What changed in this filing

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Item 1A. Risk Factors

2026-03-12 compared with 2025-03-12 · 101 added, 102 removed, 1049 unchanged (16% of the section changed)

Risk Factors.

You should carefully consider the following risk in addition to the other information included in this Annual Report on Form 10-K, including matters addressed in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” We may face additional risks and uncertainties that are not presently known to us, or that we currently deem immaterial, which may also impair our business or financial condition.

You should carefully consider the following risks in addition to the other information included in this Annual Report on Form 10-K, including matters addressed in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” We may face additional risks and uncertainties that are not presently known to us, or that we currently deem immaterial, which may also impair our business or financial condition.

The following discussion should be read in conjunction with the financial statements and notes to the financial statements included herein.

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If our Delivery Systems are not accepted and adopted by our customers, if our customers experience significant performance interruptions or if our Syndeo devices do not meet our performance standards, or if we experience an RMA rate for Syndeo devices significantly above historical averages, our revenue and results of operations will be materially and adversely affected.

Our new product introductions may not be as successful as we anticipate.

Our new product introductions may not be, and at times in the past have not been, as successful as we anticipate.

The beauty health industry is driven in part by beauty and skincare trends, which may shift quickly.

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We must continually work to develop, produce and market new products, maintain and enhance the recognition of our brand, maintain a favorable mix of products and develop our approach as to how and where we market and sell our products.

We have an established process for the development, evaluation and validation of our new product concepts.

We have continued to refine our process for the development, evaluation and validation of our new product concepts.

Nonetheless, each new product launch involves risks, as well as the possibility of unexpected results.

For example, the acceptance of new product launches and sales to our providers may not be as high as we anticipate, due to lack of acceptance of the products themselves or their price, or limited effectiveness of our marketing strategies.

In addition, our ability to launch new products may be limited by delays or difficulties affecting the ability of our suppliers or manufacturers to timely manufacture, distribute and ship new products.

For example, when we initially launched the Syndeo Delivery System back in March 2022, many customers with Syndeo 1.0 and Syndeo 2.0 builds began to experience frequent treatment interruptions and unacceptable device conditions.

In addition to issues such as distractive noise and difficult bottle insertion, a significant issue with these models was low flow and clogs in the system, due to recommended maintenance requiring overly rigorous levels to prevent serum build-up inside the system’s fluidics manifold.

Throughout 2022 and the first half of 2023, we made several enhancements to each version of the Syndeo in an effort to address and remediate these issues, but despite these efforts, performance interruptions that negatively impacted customer productivity and satisfaction continued to persist.

In July 2023, we developed Syndeo 3.0 and has noted a significant improvement in user experience and a substantial decline in initial return rates compared to 1.0 and 2.0 models, primarily due to hardware and software enhancements that automate and force effective rinse cycles and manifold cleaning with an air blast procedure that reduce build-up and clogging as well as improvements in the connector to the Delivery System’s handpiece to facilitate user cleaning.

During the third quarter of 2023, we decided that it would only market and sell Syndeo 3.0 Delivery Systems, and as a result, designated all 1.0 and 2.0 models on-hand as obsolete.

In addition, the acceptance of new product launches and sales to our providers may not be as high as we anticipate, due to lack of acceptance of the products themselves or their price, or limited effectiveness of our marketing strategies.

Furthermore, our ability to launch new products may be limited by delays or difficulties affecting the ability of our suppliers or manufacturers to timely manufacture, distribute and ship new products.

We may also experience a decrease in sales of certain existing products as a result of newly launched products.

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We believe that developing and maintaining our brand is critical and that our financial success is directly dependent on consumer perception of our brand.

Furthermore, the importance of brand recognition may become even greater as our competitors offer more products that are similar to our products.

We have relatively low brand awareness among consumers when compared to other beauty health brands.

Furthermore, the importance of brand recognition and brand differentiation may become even greater as our competitors offer more products that are similar to our products.

Maintaining and enhancing the recognition and reputation of our brand is, therefore, critical to our business and future growth.

Many factors, some of which are beyond our control, will impact our ability to maintain and enhance our reputation and brand, including our

ability to comply with ethical, social, product, labor and environmental standards.

Many factors, some of which are beyond our control, will impact our ability to maintain and enhance our reputation and brand, including our ability to comply with ethical, social, product, labor and environmental standards.

Any actual or perceived failure in compliance with such standards could damage our reputation and brand.

The growth of our brand also depends largely on our ability to provide a high-quality consumer experience, which in turn depends on our ability to bring innovative products to the market at competitive prices that respond to consumer demands and preferences.

Our ability to provide a high-quality consumer experience will depend, in part, on our ability to provide a reliable and user-friendly website interface and mobile applications for our consumers to browse and purchase products on our e-commerce websites.

Our ability to provide a high-quality consumer experience will depend, in part, on our ability to provide reliable customer service and tech support, as well as a reliable and user-friendly website interface and mobile applications for our consumers to browse and purchase products on our e-commerce websites.

The success of our brand may also suffer if our marketing plans or product initiatives do not have the desired impact on our brand’s image or our ability to attract consumers.

Further, our brand value could diminish significantly due to a number of factors, including consumer perception that we have acted in an irresponsible manner, adverse publicity about our products, failure to maintain product quality, product contamination, the failure to deliver consistently positive consumer experiences, or our products becoming unavailable to consumers.

If we are unable to preserve our reputation, enhance brand recognition and increase positive awareness of our products and Internet platforms, it may be difficult for us to maintain and grow our consumer base, and our business, financial condition and results of operations may be materially and adversely affected.

If we are unable to preserve our reputation, enhance brand recognition and brand differentiation, and increase positive awareness of our products and Internet platforms, it may be difficult for us to maintain and grow our consumer base, and our business, financial condition and results of operations may be materially and adversely affected.

Our success depends, in part, on the quality, efficacy and safety of our products.

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The failure to realize those benefits could have a material adverse effect on our business, financial condition and results of operations.

Our growth and profitability are dependent on a number of factors, and our historical growth may not be indicative of our future growth.

Our historical growth should not be considered indicative of our future performance.

Our growth and profitability are dependent on a number of factors, and any historical growth may not be indicative of future growth.

Achieving growth at any point in time should not be considered indicative of future performance.

We may be unsuccessful in executing our growth strategy, and even if we achieve our strategic plan, we may be unable to sustain profitability.

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The loss of key personnel or the failure to attract and retain qualified personnel may have a material adverse effect on our business, financial condition and results of operations.

Our workforce reductions may cause undesirable consequences and our results of operations may be harmed.

The reduction in workforce, which was part of our business transformation program (the “Transformation Program”) that we announced in September 2023 may yield unintended consequences and costs, such as the loss of institutional knowledge and expertise, employee attrition beyond what we had intended in implementing the Transformation Program, a reduction in morale among our remaining employees, greater-than-anticipated costs incurred in connection with implementing the Transformation Program, and the risk that we may not achieve the benefits from the Transformation Program to the extent or as quickly as we anticipate, all of which may have a material adverse effect on our business, results of operations or financial condition.

The initiatives of our Transformation Program could place substantial demands on our management and employees, which could lead to the diversion of our management’s and employees’ attention from other business priorities.

In addition, we may discover that the workforce reduction and other Transformation Program efforts will make it difficult for us to pursue new opportunities and initiatives and require us to hire qualified replacement personnel, which may require us to incur additional and unanticipated costs and expenses.

We rely on a number of third-party suppliers, distributors and other vendors, and they may fail to produce products or to provide services that are consistent with our standards or applicable regulatory requirements, which could harm our brand reputation, cause consumer dissatisfaction or require us to find alternative suppliers of our products or services.

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Any of the above may materially and adversely affect our business, financial condition and results of operations.

In order to deepen our market penetration and raise awareness of our brand and products, we have increased the amount we spend on marketing activities, which may not ultimately prove successful or an effective use of our resources.

To increase awareness of our products and services domestically and internationally, we have increased the amount we spend, and anticipate spending in the future on marketing activities.

In order to deepen our market penetration and raise awareness of our brand and products, we continue to spend on marketing activities, which may not ultimately prove successful or an effective use of our resources.

To increase awareness of our products and services domestically and internationally, we continue to spend, and anticipate spending in the future on marketing activities.

Our marketing efforts and costs are significant and include national and regional campaigns involving print media, social media, additional placements and alliances with strategic partners.

We attempt to structure our advertising/marketing campaigns in ways we believe most likely to increase brand awareness and adoption;

We attempt to structure our advertising/marketing campaigns in ways we believe will most likely increase brand awareness and adoption;

however, there is no assurance our campaigns will achieve the returns on advertising spend desired or successfully increase brand or product awareness sufficiently to sustain or increase our growth goals, which could have an adverse effect on our gross margin and business overall.

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However, we may be unable to satisfy financial covenants in the future, which could materially and adversely affect our ability to finance future operations, such as acquisitions or capital needs.

If our earnings substantially decrease or we are unable to obtain future financings on terms acceptable to us, it is possible that we would be unable to make payments of principal and interest due under our 1.25% Convertible Senior Notes due October 2026 (the “Notes”), resulting in a default under the Notes.

A default under the Notes, among other things, would trigger the counterparty’s ability to immediately demand payment without any further action or notice by such party.

If we are unable to repay in full or refinance our debt obligations on commercially reasonable terms, or at all, we could face substantial liquidity problems and might be required to sell material assets or operations in an attempt to meet our debt obligations.

Bank National Association (the “2026 Indenture”), or under our 7.95% Convertible Senior Secured Notes due November 15, 2028 (the “2028 Notes”, and together with the 2026 Notes, the “Notes”), where such 2028 Notes were issued pursuant to, and are governed by, an indenture, dated as of May 27, 2025, between the Company, the guarantors party thereto, and U.S.

Bank Trust Company, National Association (the “2028 Indenture”, and together with the 2026 Indenture, the “Indentures”), which would result in a default under the Notes.

A default under either of the Notes, among other things, would trigger the counterparty’s ability to immediately demand payment without any further action or notice by such party.

If our cash from operations is insufficient to meet our current or future operating needs, expenditures and debt service obligations, our business, financial condition and results of operations may be materially and adversely affected.

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If our cash flows and capital resources are insufficient to fund our debt service obligations and other cash needs, we could face substantial liquidity problems and could be forced to reduce or delay marketing initiatives, investments, acquisitions and capital expenditures or to dispose of material assets or operations, to sell our equity or debt securities, or to restructure or refinance our indebtedness.

Our credit facilities may restrict our ability to take these actions, and we may be unable to affect any such alternative measures on commercially reasonable terms, or at all.

Our Notes may restrict our ability to take these actions, and we may be unable to affect any such alternative measures on commercially reasonable terms, or at all.

The sale of our equity securities would result in dilution to our existing stockholders.

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If additional financing is unavailable to us in amounts or on terms acceptable to us, our business, financial condition and results of operations could be adversely affected.

Furthermore, if we cannot make scheduled payments on our debt, the lenders under our credit agreement may terminate their commitments to loan money to us under our revolving credit facility, and our lenders under our credit agreement can declare all outstanding principal and interest to be due and payable and foreclose against the assets securing their borrowings, and we could be forced into bankruptcy or liquidation.

The terms of our Notes require us to meet certain operating and financial covenants and place restrictions on our operating and financial flexibility.

If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our business.

The Indenture governing the Notes contains certain restrictive covenants including covenants restricting our ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company and our subsidiaries.

Each of the Indentures governing the Notes contains certain restrictive covenants including covenants restricting our ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company and our subsidiaries.

These covenants may restrict our current and future operations, particularly our ability to respond to certain changes in our business or industry, or take future actions.

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dollar will decrease the U.S.

dollar equivalent of the amounts derived from foreign operations reported in our consolidated financial statements, and an appreciation of these currencies will result in a

corresponding increase in such amounts.

dollar equivalent of the amounts derived from foreign operations reported in our consolidated financial statements, and an appreciation of these currencies will result in a corresponding increase in such amounts.

The cost of certain items, such as raw materials, manufacturing, employee salaries and transportation and freight, required by our operations may be affected by changes in the value of the relevant currencies.

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If our goodwill or long-lived assets become impaired, we may be required to record a significant charge to earnings.

Under GAAP, we review goodwill and long-lived asset group for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.

Under accounting principles generally accepted in the United States of America (“GAAP”), we review goodwill and long-lived asset group for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.

Additionally, goodwill is required to be tested for impairment at least annually.

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Components used in our products are complex in design, and our products may contain undetected errors or result in failures when first introduced or when new versions are released.

Despite product testing efforts and testing by current and potential customers, it is possible that errors will be found in a new product or enhancement after commercial shipments have commenced.

The occurrence of product defects and/or technological flaws could result in negative publicity, delays in product introduction, the diversion of resources to remedy defects, loss of or delay in industry acceptance and adoption or claims by customers against us, and could cause us to incur warranty obligations and additional costs, any one of which could adversely affect our business.

Despite product testing efforts and testing by current and potential customers, we have previously found errors in new products that we developed and released for commercial use in the past, and it is possible that errors will be found in a new product or enhancement after commercial shipments have commenced.

The occurrence of product defects and/or technological flaws has previously, and could in the future, result in negative publicity, delays in product introduction, the diversion of resources to remedy defects, loss of or delay in industry acceptance and adoption or claims by customers against us, and could cause us to incur warranty obligations and additional costs, any one of which could adversely affect our business.

Furthermore, the failure of our products to perform as promised could result in increased costs, lower margins, liquidated damage payment obligations, and harm to our reputation and brand.

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Third parties may attempt to fraudulently induce our or our service providers’ employees or consultants to misdirect funds or to disclose information in order to gain access to personal data about our consumers or website users that we maintain.

In addition, we have limited control or influence

over the security policies or measures adopted by third-party providers of online payment services through which some of our consumers may elect to make payment for purchases at our e-commerce websites.

In addition, we have limited control or influence over the security policies or measures adopted by third-party providers of online payment services through which some of our consumers may elect to make payment for purchases at our e-commerce websites.

We must have a designated employee to oversee cybersecurity operations and maintain a data security/information security program with specific measures, employee training, comprehensive risk assessments, vendor contract requirements, and timely data disposal.

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The technologies underlying AI and their use cases are rapidly developing, and it is not possible to predict all of the legal, operational or technological risks related to the use of AI.

While new AI initiatives, laws, and regulations are emerging and evolving, what they ultimately will look like remains uncertain, and our obligation to comply with them could entail significant costs, negatively affect our business, or limit our ability to incorporate certain AI capabilities into our business.

While new AI initiatives, laws, and regulations are emerging and evolving, or have been adopted such as the European Union’s Artificial Intelligence Act, what they ultimately will look like remains uncertain, and our obligation to comply with them could entail significant costs, negatively affect our business, or limit our ability to incorporate certain AI capabilities into our business.

Risks related to conducting business internationally

International sales and operations comprise a significant portion of our business, which exposes us to foreign operational, political and other risks that may harm our business.

We generate an increasing share of our revenue from international sales and maintain international operations, including supply and distribution chains that are, and will continue to be, a significant part of our business.

Since our growth strategy depends in part on our ability to penetrate international markets and increase the localization of our products and services, we expect to continue to increase our sales and presence outside the United States, particularly in markets we believe to have high-growth potential.

A significant portion of our revenue comes from international sales and we maintain international operations, including supply and distribution chains that are, and will continue to be, a significant part of our business.

Since our growth strategy depends in part on our ability to penetrate international markets and increase the localization of our products and services, we aim to increase our sales and presence outside the United States, particularly in markets we believe to have high-growth potential.

However, the substantial up-front investment required to enter new markets, the lack of consumer awareness of our products in certain jurisdictions outside of the United States, differences in consumer preferences and trends between the United States and other jurisdictions, the risk of inadequate intellectual property protections and differences in packaging, labeling and related laws, rules and regulations are all substantial matters that need to be evaluated prior to doing business in new jurisdictions, and make the success of our international efforts uncertain.

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• pandemics, such as the COVID-19 pandemic, and natural disasters;

• difficulties in managing international operations, including any travel restrictions imposed on us or our customers, such as those imposed in response to the COVID-19 pandemic;

• difficulties in managing international operations, including any travel restrictions imposed on us or our customers;

• fluctuations in currency exchange rates;

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These economic conditions could cause some of our providers or suppliers to experience cash flow or credit problems and impair their financial condition, which could disrupt our business and adversely affect product orders, payment patterns and default rates and increase our bad debt expense.

Legal, political, and economic uncertainty surrounding the planned exit of the United Kingdom from the European Union are a source of instability and uncertainty.

Legal, political, and economic uncertainty surrounding the exit of the United Kingdom from the European Union continue to be a source of instability and uncertainty.

On January 31, 2020, the United Kingdom formally withdrew from the EU.

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Our business could be negatively impacted by changes in the United States political environment.

Any policy changes as a result of the change in presidential administration and Congress in 2025 could significantly affect our business as well as the markets in which we operate.

Specific legislative and regulatory proposals discussed during election campaigns and more recently that might materially impact our business include, but are not limited to, promoting access to healthcare via market competition and pricing transparency, enhancing flexibility and choice in healthcare at the state and individual level, prioritizing domestic production and increasing tariffs on imports (which may complicate and increase costs associated with our supply chain), and rolling back regulatory initiatives adopted under the previous administration.

We cannot predict whether industry initiatives to seek tariff carve-outs for devices or other life sciences goods and products will be successful.

Personnel and policy changes at the regulatory agencies, including the FDA, may hinder our ability to operate our business as intended.

With the change in the presidential administration in 2025, substantial uncertainty remains as to how, if at all, the new administration will seek to modify or revise the requirements and policies of the FDA and other regulatory agencies with jurisdiction over our products.

Since the start of the new congressional session and presidential administration, substantial volatility and uncertainty have surrounded both the present activities of federal regulatory agencies and their future, including termination of a substantial number of employees at many agencies, and re-hiring of a substantial number of such employees at certain regulatory agencies, such as the FDA.

The new administration also has issued, and is expected to continue relying upon, executive orders to address a wide range of policy areas, some of which may impact our business.

Examples of executive orders that have already been issued on public health and healthcare topics include orders seeking to withdraw the United States from the World Health Organization, rescind a 2022 order issued under the prior administration to lower the cost of prescription drugs, and address COVID-19 vaccination requirements.

The new administration has also delayed or put on pause a number of initiatives at the FDA.

Any legal, regulatory, or policy changes by the United States government could significantly affect our business as well as the markets in which we operate.

Specific legislative and regulatory proposals and contemplated or implemented executive action that might materially impact our business include, but are not limited to, promoting access to healthcare via market competition and pricing transparency, enhancing flexibility and choice in healthcare at the state and individual level, prioritizing domestic production and further increasing or shifting tariffs on imports (which may complicate and increase costs associated with our supply chain), and rolling back regulatory initiatives adopted under the previous administration.

We cannot predict whether industry initiatives to seek tariff carve-outs for devices or other life sciences goods and products will be successful and the risks related to tariffs are changing rapidly and in an unpredictable manner.

Disruption due to any government shutdown and personnel or policy changes at regulatory agencies, including the FDA, may hinder our ability to operate our business as intended.

Recent and potential future turnover in leadership and staff at the FDA, as well as ongoing operational and political turmoil, could introduce uncertainty and disruption to our business.

Our ability to commercialize our Delivery Systems and Consumable products in the United States is heavily dependent on the FDA's regulatory processes.

High rates of staff turnover, vacancies in key leadership positions, and shifting political priorities can lead to delays in product reviews and approvals, create uncertainty regarding the implementation of new regulations that may impact our ability to market our products, lead to inconsistent application of regulations, and changes in enforcement policies and priorities.

Such disruptions could impede our ability to obtain premarket clearance or approval for new products and delay the introduction of new cosmetic products.

Substantial volatility and uncertainty have surrounded both the present activities of federal regulatory agencies and their future, including termination of a substantial number of employees at many agencies, and re-hiring of a substantial number of such employees at certain regulatory agencies, such as the FDA.

The current administration also has issued, and is expected to continue relying upon, executive orders to address a wide range of policy areas, some of which may impact our business and could create significant and unexpected risk or uncertainty related to our operations and products.

The current administration has also delayed or put on pause a number of initiatives at the FDA.

Such political developments may require us to allocate significant time, resources, and expense to modifying our policies and procedures, processes, systems, and practices to ensure compliance or adapt to the new regulatory climate, particularly to the extent such actions are subject to protracted and uncertain legal challenges.

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Pursuant to MoCRA, FDA now subjects manufacturers and cosmetic products to requirements such as facility registration and product listing requirements, adverse event reporting requirements, and other labeling requirements.

The FDA is required to promulgate final regulations implementing GMPs for cosmetics by December 29, 2025.

The FDA was required to promulgate by December 29, 2025 final regulations implementing GMPs for cosmetics, a deadline that has been delayed multiple times and the regulations are still forthcoming.

Moreover, depending on how we market the products, they could also be regulated as both drugs and cosmetics simultaneously, as the categories are not mutually exclusive.

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There can be no assurance that we will not be subject to state and federal government actions or class action lawsuits, which could harm our business, financial condition, and results of operations.

Furthermore, any new FDA guidance or publication of reports authored by federal agencies that might be applicable to our business, such as reports assessing certain risks or safety related to certain ingredients, could introduce new risks that may harm our business.

These reports could provide support for future FDA regulatory efforts that impact our business, new state or federal laws, federal agency enforcement actions, or civil litigation including class action lawsuits, which could disrupt and harm our business.

The EU does not currently require pre-market approval for cosmetic products, but all products to be marketed in the EU must be registered in the CPNP before being placed on the market.

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Any such regulatory changes could affect our ability to sell our products to certain customer groups in particular states and/or territories, which could result in decreased sales, and therefore could have a material adverse effect on our business, financial condition, and results of operation.

Uncertainty in regulatory frameworks and changes in applicable laws and regulations may affect our ability to commercialize products.

Our ability to market and sell our products in certain jurisdictions is subject to evolving laws and regulations, including those relating to product registration, safety, labeling, import/export controls, and commercial practices.

Changes in applicable laws, regulations, regulatory interpretations, or enforcement policies in any country where we operate or seek to operate could adversely affect our ability to obtain or maintain required approvals, increase our compliance costs, delay product launches, or restrict or prohibit the sale of our products in such jurisdictions.

If we are unable to comply with new or modified legal requirements on a timely basis, our business, financial condition, and results of operations could be materially adversely affected.

Our business is subject to extensive and continuing regulatory compliance obligations.

If we fail to obtain and maintain necessary market clearances from the FDA and other marketing authorizations or certifications from counterpart foreign regulatory authorities or notified bodies for our medical device products and indications, if clearances or other marketing authorizations or certifications for future products and indications are delayed or not issued, if we or any third-party suppliers or manufacturers fail to comply with applicable regulatory requirements, or if there are U.S.

If we fail to obtain and maintain necessary market clearances from the FDA and other marketing authorizations or certifications from counterpart foreign regulatory authorities or notified bodies for our applicable products and indications, if clearances or other marketing authorizations or certifications for future products and indications are delayed or not issued, if we or any third-party suppliers or manufacturers fail to comply with applicable regulatory requirements, or if there are U.S.

federal or state level or comparable foreign regulatory changes, our commercial operations could be harmed.

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Currently, Delivery Systems are subject to regulation by the FDA and comparable foreign regulatory authorities as a medical device, while our Boosters and serums are marketed as cosmetics.

Before a new medical device, or a new use of, or claim for, an existing medical device product can be marketed in the United States, it must first receive marketing authorization from the FDA unless it is exempt from such requirements.

The FDA marketing authorizations for medical devices include a clearance of a premarket notification under Section 510(k) of the FDCA (or a 510(k) clearance), or premarket approval of a Premarket Approval application.

Alternatively, some devices may be exempt from 510(k) clearance, receive enforcement discretion from the FDA or may receive marketing authorization through the De Novo classification pathway.

Before a new drug, medical device, or a new use of, or claim for, an existing medical device product can be marketed in the United States, it must first receive marketing authorization from the FDA unless it is exempt from such requirements.

Authorization processes can be expensive and lengthy.

The FDA’s 510(k) clearance process usually takes from three to 12 months, but it can take longer.

The process of obtaining premarket approval is much more costly and uncertain than the 510(k) clearance process and it generally takes from one to three years, or even longer, from the time the application is submitted to the FDA.

The De Novo classification pathway, when available, has a 150 day timeline for review.

Our future products and enhancements or changes to products may require new 510(k) clearance, premarket approval, authorization from the FDA or listing with the FDA, as well as state licenses as may be applicable to the manufacturing or distribution of medical devices.

The currently marketed medical devices are marketed pursuant to 510(k) clearances we have obtained or are exempt from the requirement to obtain such clearance or other form of marketing authorization.

Medical devices may be marketed only for the indications for which they are approved or cleared, or for which they are classified as exempt from such premarket requirements.

If the FDA disagrees with us concerning the scope or applicability of a clearance or exemption with respect to a device or its marketing, we may be required to change its promotional and/or labeling materials and/or stop marketing that device and may need to pursue additional authorizations or conduct product recalls, corrections, or removals.

Medical devices and drug products may be marketed only for the indications for which they are authorized, approved, or cleared, or for which they are classified as exempt from such premarket requirements.

If the FDA disagrees with us concerning the scope or applicability of a clearance or exemption with respect to a device or its marketing, or any drug product or its marketing, we may be required to change its promotional and/or labeling materials and/or stop marketing that product and may need to pursue additional authorizations or conduct product recalls, corrections, or removals.

We may not be able to obtain additional 510(k) clearances or premarket approvals for new products or for modifications to, or additional indications for, existing products in a timely fashion, or at all and may be found by the FDA to be in violation of these authorities.

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In addition, as of May 26, 2021, manufacturers must comply with the Medical Devices Regulation requirements applying in place of the corresponding requirements of the Medical Devices Directive with regard to registration of economic operators and of devices, post-market surveillance, market surveillance and vigilance requirements.

On January 6, 2023, the European Commission proposed a draft regulation to extend the transition periods under the EU Medical Devices Regulation for certain devices and thus extending the validity of the CE certificates that were issued under the EU Medical Devices Directive, as well as to delete the current “sell-off” deadline.

The draft amending regulation is subject to the accelerated adoption procedure of the European Parliament and Council.

The European Commission further extended the transitional provisions of the EU Medical Devices Regulation through Regulation (EU) 2023/607 on March 15, 2023, whereby manufacturers and notified bodies are given more time to carry out, in accordance with the EU Medical Devices Regulation, the conformity assessment of devices covered by a certificate or declaration of conformity issued in accordance with the EU Medical Devices Directive.

Moreover, the “sell-off” deadline in the EU Medical Devices Regulation is deleted which aims to prevent unnecessary disposal of safe devices.

The transition period of devices is extended through to December 31, 2027 or December 31, 2028 depending on the device risk classification and certain other conditions being satisfied.

Under the Medical Devices Directive, all medical devices placed on the market in the EU must meet the relevant essential requirements laid down in Annex I to the Medical Devices Directive, including the requirement that a medical device must be designed and manufactured in such a way that it will not compromise the clinical condition or safety of patients, or the safety and health of users and others.

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Our facilities are subject to regulation under the FDCA and FDA implementing regulations.

The QSR is a complex regulatory scheme that covers the methods and documentation of the design, testing, control, manufacturing, labeling, quality assurance, packaging, storage, and shipping of medical device products.

The FDA enforces the QSR through periodic announced or unannounced inspections.

Because we are subject to the QSR, we are subject to such inspections.

With respect to our medical device products, we are required to demonstrate and maintain compliance with the FDA’s current Good Manufacturing Practices, referred to as the Quality System Regulation until February 2, 2026 when these regulations are replaced by the FDA’s new Quality Management System Regulation.

The QMSR, like the QSR which preceded it, is a complex regulatory scheme that covers the methods and documentation of the design, testing, control, manufacturing, labeling, quality assurance, packaging, storage, and shipping of medical device products.

The FDA enforces the QMSR through periodic announced or unannounced inspections.

Because we are subject to the QMSR, we are subject to such inspections.

Any failure by us to take satisfactory corrective action in response to an adverse inspection could result in enforcement actions against us, including warning letters or untitled letters;

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We may only use labeling, including promotional materials, that are consistent with the specific indication(s) for use included in the FDA exemption regulation, 510(k) clearance or certification, or in the case of our cosmetic products, that are consistent with the kinds of claims that are permitted to be used for cosmetics under the FDCA, and as applicable to the specific product.

If we choose to market an over-the-counter drug product at any time in the future, this product must comply with the associated FDA monograph for the applicable drug product or any FDA approval we have obtained.

If the FDA or other authorities determine that our promotional or training materials constitute the unlawful promotion of an off-label use, they could request that we modify our training or promotional materials and/or subject us to warning letters or untitled letters;

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and criminal prosecution.

The FDA and foreign regulatory authorities have the authority to require the recall or recommend the market withdrawal, as applicable, of commercialized products in the event of material deficiencies or defects in design or manufacture of a product or in the event that a product poses an unacceptable risk to health.

The FDA and foreign regulatory authorities have the authority to require the recall or recommend the market withdrawal, as applicable, of commercialized products subject to the agency’s jurisdiction in the event of material deficiencies or defects in design or manufacture of a product or in the event that a product poses an unacceptable risk to health.

Companies may also choose to voluntarily recall a product if any material deficiency or regulatory violation is discovered.

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Depending on the corrective action we take to redress a product’s deficiencies or defects, the FDA or foreign regulatory authorities may require, or we may decide, that we will need to obtain new approvals, clearances or certifications for the product before we may market or distribute the corrected product.

Seeking such approvals, clearances or

certifications may delay our ability to replace the recalled products in a timely manner.

Seeking such approvals, clearances or certifications may delay our ability to replace the recalled products in a timely manner.

Moreover, if we do not adequately address problems associated with our products, we may face additional regulatory enforcement action, including warning letters or untitled letters;

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Disruptions at the FDA, other agencies and notified bodies may also slow the time necessary for new medical devices or modifications to be cleared or approved or certified medical devices to be reviewed and/or cleared, approved or certified by necessary government agencies or notified bodies, which would adversely affect our business.

For example, over the past decade, the United States government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical and non-critical activities.

For example, the United States government shut down in 2025 as well as several times in the past decade, and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical and non-critical activities.

In the event that a prolonged government shutdown occurs, or if new or existing global health concerns hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Furthermore, changes in the regulatory landscape in response to the new presidential administration and congress in 2025 may result in significant changes to laws, regulations, and enforcement practices of various agencies that we may not be able to follow or may significantly change the way that our business operates.

Furthermore, changes in the regulatory landscape in response to the tumultuous political environment both domestically and globally may result in significant changes to laws, regulations, and enforcement practices of various agencies that we may not be able to follow or may significantly change the way that our business operates.

Changes to existing laws, regulations, and enforcement practices may cause us to experience losses, force us to discontinue the sale of certain products or alter the way our business sells products, force us to close certain facilities or restructure, and potentially cease operations in extreme circumstances.

It is impossible to predict changes that may result from the new administration, and the risks associated with this change are not completely known.

It is impossible to predict changes that may result from the rapidly shifting political and geopolitical landscapes, and the risks associated with these changes are not completely known.

In addition, in the EU, notified bodies must be officially designated to certify products and services in accordance with the EU Medical Devices Regulation.

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As an “accelerated filer”, we are responsible for establishing and maintaining internal controls and procedures that will allow our management to report on, and our independent registered public accounting firm to attest to, our internal controls over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404.

Although our independent registered public accounting firm is required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-

Oxley Act of 2002 and our management is required to report on our internal controls over financial reporting under Section 404, any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations.

Although our independent registered public accounting firm is required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002 and our management is required to report on our internal controls over financial reporting under Section 404, any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations.

In addition, any testing by us, as and when required, conducted in connection with Section 404 or any subsequent testing by our independent registered public accounting firm, as and when required, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement.

Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our shares of Class A Common Stock.

We have identified a material weakness in our internal control over financial reporting that could negatively impact our financial condition.

Based on the Company’s assessment in the prior year, management identified a material weakness in our internal control over financial reporting, due to the Company’s lack of sufficient resources within inventory operations with an appropriate level of accounting knowledge, training, and experience which resulted in the ineffective design and operating effectiveness of controls over the accounting for inventory.

As a result, the Company’s accounting department was not provided with complete and adequate support, documentation, and information to effectively analyze and record accounting matters timely and account for the financial statement effects of the areas impacted.

This resulted in inadequate controls over 1) excess and obsolete inventory, and 2) inventory pricing and purchase arrangements.

The material weakness did not result in any material misstatements to our consolidated financial statements as of December 31, 2024 or in previous periods.

As defined in standards established by the Public Company Accounting Oversight Board (United States) (“PCAOB”), a “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

With oversight from our Audit Committee, we have made progress on our remediation plan specific to the material weakness, with the completion of the following remediation activities as of December 31, 2024:

• We appointed new individuals in key roles including the Chief Supply Chain and Operations Officer and other operational leadership roles;

• We enhanced training and operational guidelines resulting in the successful completion of our annual physical inventory counts;

• We designed and implemented controls with regards to excess and obsolete inventory and inventory pricing and purchase arrangements.

We have implemented the remediation steps detailed above;

however, we are unable to conclude that these controls are operating effectively until the applicable controls operate for a sufficient period of time and are subject to testing to conclude that remediation has been achieved.

We anticipate that remediation activities will be completed during fiscal year 2025, however, we cannot give assurance that other material weaknesses will not arise in the future.

Any failure to remediate the material weakness or the development of a new material weakness in our internal control over financial reporting could result in material misstatements in our financial statements and cause us to fail to meet our reporting obligations, which could have a negative impact on our financial condition, results of operations or cash flows or otherwise cause a decline in investor confidence and the market price of our Class A Common Stock.

For more information about the material weakness, see Part II, Item 9A “Controls and Procedures” in this Annual Report on Form 10-K.

Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.

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existing standard contractual clauses arrangements must be migrated to the revised clauses by December 27, 2022.

On July 10, 2023, the European Commission adopted an adequacy decision for the EU–U.S.

Data Privacy Framework (“DPF”), permitting transfers to U.S.

organizations that are DPF‑certified while transfers to non‑certified U.S.

recipients continue to require SCCs or another valid mechanism.

The new SCCs apply only to the transfer of personal data outside of the EEA and not the United Kingdom.

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As supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

In addition, the EU’s institutions are debating the ePrivacy Regulation, which would repeal and replace the current ePrivacy Directive that regulates electronic marketing and use of cookies and tracking technologies.

In addition, the EU’s institutions have been debating the ePrivacy Regulation, which would repeal and replace the current ePrivacy Directive that regulates electronic marketing and use of cookies and tracking technologies.

The new guidance and the ePrivacy Regulation would together require extensive disclosure and consent, regulate web beacons and similar technology affecting our ability to use a users’ location and other data for personalized advertising, and alter the ability of advertisers to place ads across social media and the web.

However, the proposed ePrivacy Regulation was officially withdrawn on July 16, 2025.

Existing rules continue to come from the current ePrivacy Directive (2002/58/EC, as amended) as implemented in each EU Member State, alongside the GDPR.

Several countries in Europe have also recently issued guidance on the use of cookies and similar tracking technologies which require an additional layer of consent from, and disclosure to, website users for third-party advertising, social media advertising and analytics.

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Such regulations, including uncertainties about how well the advertising technology ecosystem can adapt to legal changes around the use of tracking technologies, may have a negative effect on businesses, including ours, that collect and use online usage information for consumer acquisition and marketing.

The decline of cookies or other online tracking technologies as a means to identify and target potential purchasers may increase the cost of operating our business and lead to a decline in

The decline of cookies or other online tracking technologies as a means to identify and target potential purchasers may increase the cost of operating our business and lead to a decline in revenues.

In addition, legal uncertainties about the legality of cookies and other tracking technologies may increase regulatory scrutiny and increase potential civil liability under data protection or consumer protection laws.

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For example, regulations implemented pursuant to the Health Insurance Portability and Accountability Act (“HIPAA”), including regulations governing the privacy and security of individually identifiable health information held by healthcare providers and their business associates may require us to make significant and unplanned enhancements of software applications or services, result in delays or cancellations of orders, cause us to be subject to significant penalties or fines for violations, or result in the revocation of endorsement of our products and services by healthcare participants, among others.

In addition, significant changes to the regulatory requirements for cosmetic products have come into effect and more are scheduled throughout 2025.

On December 29, 2022, Congress enacted MoCRA that adds significant new regulatory requirements to cosmetic products.

Many of the requirements became applicable on December 29, 2023, and throughout 2024, though new rules regarding manufacturing practices are expected in 2025.

Notably, MoCRA requires FDA to promulgate final rules for Good Manufacturing Practices for cosmetic products by December 29, 2025.

Subsequently, compliance with such GMP requirements will become mandatory for manufacturers of cosmetic products.

In addition, significant changes to the regulatory requirements for cosmetic products are expected in the coming year, although they have already been delayed several times since 2024.

On December 29, 2022, Congress enacted MoCRA, adding significant new legal requirements applicable to cosmetic products.

Many of the requirements became applicable on December 29, 2023 and throughout 2024, and new rules regarding manufacturing practices are expected in 2026.

Notably, MoCRA required FDA to promulgate final rules for Good Manufacturing Practices for cosmetic products by December 29, 2025, which has now passed without the promulgation of these new final rules.

These final rules could be released at any time or their delay could continue.

If these final rules take effect, compliance with such GMP requirements will become mandatory for manufacturers of cosmetic products.

We, as the manufacturer, and our products, will become subject to these requirements, and will need to expend capital to ensure that our manufacturing practices and labeling processes are compliant.

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Any adverse determination against us in these proceedings, or even the allegations contained in these claims, regardless of whether they are ultimately found to be without merit, may also result in settlements, injunctions or damages that could have a material adverse effect on our business, financial condition and results of operations.

We may face product liability claims, which could result in unexpected costs and damage our reputation.

We currently face, and may continue to face, product liability claims, which could result in unexpected costs and damage our reputation.

We sell products for human use.

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Any product liability claim or series of claims brought against us could harm our business significantly, particularly if a claim were to result in adverse publicity or damage awards outside or in excess of our insurance policy limits.

For more information about the product liability claims that we currently face, see Part II, Item 8 “Financial Statements and Supplementary Data — Note 8 - Commitments and Contingencies” in this Annual Report on Form 10-K.

Anti-takeover provisions of Delaware law and our Second Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws could delay and discourage takeover attempts that stockholders may consider to be favorable.

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These provisions include:

• the classification of our Board of Directors into three classes, with one class elected each year to serve for a term of three

• the classification of our Board of Directors into three classes, with one class elected each year to serve for a term of three years;

• prohibiting cumulative voting in the election of directors;

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• the ability to remove a director only for cause and only with the vote of the holders of a majority of our voting stock;

• a special meeting of stockholders may only be called by our chairman of our Board of Directors, Chief Executive Officer,

or upon a resolution adopted by an affirmative vote of a majority of the Board of Directors, and not by our stockholders;

• a special meeting of stockholders may only be called by our chairman of our Board of Directors, Chief Executive Officer, or upon a resolution adopted by an affirmative vote of a majority of the Board of Directors, and not by our stockholders;

• prohibiting stockholder action by written consent;

• our stockholders must comply with advance notice procedures in order to nominate candidates for election to our board of

directors or to place stockholder proposals on the agenda for consideration at any meeting of our stockholders.

• our stockholders must comply with advance notice procedures in order to nominate candidates for election to our board of directors or to place stockholder proposals on the agenda for consideration at any meeting of our stockholders.

We may incur substantial costs and receive adverse outcomes in litigation, regulatory investigations, and other legal matters in connection with alleged violations of securities laws and regulations.

Our business, financial condition, and results of operations could be materially adversely affected by unfavorable results in pending or future litigations, regulatory investigations, and other legal matters related to violations or perceived violations of applicable securities laws and regulations by the Company or its affiliates.

We may become subject to SEC investigations or legal proceedings in the future.

We are currently, and may continue to be, subject to SEC investigations or legal proceedings in the future.

The ultimate resolution of such investigations and lawsuits cannot be predicted, and the claims raised in these lawsuits may result in further legal matters or actions against us, including, but not limited to, government enforcement actions or additional private litigation.

We cannot predict the outcome of any particular proceeding, or whether any SEC investigation will be resolved favorably or ultimately result in charges or material damages, fines or other penalties, enforcement actions, or civil or criminal proceedings against us or members of our senior management.

For more information about our current SEC investigation , see Part II, Item 8 “Financial Statements and Supplementary Data — Note 8 - Commitments and Contingencies” in this Annual Report on Form 10-K.

Litigation matters and regulatory investigations, regardless of their merits or their ultimate outcomes, are costly, divert management’s attention, and may materially adversely affect our reputation and demand for our products.

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As of March 9, 2026, there were 127,773,050 shares of our Class A Common Stock outstanding.

In addition, the potential conversion of the Notes into shares of our Class A Common Stock represents the issuance of approximately 17,599,686 shares of our Class A Common Stock.

In addition, the potential conversion of the 2026 Notes and 2028 Notes into shares of our Class A Common Stock represents the issuance of approximately 3,250,447 and 87,412,575 shares, respectively, of our Class A Common Stock.

The potential issuance of these shares in the future would result in significant dilution to our current stockholders and could adversely affect both the price of our Class A Common Stock and the terms on which we could raise additional capital.

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Due to the recurring fair value measurement, we expect that we will recognize non-cash gains or losses on our warrants for each reporting period that our warrants remain outstanding and that the amount of such gains or losses on our warrants could be material.

We may be subject to securities litigation, which is expensive to defend and could divert management’s attention.

We are currently, and may continue to be, subject to securities litigation, which is expensive to defend and could divert management’s attention.

In the past, following periods of market volatility in the price of a company’s securities or the reporting of unfavorable news, security holders have often instituted class action litigation.

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Any adverse determination in litigation could also subject us to significant liabilities.

For more information about the securities litigation that we currently face, see Part II, Item 8 “Financial Statements and Supplementary Data — Note 8 - Commitments and Contingencies” in this Annual Report on Form 10-K.

Actions of activist stockholders could be costly and time-consuming, divert management’s attention and resources, and have an adverse effect on our business.

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In addition, perceived uncertainties as to our future direction, strategy, or leadership created as a consequence of activist stockholder initiatives may result in the loss of potential business opportunities, harm our ability to attract new or retain existing investors, customers, directors, employees or other partners, and cause our stock price to experience periods of volatility or stagnation.

We have never paid dividends on our capital stock and we do not intend to pay dividends for the foreseeable future.

Consequently, any gains from an investment in our common stock will likely depend on whether the price of our common stock increases.

We have never declared or paid any dividends on our Class A Common Stock and do not intend to pay any dividends in the foreseeable future.

We anticipate that we will retain all of our future earnings for use in the operation of our business and for general corporate purposes.

Accordingly, investors should rely on sales of their Class A Common Stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors