TELA Bio, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures ​ The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act, refers to controls and procedures that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Operating Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on that evaluation, our Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2025. Management’s Report on Internal Control Over Financial Reporting ​ Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Operating Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. ​ Internal control over financial reporting may not prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are achieved. Further, the design of a control system must be balanced against resource constraints, and therefore the benefits of controls must be considered relative to their costs. Given the inherent limitations in all systems of controls, no evaluation of controls can provide absolute assurance all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Accordingly, given the inherent limitations in a cost-effective system of internal control, financial statement misstatements due to error or fraud may occur and may not be detected. Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance of achieving their objectives. We conduct periodic evaluations of our systems of controls to enhance, where necessary, our control policies and procedures. ​ Management is responsible for establishing and maintaining adequate internal control over our financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Operating Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting. Management has used the framework set forth in the report entitled “Internal Control—Integrated Framework (2013)” published by the Committee of Sponsoring Organizations of the Treadway Commission to evaluate the effectiveness of our internal 99 Table of Contents control over financial reporting. Based on its evaluation, management has concluded that our internal control over financial reporting was effective as of December 31, 2025. ​ Changes in Internal Control over Financial Reporting ​ During the fourth quarter ended December 31, 2025, there were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) which materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements ​ During the three months ended December 31, 2025, none of our directors or officers adopted , terminated or modified a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as defined in Item 408(a) of Regulation S-K of the Exchange Act. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. PART III ​ ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information concerning directors and compliance with Section 16(a) of the Exchange Act and our Code of Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or controller called for by Item 10 of Form 10-K will be set forth in our definitive proxy statement for the 2026 annual meeting of stockholders, to be filed within 120 days after the end of the fiscal year covered by this annual report on Form 10-K, and is incorporated herein by reference. We have adopted insider trading policies and procedures governing the purchase, sale, and other dispositions of our securities by directors, officers, and employees that we believe are reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable Nasdaq listing standards. Our insider trading policy states, among other things, that our directors, officers, and employees are prohibited from trading in such securities while in possession of material, nonpublic information. The foregoing summary of our insider trading policies and procedures does not purport to be complete and is qualified by reference to our Insider Trading Policy filed as an exhibit to this Annual Report on Form 10-K. In addition, with regard to the Company’s trading in its own securities, it is our policy to comply with the federal securities laws and the applicable exchange listing requirements. ITEM 11. EXECUTIVE COMPENSATION The information required by Item 11 of Form 10-K is incorporated by reference to the information contained in our definitive proxy statement for the 2026 annual meeting of stockholders. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information required by Item 12 of Form 10-K is incorporated by reference to the information contained in our definitive proxy statement for the 2026 annual meeting of stockholders. 100 Table of Contents ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information required by Item 13 of Form 10-K is incorporated by reference to the information contained in our definitive proxy statement for the 2026 annual meeting of stockholders. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Our independent registered public accounting firm is KPMG LLP , Philadelphia, PA , Auditor Firm ID: 185 . The information required by Item 14 of Form 10-K is incorporated by reference to the information contained in our definitive proxy statement for the 2026 annual meeting of stockholders. PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) 1. Financial Statements See Index to the Consolidated Financial Statements on page F-1 of this Annual Report. 2. Financial Statement Schedules None, as all information required in these schedules is included in the Notes to the Consolidated Financial Statements. 3. Exhibits Reference is made to the Exhibit Index on page 103 of this Annual Report for a list of exhibits required by Item 601 of Regulation S-K to be filed as part of this Annual Report. ITEM 16 . FORM 10-K SUMMARY Not applicable. ​ ​ ​ 101 Table of Contents TELA Bio, Inc. Index to Consolidated Financial Statements ​ ​ ​ Page ​ ​ Report of Independent Registered Public Accounting Firm F-2 Consolidated Balance Sheets F-4 Consolidated Statements of Operations and Comprehensive Loss F-5 Consolidated Statements of Stockholders’ Equity F-6 Consolidated Statements of Cash Flows F-7 Notes to Consolidated Financial Statements F-8 ​ ​ ​ F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors TELA Bio, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of TELA Bio, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated 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 a critical audit matter does not alter in any way our opinion on the consolidated 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. Sufficiency of audit evidence over the existence of inventory As discussed in Note 3 to the consolidated financial statements, the value of inventory was $11.0 million as of December 31, 2025. To facilitate the delivery of its products to customers, the Company maintains inventory at its headquarters and several field locations throughout the country, which includes finished goods inventory consigned to others and held by sales representatives. As of December 31, 2025, the Company had $4.5 million in finished goods consigned to others. F-2 Table of Contents We identified the assessment of the sufficiency of audit evidence over the existence of inventory as a critical audit matter. The geographical dispersion of inventory required subjective auditor judgment in determining the nature and extent of procedures performed over the existence of inventory, including the determination of physical locations to observe physical inventory counts. The following are the primary procedures we performed to address this critical audit matter. We obtained an understanding over the Company’s inventory process by inquiring with management and observing inventory counts for certain locations and determined where we would perform procedures. We applied auditor judgment to determine the nature and extent of procedures to be performed over the existence of inventory by evaluating: • homogeneity of the locations • historical inventory locations we have visited and results of prior physical counts • amounts of inventory on-hand by location. We evaluated the existence of inventory by performing independent test counts for all items at a certain location and comparing our counts to the Company’s records. We evaluated the sufficiency of audit evidence obtained by assessing the results of the procedures performed. /s/ KPMG LLP We have served as the Company’s auditor since 2013. Philadelphia, Pennsylvania March 25, 2026 ​ ​ ​ ​ F-3 Table of Contents TELA Bio, Inc. Consolidated Balance Sheets (In thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Assets ​ ​ ​ ​ Current assets: ​ ​ ​ ​ Cash and cash equivalents ​ $ 50,845 ​ $ 52,670 Accounts receivable, net of allowances of $ 287 and $ 275 ​ 10,347 ​ 10,098 Inventory ​ 11,016 ​ 12,781 Prepaid expenses and other current assets ​ 3,373 ​ 2,522 Total current assets ​ 75,581 ​ 78,071 Property and equipment, net ​ 2,226 ​ 2,341 Intangible assets, net ​ 1,359 ​ 1,739 Right-of-use assets ​ 1,502 ​ 1,738 Other long-term assets ​ ​ 500 ​ ​ 2,276 Deferred tax asset, net ​ ​ — ​ ​ 140 Restricted cash ​ ​ 250 ​ ​ 265 Total assets ​ $ 81,418 ​ $ 86,570 ​ ​ ​ ​ ​ ​ ​ Liabilities and stockholders’ equity ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ Accounts payable ​ $ 2,309 ​ $ 2,147 Accrued expenses and other current liabilities ​ 15,666 ​ 13,451 Total current liabilities ​ 17,975 ​ 15,598 Long‑term debt ​ ​ 55,653 ​ ​ 41,124 Other long‑term liabilities ​ 1,477 ​ 1,390 Total liabilities ​ 75,105 ​ 58,112 ​ ​ ​ ​ ​ ​ ​ Commitments and contingencies (Note 12) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ equity: ​ ​ ​ ​ Preferred stock; $ 0.001 par value: 10,000,000 shares authorized; no shares issued and outstanding ​ ​ — ​ ​ — Common stock; $ 0.001 par value: 200,000,000 shares authorized; 44,538,264 and 39,395,712 shares issued and outstanding at December 31, 2025 and 2024, respectively ​ 44 ​ 39 Additional paid-in capital ​ ​ 403,739 ​ ​ 387,059 Accumulated other comprehensive income ​ 91 ​ 90 Accumulated deficit ​ ( 397,561 ) ​ ( 358,730 ) Total stockholders’ equity ​ 6,313 ​ 28,458 Total liabilities and stockholders’ equity ​ $ 81,418 ​ $ 86,570 ​ See accompanying notes to consolidated financial statements. ​ ​ ​ ​ ​ F-4 Table of Contents TELA Bio, Inc. Consolidated Statements of Operations and Comprehensive Loss (In thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ 2025 ​ 2024 ​ ​ ​ 2023 Revenue ​ $ 80,275 ​ $ 69,300 ​ $ 58,453 Cost of revenue (excluding amortization of intangible assets) ​ 25,554 ​ 22,432 ​ 17,961 Amortization of intangible assets ​ 380 ​ 380 ​ 380 Gross profit ​ 54,341 ​ 46,488 ​ 40,112 Operating expenses: ​ ​ ​ ​ ​ ​ Sales and marketing ​ 63,182 ​ 64,648 ​ 59,681 General and administrative ​ 15,694 ​ 14,722 ​ 14,887 Research and development ​ 9,220 ​ 8,813 ​ 9,619 Total operating expenses ​ 88,096 ​ 88,183 ​ 84,187 Other operating income: ​ ​ ​ ​ ​ ​ ​ ​ ​ Gain on sale of product line ​ ​ — ​ ​ 7,580 ​ ​ — Loss from operations ​ ( 33,755 ) ​ ( 34,115 ) ​ ( 44,075 ) Other (expense) income: ​ ​ ​ ​ ​ ​ Interest expense ​ ( 5,245 ) ​ ( 5,290 ) ​ ( 5,223 ) Loss on extinguishment of debt ​ ​ ( 888 ) ​ ​ — ​ ​ — Other income ​ 1,287 ​ 1,420 ​ 2,634 Total other expense, net ​ ( 4,846 ) ​ ( 3,870 ) ​ ( 2,589 ) Loss before income tax (expense) benefit ​ ​ ( 38,601 ) ​ ​ ( 37,985 ) ​ ​ ( 46,664 ) Income tax (expense) benefit ​ ​ ( 230 ) ​ ​ 144 ​ ​ — Net loss ​ $ ( 38,831 ) ​ $ ( 37,841 ) ​ $ ( 46,664 ) Net loss per common share, basic and diluted ​ $ ( 0.83 ) ​ $ ( 1.33 ) ​ $ ( 2.04 ) Weighted average common shares outstanding, basic and diluted ​ ​ 46,947,932 ​ 28,526,441 ​ 22,868,663 Comprehensive loss: ​ ​ ​ ​ ​ ​ ​ Net loss ​ $ ( 38,831 ) ​ $ ( 37,841 ) ​ $ ( 46,664 ) Foreign currency translation adjustment ​ 1 ​ ​ ( 1 ) ​ ( 59 ) Comprehensive loss ​ $ ( 38,830 ) ​ $ ( 37,842 ) ​ $ ( 46,723 ) ​ See accompanying notes to consolidated financial statements. ​ ​ F-5 Table of Contents TELA Bio, Inc. Consolidated Statements of Stockholders’ Equity (In thousands, except share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ other ​ ​ ​ ​ ​ ​ ​ ​ Common stock ​ paid ‑ in ​ comprehensive ​ Accumulated ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Amount ​ ​ ​ capital ​ ​ ​ income ​ ​ ​ deficit ​ ​ ​ Total Balance at January 1, 2023 19,165,027 ​ $ 19 ​ $ 288,361 ​ $ 150 ​ $ ( 274,225 ) ​ $ 14,305 Vesting of restricted stock units and exercise of stock options 126,987 ​ — ​ 127 ​ — ​ — ​ 127 Issuance of common stock under the employee stock purchase plan ​ 10,602 ​ — ​ 88 ​ — ​ — ​ 88 Shares withheld for employee taxes ​ ( 27,131 ) ​ ​ — ​ ​ ( 289 ) ​ ​ — ​ ​ — ​ ​ ( 289 ) Foreign currency translation adjustment — ​ ​ — ​ ​ — ​ ​ ( 59 ) ​ ​ — ​ ( 59 ) Stock‑based compensation expense — ​ — ​ 5,032 ​ — ​ — ​ 5,032 Sale of common stock, net of underwriting discounts, commissions and offering costs ​ 5,219,190 ​ ​ 5 ​ ​ 46,336 ​ ​ — ​ ​ — ​ ​ 46,341 Net loss — ​ — ​ — ​ — ​ ( 46,664 ) ​ ( 46,664 ) Balance at December 31, 2023 24,494,675 ​ ​ 24 ​ ​ 339,655 ​ ​ 91 ​ ​ ( 320,889 ) — ​ 18,881 Vesting of restricted stock units and exercise of stock options 229,606 ​ 1 ​ 225 ​ — ​ — ​ 226 Issuance of common stock under the employee stock purchase plan ​ 58,994 ​ ​ — ​ ​ 281 ​ ​ — ​ ​ — ​ ​ 281 Shares withheld for employee taxes ​ ( 57,563 ) ​ ​ — ​ ​ ( 369 ) ​ ​ — ​ ​ — ​ ​ ( 369 ) Foreign currency translation adjustment — ​ — ​ — ​ ( 1 ) ​ — ​ ( 1 ) Stock‑based compensation expense ​ — ​ ​ — ​ ​ 4,362 ​ ​ — ​ ​ — ​ ​ 4,362 Sale of common stock and pre-funded warrants, net of underwriting discounts, commissions and offering costs ​ 14,670,000 ​ ​ 14 ​ ​ 42,905 ​ ​ — ​ ​ — ​ ​ 42,919 Net loss — ​ — ​ — ​ — ​ ( 37,841 ) ​ ( 37,841 ) Balance at December 31, 2024 39,395,712 ​ ​ 39 ​ ​ 387,059 ​ ​ 90 ​ ​ ( 358,730 ) ​ ​ 28,458 Vesting of restricted stock units ​ 279,765 ​ ​ 1 ​ ​ — ​ ​ — ​ ​ — ​ ​ 1 Issuance of common stock under the employee stock purchase plan ​ 58,235 ​ ​ — ​ ​ 105 ​ ​ — ​ ​ — ​ ​ 105 Shares withheld for employee taxes ​ ( 84,448 ) ​ ​ — ​ ​ ( 205 ) ​ ​ — ​ ​ — ​ ​ ( 205 ) Issuance of common stock warrants in connection with credit facility ​ — ​ ​ — ​ ​ 1,413 ​ ​ — ​ ​ — ​ ​ 1,413 Exercise of pre-funded warrant ​ 700,000 ​ ​ — ​ ​ ( 1 ) ​ ​ — ​ ​ — ​ ​ ( 1 ) Foreign currency translation adjustment ​ — ​ ​ — ​ ​ — ​ ​ 1 ​ ​ — ​ ​ 1 Stock‑based compensation expense ​ — ​ ​ — ​ ​ 3,796 ​ ​ — ​ ​ — ​ ​ 3,796 Sale of common stock and pre-funded warrants, net of underwriting discounts, commissions and offering costs ​ 4,189,000 ​ ​ 4 ​ ​ 11,572 ​ ​ — ​ ​ — ​ ​ 11,576 Net loss ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 38,831 ) ​ ​ ( 38,831 ) Balance at December 31, 2025 ​ 44,538,264 ​ $ 44 ​ $ 403,739 ​ $ 91 ​ $ ( 397,561 ) ​ $ 6,313 ​ See accompanying notes to consolidated financial statements. ​ F-6 Table of Contents TELA Bio, Inc. Consolidated Statements of Cash Flows (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ ​ ​ 2023 Cash flows from operating activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss ​ $ ( 38,831 ) ​ $ ( 37,841 ) ​ $ ( 46,664 ) Adjustments to reconcile net loss to net cash used in operating activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation expense ​ 630 ​ 632 ​ 428 Noncash interest expense ​ 529 ​ 609 ​ 599 Noncash loss on extinguishment of debt ​ ​ 888 ​ ​ — ​ ​ — Amortization of intangible assets ​ 380 ​ 380 ​ 380 Net changes in operating lease ROU assets and liabilities ​ ​ 302 ​ ​ ( 99 ) ​ ​ ( 49 ) Inventory excess and obsolescence charge ​ 2,360 ​ 2,955 ​ 1,414 Stock ‑ based compensation expense ​ 3,796 ​ 4,362 ​ 5,032 Income tax expense (benefit) ​ ​ 230 ​ ​ ( 144 ) ​ ​ — Gain on disposal of fixed assets ​ ​ — ​ ​ — ​ ​ ( 12 ) Gain on sale of product line ​ ​ — ​ ​ ( 7,580 ) ​ ​ — Change in operating assets and liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Accounts receivable, net ​ ( 110 ) ​ ( 762 ) ​ ( 3,058 ) Inventory ​ ( 503 ) ​ ( 2,972 ) ​ ( 2,718 ) Prepaid expenses and other current and long-term assets ​ 133 ​ 227 ​ ( 81 ) Accounts payable ​ 141 ​ 482 ​ 11 Accrued expenses and other current and long-term liabilities ​ 1,760 ​ ( 1,809 ) ​ 4,177 Foreign currency transaction loss ​ ​ 76 ​ ​ ( 35 ) ​ ​ ( 316 ) Net cash used in operating activities ​ ( 28,219 ) ​ ( 41,595 ) ​ ( 40,857 ) Cash flows from investing activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase of property and equipment ​ ( 448 ) ​ ( 989 ) ​ ( 611 ) Proceeds from the sale of product line ​ ​ 1,294 ​ ​ 5,440 ​ ​ — Proceeds from the sale of property and equipment ​ ​ — ​ ​ — ​ ​ 12 Net cash provided by (used in) investing activities ​ 846 ​ 4,451 ​ ( 599 ) Cash flows from financing activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Proceeds from sale of common stock and pre-funded warrants, net ​ ​ 11,823 ​ ​ 42,919 ​ ​ 46,341 Proceeds from issuance of long-term debt and warrants ​ ​ 60,000 ​ ​ — ​ ​ — Repayment of long-term debt ​ ​ ( 42,420 ) ​ ​ — ​ ​ — Payment of debt financing costs ​ ​ ( 3,554 ) ​ ​ — ​ ​ — Proceeds from exercise of stock options ​ 1 ​ 226 ​ 127 Payment of withholding taxes related to stock-based compensation to employees ​ ​ ( 205 ) ​ ​ ( 369 ) ​ ​ ( 289 ) Proceeds from issuance of common stock under the employee stock purchase plan ​ ​ 105 ​ ​ 281 ​ ​ 88 Net cash provided by financing activities ​ 25,750 ​ 43,057 ​ 46,267 Effect of exchange rate on cash and cash equivalents ​ ( 217 ) ​ 28 ​ 164 Net (decrease) increase in cash and cash equivalents and restricted cash ​ ( 1,840 ) ​ 5,941 ​ 4,975 Cash and cash equivalents and restricted cash, beginning of year ​ 52,935 ​ 46,994 ​ 42,019 Cash and cash equivalents and restricted cash, end of year ​ $ 51,095 ​ $ 52,935 ​ $ 46,994 Supplemental disclosure of cash flow information: ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash paid during the period for interest ​ $ 4,716 ​ $ 4,071 ​ $ 4,624 Supplemental disclosures of noncash investing and financing activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Property and equipment in accounts payable and accrued expenses and other current liabilities ​ $ 66 ​ $ — ​ $ 119 Operating lease ROU asset exchanged for operating lease liabilities ​ $ — ​ $ — ​ $ 895 Offering costs in accrued expenses and other current liabilities ​ ​ 247 ​ ​ — ​ ​ — Issuance of common stock warrants in connection with credit facility ​ $ 1,413 ​ $ — ​ $ — ​ See accompanying notes to consolidated financial statements. ​ ​ F-7 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (1) Background TELA Bio, Inc. (the “Company”) was incorporated in the state of Delaware on April 17, 2012 and wholly owns TELA Bio Limited, a company incorporated in the United Kingdom and is the ultimate parent of TELA Bio GmbH, a company incorporated in Germany through TELA Bio Limited. The Company is a commercial-stage medical technology company focused on providing innovative soft-tissue reconstruction solutions that optimize clinical outcomes by prioritizing the preservation and restoration of the patient’s own anatomy. OviTex Reinforced Tissue Matrix (“OviTex”), the Company’s first portfolio of products, addresses unmet needs in hernia repair and abdominal wall reconstruction by combining the benefits of biologic matrices and polymer materials while minimizing their shortcomings, at a cost-effective price. OviTex PRS Reinforced Tissue Matrix (“OviTex PRS”), the Company’s second portfolio of products, addresses unmet needs in plastic and reconstructive surgery. The Company’s principal corporate office and research facility is located in Malvern, Pennsylvania. (2) Risks and Liquidity The Company’s operations to date have focused on commercializing products, developing and acquiring technology and assets, business planning, raising capital and organization and staffing. The Company has incurred recurring losses and negative cash flows from operations since inception and has an accumulated deficit of $ 397.6 million as of December 31, 2025. The Company anticipates incurring additional losses until such time, if ever, it can generate sufficient revenue from its products to cover its expenses. On November 13, 2025, the Company executed an underwriting agreement in connection with an underwritten registered direct offering of 4,189,000 shares of its common stock, at a price of $ 1.11 per share and, in lieu of common stock to investors who so chose, pre-funded warrants to purchase 7,523,000 shares of common stock at an offering price of $ 1.1099 per pre-funded warrant, which represents the per share offering price for the shares of common stock less the $ 0.0001 per share exercise price for each pre-funded warrant. The offering closed on November 17, 2025. The offering resulted in net proceeds of approximately $ 11.6 million, after deducting underwriting discounts and commissions and other estimated offering expenses and assuming no subsequent exercise of the pre-funded warrants. The exercise of the pre-funded warrants, if any, is not expected to provide significant additional funding to the Company. ​ The operations of the Company are subject to certain risks and uncertainties including, among others, the uncertainty of product development, the impact of macroeconomic conditions, including, general economic uncertainty, inflationary pressures and the measures undertaken by various governments to address them, banking instability, monetary policy changes (including tariffs that have been or may in the future be imposed by the U.S. or other countries), geopolitical factors such as the ongoing Russia-Ukraine conflict, recent events in Venezuela, the current conflicts in the Middle East (including any escalation or expansion) and increasing tensions between China and Taiwan, cybersecurity events affecting or disrupting normal hospital operations, constraints on the supply of critical surgical and hospital supplies necessary to facilitate the surgical procedures in which the Company’s products are utilized, technological uncertainty, commercial acceptance of any developed products, alternative competing technologies, dependence on collaborative partners, uncertainty regarding patents and proprietary rights, comprehensive government regulations, and dependence on key personnel. ​ (3) Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”). The consolidated financial statements include the F-8 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) accounts of TELA Bio, Inc. and its wholly owned subsidiaries TELA Bio Limited and TELA Bio GmbH. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The most significant judgments are employed in estimates used to determine the recoverability of the carrying value of the Company’s inventory. As future events and their effects cannot be determined with precision, actual results may differ significantly from these estimates. Segments Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources in assessing performance. The Company has one reportable segment which is focused on providing innovative soft-tissue reconstruction solutions that optimize clinical outcomes by prioritizing the preservation and restoration of the patient’s own anatomy. The Company’s chief operating decision maker (“CODM”) is the chief executive officer. ​ The accounting policies of its segment are the same as those described in the summary of significant accounting policies. The CODM uses budget to actual forecasts and net income in assessing entity-wide operating results and deciding how to invest in the Company. The CODM is regularly provided with net loss and consolidated assets, which are reported on the consolidated statement of operations and comprehensive loss and consolidated balance sheet, respectively. ​ The tables below summarizes the items included within net loss regularly provided to the CODM for the years ended December 31, 2025, 2024 and 2023: ​ F-9 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2025 ​ 2024 ​ ​ ​ 2023 Revenue $ 80,275 ​ $ 69,300 ​ $ 58,453 Cost of revenue (excluding amortization of intangible assets) 25,554 ​ 22,432 ​ 17,961 Amortization of intangible assets 380 ​ 380 ​ 380 Gross profit 54,341 ​ 46,488 ​ 40,112 Sales and marketing: ​ ​ ​ ​ ​ Sales and sales management 43,365 ​ 44,132 ​ 35,469 International 5,711 ​ 5,072 ​ 3,916 Other sales and marketing (a) 14,106 ​ 15,444 ​ 20,296 Total sales and marketing 63,182 ​ 64,648 ​ 59,681 General and Administrative: ​ ​ ​ ​ ​ Finance and Legal ​ 7,461 ​ ​ 7,503 ​ ​ 7,715 Other general and administrative (b) 8,233 ​ 7,219 ​ 7,172 Total general and administrative 15,694 ​ 14,722 ​ 14,887 Research and Development: ​ ​ ​ ​ ​ ​ ​ ​ Clinical ​ 3,568 ​ ​ 4,068 ​ ​ 3,891 Regulatory and quality 2,158 ​ ​ 1,452 ​ ​ 2,189 Other research and development (c) ​ 3,494 ​ ​ 3,293 ​ ​ 3,539 Total research and development ​ 9,220 ​ ​ 8,813 ​ ​ 9,619 Gain on sale of product line ​ — ​ ​ 7,580 ​ ​ — Other segment items (d) ​ ( 5,076 ) ​ ​ ( 3,726 ) ​ ​ ( 2,589 ) Net loss $ ( 38,831 ) ​ $ ( 37,841 ) ​ $ ( 46,664 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Other sales and marketing includes strategy, analytics and allocated facility expenses. (b) Other general and administrative includes executive, human resources, information technology and allocated facility expenses. (c) Other research and development includes engineering and allocated facility expenses. (d) Other segment items include other operating income and other expenses as disclosed in the consolidated statements of operations and comprehensive loss; interest expense, loss on extinguishment of debt, other income and income tax expense. ​ Concentration of Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company places its cash with high-credit-quality financial institutions and primarily invests in money market funds. The Company has established guidelines relative to credit ratings and maturities that seek to maintain safety and liquidity. As described in Note 12, the Company has licensed patents and other intellectual property from Aroa Biosurgery Ltd. (“Aroa”). As part of this agreement, Aroa is also the exclusive contract manufacturer of the Company’s OviTex portfolio of products. The inability of Aroa to fulfill supply requirements of the Company could materially impact future operating results. A change in the relationship with Aroa, or an adverse change in their business, could materially impact future operating results. F-10 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) Cash and Cash Equivalents The Company considers cash equivalents to be highly-liquid investments with maturities of three months or less from the date of purchase. Cash equivalents consist of investments in a money market fund. The Company’s cash and cash equivalents are carried at fair value. Restricted Cash Restricted cash represents an amount held in an escrow deposit account, securing a letter of credit for the Company’s office lease. The following table presents a reconciliation of all captions of cash, cash equivalents and restricted cash reported on the balance sheets that sum to the total of those same amounts shown in the statements of cash flows. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Cash and cash equivalents ​ $ 50,845 ​ $ 52,670 Restricted cash ​ 250 ​ 265 Total cash and cash equivalents and restricted cash shown in statements of cash flows ​ $ 51,095 ​ $ 52,935 ​ Inventory Inventory consists of purchased materials, primarily finished goods, and is identified and tracked by lot and stated at the lower of cost or net realizable value, with cost being determined on a first-in, first-out basis. Inventories consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Finished goods ​ $ 10,898 ​ $ 12,645 Raw materials ​ 118 ​ 136 Total inventory ​ $ 11,016 ​ $ 12,781 ​ The Company periodically analyzes its inventory levels and writes down inventory that has become obsolete or that has a cost basis in excess of its expected net realizable value based on expected customer demand. To facilitate the delivery of its products to customers, the Company maintains inventory at its headquarters and several field locations throughout the country, which includes finished goods inventory consigned to others and held by sales representatives. As of December 31, 2025 and 2024, the Company had $ 4.5 million and $ 3.2 million, respectively, in finished goods consigned to others. Property and Equipment Property and equipment are stated at the aggregate cost incurred to acquire and place the asset in service. Expenditures for routine maintenance and repairs are charged to expense as incurred and costs of improvements and renewals are capitalized. Depreciation is provided over the estimated useful lives of the assets using the straight-line method. F-11 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) Intangible Assets Upfront payments and milestone payments due related to licenses or commercialization rights prior to future economic benefit being established are recorded as research and development expenses. Milestone payments due related to licenses or commercialization rights after future economic benefit is established are recorded as intangible assets. The Company recorded $ 0.4 million of amortization expense, respectively, in each of 2025, 2024 and 2023 related to intangible assets. At December 31, 2025, the remaining life of intangible assets was 3.6 years. The Company anticipates recognizing amortization expense of $ 0.4 million in each of the next three years and $ 0.2 million thereafter. Leases The Company determines if an arrangement is a lease at contract inception. A lease exists when a contract conveys to the customer the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. The definition of a lease embodies two conditions: (1) there is an identified asset in the contract that is land or a depreciable asset (i.e., property, plant, and equipment), and (2) the customer has the right to control the use of the identified asset. Operating leases are included as a right-of-use (“ROU”) asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ​ Long-Lived Assets Long-lived assets, such as property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by such asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group exceeds the undiscounted cash flows, an impairment is recognized to the extent the carrying value exceeds its fair value. Fair value is determined using various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary. No impairment losses were recognized during the years ended December 31, 2025, 2024 or 2023. Debt Issuance Costs Debt issuance costs incurred in connection with debt (Note 6) are amortized to interest expense over the term of the respective financing arrangement using the effective-interest method. Debt issuance costs, net of related amortization are deducted from the carrying amount of the related debt. Revenue Recognition Under ASC Topic 606, Revenue from Contracts with Customers , (“ASC 606”), an entity recognizes revenue when its customer obtains control of the promised good, in an amount that reflects the consideration that the entity expects to be entitled in exchange for those goods. The Company performs the following five steps to recognize revenue under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only recognizes revenue when it is probable that it will collect the consideration to which it is entitled in exchange for the goods or services that will be transferred to the customer. A significant portion of the Company’s revenue is generated from product shipped to a customer or from consigned inventory maintained at hospitals or other surgical facilities. Revenue from the sale of consigned products is recognized F-12 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) when control is transferred to the customer, which occurs at the time the product is used in a surgical procedure. For product that is not held on consignment, the Company recognizes revenue when control transfers to the customer which occurs at the time the product is shipped or delivered. For all of the Company’s customer contracts, the only identified performance obligation is providing the product to the customer. Revenue is recognized at the estimated net sales price, which includes estimates of variable consideration. The Company enters into contracts with certain third-party payors for the payment of rebates with respect to the utilization of its products. These rebates are primarily based on contractual percentages. The Company estimates and records these rebates in the same period the related revenue is recognized, resulting in a reduction of product revenue. Payment terms with customers do not exceed one year and, therefore, the Company does not account for a financing component in these arrangements. There are no incremental costs of obtaining a contract that would rise to or enhance an asset other than product costs, which are a component of inventory. The Company expenses incremental costs of obtaining a contract with a customer (e.g., sales commissions) when incurred as the period of benefit is less than one year. Fees charged to customers for shipping are recognized as revenue. The following table presents revenue disaggregated (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 OviTex ​ $ 51,224 ​ $ 45,925 ​ $ 39,416 OviTex PRS ​ ​ 27,306 ​ ​ 22,745 ​ ​ 18,736 Other ​ ​ 1,745 ​ ​ 630 ​ ​ 301 Total revenue ​ $ 80,275 ​ $ 69,300 ​ $ 58,453 ​ Sales outside of the U.S. were $ 12.1 million, or 15 %, of total revenue for the year ended December 31, 2025, $ 10.3 million or 15 % of total revenue for the year ended December 31, 2024 and $ 6.1 million or 10 % of total revenue for the year ended December 31, 2023. Research and Development Research and development costs are charged to expense as incurred and consist primarily of salaries, benefits, and other related costs, including stock-based compensation for personnel serving in the research and development functions as well as costs incurred with Aroa under development agreements related to technology transfer, laboratory materials and supplies. At the end of the reporting period, the Company compares payments made to third-party service providers to the estimated progress toward completion of the research or development objectives. Such estimates are subject to change as additional information becomes available. Depending on the timing of payments to the service providers and the progress that the Company estimates has been made as a result of the service provided, the Company may record net prepaid or accrued expense relating to these costs. Costs incurred in obtaining patent and other intellectual property licenses or milestone payments from license agreements for which there are no alternative future uses are charged to expense as incurred. Stock-Based Compensation The Company accounts for stock-based awards in accordance with provisions of ASC Topic 718, Compensation—Stock Compensation , under which the Company recognizes the grant-date fair value of stock-based awards issued to employees and nonemployee board members as compensation expense on a straight-line basis over the vesting period of the award while awards containing a performance condition are recognized as expense when the achievement of the F-13 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) performance criteria is considered probable. The Company uses the Black-Scholes option pricing model to determine the grant-date fair value of stock options. The Company estimates forfeitures that it expects will occur and adjusts expense for actual forfeitures in the periods they occur. Warrants The Company accounts for issued warrants either as a liability or equity in accordance with ASC Topic 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity (“ASC 480-10”) or ASC Topic 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock (“ASC 815-40”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the company’s own stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. Warrants that are equity-classified instruments and recorded in additional paid-in capital at issuance are not subject to remeasurement. The Company periodically evaluates changes in facts and circumstances that could impact the classification of warrants. Income Taxes Income taxes are accounted for under the asset-and-liability method as required by ASC Topic 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period corresponding to the enactment date. Under ASC 740, a valuation allowance is required when it is more likely than not all or some portion of the deferred tax assets will not be realized through generating sufficient future taxable income. ASC Subtopic 740-10, Accounting for Uncertainty of Income Taxes (“ASC 740-10”), defines the criterion an individual tax position must meet for any part of the benefit of the tax position to be recognized in consolidated financial statements prepared in conformity with GAAP. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not such tax position will be sustained on examination by the taxing authorities, based solely on the technical merits of the respective tax position. The tax benefits recognized in the consolidated financial statements from such a tax position should be measured based on the largest benefit having a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority. In accordance with the disclosure requirements of ASC 740-10, the Company’s policy on income statement classification of interest and penalties related to income tax obligations is to include such items as part of income tax expense. Fair value of financial instruments Fair value is the price that could be received to sell an asset or paid to transfer a liability in an orderly transaction among market participants. Fair value determination in accordance with applicable accounting guidance requires that a number of significant judgments are made. Additionally, fair value is used on a nonrecurring basis to evaluate assets for impairment or as required for disclosure purposes by applicable accounting guidance on disclosures about fair value of financial instruments. Depending on the nature of the assets and liabilities, various valuation techniques and assumptions are used when estimating fair value. The carrying amounts of certain of the Company’s financial instruments, including F-14 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) cash and cash equivalents, accounts receivable, other assets, and accounts payable are shown at cost, which approximates fair value due to the short-term nature of these instruments. The carrying amount of the Perceptive Term Loan Facility (as later defined) approximates fair value due to its variable interest rate. The Company follows the provisions of ASC Topic 820, Fair Value Measurement , for financial assets and liabilities measured on a recurring basis. The guidance requires fair value measurements be classified and disclosed in one of the following three categories: ● Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. ● Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liabilities. ● Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). The following fair value hierarchy table presents information about each major category of the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value measurement at reporting date using ​ ​ Quoted prices in ​ ​ ​ ​ ​ ​ ​ ​ active markets ​ Significant other ​ Significant ​ ​ for identical ​ observable ​ unobservable ​ ​ assets ​ inputs ​ inputs ​ ​ ​ ​ (Level 1) ​ ​ ​ (Level 2) ​ ​ ​ (Level 3) December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents – money market fund ​ $ 47,068 ​ $ — ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents – money market fund ​ $ 48,131 ​ $ — ​ $ — ​ Allowance for credit losses The following table presents a rollforward of the allowance of credit losses (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at Beginning of Period ​ Bad Debt Expense Recognized ​ Write-offs of Uncollectible Balances ​ ​ Balance at End of Period Year ended December 31, 2023 $ ( 143 ) ​ ( 306 ) ​ 33 ​ $ ( 416 ) Year ended December 31, 2024 $ ( 416 ) ​ ( 65 ) ​ 206 ​ $ ( 275 ) Year ended December 31, 2025 $ ( 275 ) ​ ( 97 ) ​ 85 ​ $ ( 287 ) ​ Net loss per share Basic and diluted net loss per common share is determined by dividing net loss by the weighted-average shares of common stock outstanding during the reporting period. In periods in which the Company reports a net loss, diluted net loss per share is the same as basic net loss per share since dilutive shares are not assumed to have been issued if their effect is antidilutive. Therefore, the weighted-average shares used to calculate both basic and diluted loss per share are the same. F-15 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) The following potentially dilutive securities have been excluded from the computation of diluted weighted-average shares outstanding, as they would be antidilutive. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 Stock options ​ 2,672,859 2,119,183 ​ 2,162,453 Unvested restricted stock units ​ 1,321,162 ​ 948,788 ​ 907,203 Common stock warrants ​ 88,556 ​ 88,556 ​ 88,556 Common stock warrants issued with credit facility ​ 2,000,000 ​ — ​ — Total 6,082,577 3,156,527 ​ 3,158,212 ​ Due to their nominal exercise price of $ 0.0001 per share, all outstanding pre-funded warrants are considered common stock equivalents and are included in the calculation of weighted-average shares of common stock outstanding from the respective closing dates. ​ Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures , requiring entities to provide additional information in the income tax rate reconciliation and additional disclosures about income taxes paid. The new accounting guidance requires entities to disclose in their rate reconciliation table additional categories of information about federal, state and foreign income taxes and to provide more details about the reconciling items in some categories if the items meet a quantitative threshold. This guidance is effective for annual periods beginning after December 15, 2024, and should be applied prospectively, but entities have the option to apply it retrospectively for each period presented. We adopted this guidance, retrospectively on January 1, 2025 and included the necessary disclosures in Note 11. ​ In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses . ASU 2024-03 requires additional disclosure of specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact that the adoption of ASU 2024-03 will have on its consolidated financial statements and disclosures. ​ In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-use Software . The new guidance eliminates project stages and requires capitalizing software costs to begin when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. When evaluating if a project is probable to be completed, significant development uncertainty must be assessed. Additionally, disclosures for property, plant and equipment will be required for all capitalized software costs. The guidance is effective in the first quarter of 2028 with early adoption permitted as of the beginning of an annual reporting period. Upon adoption, the guidance may be applied prospectively, retrospectively or using a modified transition approach. The Company is currently evaluating the expected impact that the standard could have on its consolidated financial statements and related disclosures. ​ In July 2025, the FASB issued ASU 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets. The guidance provides a practical expedient that an entity may assume that conditions as of the balance sheet date remain unchanged over the remaining life of the asset when estimating expected credit losses for current accounts receivable and current contract assets arising from revenue transactions from contracts with customers. The guidance is effective in the first quarter of 2026 with early adoption permitted, to be applied on a prospective basis. The Company F-16 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) prospectively adopted this guidance on October 1, 2025 and the adoption of this guidance did not have a significant impact on the consolidated financial statements and related disclosures. ​ (4) Property and Equipment Property and equipment consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, Asset description ​ ​ ​ Estimated useful lives ​ ​ ​ 2025 ​ ​ ​ 2024 Lab equipment 5 Years ​ $ 1,805 ​ $ 2,968 Furniture and fixtures 5 Years ​ 370 ​ 366 Computer equipment and software 3 Years ​ 1,002 ​ 733 Leasehold improvements Lesser of useful life or lease term ​ 2,537 ​ 2,934 Total ​ ​ 5,714 ​ 7,001 Less accumulated depreciation and amortization ​ ​ ( 3,488 ) ​ ( 4,660 ) Property and equipment, net ​ ​ $ 2,226 ​ $ 2,341 ​ Depreciation expense was $ 0.6 million, $ 0.6 million and $ 0.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. During the year ended December 31, 2025, the Company disposed of $ 1.8 million of assets. All assets were fully depreciated. (5) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Compensation and related benefits ​ $ 7,096 ​ $ 7,343 Third-party and professional fees ​ 3,525 ​ 2,493 Amounts due to contract manufacturer ​ ​ 3,058 ​ ​ 2,095 Current portion of operating lease liabilities ​ ​ 524 ​ ​ 545 Research and development expenses ​ ​ 27 ​ ​ 20 Income/sales tax payable ​ ​ 725 ​ ​ 476 Other ​ 711 ​ 479 Total accrued expenses and other current liabilities ​ $ 15,666 ​ $ 13,451 ​ ​ F-17 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) (6) Debt Long-term debt consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Perceptive term loan ​ $ 60,000 ​ $ — MidCap term loan ​ ​ — ​ ​ 40,000 Exit fee ​ — ​ 2,000 Unamortized exit fee and issuance costs ​ ( 4,347 ) ​ ( 876 ) Long-term debt ​ $ 55,653 ​ $ 41,124 ​ Perceptive Term Loan On November 13, 2025, the Company entered into a Credit Agreement and Guaranty (the “Credit Agreement”) with Perceptive Credit Holdings V, LP, as lender and administrative agent (“Perceptive”), which provides for a senior secured term loan facility in an aggregate principal amount of up to $ 70.0 million (the “Perceptive Term Loan Facility”). An initial loan in an aggregate principal amount of $ 60.0 million (the “Initial Loan”) was funded under the Perceptive Term Loan Facility on November 14, 2025 (the “Closing Date”). In addition to the Initial Loan, the Perceptive Term Loan Facility includes an additional delayed draw loan in an aggregate principal amount of $ 10.0 million to be available in a single drawing after the Closing Date on or prior to the Delayed Draw Commitment Termination Date (as defined in the Credit Agreement but not later than April 30, 2027) (the “Delayed Draw Loan,” together with the Initial Loan, the “Loans”), which will be accessible by the Company so long as it satisfies certain customary conditions precedent, including but not limited to, the achievement of net revenue thresholds. The Perceptive Term Loan Facility has a maturity date of November 14, 2030 (the “Maturity Date”). The Perceptive Term Loan Facility will accrue interest at an annual rate equal to the sum of (a) an applicable margin of 7.85 % (the “Applicable Margin”) plus (b) the greater of (i) the Reference Rate (as defined in the Credit Agreement) and (ii) four and one quarter percent ( 4.25 %). Accrued interest on the Term Loans is payable monthly in arrears. Upon an Event of Default (as defined in the Credit Agreement), the Applicable Margin will automatically increase by an additional 3.00 % per annum. Prior to the Maturity Date, there will be no scheduled principal payments under the Perceptive Term Loan Facility. On the Maturity Date, the Company is required to pay Perceptive the aggregate outstanding principal amount of the Loans and all accrued and unpaid interest thereon. The Term Loans may be prepaid at any time, subject to a prepayment premium equal to 2 % to 10 % of the aggregate outstanding principal amount being prepaid, depending on the date of prepayment. In connection with the Credit Agreement, the Company also entered into a Security Agreement (the “Security Agreement”), dated as of the Signing Date, with Perceptive, pursuant to which all of its obligations under the Credit Agreement are secured by a first lien perfected security interest on substantially all of its existing and after-acquired assets, subject to customary exceptions. ​ In addition, on the Closing Date, as consideration for the Credit Agreement, the Company issued to Perceptive warrants to purchase up to 2,000,000 shares (the “Warrant Shares”) of the Company’s common stock, par value $ 0.001 per share (the “Common Stock”), with an exercise price of $ 1.11 (the “Initial Loan Warrants”). Additionally, if the Delayed Draw Loan is drawn upon, the Company will be required to issue to Perceptive additional warrants to purchase up to 333,333 shares of its Common Stock, with an exercise price of $ 1.11 (the “DDL Warrants” and, together with the Initial Loan Warrants, the “Warrants”). ​ F-18 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) The Warrants have an expiration date of November 14, 2035 and may be exercised on a cashless or “net” basis. The Warrants are freely transferable and will be automatically exercised, on a cashless basis, prior to their expiration if the value of the underlying shares is greater than the then-applicable exercise price. The exercise price described herein is subject to adjustment for certain recapitalization events, as further described in the Warrants. Pursuant to the Warrants, the Company has granted Perceptive certain resale registration rights in respect of the Warrant Shares. The Company determined that the Warrants were equity classified and therefore allocated the proceeds received between the debt and warrants based on their relative fair values. The amount allocated to the Warrants, or $ 1.4 million, has been treated as an additional debt issuance cost. None of the Warrants have been exercised as of December 31, 2025. ​ The Credit Agreement contains certain representations and warranties, affirmative covenants, negative covenants, financial covenants, and conditions that are customarily required for similar financings. The affirmative covenants, among other things, require the Company to undertake various reporting and notice requirements, maintain insurance and maintain in full force and effect all Regulatory Approvals, Material Agreements, Intellectual Property (each as defined in the Credit Agreement) and other rights, interests or assets (whether tangible or intangible) reasonably necessary for the operations of its business. The negative covenants restrict or limit the Company’s ability to, among other things and subject to certain exceptions contained in the Credit Agreement, incur new indebtedness; create liens on assets; engage in certain fundamental corporate changes, such as mergers or acquisitions, or changes to the Company’s business activities; make certain Investments or Restricted Payments (each as defined in the Credit Agreement); change the Company’s fiscal year; pay dividends; repay other certain indebtedness; engage in certain affiliate transactions; or enter into, amend or terminate any other agreements that has the impact of restricting the Company’s ability to make loan repayments under the Credit Agreement. In addition, the Company must (i) at all times prior to the Maturity Date, maintain minimum Liquidity (as defined in the Credit Agreement) of $ 5.0 million and (ii) as of each quarterly calculation date set forth in the Credit Agreement, maintain revenue that is not less than the amounts specified in the Credit Agreement. The Credit Agreement also contains certain customary Events of Default which include, among others, non-payment of principal, interest, or fees, violation of covenants, inaccuracy of representations and warranties, bankruptcy and insolvency events, material judgments, cross-defaults to material contracts, certain regulatory-related events and events constituting a change of control. The occurrence of an Event of Default could result in, among other things, the declaration that all outstanding principal and interest under the Perceptive Term Loan Facility are immediately due and payable in whole or in part. Interest expense associated with the Perceptive Credit Facility recorded for the year ended December 31, 2025 was $ 1.1 million, of which $ 0.1 million was related to the amortization of debt issuance costs. MidCap Term Loan In May 2022, the Company entered into the Credit and Security Agreement (the “MidCap Credit Agreement”) with MidCap Financial Trust, as agent, and certain lender parties thereto. The MidCap Credit Agreement consisted of $ 40.0 million in a term loan. On November 14, 2025, the Company closed on a credit facility from Perceptive and upon closing used a portion of the proceeds to repay all borrowings under the MidCap Credit Agreement. As a result of these payments, a $ 0.9 million loss on extinguishment was recorded during the year ended December 31, 2025. ​ The MidCap term loan bore interest at a rate equal to 6.25 % plus the greater of one-month Term SOFR (as defined in the MidCap Credit Agreement) or 1.0 %. Interest expense associated with the MidCap Credit Facility recorded for the year ended December 31, 2025 was $ 4.1 million, of which $ 0.4 million was related to the amortization of debt issuance costs. Interest expense associated with the MidCap Credit Facility recorded for the year ended December 31, 2024 was $ 5.3 million, of which $ 0.6 million was related to the amortization of debt issuance costs. Interest expense associated with the MidCap Credit Facility recorded for the year ended December 31, 2023 was $ 5.2 million, of which $ 0.6 million was related to the amortization of debt issuance costs. ​ F-19 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) (7) Stockholders’ Equity Public Stock Offerings In April 2023, the Company completed an underwritten public offering in which the Company issued and sold 5,219,190 shares of its common stock (including 469,190 shares sold pursuant to the underwriters’ overallotment option in May 2023) at a public offering price of $ 9.50 per share. The Company received net proceeds of approximately $ 46.3 million after deducting underwriting discounts, commissions and other offering expenses. ​ In November 2023, the Company entered into a new Equity Distribution Agreement (the “2023 Equity Agreement”) with Piper Sandler & Co, (“Piper”) in connection with the establishment of an at-the-market offering program under which the Company may sell shares of its common stock, from time to time through Piper as sales agent, in an initial amount of up to $ 50 million. The 2023 Equity Agreement supersedes and replaces the Company’s previous Equity Distribution Agreement with Piper dated December 18, 2020 (the “2020 Equity Agreement”), which is no longer effective. No sales were made under the 2023 Equity Agreement or the 2020 Equity Agreement during the years ended December 31, 2025, 2024 or 2023. On October 24, 2024, the Company completed an underwritten public offering of 14,670,000 shares of its common stock, including the exercise in full of the underwriters’ overallotment option to purchase additional shares of common stock, at a price to the public of $ 2.25 per share and, in lieu of common stock to investors who so chose, pre-funded warrants to purchase 5,800,000 shares of common stock at a public offering price of $ 2.2499 per pre-funded warrant, which represents the per share public offering price for the shares of common stock less the $ 0.0001 per share exercise price for each pre-funded warrant. The offering resulted in net proceeds of $ 42.9 million, after deducting underwriting discounts and commissions and other estimated offering expenses and assuming no subsequent exercise of the pre-funded warrants. During the third quarter of 2025, pre-funded warrants were exercised for 700,000 shares of common stock for de minimis proceeds. The exercise of the remaining pre-funded warrants, if any, is not expected to provide significant additional funding to the Company. ​ On November 13, 2025, the Company executed an underwriting agreement in connection with an underwritten registered direct offering of 4,189,000 shares of its common stock, at a price of $ 1.11 per share and, in lieu of common stock to investors who so chose, pre-funded warrants to purchase 7,523,000 shares of common stock at an offering price of $ 1.1099 per pre-funded warrant, which represents the per share offering price for the shares of common stock less the $ 0.0001 per share exercise price for each pre-funded warrant. The offering closed on November 17, 2025. The offering resulted in net proceeds of approximately $ 11.6 million, after deducting underwriting discounts and commissions and other estimated offering expenses and assuming no subsequent exercise of the pre-funded warrants. The exercise of the pre-funded warrants, if any, is not expected to provide significant additional funding to the Company. None of these pre-funded warrants were exercised as of December 31, 2025. ​ Warrants ​ The Company had the following warrants outstanding at December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Exercise ​ Expiration ​ ​ ​ ​ Outstanding ​ ​ ​ ​ price ​ ​ ​ dates Common stock warrants 8,379 ​ $ 28.65 2028 Common stock warrants 80,177 ​ 28.65 2027 Common stock warrants issued with credit facility ​ 2,000,000 ​ ​ 1.11 ​ 2035 Pre-funded common stock warrants ​ 12,623,000 ​ ​ 0.0001 ​ NA ​ 14,711,556 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ F-20 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) The following table summarizes warrant activity: ​ ​ ​ ​ ​ ​ Number of ​ ​ ​ ​ warrants Outstanding at January 1, 2023 ​ 88,556 Granted ​ — Exercised ​ — Canceled/forfeited ​ — Outstanding at December 31, 2023 ​ 88,556 Granted ​ 5,800,000 Exercised ​ — Canceled/forfeited ​ — Outstanding at December 31, 2024 ​ 5,888,556 Granted ​ 9,523,000 Exercised ​ ( 700,000 ) Canceled/forfeited ​ — Outstanding at December 31, 2025 ​ 14,711,556 ​ On October 24, 2024, in connection with the underwritten public offering, the Company granted pre-funded warrants to purchase 5,800,000 shares of common stock at a public offering price of $ 2.2499 per pre-funded warrant, which represents the per share public offering price for the shares of common stock less the $ 0.0001 per share exercise price for each pre-funded warrant. The common stock and pre-funded warrants each met the criteria for equity classification. Accordingly, the amount allocated to the pre-funded warrants was recorded as a component of stockholders’ equity within additional paid-in capital. ​ On November 13, 2025, in connection with the underwritten registered direct offering, the Company granted pre-funded warrants to purchase 7,523,000 shares of common stock at a public offering price of $ 1.1099 per pre-funded warrant, which represents the per share public offering price for the shares of common stock less the $ 0.0001 per share exercise price for each pre-funded warrant. The common stock and pre-funded warrants each met the criteria for equity classification. Accordingly, the amount allocated to the pre-funded warrants was recorded as a component of stockholders’ equity within additional paid-in capital. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (8) Sale of Product Line ​ In March 2024, the Company entered into an Asset Purchase Agreement (“APA”) with MiMedx Group, Inc. (“MDXG”) to sell certain assets (the “Transaction”) related to NIVIS Fibrillar Collagen Pack Device (“NIVIS”). These assets mainly included the Company’s existing inventory of NIVIS, with a net carrying value of $ 0.8 million, and certain intellectual property rights to sell NIVIS, with no carrying value. MDXG assumed the Company’s existing supply agreements, including the minimum obligations for NIVIS that the Company entered into in 2022 ahead of the initial sales of NIVIS. In exchange for entering into the Transaction, the Company received an initial $ 5.0 million upfront payment and is entitled to receive future revenue-sharing payments based on the net sales of NIVIS (now marketed as HELIOGEN) during the first two years following its launch by MDXG, which revenue-sharing payments would range from a minimum of $ 3.0 million to a maximum of $ 7.0 million in the aggregate. In addition, $ 0.4 million of consideration was received for existing NIVIS inventory on-hand. Any consideration in excess of $ 3.0 million up to $ 7.0 million is considered variable consideration that is fully constrained. The Company accounted for the Transaction as a sale of a nonfinancial asset group in accordance with ASC 610-20 and followed the principles of ASC 606 to determine the consideration of $ 8.4 million related to the Transaction which includes the consideration for the existing inventory. The Company transferred control of the nonfinancial asset group in March 2024 and upon closing recognized a gain of $ 7.6 million in the consolidated statement of operations and F-21 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) comprehensive loss during the three months ended March 31, 2024. The $ 8.4 million transaction price included the minimum revenue-share payment of $ 3.0 million, which was recorded as a receivable when the deal closed. Revenue-share payments commenced after the third quarter of 2024 and $ 1.4 million of this amount had been collected as of December 31, 2025. The remaining receivable of $ 1.6 million is recorded in prepaid expenses and other current assets in the consolidated balance sheet at December 31, 2025. At each reporting date, the Company assesses the constraint of variable consideration and records increases in the transaction price in the period that the estimate of variable consideration changes. For the years ended December 31, 2025 and 2024, no changes were made to the variable consideration. ​ ​ (9) Stock-Based Compensation The Company has two equity incentive plans: the 2012 Stock Incentive Plan and the Amended and Restated 2019 Equity Incentive Plan (the “Plan”). On April 3, 2025, the Company’s board of directors approved an amendment to the Plan to increase the number of authorized shares issuable under the Plan by 3,500,000 shares and eliminate the “evergreen” provision. This amendment was approved by the Company’s stockholders on May 28, 2025. New awards can only be granted under the Plan. At December 31, 2025, 3,667,106 shares of common stock were available for future issuances under the Plan. The Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock awards, restricted stock units and/or stock appreciation rights to employees, directors, and other persons, as determined by the Company’s board of directors. The Company’s stock options vest based on the terms in each award agreements and generally vest over four years and have a term of 10 years . The Company estimates forfeitures that it expects will occur and adjusts expense for actual forfeitures in the periods they occur. The Company measures employee and nonemployee stock-based awards at grant-date fair value and records compensation expense ratably over the vesting period of the award. The Company recorded stock-based compensation expense in the following expense categories of its accompanying consolidated statements of operations and comprehensive loss (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ 2023 Sales and marketing ​ $ 1,114 ​ $ 1,293 ​ $ 1,824 General and administrative ​ 2,225 ​ 2,429 ​ 2,478 Research and development ​ 457 ​ 640 ​ 730 Total stock‑based compensation ​ $ 3,796 ​ $ 4,362 ​ $ 5,032 ​ F-22 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) The following table summarizes stock option activity for the Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ ​ ​ average ​ ​ ​ ​ Weighted ​ remaining ​ ​ Number of ​ average exercise ​ contractual term ​ ​ ​ ​ shares ​ ​ ​ price per share ​ ​ ​ (years) Outstanding at January 1, 2023 ​ 2,071,848 ​ ​ 11.49 ​ ​ Granted ​ 212,960 ​ ​ 10.50 ​ ​ Exercised ​ ( 25,428 ) ​ ​ 5.00 ​ ​ Canceled/forfeited ​ ( 96,927 ) ​ ​ 11.25 ​ ​ Outstanding at December 31, 2023 ​ 2,162,453 ​ ​ 11.48 ​ ​ Granted ​ 259,900 ​ ​ 6.86 ​ ​ Exercised ​ ( 38,431 ) ​ ​ 5.88 ​ ​ Canceled/forfeited ​ ( 264,739 ) ​ ​ 12.24 ​ ​ Outstanding at December 31, 2024 ​ 2,119,183 ​ ​ 10.92 ​ ​ Granted 798,200 ​ 2.11 ​ Exercised — ​ — ​ Canceled/forfeited ( 244,524 ) ​ 7.33 ​ Outstanding at December 31, 2025 2,672,859 ​ $ 8.62 6.26 Vested and expected to vest at December 31, 2025 2,612,689 ​ $ 8.75 6.19 Exercisable at December 31, 2025 1,713,790 ​ $ 11.63 4.72 ​ Included in outstanding options at December 31, 2025, were 356,903 stock options granted outside of the Plan. These grants were made pursuant to the Nasdaq inducement grant exception in accordance with Nasdaq listing rule 5635(c)(4). At December 31, 2025, the aggregate intrinsic value of outstanding options and exercisable options was $ 0 . The weighted average grant-date fair value per share of options granted was $ 1.43 , $ 4.67 and $ 7.19 for the years ended December 31, 2025, 2024 and 2023, respectively. The aggregate intrinsic value of options exercised was $ 0 , $ 41,000 and $ 0.1 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, the total unrecognized compensation expense related to unvested employee and nonemployee stock option awards was $ 1.8 million, which is expected to be recognized in expense over a weighted-average period of approximately 2.6 years. ​ Estimating Fair Value of Stock Options The fair value of each grant of stock options was determined by the Company using the methods and assumptions discussed below. Certain of these inputs are subjective and generally require judgment to determine. Expected term – The expected term of stock options represents the weighted average period the stock options are expected to be outstanding. The Company uses the simplified method for estimating the expected term as provided by the Securities and Exchange Commission. The simplified method calculates the expected term as the average time to vesting and the contractual life of the options. Expected volatility – Due to the Company’s limited operating history and lack of sufficient company-specific historical or implied volatility, the expected volatility assumption was determined by examining the historical volatilities of a group of industry peers, including the Company, whose share prices are publicly available. Risk-free interest rate – The risk-free rate assumption is based on the U.S. Treasury instruments, the terms of which were consistent with the expected term of the Company’s stock options. F-23 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) Expected dividend – The Company has not paid and does not intend to pay dividends. The fair value of each option was estimated on the date of grant using the weighted average assumptions in the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ ​ ​ ​ 2025 ​ 2024 ​ ​ ​ 2023 ​ Expected dividend yield — ​ — ​ — ​ Expected volatility 72.6 % 73.2 % 74.3 % Risk‑free interest rate 4.20 % 4.29 % 3.99 % Expected term (in years) 6.03 ​ 6.14 ​ 6.15 ​ ​ Restricted Stock Units The Company has issued service-based and performance-based restricted stock units (“RSUs”). Vesting of the service-based RSUs is based on the terms in each award agreement and is generally over four years . Vesting of the performance-based RSUs is subject to continued service through 2026 and the achievement of certain performance milestones for fiscal year 2026. The amount of performance-based RSUs that will vest can range from 0 % to 110 % of the original number of RSUs granted. Expense for the performance-based RSUs is not recognized until the performance conditions are deemed probable of achievement. The Company has not recorded any expense related to the performance-based RSUs as the performance conditions are not deemed to be probable of achievement. The following table summarizes the service-based RSUs for the Plan: ​ ​ ​ ​ ​ ​ Number of ​ ​ ​ ​ shares Outstanding at January 1, 2023 ​ 311,991 Granted ​ 479,585 Vested ​ ( 101,559 ) Canceled/forfeited ​ ( 32,963 ) Outstanding at December 31, 2023 ​ 657,054 Granted ​ 421,725 Vested ​ ( 191,175 ) Canceled/forfeited ​ ( 155,316 ) Outstanding at December 31, 2024 ​ 732,288 Granted ​ 750,350 Vested ​ ( 279,765 ) Canceled/forfeited ​ ( 98,211 ) Outstanding at December 31, 2025 ​ 1,104,662 ​ ​ F-24 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) The following table summarizes the performance-based RSUs for the Plan: ​ ​ ​ ​ ​ ​ Number of ​ ​ ​ ​ shares Outstanding at January 1, 2023 ​ — Granted ​ 250,149 Vested ​ — Canceled/forfeited ​ — Outstanding at December 31, 2023 ​ 250,149 Granted ​ — Vested ​ — Canceled/forfeited ​ ( 33,649 ) Outstanding at December 31, 2024 ​ 216,500 Granted ​ — Vested ​ — Canceled/forfeited ​ — Outstanding at December 31, 2025 ​ 216,500 ​ Included in outstanding RSUs at December 31, 2025, were 137,417 RSUs granted outside of the Plan. These grants were made pursuant to the Nasdaq inducement grant exception in accordance with Nasdaq listing rule 5635(c)(4). The weighted average grant-date fair value per RSU granted was $ 2.27 , $ 6.54 and $ 10.25 during the years ended December 31, 2025, 2024 and 2023, respectively. The aggregate intrinsic value of RSUs outstanding was $ 1.6 million, $ 2.9 million and $ 6.0 million at December 31, 2025, 2024 and 2023, respectively. The total unrecognized compensation expense at December 31, 2025 related to RSUs was $ 3.0 million, excluding unrecognized compensation expense associated with performance-based RSUs that are not deemed probable of achievement, which is expected to be recognized in expense over a weighted-average period of approximately 2.3 years. ​ (10) Employee Benefit Plans 401(k) Defined Contribution Plan The Company sponsors a 401(k) defined-contribution plan covering all employees. Participants are permitted to contribute up to 100 % of their eligible annual pretax compensation up to an established federal limit on aggregate participant contributions. Discretionary contributions made by the Company, if any, are determined annually by the board of directors. The Company matches 50 % of employees’ contributions up to 6 %, subject to a maximum annual amount. The Company’s contributions were $ 0.6 million, $ 0.6 million and $ 0.5 million for the years ended December 31, 2025, 2024 and 2023, respectively. Participants are immediately vested in their own contributions to the plan and are fully vested in discretionary profit sharing made by the Company after three years of service. 2019 Employee Stock Purchase Plan In November 2019, the Company adopted the 2019 Employee Stock Purchase Plan (the “ESPP”). At December 31, 2025, 509,008 shares were available for future issuance under the ESPP. The ESPP is subject to an annual increase, subject to prior approval by the Company’s board of directors, equal to the least of (i) 107,887 shares of common stock, (ii) 1 % of the shares outstanding on the final day of the immediately preceding calendar year, and (iii) such smaller number of shares as determined by the board of directors. The ESPP provides the opportunity to purchase the Company’s common stock at a 15 % discount to the market price through payroll deductions. During the years ended December 31, 2025, 2024 and 2023, 58,235 , 58,994 and 10,602 shares, respectively, were issued under the ESPP. F-25 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) (11) Income Taxes On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company evaluated the impact of the OBBBA and determined that it did not have a material impact on the Company’s consolidated financial statements for the year ended December 31, 2025. ​ The Company has incurred losses since inception. Deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect for years in which differences are expected to reverse. The following table sets forth the Company’s loss before income tax (expense) benefit disaggregated between domestic and foreign: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 Domestic ​ $ ( 39,157 ) ​ $ ( 38,600 ) ​ $ ( 47,203 ) Foreign ​ ​ 556 ​ ​ 615 ​ ​ 539 Total loss before income tax (expense) benefit ​ $ ( 38,601 ) ​ $ ( 37,985 ) ​ $ ( 46,664 ) ​ ​ F-26 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) Components of the Company’s current and deferred income tax expense or benefit consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, Current taxes: ​ 2025 ​ 2024 ​ 2023 U.S. Federal ​ ​ ​ ​ ​ ​ ​ ​ ​ State ​ $ — ​ $ — ​ $ — Foreign ​ ​ ( 86 ) ​ ​ — ​ ​ — Total current income tax expense ​ ​ ( 86 ) ​ ​ — ​ ​ — Deferred taxes: ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Federal ​ ​ ​ ​ ​ ​ ​ ​ ​ State ​ ​ — ​ ​ — ​ ​ — Foreign ​ ​ ( 144 ) ​ ​ 144 ​ ​ ​ Total deferred income taxes ​ ​ ( 144 ) ​ ​ 144 ​ ​ — Total income tax (expense) benefit ​ $ ( 230 ) ​ $ 144 ​ $ — ​ Significant components of the Company’s deferred tax assets for federal income taxes consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Deferred tax assets ​ ​ ​ ​ ​ ​ Net operating loss carryforwards ​ $ 75,492 ​ $ 66,265 Capitalized research and development expenses ​ ​ 4,451 ​ ​ 6,185 Stock-based compensation ​ ​ 1,590 ​ ​ 1,604 Accrued expenses and other ​ ​ 1,160 ​ ​ 1,193 Lease liability ​ ​ 486 ​ ​ 478 Research and development credits ​ ​ 1,038 ​ ​ 830 Inventory reserve ​ ​ 295 ​ ​ 432 Interest expense carryforward ​ ​ 1,620 ​ ​ 691 Gross deferred tax asset before valuation allowance ​ 86,132 ​ 77,678 Less: valuation allowance ​ ​ ( 85,523 ) ​ ​ ( 76,782 ) Total deferred tax asset ​ ​ 609 ​ ​ 896 Deferred tax liabilities ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ ( 244 ) ​ ( 326 ) Right of use asset ​ ​ ( 365 ) ​ ​ ( 430 ) Gross deferred tax liability ​ ( 609 ) ​ ​ ( 756 ) Net deferred tax asset ​ $ — ​ $ 140 ​ The Company does no t have unrecognized tax benefits as of December 31, 2025 and 2024. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. The Company’s net operating loss (“NOL”) carryforwards for federal and state income tax purposes consisted of the following (in thousands): F-27 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 NOL carryforwards ​ ​ ​ ​ ​ ​ Federal ​ $ 304,094 ​ $ 266,665 State ​ 244,454 ​ 218,944 ​ The NOL carryforwards begin expiring in 2032 for federal purposes and in 2026 for state income tax purposes yet $ 224.7 million of the federal NOL carryforwards have no expiration. The Company recorded a valuation allowance on the majority of its deferred tax assets as of December 31, 2025 and 2024 because of the uncertainty of their realization. The valuation allowance increased by $ 8.7 million and $ 5.7 million for the years ended December 31, 2025 and 2024, respectively, mainly due to losses incurred. Utilization of the net operating losses and general business tax credits carryforwards may be subject to a substantial limitation under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if changes in ownership of the company have occurred previously or occur in the future. Ownership changes may limit the amount of net operating losses and general business tax credits carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of 5% shareholders in the stock of a corporation by more than 50 percentage points over a three-year period. If the Company experiences a Section 382 ownership change, the tax benefits related to the NOL carryforwards may be further limited or lost. The Company has not performed an analysis under Section 382 and cannot predict or otherwise determine whether there would be any limitation to the amount of net operating losses and general business tax credits carryforwards that can be utilized. A reconciliation of income tax (expense) benefit at the statutory federal income tax rate and as reflected in the consolidated financial statements is as follows ($ in thousands, except percentages): F-28 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ ​ ​ ​ 2025 ​ ​ ​ ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Statutory Tax Rate $ 8,105 ​ ( 21.0 ) % $ 7,977 ​ ( 21.0 ) % State and Local Income Taxes, Net of Federal Income Tax Effect * ( 254 ) ​ 0.7 ​ 4,747 ​ ( 12.5 ) ​ Foreign Tax Effects ​ ​ ​ ​ ​ ​ ​ ​ United Kingdom ​ ​ ​ ​ ​ ​ ​ ​ Statutory tax rate difference between United Kingdom and United States ( 39 ) ​ 0.1 ​ ( 25 ) ​ 0.1 ​ Change in valuation allowance ​ — ​ — ​ ​ 339 ​ ( 0.8 ) ​ Other — ​ — ​ — ​ — ​ Germany ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Statutory tax rate difference between Germany and United States ​ 30 ​ ( 0.1 ) ​ ​ — ​ — ​ Change in valuation allowance ​ — ​ — ​ ​ — ​ — ​ Other ​ — ​ — ​ ​ — ​ — ​ Effect of Changes in Tax Laws or Rates Enacted in the Current Period ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of Cross-Border Tax Laws ​ ( 218 ) ​ 0.6 ​ ​ ( 128 ) ​ 0.3 ​ Tax Credits 206 ​ ( 0.5 ) ​ — ​ — ​ Change in Valuation Allowances ( 7,315 ) ​ 18.9 ​ ( 11,558 ) ​ 30.4 ​ Nontaxable or Nondeductible Items ( 177 ) ​ 0.4 ​ ( 321 ) ​ 0.8 ​ Changes in Unrecognized Tax Benefits — ​ — ​ — ​ — ​ Other Adjustments ​ ​ ​ ​ ​ ​ ​ ​ ​ Stock Compensation ​ ( 568 ) ​ 1.5 ​ ( 887 ) ​ 2.3 ​ Actual income tax (expense) benefit effective tax rate $ ( 230 ) ​ 0.6 % $ 144 ​ ( 0.4 ) % * The following states made up the majority (greater than 50%) of the tax effect in this category: California, Colorado, Florida, Georgia, North Carolina, New York and Pennsylvania. The Company files income tax returns in the U.S. federal jurisdiction, various state jurisdictions and the United Kingdom. Tax years 2021 and forward remain open for examination for federal and the Company’s more significant state tax jurisdictions. Carryforward attributes from prior years may be adjusted upon examination by taxing authorities if used in an open period. There were no tax payments or refunds received during the years ended December 31, 2025, 2024 or 2023. ​ (12) Commitments and Contingencies Legal Proceedings From time to time, the Company may be a party to lawsuits, claims, and other legal proceedings that arise in the ordinary course of its business. While the outcomes of these matters are uncertain, management does not expect that the ultimate F-29 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) costs to resolve these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations, or cash flows. Agreements with Aroa In August 2012, the Company entered into a License, Product Development, and Supply Umbrella Agreement (“Aroa Agreement”) with Aroa. The Aroa Agreement provides the Company a license to patent rights and other intellectual property related to Aroa’s products and technologies for use in certain indications and expires on the expiration of the last patent covering the products (currently March 9, 2031). The Company has the right to extend the term of the agreement by an additional 10 years following the expiration of the last patent covering the products on commercially reasonable terms to be negotiated by the parties. This agreement initially limited the Company’s license rights to the U.S. but was subsequently amended in March 2013 to include certain countries in Europe including the United Kingdom and members of the European Union and certain former Union of Soviet Socialist Republic satellite nations. The Aroa Agreement required payments aggregating up to $ 4.0 million upon the achievement of U.S. and European cumulative product sales targets. All amounts have been paid. Other key terms of the amended Aroa agreement in addition to those disclosed above are as follows: ● The Company purchases product from Aroa at a fixed transfer cost as a percentage of Aroa’s cost of goods, which, subject to a true-up adjustment, results in an amount equal to 27 % of the Company’s net sales of the Company’s OviTex and OviTex PRS products, with the exception of OviTex inguinal hernia repair (“IHR”) product configurations, for which the Company pays the greater of the initial fixed transfer cost or 27 % of our net sales of OviTex IHR. ● The transfer price and the quarterly true-up amount continued to equal 27 % of Company’s net sales of licensed products, with the exception of the IHR products, where the total amount payable to Aroa will at least equal the aggregate transfer pricing paid to Aroa for such products during the applicable calendar year. ● Provisions exist for the Company to step in and operate Aroa’s plant if a supply failure occurs and is not cured within a set timeframe. Under the amended agreement, the criteria for a supply failure was modified to mean a failure by Aroa to timely supply, during any consecutive 60-day period, at least 75 % of the products ordered by the Company under binding purchase orders. During the period that the Company steps in and assumes manufacturing responsibility, the Company shall pay a royalty of 6 % of net sales in lieu of 27 % of net sales of the licensed products. Research and Development Agreements As of December 31, 2025, the Company had $ 1.8 million in milestone payments related to certain research and development arrangements which are currently deemed not probable as the timing and likelihood of such payments are not known with certainty. Employment Agreements The Company entered into employment agreements with key personnel providing for compensation and severance in certain circumstances, as defined in the respective employment agreements. F-30 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) Leases The Company leases office and laboratory space in Malvern, Pennsylvania under a noncancelable lease (the “Malvern Lease”). The Malvern Lease, which was concluded to be an operating lease, was amended in October 2023 to extend the term of the lease from May 2028 to May 2030 (the “Lease Amendment”). Pursuant to the Lease Amendment, the Company leased an additional 15,881 square feet at the Company’s corporate headquarters which commenced on December 1, 2023 (the “Expansion Premises”) and relinquished 4,652 square feet of non-contiguous space previously subject to the lease agreement on June 30, 2025 (the “Relinquished Space”). The Expansion Premises increased the Company’s total leased square footage in the building from 24,725 square feet to 40,606 square feet, which was subsequently reduced to 35,954 square feet as of June 30, 2025 following removal of the Relinquished Space. The modification of the lease terms for the Company’s existing space was not treated as a separate contract; however, the Company notes that the Expansion Premises is being treated as a new ROU asset. The Lease Amendment required the Company to pay an additional security deposit of $ 0.3 million. The Malvern Lease has annual scheduled payment increases and provides the Company with a renewal option for an additional term of 60 months at the end of the lease term. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. As the Company is not reasonably certain to exercise the renewal option, the additional 60-month term has been excluded. ​ Operating lease leasehold improvements are depreciated over the lesser of the useful lives of the leasehold improvements or the lease term. ​ The Company determined that the rate implicit in its lease is not readily determinable, and therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The Company used an incremental borrowing rate of 11.66 % to discount the Malvern Lease payments included in the operating lease liabilities recognized. ​ The Company recognized $ 0.5 million of lease cost during the years ended December 31, 2025 and 2024 and $ 0.3 million of lease cost during the year ended December 31, 2023. Cash paid for amounts included in the measurement of operating lease liabilities was $ 0.6 million, $ 0.6 million and $ 0.4 million for the years ended December 31, 2025, 2024 and 2023, respectively, and these amounts are included in operating activities in the consolidated statements of cash flows. As of December 31, 2025, the remaining lease term for the Malvern Lease is 4.4 years. ​ The following table reconciles the undiscounted future minimum lease payments (displayed in aggregate by year) under non-cancelable operating leases with terms of more than one year to the total operating lease liabilities recognized on the consolidated balance sheets as of December 31, 2025 (in thousands): ​ ​ ​ ​ 2026 $ 557 2027 570 2028 ​ 583 2029 ​ 595 2030 ​ 250 Thereafter ​ — Total undiscounted future minimum lease payments $ 2,555 Less imputed interest ​ ( 554 ) Total operating lease liabilities $ 2,001 ​ F-31 Table of Contents TELA Bio, Inc. Notes to Consolidated Financial Statements (continued) As of December 31, 2024, $ 0.5 million representing the current portion of operating lease liabilities is included in accrued expenses and other current liabilities in the consolidated balance sheets and $ 1.5 million representing the long-term portion of operating lease liabilities is included in other long-term liabilities in the consolidated balance sheets. ​ ​ ​ ​ F-32 Table of Contents Exhibits. ​ The following exhibits are being filed herewith: ​ EXHIBIT INDEX ​ Exhibit No. ​ ​ ​ Exhibit ​ ​ ​ 3.1 ​ Fourth Amended and Restated Certificate of Incorporation (incorporated by reference to exhibit 3.1 of the Company’s Current Report on Form 8-K filed on November 19, 2019). 3.2 ​ Certificate of Amendment to TELA Bio, Inc.’s Fourth Amended and Restated Certificate of Incorporation (incorporated by reference to exhibit 3.1 of the Company’s Quarterly Report on Form 10-Q filed on August 11, 2025). 3.3 ​ Third Amended and Restated Bylaws (incorporated by reference to exhibit 3.1 of the Company’s Quarterly Report on Form 10-Q filed on November 13, 2023). 4.1 ​ Specimen Common Stock Certificate of the Company (incorporated by reference to exhibit 4.1 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 4.2 ​ Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to exhibit 4.2 to the Company’s Annual Report on Form 10-K, filed on March 30, 2020) . 4.3 ​ Amended and Restated Investors’ Rights Agreement (incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 4.4 ​ First Amendment and Joinder to Amended and Restated Investor Rights Agreement (incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 4.5 ​ Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on October 23, 2024). 4.6 ​ Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on November 14, 2025). 4.7 ​ Form of Warrant to Purchase Common Stock (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 14, 2025). 10.1 ​ Form of Indemnification Agreement by and between the Company and its individual directors and officers (incorporated by reference to exhibit 10.1 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.2 ​ TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.2 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.3 ​ Amendment to the TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.3 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.4 ​ Second Amendment to the TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.4 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.5 ​ Third Amendment to the TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.5 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.6 ​ Fourth Amendment to the TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.6 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.7 ​ Fifth Amendment to the TELA Bio, Inc. 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.7 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.8 ​ Form of Incentive Stock Option Agreement pursuant to the 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.8 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.9 ​ Form of Nonstatutory Stock Option Agreement pursuant to 2012 Stock Incentive Plan (incorporated by reference to exhibit 10.9 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.10 ​ TELA Bio, Inc. Amended and Restated 2019 Equity Incentive Plan (incorporated by reference to exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 8, 2020) . 10.11 ​ Amendment No. 1 to TELA Bio, Inc. Amended and Restated 2019 Equity Incentive Plan (incorporated by reference to exhibit 99.2 to the Company’s Registration Statement on Form S-8 filed on August 11, 2025). 103 Table of Contents 10.12 ​ Form of TELA Bio, Inc. Amended and Restated 2019 Equity Incentive Plan Stock Option Grant Notice and Stock Option Agreement (incorporated by reference to exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed on May 11, 2022). 10.13 ​ Form of TELA Bio, Inc. Amended and Restated 2019 Equity Incentive Plan Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement (time-based vesting) (incorporated by reference to exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed on May 11, 2022). 10.14 ​ Form of TELA Bio, Inc. Amended and Restated 2019 Equity Incentive Plan Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement (performance-based vesting) (incorporated by reference to exhibit 10.13 to the Company’s Annual Report on Form 10-K, filed on March 23, 2023). 10.15 ​ TELA Bio, Inc. 2019 Employee Stock Purchase Plan (incorporated by reference to exhibit 10.12 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.16 ​ Amendment No. 1 to TELA Bio, Inc. 2019 Employee Stock Purchase Plan (incorporated by reference to exhibit 10.15 to the Company’s Annual Report on Form 10-K, filed on March 23, 2023) . 10.17 ​ Form of TELA Bio, Inc. Inducement Award Agreement for Non-Qualified Stock Option (incorporated by reference to exhibit 10.16 to the Company’s Annual Report on Form 10-K, filed on March 23, 2023 ). 10.18 ​ Form of TELA Bio, Inc. Inducement Award Agreement for Restricted Stock Unit (incorporated by reference to exhibit 10.17 to the Company’s Annual Report on Form 10-K, filed on March 23, 2023 ) . 10.19 ​ TELA Bio, Inc. Amended and Restated Non-Employee Director Compensation Policy (incorporated by reference to exhibit 10.18 to the Company’s Annual Report on Form 10-K, filed on March 21, 2025). 10.20 ​ Amended and Restated Employment Agreement, dated October 25, 2019, by and between the Company and Antony Koblish (incorporated by reference to exhibit 10.16 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.21 ​ Employment Agreement, dated August 27, 2021, by and between the Company and Roberto Cuca (incorporated by reference to exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on September 27, 2021) . 10.22 ​ Employment Agreement, dated September 15, 2020, by and between the Company and Paul Talmo (incorporated by reference to exhibit 10.19 to the Company’s A nnual Report on Form 10-K, filed on March 23, 2022) . 10.23 ​ Employment Agreement, dated August 3, 2023, by and between the Company and Gregory Firestone (incorporated by reference to exhibit 10.1 to the Company’s Q uarterly Report on Form 10-Q, filed on August 10, 2023). 10.24 ​ Employment Agreement, dated June 2, 2025, by and between the Company and Jeffrey Blizard (incorporated by reference to exhibit 10.2 to the Company’s Q uarterly Report on Form 10-Q, filed on August 11, 2025). 10.25 ​ Letter Agreement, dated May 20, 2024, by and between the Company and Gregory Firestone (incorporated by reference to exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed on August 13, 2024). 10.26 ​ Employment Agreement, dated March 1, 2026, by and between the Company and Howard Langstein (filed herewith). 10.27* ​ Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated July 16, 2015, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.23 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.28* ​ Amendment to Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated November 26, 2015, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.24 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019) . 10.29* ​ Amendment to Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated January 3, 2019, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.25 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.30* ​ Addendum to the Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated August 27, 2019, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.22 on the Company’s Annual Report on Form 10-K filed on March 30, 2020). 10.31* ​ Addendum to the Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated February 15, 2020, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.2 on the Company’s Quarterly Report on Form 10-Q filed on May 15, 2020). 104 Table of Contents 10.32* ​ Addendum to the Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated August 13, 2020, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.31 to the Company’s Annual Report on Form 10-K, filed on March 22, 2024). 10.33* ​ Addendum to the Second Amended and Restated License, Product Development and Supply Umbrella Agreement, dated August 1, 2024, by and between the Company and Aroa Biosurgery Ltd. (incorporated by reference to exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed on November 8, 2024). 10.34 ​ Lease between the Company and Liberty Property Limited Partnership, dated January 31, 2013 (incorporated by reference to exhibit 10.26 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.35 ​ First Amendment to Lease between the Company and Liberty Property Partnership, dated June 19, 2014 (incorporated by reference to exhibit 10.27 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.36 ​ Second Amendment to Lease between the Company and WPT Land 2 LP (as successor in interest to Liberty Property Limited Partnership), dated January 17, 2018 (incorporated by reference to exhibit 10.28 to the Company’s Registration Statement on Form S-1 (File No. 333-234217), dated November 7, 2019). 10.37 ​ Third Amendment to Lease between the Company and WPT Land 2 LP (as successor in interest to Liberty Property Limited Partnership), dated December 22, 2020 (incorporated by reference to exhibit 10.29 to the Company’s Annual Report on Form 10-K, filed on March 25 , 202 1 ) . 10.38 ​ Fourth Amendment to Lease between the Company and WPT Land 2 LP (as successor in interest to Liberty Property Limited Partnership), dated October 18, 2023 ( incorporated by reference to exhibit 10.36 to the Company’s Annual Report on Form 10-K, filed on March 22, 2024 ). 10.39 ​ Equity Distribution Agreement, dated November 13, 2023 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on November 13, 2023) . 10.40*# ​ Credit Agreement and Guaranty dated as of November 13, 2025, by and among TELA Bio, Inc., Perceptive Credit Holdings V, LP, as lender and administrative agent (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on November 14, 2025). 10.41* ​ Security Agreement, dated as of November 13, 2025, by and among the Company and Perceptive Credit Holdings V, LP (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on November 14, 2025). 19.1 ​ TELA Bio, Inc. Insider Trading Policy (filed herewith). 21.1 ​ Subsidiaries of the Registrant (filed herewith). 23.1 ​ Consent of KPMG LLP (filed herewith). 31.1 ​ ​ Certification of Chief Executive Officer pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). 31.2 ​ ​ Certification of Chief Financial Officer pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). 32.1 ​ ​ Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). 32.2 ​ ​ Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). 97.1 ​ TELA Bio, Inc. Compensation Recovery Policy (incorporated by reference to exhibit 97.1 to the Company’s Annual Report on Form 10-K, filed on March 22 , 2024). 101 INS ​ Inline XBRL Instance Document (filed herewith). 101 SCH ​ Inline XBRL Taxonomy Extension Schema Document (filed herewith). 101 CAL ​ Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith). 101 DEF ​ Inline XBRL Taxonomy Extension Definition Linkbase Document (filed herewith). 101 LAB ​ Inline XBRL Taxonomy Extension Label Linkbase Document (filed herewith). 101 PRE ​ Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith). 104 ​ Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). ​ ​ ​ * ​ Certain confidential portions (indicated by brackets and asterisks) have been omitted from this exhibit. ​ # ​ ​ # ​ Confidential information has been omitted because it is both (i) not material and (ii) is the type of information that the Company treats as private or confidential pursuant to Item 601 of Regulation S-K. 105 Table of Contents ​ ​ SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ​ ​ ​ ​ TELA BIO, INC. ​ ​ ​ ​ By: /s/ ANTONY KOBLISH ​ ​ Name: Antony Koblish ​ ​ Title: Chief Executive Officer and Director Date: March 25, 2026 ​ Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature ​ ​ ​ Title ​ ​ ​ Date ​ ​ ​ ​ ​ /s/ ANTONY KOBLISH ​ Chief Executive Officer and Director (Principal Executive Officer) ​ March 25, 2026 Antony Koblish ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ ROBERTO CUCA ​ Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) ​ March 25, 2026 Roberto Cuca ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ MEGAN SMEYKAL ​ Chief Accounting Officer and Controller (Principal Accounting Officer) ​ March 25, 2026 Megan Smeykal ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ DOUG EVANS ​ Chairman, Board of Directors ​ March 25, 2026 Doug Evans ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ KURT AZARBARZIN ​ Director ​ March 25, 2026 Kurt Azarbarzin ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ VINCE BURGESS ​ Director ​ March 25, 2026 Vince Burgess ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ FEDERICA O’BRIEN ​ Director ​ March 25, 2026 Federica O’Brien ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ WILLIAM PLOVANIC ​ Director ​ March 25, 2026 William Plovanic ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ BETTY JO ROCCHIO ​ Director ​ March 25, 2026 Betty Jo Rocchio ​ ​ ​ ​ ​ ​ ​ 106