic may materially impact our financial condition, liquidity, or results of operations in future periods remains uncertain.

Recent Accounting Pronouncements

Accounting Pronouncements Implemented in 2024

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 or fifteen 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 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 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.

In November 2023, the FASB issued ASU No.

2023-07, Improvements to Reportable Segment Disclosures.

The FASB amended the guidance in ASC 280, Segment Reporting ("ASC 280"), to require a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually.

Public entities with a single reportable segment are required to provide the new disclosures and all the disclosures required under ASC 280.

The guidance is applied retrospectively to all periods presented in financial statements, unless it is impracticable.

This new guidance is effective for public business entities for annual periods beginning after December 15, 2023, and for interim periods beginning after December 15, 2024.

The Company adopted this new standard effective December 31, 2024.

See Note 6, Segment Information, for disclosures related to the adoption of ASU 2023-07.

Recently Issued Accounting Pronouncements to be Implemented

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments , which requires the Company to measure and recognize expected credit losses for financial assets held and not accounted for at fair value through net income.

In November 2018, April 2019 and May 2019, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses , ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses and ASU 2019-05, Financial Instruments - Credit Losses (Topic 326):

Targeted Transition Relief , which provided additional implementation guidance on ASU 2016-03.

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

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

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740).

The update enhances the disclosure requirements related to tax rate reconciliations and income taxes paid.

The standard will take effect for public business entities for annual periods beginning after December 15, 2024.

We are currently evaluating the impact the adoption of this ASU will have, if any, on our financial statements.

We are adopting this ASU on January 1, 2025 and will include enhanced disclosures in our fiscal year-end 2025 annual consolidated financial statements, as applicable.

In November 2024, the FASB issued Accounting Standards Update 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses ("ASU 2024-03") , and in January 2025, the FASB issued Accounting Standards Update No.2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date ("ASU 2025-01").

ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement.

ASU 2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

Both early adoption and retrospective application are permitted.

The Company is currently evaluating the impact of the adoption of this standard on the related disclosures.

Disaggregation of Revenue

5 unchanged sentences

Revenue information by type is as follows:

MRI Compatible IV Infusion Pump Systems

MRI Compatible Intravenous ("IV") Infusion Pump Systems

MRI Compatible Patient Vital Signs Monitoring Systems

6 unchanged sentences

Our contract liabilities consist of:

As of December 31,

Advance payments from customers

7 unchanged sentences

Contract liabilities, December 31, 2024

Increases due to cash received from customers

Decreases due to recognition of revenue

( 4,477,443 )

Contract liabilities, December 31, 2023

Capitalized Contract Costs

10 unchanged sentences

Property and equipment consist of:

As of December 31,

Computer software and hardware

2 unchanged sentences

Machinery and equipment

Fixed assets in-process

Construction in-process

Accumulated depreciation

1 unchanged sentence

( 4,069,835 )

The increase in construction in-process is related to the continued construction of new executive offices and manufacturing facility.

Depreciation expense of property and equipment was $ 585,542 and $ 648,133 for the year ended December 31, 2024 and 2023, 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

( 1,184,146 )

Amortization expense of intangible assets was $ 232,114 and $ 117,047 for the year ended December 31, 2024, and 2023, respectively.

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

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 (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

Balance at December 31, 2023

6 — Segment Reporting

The Company operates in one business segment that develops, manufactures, markets and distributes MRI compatible medical devices and related accessories, disposables and services relating to them.

The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Company’s appointed chief operating decision maker (“CODM”), who is President, Chief Executive Officer, and Chairman of the Board of Directors, Roger Susi.

As the Company has only one operating segment and is managed on a consolidated basis, the measure of profit or loss is consolidated net income or loss.

See the Consolidated Statements of Operations.

7 — Stock-Based Compensation

In April 2014, our Board of Directors adopted and our shareholders approved the 2014 Equity Incentive Plan (“2014 Plan”).

In April 2014, our Board of Directors adopted and our stockholders approved the 2014 Equity Incentive Plan (“2014 Plan”).

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 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 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, RSUs, performance awards and other stock-based and cash awards.

On June 12, 2020, the stockholders 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.

The 2014 Plan expired in April 2024 and the remaining shares available for granting future awards were cancelled.

On June 15, 2023, our Board of Directors adopted, and our stockholders 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, RSUs, performance awards and other stock-based awards.

As of December 31, 2024, there were 1,309,213 shares available for future granting and vesting of

awards under the 2023 Plan.

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

10 unchanged sentences

Outstanding beginning of period

Options granted

Options exercised

Options cancelled

Options expired

Outstanding end of period

2 unchanged sentences

Restricted Stock Units

The following table presents a summary of our restricted stock unit activity as of and for the year ended December 31, 2023:

The following table presents a summary of our RSU activity as of and for the year ended December 31, 2024:

Weighted-Average

2 unchanged sentences

Unvested at December 31, 2024

As of December 31, 2023, we had $ 4,170,643 of unrecognized compensation cost related to the unvested restricted stock units, which is expected to be recognized over a weighted-average period of 2.57 years.

As of December 31, 2024, we had $ 4,692,820 of unrecognized compensation cost related to the unvested RSUs, which is expected to be recognized over a weighted-average period of 2.54 years.

Performance-Based Restricted Stock Units

The following table presents a summary of our Performance-Based Restricted Stock Unit (“PSU”) activity as of and for the year ended December 31, 2023:

The following table presents a summary of our PSU activity as of and for the year ended December 31, 2024:

Performance-Based

7 unchanged sentences

The awards will vest three years from the award date based on the achievement of certain performance criteria approved by the Compensation Committee.

Based on the level of achievement of the performance criteria at the end of the three years for each of the PSUs awarded, the number of shares earned can range from 0 percent to 200 percent of the remaining shares outstanding;

Based on the level of achievement of the performance criteria at the end of the three years for each of the PSUs awarded, the number of shares earned can range from zero to 200 percent of the remaining shares outstanding;

therefore, the maximum number of shares that can be issued under these awards is twice the original remaining outstanding awards of 44,251 PSUs, or 88,502 shares.

8 unchanged sentences

Other income, net consists of:

For the Years Ended December 31,

Year Ended December 31,

Interest income

Realized gains on maturities of investments

Foreign currency exchange losses

Disposal of assets

Other income, net

Total other income, net

1 unchanged sentence

The components of the provision for income taxes are as follows:

For the Years Ended December 31,

Year Ended December 31,

Current taxes:

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Depreciation and amortization

Accrued expenses

Capitalized research and development

2 unchanged sentences

federal tax rate to our effective rate is as follows:

For the Years Ended December 31,

Year Ended December 31,

Statutory U.S.

federal tax rate

CARES Act NOL carryback

Stock compensation expense and tax windfalls upon exercises and vesting

5 unchanged sentences

Effective rate

As of December 31, 2023 and December 31, 2022, we did not identify or accrue for any uncertain tax positions.

We are currently not aware of any uncertain tax positions that could result in significant payments, accruals or other material deviations in this estimate over the next 12 months.

The Company does not have any outstanding U.S.

federal income tax or material state and local tax matters for years through 2023.

There are no federal income tax returns currently under examination by the Internal Revenue Service.

The Company remains subject to income tax examinations for our United States Federal and certain U.S.

state income taxes for 2020 and subsequent years and various other U.S.

state income taxes for 2019 and subsequent years.

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized.

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.

As of December 31, 2024 the Company has fully utilized 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.

The Company files income tax returns with the U.S.

federal government, Singapore, and various state and local jurisdictions that are subject to potential examination by the respective taxing authorities.

The Company is currently under examination by the U.S.

Internal Revenue Service for 2021 and remains subject to income tax examinations for

federal for 2021 and subsequent years.

state income taxes for 2020 and subsequent years remain open by statute.

A valuation allowance for deferred tax assets is provided when it is more likely than not that some portion of the deferred tax asset will not be realized.

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 recorded net deferred income tax assets as of December 31, 2024.

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

4 unchanged sentences

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

Prior to May 31, 2019, the expiration date of the initial lease term, and pursuant to the terms of the lease contract, we renewed the lease for an additional five years , resulting in a new lease expiration date of May 31, 2024.

Unless advance written notice of termination is timely provided, the lease will automatically renew for one additional successive term of five years beginning in 2024, and thereafter, will be renewed for successive terms of one year each.

At the time we adopted ASU 2016-02, Leases (Topic 842), we concluded that we will exercise the remaining five-year option, resulting in a remaining lease term of 6.2 years as of December 31, 2023.

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

On May 29, 2024, the Company entered into a lease amendment (the “Lease Amendment”) with Susi, LLC under which it did not exercise the second five-year option because of the Company’s continued construction of a new corporate office and manufacturing facility in Orange County, Florida, to accommodate our increased operations and anticipated growth.

Pursuant to the terms of the Lease Amendment, the monthly base rent is $ 34,133 , adjusted annually for changes in the consumer price index, and the Lease Amendment has an expiration date of May 31, 2025, and includes an option to renew on a month-to-month basis for up to six months thereafter.

This Lease Amendment 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.

For the year ended December 31, 2024 and 2023, the Company paid $ 126,522 and $ 110,605 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.

Pursuant to the contract terms, the leases expired 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 Year Ended

Cost of revenue

2 unchanged sentences

Research and development

Lease costs for short-term leases were immaterial for the years ended December 31, 2023 and 2022.

Lease costs for short-term leases, such as printers and copiers, were immaterial for the years ended December 31, 2024 and 2023.

Maturity of Operating lease liability as of December 31, 2024, is as follows:

Three months ending December 31, 2023

Total lease payments

2 unchanged sentences

We used a discount rate of 6.0 % to determine the present value of the operating lease liability on January 1, 2019.

We will reassess the lease accounting terms and assumptions once the details regarding completion of new manufacturing facility and planned departure of the current facility is finalized.

In 2024 we completed a mid-year reassessment and right-of-use asset adjustment due to the lease amendment and anticipated completion of our new executive offices and manufacturing facility.

11 — Employee Benefit Plan

25 unchanged sentences

The holders of the Preferred Stock are entitled to receive dividends from legally available assets prior to any declaration or payment of dividends to the holders of Common Stock.

Dividends on each share of Preferred Stock are initially at $ 0.06429 per year payable when and as declared by the Board and are non-cumulative.

Dividends on each share of Preferred Stock are initially at $ 0.06429 per year payable when and as

declared by the Board and are non-cumulative.

After payment of such dividends, any additional dividends or distributions are distributed among all holders of Common Stock and Preferred Stock in proportion to the number of shares of Common Stock that would be held by each holder if all shares of Preferred Stock were converted to Common Stock at the then effective conversion rate.

16 unchanged sentences

14 — Subsequent Events

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.

In February 2025 , our Board of Directors declared a regular quarterly cash dividend of $ 0.17 per share of our outstanding common stock, payable on March 5, 2025 , to stockholders of record as of the close of business on February 24, 2025 .

Total payment for this cash dividend was $ 2,161,522 .

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