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Item 1. Business

2026-03-27 compared with 2025-03-26 · 775 added, 757 removed, 117 unchanged (93% of the section changed)

Tenon Medical,

(the “Company”), was incorporated in the State of Delaware on June 19, 2012 and was headquartered in San Ramon, California

until June 2021 when it relocated to Los Gatos, California.

The Company is a medical device company that has developed The Catamaran™

SI Joint Fusion System (“The Catamaran System”) that offers a novel, less invasive approach to the sacroiliac joint (the

“SI Joint”) using a single, robust, titanium implant for treatment of the most common types of SI Joint disorders that cause

lower back pain.

The Company received U.S.

Food and Drug Administration (“FDA”) clearance in 2018 for The Catamaran System

and is currently focused on the US market.

Since the national launch of The Catamaran System in October 2022, the Company is focused

on three commercial opportunities:

1) Primary SI Joint procedures, 2) Revision procedures of failed SI Joint implants and 3) SI Joint

fusion adjunct to a spine fusion construct.

The Opportunity

We estimate that

over 30 million American adults have chronic lower back pain.

Published clinical studies have shown that 15% to 30% of all chronic lower

back pain is associated with the SI-Joint.

For patients whose chronic lower back pain stems from the Sacroiliac Joint (“SI-Joint”),

our experience in both clinical trials and commercial settings indicates the system to be introduced by Tenon could be beneficial for

patients who are properly diagnosed and screened for surgery by trained healthcare providers.

In 2019, approximately

475,000 patients in the United States were estimated to have received an aesthetic injection to temporarily alleviate pain emanating

from the SI-Joint and/or to diagnose SI-Joint pain.

Additionally, several non-surgical technologies have been introduced in the past

10 years to address patients who do not respond to conservative options, including systemic oral medications, opioids, physical therapy

and injection therapy.

To date, the penetration

of a surgical solution for this market has been relatively low (5-7%).

We believe this is due to complex surgical approaches and suboptimal

implant design of existing options.

The penetration of this market with an optimized surgical solution is Tenon’s focus.

We believe the

SI-Joint is the last major joint to be successfully addressed by the spine implant industry.

Studies have shown that disability resulting

from disease of the SI-Joint is comparable to the disability associated with a number of other serious spine conditions, such as knee

and hip arthritis and degenerative disc disease, each of which has surgical solutions where an implant is used, and a multi-billion-dollar

Medical, Inc.

(“we” or the “Company”) was incorporated in the State of Delaware on June 19, 2012 and was headquartered

in San Ramon, California until June 2021 when it relocated to Los Gatos, California.

We are a medical device company dedicated to transforming

care for patients with certain sacro-pelvic disorders.

We currently offer two systems to treat a diseased sacroiliac joint (the “SI

We have developed The Catamaran ® ™ SI Joint Fusion System (“The Catamaran System”) that

offers a novel, less invasive approach to the SI Joint using a single, robust, titanium implant for treatment of the most common types

of SI Joint disorders that cause lower back pain.

We received U.S.

Food and Drug Administration (“FDA”) clearance in 2018

for The Catamaran System and are currently focused on the US market.

Since the national launch of The Catamaran System in October 2022,

we have been focused on three commercial opportunities:

1) Primary SI Joint procedures, 2) Revision procedures of failed SI Joint implants

and 3) SI Joint fusion adjunct to a spine fusion construct.

August 2025, we acquired substantially all of the assets of SiVantage, Inc.

and SIMPL Medical, LLC, including the SImmetry +®

SI Joint Fusion System (“The SImmetry + System”) that treats disorders of the SI Joint through minimally invasive

lateral access solution that incorporates well-established orthopedic fusion principles-including joint decortication, bone graft placement,

and rigid fixation-with the goal of achieving a true biological fusion across the SI Joint.

2026 Financing

March 11, 2026, we entered into securities purchase agreements with certain accredited investors pursuant to which we issued and sold

in a private placement 20% original issue discount senior convertible promissory notes (the “Convertible Promissory Notes”)

in an aggregate principal amount of approximately $5.2 million for aggregate gross proceeds of approximately $4.3 million.

The Convertible Promissory

Notes have a maturity date of September 11, 2026, which, at our option, can be extended to December 11, 2026.

Following the 6-month anniversary

of the issuance date, the Convertible Promissory Notes will be convertible at any time at the option of the holder into shares of our

common stock at a conversion price per share equal to the greater of 80% of the VWAP for the three trading days immediately prior to

the date of conversion and $0.1567, subject to adjustment for stock splits and pro rata distributions as provided in the Convertible

Promissory Notes.

If the maturity date of the Convertible Promissory Notes is extended, their outstanding principal amount will be increased

Any prepayment of the Convertible Promissory Notes will be paid at 102.5% of the principal amount being prepaid.

we are required to prepay the Convertible Promissory Notes from 15% of the net proceeds we may receive from future securities financing

transactions less certain amounts attributable to the original issue discount.

Capital LLC acted as our placement agent in connection with this offering and received a cash fee equal to 7.0% of the aggregate gross

proceeds raised in the offering and reimbursement of certain expenses in the amount of $65,000.

February 25, 2026, we received a letter from the Nasdaq Listing Qualifications Department notifying us that, for the 30 consecutive business

day period between January 9, 2026 through February 24, 2026, our common stock had not maintained a minimum closing bid price of $1.00

per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price

Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), we were provided an initial period of 180 calendar days, or until August

24, 2026 (the “Compliance Period”), to regain compliance with the Bid Price Rule.

In order to regain compliance with the

Bid Price Rule, our common stock is required to maintain a minimum closing bid price of $1.00 for a minimum of ten consecutive business

days during the Compliance Period prior to August 24, 2026.

If we do not regain compliance with the Bid Price Rule by August 24, 2026,

we may be eligible for an additional 180-day period to regain compliance.

of the date of this report, our common stock has not regained compliance with the Bid Price Rule.

If we cannot regain compliance during

the Compliance Period or any subsequently granted compliance period, our common stock will be subject to delisting.

At that time, we

may appeal the delisting determination to a Nasdaq hearings panel.

notice from Nasdaq has no immediate effect on the listing of our common stock, which will continue to be listed on The Nasdaq Capital

Market under the symbol “TNON.” We are currently evaluating our options for regaining compliance with the Bid Price Rule.

2025 PIPE Financing

November 10, 2025, we entered into securities purchase agreements with certain accredited investors in an at-the-market private investment

in public equity financing (the “PIPE Financing”) pursuant to which we agreed to issue and sell an aggregate of 2,217,904

shares of common stock and/or pre-funded common stock purchase warrants, and common stock purchase warrants, each exercisable for one

share of our common stock, at a combined offering price of $1.285 per share and warrant to purchase one share of common stock.

have an exercise price of $1.16 per share and expire 3 years from the date of issuance.

The PIPE Financing closed on November 14, 2025,

and we issued to the investors 2,217,904 shares of common stock and 2,217,904 common stock purchase warrants.

Pursuant to the purchase

agreements, we received proceeds, net of transaction expenses, of approximately $2.7 million.

Steven Foster, the Company’s Chief

Executive Officer and Director, Nathaniel Grawey, the Company’s Chief Commercial Officer, and Wyatt Geist, the Company’s

Chief Innovation Officer, participated in the PIPE Financing as investors.

The shares of our common stock and the shares underlying warrants

issued in the PIPE Financing are entitled to customary resale registration rights.

estimate that over 30 million American adults have chronic lower back pain.

Published clinical studies have shown that 15% to 30% of

all chronic lower back pain is associated with the SI Joint.

For patients whose chronic lower back pain stems from the SI Joint, our

experience in both clinical trials and commercial settings indicates the system to be introduced by Tenon could be beneficial for patients

who are properly diagnosed and screened for surgery by trained healthcare providers.

2019, approximately 475,000 patients in the United States were estimated to have received an aesthetic injection to temporarily alleviate

pain emanating from the SI Joint and/or to diagnose SI Joint pain.

Additionally, several non-surgical technologies have been introduced

in the past 10 years to address patients who do not respond to conservative options, including systemic oral medications, opioids, physical

therapy and injection therapy.

date, the penetration of a surgical solution for this market has been relatively low (5-7%).

We believe this is due to complex surgical

approaches and suboptimal implant design of existing options.

The penetration of this market with an optimized surgical solution is Tenon’s

believe the SI Joint is the last major joint to be successfully addressed by the spine implant industry.

Studies have shown that disability

resulting from disease of the SI Joint is comparable to the disability associated with a number of other serious spine conditions, such

as knee and hip arthritis and degenerative disc disease, each of which has surgical solutions where an implant is used, and a multi-billion-dollar

market exists.

The SI-Joint is

a strong weight bearing synovial joint situated between the lumbar spine and the pelvis and is aligned along the longitudinal load bearing

axis of the human spine when in an upright posture.

It functions as a force transfer conduit where it transfers axial loads bi-directionally

from the spine to the pelvis and lower extremities and allows forces to be transmitted from the extremities to the spine.

It also provides

load sharing between the hip and spine to contribute towards attenuation of impact shock and stress from activities of daily living.

The SI-Joint is

a relatively immobile joint that connects the sacrum (the spinal segment that is attached to the base of the lumbar spine at the L5 vertebra)

and the ilium of the pelvis.

SI Joint is a strong weight bearing synovial joint situated between the lumbar spine and the pelvis and is aligned along the longitudinal

load bearing axis of the human spine when in an upright posture.

It functions as a force transfer conduit where it transfers axial loads

bi-directionally from the spine to the pelvis and lower extremities and allows forces to be transmitted from the extremities to the spine.

It also provides load sharing between the hip and spine to contribute towards attenuation of impact shock and stress from activities

of daily living.

SI Joint is a relatively immobile joint that connects the sacrum (the spinal segment that is attached to the base of the lumbar spine

at the L5 vertebra) and the ilium of the pelvis.

Each SI Joint is approximately 2-4mm wide and irregularly shaped.

Motion of the SI-Joint

features vertical shear and rotation.

Although the rotational forces about the SI-Joint are relatively low, repetitive motions created

by daily activities such as walking, jogging, twisting at the hips, and jumping can increase the stresses on the SI-Joint.

If the SI-Joint

is compromised through injury or degeneration, the load bearing and motion restraints from the surrounding anatomical structures of the

SI-Joint will be compromised resulting in abnormal stress transfers across the joint to these structures, thereby further augmenting

the degenerative cascade of the SI-Joint.

Eventual pain and cessation of an individual’s normal activities due to a painful and

unstable SI-Joint have led to an increase in the recent development of SI-Joint stabilization devices.

of the SI Joint features vertical shear and rotation.

Although the rotational forces about the SI Joint are relatively low, repetitive

motions created by daily activities such as walking, jogging, twisting at the hips, and jumping can increase the stresses on the SI Joint.

If the SI Joint is compromised through injury or degeneration, the load bearing and motion restraints from the surrounding anatomical

structures of the SI Joint will be compromised resulting in abnormal stress transfers across the joint to these structures, thereby further

augmenting the degenerative cascade of the SI Joint.

Eventual pain and cessation of an individual’s normal activities due to a

painful and unstable SI Joint have led to an increase in the recent development of SI Joint stabilization devices.

Non-Surgical Treatment

4 unchanged sentences

Non-surgical treatments

● Drug Therapy :

opiates and non-steroidal anti-inflammatory medications.

● Intra-Articular Injections

of Steroid Medications :

which are typically performed by physicians who specialize in pain treatment or anesthesia.

● Radiofrequency Ablation :

or the cauterizing of the lateral branches of the sacral nerve roots.

including opiates and non-steroidal anti-inflammatory medications.

● Intra-Articular

Injections of Steroid Medications :

which are typically performed by physicians who specialize

in pain treatment or anesthesia.

conservative steps fail to deliver sustained pain relief and return to quality of life, specific diagnostic protocols are utilized to

explore if a surgical option should be considered.

Historically, diagnosing

pain from the SI-Joint was not routinely a focus of orthopedic or neurosurgery training during medical school or residency programs.

Due to its invasiveness, post-operative pain, and muscle disruption along with a difficult procedure overall, the open SI-Joint fusion

procedure was rarely taught in these settings.

The emergence of

various SI-Joint surgical technologies has generated a renewed discussion of SI-Joint issues.

Of particular focus is the diagnostic protocol

utilized to properly select patients for SI-Joint surgery.

Patients with low back pain typically start with primary care physicians who

often refer to pain specialists.

Here, the patient will undergo traditional physical therapy combined with oral medications (anti-inflammatory,

narcotic, etc.).

If the patient fails to respond to these steps the pain specialist may move to therapeutic injections of the SI-Joint.

Historically,

diagnosing pain from the SI Joint was not routinely a focus of orthopedic or neurosurgery training during medical school or residency

Due to its invasiveness, post-operative pain, and muscle disruption along with a difficult procedure overall, the open SI Joint

fusion procedure was rarely taught in these settings.

emergence of various less invasive SI Joint surgical technologies has generated a renewed discussion of SI Joint issues.

Of particular

focus is the diagnostic protocol utilized to properly select patients for SI Joint surgery.

Patients with low back pain typically start

with primary care physicians who often refer to pain specialists.

Here, the patient will undergo traditional physical therapy combined

with oral medications (anti-inflammatory, narcotic, etc.).

If the patient fails to respond to these steps the pain specialist may move

to therapeutic injections of the SI Joint.

These injections may serve to lessen inflammation to the point that the patient is satisfied.

However, the impact from these injections

is often transient.

In this case the patient is often referred to a clinician to determine if the patient may be a candidate for surgical

intervention.

A series of provocative tests in clinic, combined with a specific injection protocol to isolate the SI-Joint as the pain

generator is then utilized to confirm the need for surgical intervention.

Published literature has shown this technique to be a very

effective step to determine the best treatment to alleviate pain.

However, the impact from these injections is often transient.

In this case the patient is often referred to a clinician to determine

if the patient may be a candidate for surgical intervention.

A series of provocative tests in clinic, combined with a specific injection

protocol to isolate the SI Joint as the pain generator is then utilized to confirm the need for surgical intervention.

Published literature

has shown this technique to be a very effective step to determine the best treatment to alleviate pain.

of Existing Treatment Options

Surgical fixation

and fusion of the SI-Joint with an open surgical technique was first reported in 1908, with further reports in the 1920s.

The open procedure

uses plates and screws, requires a 6 to 12-inch incision and is extremely invasive.

Due to the high invasiveness

and associated morbidity, the use of this procedure is limited to cases involving significant trauma, tumor, etc.

Less invasive surgical

options along with implant design began to emerge over the past 15 years.

These options feature a variety of approaches and implant designs

and have been met with varying degrees of adoption.

Lack of a standard and accepted diagnostic approach, complexity of approach, high

morbidity of approach, abnormally high complication rates and inability to radiographically confirm fusion have all been cited as reasons

for low adoption of these technologies.

fixation and fusion of the SI Joint with an open surgical technique was first reported in 1908, with further reports in the 1920s.

open procedure uses plates and screws, requires a 6 to 12-inch incision and is extremely invasive.

Due to the high

invasiveness and associated morbidity, the use of this procedure is limited to cases involving significant trauma, tumor, etc.

invasive surgical options along with implant design began to emerge over the past 15 years.

These options feature a variety of approaches

and implant designs and have been met with varying degrees of adoption.

Lack of a standard and accepted diagnostic approach, complexity

of approach, high morbidity of approach, abnormally high complication rates and inability to radiographically confirm fusion have all

been cited as reasons for low adoption of these technologies.

Commercialization

Tenon initiated

its national commercial launch of The Catamaran System in October 2022 to address what we believe is a large market opportunity.

Catamaran System includes instruments and implants designed to prepare and fixate the SI-Joint for fusion.

The Catamaran System is distinct

from other competitive offerings in the following ways:

● Transfixes the SI-Joint

● Inferior / Posterior Sacroiliac

Fusion Approach

● Reduced Approach Morbidity

● Direct And Visualized Approach

to the SI-Joint

● Single Implant Technique

● Insertion Trajectory Away from

the Neural Foramen

● Insertion Trajectory Away from

Major Lateral Vascular Structures

● Autologous Bone Grafting in

the Ilium, Sacrum and Bridge

● Radiographic Confirmation of

Bridging Bone Fusion of the SI-Joint

Catamaran and SImmetery + Systems make up the Company’s growing portfolio of advanced SI Joint technologies.

these platforms uniquely position Tenon with multiple surgical approaches – lateral and inferior-posterior – both designed

to be minimally invasive, enable authentic arthrodesis and supported by robust clinical evidence, including the published prospective

Mainsail™ and EVoluSIon™ SI Joint fusion studies.

We anticipate that these differentiated technologies will enable physicians

to customize treatment plans for their patients with an innovative portfolio that spans SI Joint, spinal fusion, and deformity adjuncts

— each solution engineered to deliver fusion outcomes more reliably.

We believe that this multi-platform, multi-approach strategy

strengthens Tenon’s competitive advantage in the expanding SI Joint fusion market and underscores the Company’s commitment

to delivering effective, durable outcomes for physicians and patients.

Catamaran System

initiated its national commercial launch of The Catamaran System in October 2022 to address what we believe is a large market opportunity.

The Catamaran System includes instruments and implants designed to prepare and fixate the SI Joint for fusion.

The Catamaran System is

distinct from other competitive offerings in the following ways:

● Trans-articular

placement across the SI Joint

● Inferior-posterior

sacroiliac fusion approach

approach morbidity

visualization to the SI Joint

implant technique

trajectory away from the neural foramen

trajectory away from major lateral vascular structures

bone grafting in the ilium, sacrum and bridge

● Radiographic

confirmation of bridging bone fusion of the SI Joint

fixation device and its key features are shown below:

“Pontoon” in the ilium

“Pontoon” in the sacrum

Robust single titanium

Incorporates fusion principles

to facilitate long-term fixation

Immediate stabilization

along the long axis of the joint.

Fenestrated pontoons designed

to facilitate bony in-growth.

“Pontoons and Bridge

filled with autologous bone from drilling process

Leading edge osteotome creates defect and facilitates ease of insertion

window” filled with autologous bone from drilling process

Proprietary osteotome bridge

designed to disrupt the joint in preparation for fusion

Catamaran System represents a novel less invasive approach to treat SI Joint dysfunction.

Its trans-articular placement, combined with

a design rooted in fusion principles, ensures immediate fixation and stabilization supported by peer reviewed clinical and radiographic

evidence of fusion with a compelling safety profile.

The Catamaran System is a singular implant designed with several proprietary components

which allow for it to be explicitly formatted to address the SI Joint with a single, less invasive approach and implant.

This contrasts

with several competitive implant systems that require multiple approach pathways and implants to achieve fixation.

In addition, the inferior-posterior

approach is designed to be direct to the joint and through limited anatomical structures which may minimize the morbidity of the approach.

The implant features a patented dual pontoon open cell design which enables the clinician to pack the pontoons with the patient’s

own autologous bone designed to promote bone fusion across the joint.

The Catamaran System is designed specially to resist vertical shear

and rotation of the joint in which it was implanted, helping stabilize the joint in preparation for eventual fusion.

instruments we have developed are proprietary to The Catamaran System and specifically designed to transfix the SI Joint and facilitate

an inferior-posterior approach that is unique to the system.

also has developed a proprietary 2D radiographic placement protocol as well as a protocol for 3D navigation utilizing the latest techniques

in spine surgery.

These Tenon advancements are intended to further enhance the safety and ease of the procedure and encourage more physicians

to adopt the procedure.

October 2022, we received Institutional Review Board (“IRB”) approval from WCG IRB for two separate Tenon-sponsored post

market clinical studies of The Catamaran System.

The approval by WCG allows designated Catamaran study centers to begin recruiting and

enrolling patients into the clinical studies.

The first approval from WCG IRB supports a prospective, multi-center, single arm post market

study that will evaluate the clinical outcomes of patients with sacroiliac joint disruptions or degenerative sacroiliitis treated with

The Catamaran System.

is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to address the SI-Joint

with a single approach and implant.

This contrasts with several competitive implant systems that require multiple approach pathways and

implants to achieve fixation.

In addition, the inferior-posterior approach is designed to be direct to the joint and through limited

anatomical structures which may minimize the morbidity of the approach.

The implant features a patented dual pontoon open cell design

which enables the clinician to pack the pontoons with the patient’s own autologous bone designed to promote bone fusion across

The Catamaran System is designed specially to resist vertical shear and rotation of the joint in which it was implanted, helping

stabilize the joint in preparation for eventual fusion.

The instruments

we have developed are proprietary to The Catamaran System and specifically designed to transfix the SI-Joint and facilitate an inferior-posterior

approach that is unique to the system.

Tenon also has

developed a proprietary 2D placement protocol as well as a protocol for 3D navigation utilizing the latest techniques in spine surgery.

These Tenon advancements are intended to further enhance the safety of the procedure and encourage more physicians to adopt the procedure.

In October 2022,

we received Institutional Review Board (“IRB”) approval from WCG IRB for two separate Tenon-sponsored post market clinical

studies of The Catamaran System.

The approval by WCG allows designated Catamaran study centers to begin recruiting and enrolling patients

into the clinical studies.

The first approval from WCG IRB supports a prospective, multi-center, single arm post market study that

will evaluate the clinical outcomes of patients with sacroiliac joint disruptions or degenerative sacroiliitis treated with The Catamaran

Patients will be followed out to 24 months assessing various patient reported outcomes, radiographic assessments, and adverse

The second prospective, multi-center, Catamaran study will evaluate 6-to-12-month radiographic outcomes to assess fusion of patients

that have already undergone treatment with The Catamaran System.

In addition, retrospective and prospective clinical outcomes will be

Based on market

research and internal estimates, Tenon believes the potential market for surgical intervention of the SI-Joint to be 279,000 procedures

annually in the U.S.

Patients will be followed out to 24 months assessing various patient reported outcomes, radiographic assessments,

and adverse events.

The second prospective, multi-center, Catamaran study will evaluate 6-to-12-month radiographic outcomes to assess

fusion of patients that have already undergone treatment with The Catamaran System.

In addition, retrospective and prospective clinical

outcomes will be evaluated.

SImmetry + System

August 2025, we acquired The SImmetry + System, which affords an efficient and effective minimally invasive technique to effect

a true arthrodesis of the SI Joint in the following way:

invasive lateral access for safety and control

designed with well-established orthopedic fusion principles

3D printed titanium implants and proprietary instrumentation provides rigid fixation

preparation with the proprietary SImmetry Decorticator removes cartilage and decorticates

opposing joint surfaces

graft delivery to the prepared joint to facilitate fusion

on market research and internal estimates, Tenon believes the potential market for surgical intervention of SI Joint dysfunction to be

270,000 procedures annually in the U.S.

alone, for a potential annual market of approximately $2.1 billion.

These estimates are driven by coding data for

SI-Joint injections to treat pain and informed assumptions relative to surgical intervention candidacy

Based on public

information, we believe that the largest clinical device supplier in this market does approximately 16,000 SI-Joint fixations a year

representing the largest market share.

The other competitive devices that are offered are all products generally part of much larger

companies with a variety of orthopedic devices and as such do not specifically call out the number of specific SI-Joint procedures performed

with their products.

It is our belief that all other competitive devices represent approximately another 5,000 potential SI-Joint procedures.

Based on this analysis

we believe the market is vastly underserved and only penetrated 5-7%, leaving tremendous upside for a next generation device that meets

the needs of this market.

We believe Tenon

is the first company to develop and manufacture a novel Inferior-Posterior approach featuring a dual pontoon fixation technology cleared

by the FDA expressly for SI-Joint fusion.

The approach, referred to as Inferior Posterior Sacroiliac Fusion is focused on these critical

aspects of the surgical procedure:

Designed for Safety :

the approach trajectory and angle are away from the neural foramen and major vascular structures.

Focus on Efficiency :

the approach is designed to be direct to the SI-Joint, which allows for visualization of the joint and is designed to pass through minimal

muscle structures, which may result in a faster and more efficient surgical procedure and reduced post-op pain for the patient.

Targeted Anatomy :

approach places the implant in the aspect of the SI-Joint with the densest bone, designed to provide maximum fixation and resistance

to vertical shear.

This is designed to provide a secure press fit of the implant, reducing the incidence of revision surgery due to implant

loosening, which we believe is the reason for many competitive device failures as reported to the FDA Medical Device Reporting (MDR).

Note the trajectory

used in the Inferior Posterior approach:

The following are the primary factors

on which companies compete in our industry:

● product and clinical procedure

effectiveness;

● ease of surgical technique

and use of associated instruments;

● published clinical outcomes

and evidence;

● sales force knowledge and service

● product support and service,

and customer service;

● comprehensive training, including

disease, anatomy, diagnosis, and treatment;

● product innovation and the

speed of innovation;

● intellectual property;

● accountability and responsiveness

to customers’ demands;

● pricing and reimbursement;

● scientific (biomechanics) data;

● attracting and retaining key

Tenon believes

that refined approaches and improved implant design will open the door to enhanced adoption and further penetration of this important

The Catamaran™

SI-Joint Fusion System Solution

Until October 2022,

Tenon sold The Catamaran System to a limited number of clinician advisors to refine the product for a full commercial launch.

2022, Tenon initiated a full commercial launch at the NASS meeting in Chicago.

The Catamaran System includes instruments and implants

designed to prepare and fixate the SI-Joint for fusion.

We believe The Catamaran System will address a large market opportunity with

a superior product and is distinct from other competitive offerings in the following ways:

● Transfixes the SI joint

● Inferior-Posterior Sacroiliac

Fusion Approach

● Reduced Approach Morbidity

● Direct And Visualized Approach

to the SI-Joint

● Single Implant Technique

● Insertion Trajectory Away from

the Neural Foramen

● Insertion Trajectory Away from

Major Vascular Structures

● Autologous Bone Grafting in

the Ilium, Sacrum and Bridge

● Radiographic Confirmation of

Bridging Bone Fusion of the SI-Joint

The fixation device

and its key features are shown below:

“Pontoon” in the ilium

“Pontoon” in the sacrum

“Pontoons and Bridge”

filled with autologous bone from drilling process

Leading edge osteotome creates defect and facilitates ease of insertion

The Catamaran System

is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to transfix the SI-Joint

with a single approach and implant.

This contrasts with several competitive implant systems that require multiple approach pathways and

implants to achieve fixation.

In addition, the Inferior-Posterior approach is designed to be direct to the joint and through limited

anatomical structures which may minimize the morbidity of the approach.

The implant features a patented dual pontoon open cell design

which enables the clinician to pack the pontoons with the patient’s own autologous bone designed to promote bone fusion across

The Catamaran System is designed specially to resist vertical shear and rotation of the joint in which it was implanted, helping

stabilize the joint in preparation for eventual fusion.

The instruments

we have developed are proprietary to The Catamaran System and specifically designed to facilitate an Inferior Posterior approach that

is unique to the system.

Tenon also has

developed a proprietary 2D placement protocol as well as a protocol for 3D navigation utilizing the latest techniques in spine surgery.

These Tenon advancements are intended to further enhance the safety of the procedure and encourage more physicians to adopt the procedure.

The Catamaran System,

as mentioned previously, is placed in the densest aspect of the SI-Joint as confirmed by the pre-op planning images below:

Surgical Plan Key:

Pontoon (Ilium)

Medial Pontoon (Sacrum)

Upper Right Quadrant:

and purple pontoons represent the placement in the dense bone inferior – contrasted with the dorsal gap superiorly where competitive

systems are most often placed.

Lower Right Quadrant:

and purple outlines represent The Catamaran System pontoons, illustrating the angle of insertion is away from the sacral neuro

foramen providing for a much safter trajectory for device implantation.

These estimates are driven

by coding data for SI Joint injections to treat pain and informed assumptions relative to surgical intervention candidacy

on public information, we believe that the largest clinical device supplier in this market does approximately 16,000 SI Joint fixations

a year representing the largest market share.

The other competitive devices that are offered are all products generally part of much

larger companies with a variety of orthopedic devices and as such do not specifically call out the number of specific SI Joint procedures

performed with their products.

It is our belief that all other competitive devices represent approximately another 5,000 potential SI

Joint procedures.

on this analysis we believe the market is vastly underserved and only penetrated 5-7%, leaving tremendous upside for a next generation

device that meets the needs of this market.

expanding the Tenon portfolio to include both the Catamaran and SImmetry+ systems, we have created a differentiated market position with

multiple approaches to SI Joint fusion backed by clinical outcomes including:

satisfaction, and

● Independent

confirmation of bridging bone fusion across the joint.

our view, this differentiated market position strengthens our ability to drive adoption, increase procedure volumes, and capture a larger

share of this rapidly expanding market

The following

are the primary factors on which companies compete in our industry:

and clinical procedure effectiveness;

of surgical technique and use of associated instruments;

clinical outcomes and evidence;

force knowledge and service levels;

support and service, and customer service;

● comprehensive

training, including disease, anatomy, diagnosis, and treatment;

innovation and the speed of innovation;

● intellectual

● accountability

and responsiveness to customers’ demands;

and reimbursement;

(biomechanics) data;

and retaining key personnel.

believes providing physicians innovative SI Joint system choices, backed by clinical outcomes, will open the door to enhanced adoption

and further penetration of this important market.

Catamaran ® ™ SI Joint Fusion System Solution

October 2022, Tenon sold The Catamaran System to a limited number of clinician advisors to refine the product for a full commercial launch.

In October 2022, Tenon initiated a full commercial launch at the NASS meeting in Chicago.

The Catamaran System includes instruments and

implants designed to prepare and fixate the SI Joint for fusion.

We believe The Catamaran System will address a large market opportunity

with a superior product and is distinct from other competitive offerings in the following ways:

● Trans-articular

placement across the SI Joint

● Inferior-posterior

sacroiliac fusion approach

invasive surgical approach

visualization to the SI Joint

implant technique

trajectory away from the neural foramen

trajectory away from major vascular structures

bone grafting in the ilium, sacrum and bridge

● Radiographic

confirmation of bridging bone fusion of the SI Joint

Catamaran System is a singular implant designed with several proprietary components which allow for it to be explicitly formatted to

transfix the SI Joint with a single approach and implant.

This contrasts with several competitive implant systems that require multiple

approach pathways and implants to achieve fixation.

In addition, the Inferior-Posterior approach is designed to be direct to the joint

and through limited anatomical structures which may minimize the morbidity of the approach.

The implant features a patented dual pontoon

open cell design which enables the clinician to pack the pontoons with the patient’s own autologous bone designed to promote bone

fusion across the joint.

The Catamaran System is designed specially to resist vertical shear and rotation of the joint in which it was

implanted, helping stabilize the joint in preparation for eventual fusion.

instruments we have developed are proprietary to The Catamaran System and specifically designed to facilitate an Inferior Posterior approach

that is unique to the system.

also has developed a proprietary 2D placement protocol as well as a protocol for 3D navigation utilizing the latest techniques in spine

These Tenon advancements are intended to further enhance the safety of the procedure and encourage more physicians to adopt

the procedure.

We believe The

Catamaran System and its differentiated characteristics allow for an efficient and effective procedure designed to deliver short-term

stabilization and long-term fusion that can be confirmed radiographically.

Shown below is an illustration demonstrating the unique placement

of The Catamaran System inserted Inferior-Posterior and coming directly down to and transfixing the joint

The Catamaran System

procedure is typically performed under general anesthesia using a specially designed instrument set we provide to prepare for the Inferior-Posterior

access to the SI-Joint.

Specially designed imaging and navigation protocols are designed to ensure the clinician has the proper entry

point, trajectory, angle and depth so that the pontoons of The Catamaran System are placed for maximum fixation.

The Catamaran System

incorporates two pontoons and is designed so that when the system is impacted into the bone one pontoon is on the Illum side and the

other is in the Sacrum side with the bridge spanning the joint, preventing shear and rotation of the joint.

The device also features

an open cell design where the patient’s own (autologous) bone is packed into the pontoons and the bridge to facilitate fusion across

believe The Catamaran System and its differentiated characteristics allow for an efficient and effective procedure designed to deliver

short-term stabilization and long-term fusion that can be confirmed radiographically.

Shown below is an illustration demonstrating the

unique placement of The Catamaran System inserted Inferior-Posterior and coming directly down to and transfixing the joint.

Catamaran System procedure is typically performed under general anesthesia using a specially designed instrument set we provide to prepare

for the Inferior-Posterior access to the SI Joint.

Specially designed imaging and navigation protocols are designed to ensure the clinician

has the proper entry point, trajectory, angle and depth so that the pontoons of The Catamaran System are placed for maximum fixation.

The Catamaran System incorporates two pontoons and is designed so that when the system is impacted into the bone one pontoon is on the

Illum side and the other is in the Sacrum side with the bridge spanning the joint, preventing shear and rotation of the joint.

also features an open cell design where the patient’s own (autologous) bone is packed into the pontoons and the bridge to facilitate

fusion across the joint.

The leading edge of the bridge is designed to act as an osteotome, providing a self-created deficit upon insertion.

features are designed to create an ideal environment for bone ingrowth and fusion.

Below is a fluoroscopic image of an implanted Catamaran

Fixation Device spanning the SI-Joint.

Tenon believes

the surgical approach and implant design it has developed, along with the 2D and 3D protocols for proper implantation will be received

well by the clinician community who have been looking for a next generation device.

Our initial clinical results indicate that The Catamaran

System is promoting fusion across the joint as evidenced by post-op CT scans (the recognized gold standard widely accepted by the Clinical

Post-Op fluoroscopic image of

implant spanning the SI-Joint

6-Month CT-Scan showing clear

bridging bone fusion

A preliminary 18

case series (Michael Joseph Chaparro, MD, F.A.A.N.S., F.A.C.S.) has documented that The Catamaran System does in fact promote fusion

across the SI-Joint, which many of our competitors have not been able to demonstrate.

While products from some of our competitors use

screws and triangular wedges to treat the SI-Joint, most do not effectively resist the vertical shear and twisting within the joint.

These features are designed to create an ideal environment for bone ingrowth and fusion.

Below is a fluoroscopic image of an implanted

Catamaran Fixation Device spanning the SI Joint.

believes the surgical approach and implant design it has developed, along with the 2D and 3D protocols for proper implantation will be

received well by the clinician community who have been looking for a next generation device.

Our initial clinical results indicate that

The Catamaran System is promoting fusion across the joint as evidenced by post-op CT scans (the recognized gold standard widely accepted

by the Clinical community).

preliminary 18 case series (Michael Joseph Chaparro, MD, F.A.A.N.S., F.A.C.S.) has documented that The Catamaran System does in fact

promote fusion across the SI Joint, which many of our competitors have not been able to demonstrate.

While products from some of our

competitors use screws and triangular wedges to treat the SI Joint, most do not effectively resist the vertical shear and twisting within

This 18 patient series was presented at the North American Spine Society Annual Meeting in Chicago, IL in October 2022.

An independent

biomechanical study (Lisa Ferrara, Ph.D.

OrthoKinetic Technologies, LLC now part of Element) demonstrated that a single Catamaran SIJ

Fixation Device was superior to predicate device in the areas of Fixation Strength, Shear Stiffness, Dynamic Endurance and Pullout Strength.

We hold issued patents on The Catamaran System and its unique features including the dual pontoons and the open cell structure for bone

graft packing.

We also hold an issued patent for the method of placing The Catamaran System into the SI-Joint where one pontoon is in

the ilium and the other in the sacrum.

The Catamaran System’s

unique design has already demonstrated radiographically confirmed fusion in initial patients.

We believe that this beneficial advantage

along with a simpler, safer, and less painful procedure will make this the procedure of choice for most physicians.

Tenon has initiated

post market, IRB controlled clinical trials to demonstrate this technology delivers on these advantages.

Coverage and Reimbursement

When a Tenon procedure

utilizing The Catamaran System is performed, the healthcare facility, either a hospital (inpatient or outpatient clinic), and the

clinician submit claims for reimbursement to the patient’s insurer.

Generally, the facility obtains a lump sum payment, or facility

fee, for SI-Joint fusions.

Our products are purchased by the facility, along with other supplies used in the procedure.

must also pay for its own fixed costs of operation, including certain operating room personnel involved in the procedure, ICD and other

medical services care.

If these costs exceed the facility reimbursement, the facility’s managers may discourage or restrict clinicians

from performing the procedure in the facility or using certain technologies, such as The Catamaran System, to perform the procedure.

The Medicare 2023

national average hospital inpatient payment for SI-Joint procedures ranges from approximately $25,661 to approximately $46,437 depending

on the procedural approach and the presence of Complication and Comorbidity/Major Complication and Comorbidity.

The Medicare 2023

national average hospital outpatient clinic payment is $17,756.

We believe that insurer payments to facilities are generally adequate

for these facilities to offer The Catamaran System procedure.

Physicians are

reimbursed separately for their professional time and effort to perform a surgical procedure.

Depending on the surgical approach, the

incision size, type and extent of imaging guidance, indication for procedure, and the insurer, The Catamaran System procedure may be

reported by the physician using any one of the applicable following CPT® codes 27279, 27280, 27299.

The Medicare 2022 national average

payment for CPT® 27279 is $807 and $1,352 for 27280.

CPT® 27299 has no national valuation.

Clinicians, however, can present a

crosswalk to another procedure believed to be fairly equivalent and/or comparison to a code for which there is an existing valuation.

For some governmental

programs, such as Medicaid, coverage and reimbursement differ from state to state, and some state Medicaid programs may not pay an adequate

amount for the procedures performed with our products, if any payment is made at all.

Similar to Medicaid, many private payors’

coverage and payment may differ from one payer to another.

independent biomechanical study (Lisa Ferrara, Ph.D.

OrthoKinetic Technologies, LLC now part of Element) demonstrated that a single Catamaran

SIJ Fixation Device was superior to predicate device in the areas of Fixation Strength, Shear Stiffness, Dynamic Endurance and Pullout

We hold issued patents on The Catamaran System and its unique features including the dual pontoons and the open cell structure

for bone graft packing.

We also hold an issued patent for the method of placing The Catamaran System into the SI Joint where one pontoon

is in the ilium and the other in the sacrum.

Catamaran System’s unique design has already demonstrated radiographically confirmed fusion in initial patients.

We believe that

some clinicians view the current Medicare reimbursement amount as insufficient for current SI-Joint procedures, given the work effort

involved with the procedure, including the time to diagnose the patient and obtain prior authorization from the patient’s health

insurer when necessary.

Many private payors require extensive documentation of a multi-step diagnosis before authorizing SI-Joint fusion

for a patient.

We believe that some private payors apply their own coverage policies and criteria inconsistently, and clinicians may

experience difficulties in securing approval and coverage for sacroiliac fusion procedures.

Additionally, many private payors limit coverage

for open SI-Joint fusion to trauma, tumors or extensive spine fusion procedures involving multiple levels.

We believe the

unique design of The Catamaran System and the fact The Catamaran System may be placed both via an open procedure based on the clinician’s

determination of trauma induced SI-Joint pain or as a minimally invasive approach provides a unique and differentiated approach for the

clinician to determine the reimbursement code that best fits the clinical problem.

We believe this is a significant advantage over competitive

devices by providing the clinician the clinical flexibility of offering the best clinical solution and approach for patients.

Sales and Marketing

We market and sell

The Catamaran System primarily through independent distributors and sales representatives specializing in orthopedics and spine sales.

Our target customer base includes approximately 12,000 physicians who perform spine and/or pelvic surgical procedures.

We provide general

sales and marketing training to our independent sales representative along with comprehensive, hands-on cadaveric and dry-lab training

sessions focusing on the clinical benefits of The Catamaran System and the importance of using the 2D and 3D protocols we have developed.

We believe many clinicians have already been trained using one of the alternative products but have not been satisfied with the approach

and technology.

This provides us with an opportunity to demonstrate to an already-trained-clinician the unique attributes of The Catamaran

Our business objective

is to introduce the Next Generation Implant for SI-Joint Fixation.

The past 10 years has seen an acceleration in recognition and discussion

of the SI-Joint as a cause of pain that can be treated.

However, adoption has been hindered by complexity of the procedure as evidenced

by the significant number of reported Medical Device Records (MDR’s).

The need for multiple implants and resulting post-op pain

has also contributed to low adoption numbers.

Our strategy is to provide a safer, faster, and better surgical experience and a significant

pain reduction benefit for the patient.

this beneficial advantage along with a simpler, safer, and less painful procedure will make this the procedure of choice for most physicians.

Tenon has initiated a post market, IRB controlled clinical trial to demonstrate this technology delivers on these advantages.

The Mainsail™

Study is an ongoing prospective, single-arm, multi-center, post-market study evaluating clinical and radiographic outcomes of adult patients

with sacroiliac joint disruptions or degenerative sacroiliitis treated with the Catamaran SI Joint Fusion System.

The target enrollment

for this study is up to 50 patients with up to 24-month follow-up.

There have been two published interim analysis of the study with robust

and sustainable clinical outcomes out to 12 months.

These outcomes include the following:

● Statistically

significant reduction in SI Joint pain at 12 months

safety profile

patient satisfaction throughout all follow-up timepoints

definitive evidence of fusion response at 12 months

surgical technique and procedural workflow

SImmetry + SI Joint Fusion System Solution

August 2025, we acquired The SImmetry + System, which affords an efficient and effective minimally invasive technique to effect

a true arthrodesis of the SI Joint in the following way:

invasive lateral access for safety and control

preparation with the proprietary SImmetry Decorticator removes cartilage and decorticates

opposing joint surfaces

graft delivery to the prepared joint to facilitate fusion

fixation with threaded 3D printed titanium implants

SImmetry + procedure is designed to:

true bony fusion

pain and improve function in appropriately selected patients

approach combines immediate fixation with biologically driven fusion, aligning with long-standing orthopedic fusion principles while

utilizing a minimally invasive surgical technique.

Simmetry + System procedure is typically performed under general anesthesia using a specially designed instrument set we provide

to prepare for lateral access to the SI Joint.

Specially designed imaging and navigation protocols are designed to ensure the clinician

has the proper entry point, trajectory, angle and depth of the implant for maximum fixation.

The SImmetry + SI Joint Fusion

procedure is a minimally invasive surgical technique designed to achieve true bony fusion of the sacroiliac joint.

Through a small lateral

incision and fluoroscopic guidance, the joint is accessed and prepared using specialized decortication instruments to expose bleeding

bone surfaces.

Bone graft material is then placed within the joint to promote biological fusion, followed by placement of titanium implants

across the ilium and sacrum to provide immediate mechanical stabilization.

This combination of joint preparation, bone grafting, and

fixation is intended to support durable fusion while minimizing surgical disruption.

SImmetry + System was part of the EVoluSIon study which was a prospective, multi-center clinical study evaluating up to 250

patients treated with The SImmetry + System.

At 12 months, patients demonstrated statistically significant reductions in pain

and disability, meaningful reductions in opioid use, and approximately 69% showed radiographic evidence of fusion on CT.

As one of the

largest clinical datasets in minimally invasive SI Joint fusion, EVoluSIon supports the safety, effectiveness, and true fusion approach

of the SImmetry + platform.

and Reimbursement

a Tenon procedure utilizing The Catamaran System or The SImmetry + System is performed, the healthcare facility, either

a hospital (inpatient or outpatient clinic), and the clinician submit claims for reimbursement to the patient’s insurer.

the facility obtains a lump sum payment, or facility fee, for SI Joint fusions.

Our products are purchased by the facility, along with

other supplies used in the procedure.

The facility must also pay for its own fixed costs of operation, including certain operating room

personnel involved in the procedure, ICD and other medical services care.

If these costs exceed the facility reimbursement, the facility’s

managers may discourage or restrict clinicians from performing the procedure in the facility or using certain technologies, such as The

Catamaran System or The SImmetry + System, to perform the procedure.

Medicare 2025 national average hospital outpatient clinic payment was $17,914.

We believe that insurer payments to facilities are generally

adequate for these facilities to offer The Catamaran System and The SImmetry + System procedures.

are reimbursed separately for their professional time and effort to perform a surgical procedure.

Depending on the surgical approach,

the incision size, type and extent of imaging guidance, indication for procedure, and the insurer, The Catamaran System and The SImmetry +

System procedures may be reported by the physician using CPT® codes 27279 and 27280.

The Medicare 2026 payment rates for CPT®

codes 27279 and 27280 are $759 and $1,284, respectively.

some governmental programs, such as Medicaid, coverage and reimbursement differ from state to state, and some state Medicaid programs

may not pay an adequate amount for the procedures performed with our products, if any payment is made at all.

Similar to Medicaid, many

private payors’ coverage and payment may differ from one payer to another.

believe that some clinicians view the current Medicare reimbursement amount as insufficient for current SI Joint procedures, given the

work effort involved with the procedure, including the time to diagnose the patient and obtain prior authorization from the patient’s

health insurer when necessary.

Many private payors require extensive documentation of a multi-step diagnosis before authorizing SI Joint

fusion for a patient.

We believe that some private payors apply their own coverage policies and criteria inconsistently, and clinicians

may experience difficulties in securing approval and coverage for sacroiliac fusion procedures.

Additionally, many private payors limit

coverage for open SI Joint fusion to trauma, tumors or extensive spine fusion procedures involving multiple levels.

and Marketing

market and sell The Catamaran System and The SImmetry + System primarily through independent distributors and sales representatives

specializing in orthopedics and spine sales.

Our target customer base includes approximately 12,000 physicians who perform spine and/or

pelvic surgical procedures.

provide general sales and marketing training to our independent sales representative along with comprehensive, hands-on cadaveric and

dry-lab training sessions focusing on the clinical benefits of The Catamaran System and The SImmetry + System and the importance

of using the 2D and 3D protocols we have developed.

We believe many clinicians have already been trained using one of the alternative

products but have not been satisfied with the approach, outcomes, and technology.

This provides us with an opportunity to demonstrate

to an already-trained-clinician the unique attributes of The Catamaran System and The SImmetry + System.

business objective is to introduce the next generation of implants for SI Joint fixation and fusion.

The past 10 years have seen an acceleration

in recognition and discussion of the SI Joint as a cause of pain that can be treated.

However, adoption has been hindered by complexity

of the procedure as evidenced by the significant number of reported Medical Device Records (MDR’s).

The need for multiple implants

and resulting post-op pain has also contributed to low adoption numbers.

Our strategy is to provide a safer, faster, and better surgical

experience and a significant pain reduction benefit for the patient.

Our goals are simple but impactful and as such we plan on the following:

● Educate and inform physicians

and other healthcare providers, payors, and patients about the growing body of evidence supporting what we believe is the safety, durable

clinical effectiveness, economic benefit, and reduction in opioid use associated with SI-Joint fixation and The Catamaran System procedure.

● Utilize the most effective

means of training via video and in-person labs demonstrating the ease of use with 2D and 3D navigation.

Since many physicians have already

been trained but have not incorporated SI-Joint fixation into their practices we will work with these physicians to reengage and train

them on the Next Generation of an SI-Joint implant which incorporates a safer and simpler approach.

● Utilize the best approaches

of direct-to-consumer outreach to educate patients that there is a safe solution to help them improve their quality of life.

Additionally,

to reach the broadest physician and patient audience on case study results from around the United States we plan to implement an active

social media campaign incorporating Facebook, Instagram, YouTube, etc.

● Invest in our independent sales

representative network to ensure that all Tenon representatives have the latest in marketing and education tools to reduce the time from

training to adoption.

● Remain true to our next generation

product development strategy by continually bringing out new advancements in and around the SI-Joint and pelvic region.

● Continue to grow our existing

intellectual property portfolio.

● Execute post-market clinical

research to confirm the benefits of the distinct approach and implant.

Regulatory Status

We have received

FDA 510(k) clearance to market and sell The Catamaran System for sacroiliac joint fusion for conditions including sacroiliac joint disruptions

and degenerative sacroiliitis.

Research & Development

Our initial development

of The Catamaran System has incorporated several differentiating features which we believe will make an important contribution for many

patients suffering from SI-Joint pain.

To our knowledge, no other competitive product incorporates these Next Generation features:

● Dual Pontoon implant that transfixes

the targeted joint;

● Open cell design designed for

utilizing the patient’s own autologous bone for promotion of fusion;

● Bridge design between the dual

pontoons for enhanced strength;

● Leading edge of the implant

designed to function as an osteotome providing a self-creating defect feature not available with competitive systems;

● Single implant designed with

varying pontoon sizes to ensure a robust fixation based on anatomy;

● Additional smaller Catamaran

designed for smaller anatomy and/or revision surgery.

Our development

plan is to expand The Catamaran System offering by introducing a series of progressively longer pontoons so that the clinician has a

full complement of sized implants to choose from depending on the patient’s anatomy.

and inform physicians and other healthcare providers, payors, and patients about the growing

body of evidence supporting what we believe is the safety, durable clinical effectiveness,

economic benefit, and reduction in opioid use associated with SI Joint fixation and The Catamaran

System and The SImmetry + System procedures.

the most effective means of training via video and in-person labs demonstrating the ease

of use with 2D and 3D navigation.

Since many physicians have already been trained but have

not incorporated SI Joint fixation into their practices we will work with these physicians

to reengage and train them on the next generation of SI Joint implants which incorporate

a safer and simpler approach.

the best approaches of direct-to-consumer outreach to educate patients that there is a safe

solution to help them improve their quality of life.

Additionally, to reach the broadest

physician and patient audience on case study results from around the United States we plan

to implement an active social media campaign incorporating LinkedIn, Facebook, Instagram,

YouTube, etc.

in our independent sales representative network to ensure that all Tenon representatives

have the latest in marketing and education tools to reduce the time from training to adoption.

true to our next generation product development strategy by continually bringing out new

advancements in and around the SI Joint and pelvic region.

to grow our existing intellectual property portfolio.

post-market clinical research to confirm the benefits of the distinct approach and implant.

have received FDA 510(k) clearance to market and sell both The Catamaran System and The SImmentry + System for sacroiliac joint

fusion for conditions including sacroiliac joint disruptions and degenerative sacroiliitis.

Additionally, The Catamaran System received

an expanded indication from the FDA in March 2025 to augment immobilization and stabilization of the SI Joint in patients undergoing

sacropelvic fixation as part of a lumbar fusion procedure.

& Development

initial development of The Catamaran System has incorporated several differentiating features which we believe will make an important

contribution for many patients suffering from SI Joint pain.

To our knowledge, no other competitive product incorporates the following

next generation features:

Pontoon implant that trans-articulates across the targeted joint;

cell design designed for utilizing the patient’s own autologous bone for promotion

design between the dual pontoons for enhanced strength;

edge of the implant designed to function as an osteotome providing a self-creating defect

feature not available with competitive systems;

implant designed with varying pontoon sizes to ensure a robust fixation based on anatomy;

smaller Catamaran designed for smaller anatomy and/or revision surgery.

development plan is to expand The Catamaran System offering by introducing various sizes in length and width so that the clinician has

a full complement of sized implants to choose from depending on the patient’s anatomy.

These product enhancements will enable the

1 unchanged sentence

We believe, based on literature searches of

prior SI-Joint fixation technologies, that adverse event incidence where the implant has loosened or been misplaced thereby requiring

prior SI Joint fixation technologies, that adverse event incidence where the implant has loosened or been mal-placed thereby requiring

a revision surgery could reach 20%.

We believe that our ability to make The Catamaran System a specifically sized fixation device will

benefit many patients requiring a revision surgery.

The Catamaran System

shown below has been cleared by the FDA for commercialization.

This patented titanium implant incorporates the Catamaran SI-Joint Fixation

Device pontoon design and the open cell configuration which we believe, when filled with the patient’s autologous bone, promotes

The two images below show a comparison of a competitive implant requiring three implants and The Catamaran System unique pontoon

design showing the need of only one implant to cover the same amount of the SI-Joint.

The Catamaran™ SIJ Fusion

System Single Implant

iFuse® Three Implants

Our mission will

be to continue developing enhancements to The Catamaran System to meet our customers’ changing needs and to improve the surgery’s

effectiveness.

This includes revision surgery options as well as options as an adjunct to long fusion constructs in the lumbar spine.

Additionally, we

will initiate various post marketing clinical studies in accordance with FDA cleared indications for use.

We believe that our ability to offer The Catamaran System implants in various sizes will benefit

many patients requiring a revision surgery and thus reduce the associated challenges and variability found in this type of procedure.

The Catamaran System’s patented titanium implant incorporates the Catamaran SI Joint Fixation Device pontoon design and the open

cell configuration which we believe, when filled with the patient’s autologous bone, promotes fusion.

mission continues to be developing enhancements to The Catamaran System and its instrument system to meet our customers’ changing

needs and to improve the surgery’s effectiveness.

This includes revision surgery options as well as options as an adjunct to long

fusion constructs in the lumbar spine.

Additionally,

we will initiate various post marketing clinical studies in accordance with FDA cleared indications for use.

Since we have already received

2 unchanged sentences

Tenon has received IRB approval for two post-market trials, including a 50 patient, 10 center multi-center trial and a

prospective CT trial to demonstrate fusion in patient who have already been treated with The Catamaran System.

Clinical study endpoints

may include but are not limited to;

pain scoring, length of surgical procedure, blood loss, post-op pain, length of stay, duration of

non-weight-bearing post-op, radiographic confirmation of fusion and surgical complication rates.

Statistical analysis plans may be designed

to demonstrate non-inferiority to historical control, as reported in published literature, which may be used for submission to peer reviewed

articles / posters / presentations and the like.

Developing and

maintaining a strong intellectual property position is an important element of our business.

We maintain the intellectual property through

a combination of patent protection, trademarks, and trade secrets.

We have sought, and will continue to seek, patent protection for our

technology, for improvements to our technology, as well as for any of our other technologies where we believe such protection will be

advantageous.

As of March 26, 2025, we own eight issued U.S.

utility patents, 21

utility patent applications, four issued foreign utility patents in Australia, Canada, Japan and Israel, and two pending

foreign utility patent applications in the European Community, Brazil and Japan.

We also have thirteen registered trademarks (seven U.S.

and six foreign) and twelve pending trademark applications in the U.S.

Our utility patents

and patent applications are directed to several different aspects of our sacroiliac (SI) joint stabilization technology and related patent

By way of example, our granted patents and pending patent applications cover various structural features of our unique Catamaran

SI-Joint prosthesis and means for employing same to stabilize a dysfunctional SI-Joint.

The term of individual

patents depends on the legal term for patents in the countries in which they are granted.

In most countries, including the United States,

the patent term for a utility patent is generally 20 years from the earliest claimed filing date of a nonprovisional patent application

in the applicable country.

prospective CT trial (the Mainsail Study) to demonstrate fusion in patients who have been treated with The Catamaran System.

study endpoints may include but are not limited to;

pain scoring, length of surgical procedure, blood loss, post-op pain, length of stay,

duration of non-weight-bearing post-op, radiographic confirmation of fusion and surgical complication rates.

Statistical analysis plans

may be designed to demonstrate non-inferiority to historical control, as reported in published literature, which may be used for submission

to peer reviewed articles, posters and presentations, etc.

believe that our 2025 acquisition of the strategic assets of SiVantage provides a robust pipeline of innovative technologies designed

to further strengthen and expand our portfolio for the treatment of SI Joint disease.

Ongoing enhancements to the SImmetry +

Instrument System are expected to improve procedural efficiency and streamline surgical workflow.

In addition, we expect that The SImmetry +

System will broaden its implant portfolio with expanded length and diameter options to better accommodate varying patient anatomies.

In addition to enhancements to The SImmetry + System, we are advancing novel and potentially disruptive technology platforms

that introduce additional approaches to treating the SI Joint, while remaining firmly grounded in the orthopedic principles of fusion

that underpin each new platform.

and maintaining a strong intellectual property position is an important element of our business.

We maintain the intellectual property

through a combination of patent protection, trademarks, and trade secrets.

We have sought, and will continue to seek, patent protection

for our technology, for improvements to our technology, as well as for any of our other technologies where we believe such protection

will be advantageous.

of March 27, 2026, we own 31 issued U.S.

utility patents, 13 pending U.S.

utility patent applications, 9 issued foreign utility patents

in Australia, Canada, Japan and Israel, and 19 pending foreign utility patent applications in the European Community, Brazil and Japan.

We have 1 licensed U.S.

We also have 14 registered U.S.

trademarks and 6 foreign trademarks and 1 pending trademark application

utility patents and patent applications are directed to several different aspects of our SI Joint stabilization technology and related

patent platform.

By way of example, our granted patents and pending patent applications cover various structural features of our unique

Catamaran SI Joint prosthesis and means for employing same to stabilize a dysfunctional SI Joint.

term of individual patents depends on the legal term for patents in the countries in which they are granted.

In most countries, including

the United States, the patent term for a utility patent is generally 20 years from the earliest claimed filing date of a nonprovisional

patent application in the applicable country.

Our issued U.S.

and foreign utility patents are anticipated to naturally expire around 2031, and our U.S.

pending utility patent applications, if issued into patents, are similarly anticipated to naturally expire around 2031, excluding any

additional patent term adjustment(s) or extension(s), and assuming payment of all applicable maintenance or annuity fees.

Once a patent

expires, patent protection ends and an invention enters the public domain allowing anyone to commercially exploit the invention without

infringing the patent.

We cannot guarantee

that patents will be issued from any of our pending applications or that issued patents will be of sufficient scope or strength to provide

meaningful protection for our technology.

Notwithstanding the scope of the patent protection available to us, a competitor could develop

methods or devices that are not covered by our patents or circumvent these patents.

Furthermore, although, at present, we are unaware

of any patent applications that may result in one or more issued patents that our existing products or technologies may be alleged to

infringe, since U.S.

and foreign applications can take many months to publish, there may be applications unknown to us that may result

in one or more issued patents that our existing products or technologies may be alleged to infringe.

As of March 26, 2025, we also have priority rights in and to several

significant trademarks that support our products and brand, including seven registered U.S.

and foreign utility patents are anticipated to naturally expire around

2031, and our U.S.

pending utility patent applications, if issued into patents, are similarly anticipated to naturally expire around

2031, excluding any additional patent term adjustment(s) or extension(s), and assuming payment of all applicable maintenance or annuity

Once a patent expires, patent protection ends and an invention enters the public domain allowing anyone to commercially exploit

the invention without infringing the patent.

cannot guarantee that patents will be issued from any of our pending applications or that issued patents will be of sufficient scope

or strength to provide meaningful protection for our technology.

Notwithstanding the scope of the patent protection available to us,

a competitor could develop methods or devices that are not covered by our patents or circumvent these patents.

Furthermore, although,

at present, we are unaware of any patent applications that may result in one or more issued patents that our existing products or technologies

may be alleged to infringe, since U.S.

and foreign applications can take many months to publish, there may be applications unknown to

us that may result in one or more issued patents that our existing products or technologies may be alleged to infringe.

of March 27, 2026, we also have priority rights in and to several significant trademarks that support our products and brand, including

seven registered U.S.

trademarks, twelve U.S.

trademark applications

and six foreign trademark applications in the European Community (excluding the United Kingdom), Australia and Japan.

trademark applications and six foreign trademark applications in the European Community

(excluding the United Kingdom), Australia and Japan.

Regulation of Our Products and Business.

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domestically or exported internationally are safe and effective for their intended uses:

● product design, development,

and manufacture;

● product safety, testing, labeling,

● record keeping procedures;

● product marketing, sales, distribution

● post-marketing surveillance,

complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions, and repair or recall of products.

There are numerous

FDA regulatory requirements governing the clearance or approval and marketing of our products.

design, development, and manufacture;

safety, testing, labeling, and storage;

keeping procedures;

marketing, sales, distribution and export;

● post-marketing

surveillance, complaint handling, medical device reporting, reporting of deaths, serious

injuries or device malfunctions, and repair or recall of products.

are numerous FDA regulatory requirements governing the clearance or approval and marketing of our products.

These include:

● product listing and establishment

registration, which helps facilitate FDA inspections and other regulatory action;

● investigational device exemptions

to conduct premarket clinical trials, which include extensive monitoring, recordkeeping, and reporting requirements;

● QSR, which requires manufacturers,

including contract manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures

during all aspects of the manufacturing process;

● labeling regulations and FDA

prohibitions against the promotion of products for uncleared, unapproved or off-label use or indication;

● clearance of product modifications

that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared

● approval of product modifications

that affect the safety or effectiveness of one of our approved devices;

● medical device reporting regulations,

which require that manufacturers comply with FDA requirements to report if their device may have caused or contributed to a death or

serious injury, or has malfunctioned in a way that would likely cause or contribute to a death or serious injury if the malfunction of

the device or a similar device were to recur;

● post-approval restrictions

or conditions, including post-approval study commitments;

● post-market surveillance regulations,

which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device;

● the FDA’s recall authority,

whereby it can ask, or under certain conditions order, device manufacturers to recall from the market a product that is in violation

of governing laws and regulations;

● regulations pertaining to voluntary

● notices of corrections or removals.

The FDA has broad

post-market and regulatory enforcement powers.

We and our contract manufacturers are subject to announced and unannounced inspections

by the FDA to determine our compliance with the QSR and other regulations and these inspections may include the manufacturing facilities

of our suppliers.

Tenon has a robust Supplier Qualification and Audit process as part of our quality system that ensures contract manufacturers,

and their suppliers meet all requirements.

An FDA pre-approval

inspection is not required for The Catamaran System due to its lower device classification, class II versus the higher class III.

is the case for most medical device firms, Tenon is subject to routine and “for cause” FDA inspections.

Routine inspections are

mandated by law every 2 years for class II and class III device manufacturers and make up the majority of FDA’s inspections.

public health risk is identified during a routine inspection, the inspection may convert to a “for cause” inspection.

the current environment, FDA has limited compliance resources and has not been able to perform routine inspections in accordance with

the 2-year mandate.

Therefore, FDA uses a risk-based approach when deciding which firms should be selected for a routine inspection.

Using the Establishment Registration and Device Listing databases, FDA identifies who manufactures and/or distributes which devices.

listing and establishment registration, which helps facilitate FDA inspections and other

regulatory action;

● investigational

device exemptions to conduct premarket clinical trials, which include extensive monitoring,

recordkeeping, and reporting requirements;

which requires manufacturers, including contract manufacturers, to follow stringent design,

testing, control, documentation and other quality assurance procedures during all aspects

of the manufacturing process;

regulations and FDA prohibitions against the promotion of products for uncleared, unapproved

or off-label use or indication;

of product modifications that could significantly affect safety or effectiveness or that

would constitute a major change in intended use of one of our cleared devices;

of product modifications that affect the safety or effectiveness of one of our approved devices;

device reporting regulations, which require that manufacturers comply with FDA requirements

to report if their device may have caused or contributed to a death or serious injury, or

has malfunctioned in a way that would likely cause or contribute to a death or serious injury

if the malfunction of the device or a similar device were to recur;

● post-approval

restrictions or conditions, including post-approval study commitments;

● post-market

surveillance regulations, which apply when necessary to protect the public health or to provide

additional safety and effectiveness data for the device;

FDA’s recall authority, whereby it can ask, or under certain conditions order, device

manufacturers to recall from the market a product that is in violation of governing laws

and regulations;

● regulations

pertaining to voluntary recalls;

of corrections or removals.

FDA has broad post-market and regulatory enforcement powers.

We and our contract manufacturers are subject to announced and unannounced

inspections by the FDA to determine our compliance with the QSR and other regulations and these inspections may include the manufacturing

facilities of our suppliers.

Tenon has a robust Supplier Qualification and Audit process as part of our quality system that ensures contract

manufacturers, and their suppliers meet all requirements.

FDA pre-approval inspection is not required for The Catamaran System or The SImmetry + System due to its lower device classification,

class II versus the higher class III.

As is the case for most medical device firms, Tenon is subject to routine and “for cause”

FDA inspections.

Routine inspections are mandated by law every 2 years for class II and class III device manufacturers and

make up the majority of FDA’s inspections.

If a serious public health risk is identified during a routine inspection, the inspection

may convert to a “for cause” inspection.

In the current environment, FDA has limited compliance resources and has not

been able to perform routine inspections in accordance with the 2-year mandate.

Therefore, FDA uses a risk-based approach when deciding

which firms should be selected for a routine inspection.

Using the Establishment Registration and Device Listing databases, FDA identifies

who manufactures and/or distributes which devices.

The firms are then prioritized by risk, class III > class II > class I.

Firms that have recently introduced a new device to the

market also are given higher priority, as well as those that have had significant prior violations and complaints.

At present, Tenon

has not been selected for an FDA inspection.

Tenon uses best practices to secure and maintain regulatory compliance by engaging

with suppliers and contract manufacturing firms that are ISO 13485 (or equivalent) compliant and by periodically performing internal,

external, and third-party inspections and audits of the facilities and systems to assess compliance.

FDA Premarket

Clearance and Approval Requirements.

Unless an exemption applies, each medical device we wish to commercially distribute in the

United States will require either premarket notification, or 510(k), clearance or approval of a PMA from the FDA.

that have recently introduced a new device to the market also are given higher priority, as well as those that have had significant prior

violations and complaints.

At present, Tenon has not been selected for an FDA inspection.

Tenon uses best practices to secure

and maintain regulatory compliance by engaging with suppliers and contract manufacturing firms that are ISO 13485 (or equivalent) compliant

and by periodically performing internal, external, and third-party inspections and audits of the facilities and systems to assess compliance.

Premarket Clearance and Approval Requirements.

Unless an exemption applies, each medical device we wish to commercially distribute

in the United States will require either premarket notification, or 510(k), clearance or approval of a PMA from the FDA.

The FDA classifies

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products are Class II devices, subject to 510(k) clearance.

After a device

receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute

a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending on the modification,

a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would

constitute a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending on the modification,

PMA approval.

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Clinical trials are generally required to support a PMA application and are sometimes required for 510(k) clearance.

Such trials for implanted devices such as the Catamaran SIJ Fixation Device generally require an investigational device exemption application,

or IDE, approved in advance by the FDA for a specified number of subjects and study sites, unless the product is deemed a nonsignificant

risk device eligible for more abbreviated IDE requirements.

Clinical trials are subject to extensive monitoring, recordkeeping, and reporting

requirements.

Clinical trials must be conducted under the oversight of an institutional review board, or IRB, for the relevant clinical

trial sites and must comply with FDA regulations, including but not limited to those relating to good clinical practices.

a clinical trial, we also are required to obtain the subjects’ informed consent in form and substance that complies with both FDA

requirements and state and federal privacy and human subject protection regulations.

We, the FDA, or the institutional review board,

or IRB, could suspend a clinical trial at any time for various reasons, including a belief that the risks to study subjects outweigh

the anticipated benefits.

Even if a trial is completed, the results of clinical testing may not adequately demonstrate the safety and

effectiveness of the device or may otherwise not be sufficient to obtain FDA clearance or approval to market the product in the United

Such trials for implanted devices such as devices included in The Catamaran System and The SImmetry+ System generally require an investigational

device exemption application, or IDE, approved in advance by the FDA for a specified number of subjects and study sites, unless the product

is deemed a nonsignificant risk device eligible for more abbreviated IDE requirements.

Clinical trials are subject to extensive monitoring,

recordkeeping, and reporting requirements.

Clinical trials must be conducted under the oversight of an institutional review board, or

IRB, for the relevant clinical trial sites and must comply with FDA regulations, including but not limited to those relating to good

clinical practices.

To conduct a clinical trial, we also are required to obtain the subjects’ informed consent in form and substance

that complies with both FDA requirements and state and federal privacy and human subject protection regulations.

We, the FDA, or the

institutional review board, or IRB, could suspend a clinical trial at any time for various reasons, including a belief that the risks

to study subjects outweigh the anticipated benefits.

Even if a trial is completed, the results of clinical testing may not adequately

demonstrate the safety and effectiveness of the device or may otherwise not be sufficient to obtain FDA clearance or approval to market

the product in the United States.

and Continuing Regulation.

After a device is placed on the market, numerous regulatory requirements continue to apply.

● Product listing and establishment

registration, which helps facilitate FDA inspections and other regulatory action;

● QSR, which requires manufacturers,

including contract manufacturers, to follow stringent design, testing, control, documentation, and other quality assurance procedures

during all aspects of the manufacturing process;

● labeling regulations and FDA

prohibitions against the promotion of products for uncleared, unapproved, or off-label use or indication;

● clearance of product modifications

that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared

● approval of product modifications

that affect the safety or effectiveness of one of our approved devices;

● post-approval restrictions

or condition, including post-approval study commitments;

● post-market surveillance regulations,

which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device;

● the FDA’s recall authority,

whereby it can ask, or under certain conditions order, device manufacturers to recall from the market a product that is in violation

of governing laws and regulations;

● regulations pertaining to voluntary

● notices of corrections or removals.

The FDA has broad

post-market and regulatory enforcement powers.

We are subject to unannounced inspections by the FDA to determine our compliance with

the QSR and other regulations, and these inspections may include the manufacturing facilities of some of our subcontractors.

listing and establishment registration, which helps facilitate FDA inspections and other

regulatory action;

which requires manufacturers, including contract manufacturers, to follow stringent design,

testing, control, documentation, and other quality assurance procedures during all aspects

of the manufacturing process;

regulations and FDA prohibitions against the promotion of products for uncleared, unapproved,

or off-label use or indication;

of product modifications that could significantly affect safety or effectiveness or that

would constitute a major change in intended use of one of our cleared devices;

of product modifications that affect the safety or effectiveness of one of our approved devices;

● post-approval

restrictions or condition, including post-approval study commitments;

● post-market

surveillance regulations, which apply when necessary to protect the public health or to provide

additional safety and effectiveness data for the device;

FDA’s recall authority, whereby it can ask, or under certain conditions order, device

manufacturers to recall from the market a product that is in violation of governing laws

and regulations;

● regulations

pertaining to voluntary recalls;

of corrections or removals.

FDA has broad post-market and regulatory enforcement powers.

We are subject to unannounced inspections by the FDA to determine our compliance

with the QSR and other regulations, and these inspections may include the manufacturing facilities of some of our subcontractors.

by us or by our suppliers to comply with applicable regulatory requirements can result in enforcement action by the FDA or other regulatory

authorities, which may result in sanctions including, but not limited to:

● untitled letters, warning letters,

fines, injunctions, consent decrees, and civil penalties;

● unanticipated expenditures

to address or defend such actions

● customer notifications for

repair, replacement, refunds;

● recall, detention, or seizure

of our products;

● operating restrictions or partial

suspension or total shutdown of production;

● refusing or delaying our requests

for 510(k) clearance or PMA approval of new products or modified products;

● operating restrictions;

● withdrawing 510(k) clearances

or PMA approvals that have already been granted:

● refusal to grant export approval

for our products;

● criminal prosecution.

The FDA has not yet inspected our contract

manufacturer’s manufacturing facilities.

letters, warning letters, fines, injunctions, consent decrees, and civil penalties;

● unanticipated

expenditures to address or defend such actions

notifications for repair, replacement, refunds;

detention, or seizure of our products;

restrictions or partial suspension or total shutdown of production;

or delaying our requests for 510(k) clearance or PMA approval of new products or modified

restrictions;

● withdrawing

510(k) clearances or PMA approvals that have already been granted:

to grant export approval for our products;

not yet inspected our contract manufacturer’s manufacturing facilities.

Materials “Off-Label” Promotion.

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event, our reputation could be damaged, and adoption of the products would be impaired.

In addition, under

the federal Lanham Act and similar state laws, competitors, and others can initiate litigation relating to advertising claims.

Healthcare Fraud

Federal and state

governmental agencies and equivalent foreign authorities subject the healthcare industry to intense regulatory scrutiny, including heightened

civil and criminal enforcement efforts.

These laws constrain the sales, marketing and other promotional activities of medical device

manufacturers by limiting the kinds of financial arrangements we may have with hospitals, physicians and other potential purchases of

our products.

Federal healthcare fraud and abuse laws apply to our business when a customer submits a claim for an item or service that

is reimbursed under Medicare, Medicaid, or other federally funded healthcare programs.

addition, under the federal Lanham Act and similar state laws, competitors, and others can initiate litigation relating to advertising

Fraud and Abuse

and state governmental agencies and equivalent foreign authorities subject the healthcare industry to intense regulatory scrutiny, including

heightened civil and criminal enforcement efforts.

These laws constrain the sales, marketing and other promotional activities of medical

device manufacturers by limiting the kinds of financial arrangements we may have with hospitals, physicians and other potential purchases

of our products.

Federal healthcare fraud and abuse laws apply to our business when a customer submits a claim for an item or service

that is reimbursed under Medicare, Medicaid, or other federally funded healthcare programs.

Descriptions of some of the laws and regulations

that may affect our ability to operate follows.

The federal Anti-Kickback

Statute prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering, or paying remuneration,

directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation

of, items or services for which payment may be made, in whole or in part, under federal healthcare programs.

The term “remuneration”

has been broadly interpreted to include anything of value, and the government can establish a violation of the Anti-Kickback Statute

without proving that a person or entity had actual knowledge of, or a specific intent to violate, the law.

The Anti-Kickback Statute

is subject to evolving interpretations and has been applied by government enforcement officials to a number of common business arrangements

in the medical device industry.

There are a number of statutory exceptions and regulatory safe harbors protecting some common activities

from prosecution;

however, those exceptions and safe harbors are drawn narrowly, and there is no exception or safe harbor for many common

business activities.

Failure to meet all of the requirements of a particular statutory exception or regulatory safe harbor does not make

the conduct per se illegal under the Anti-Kickback Statute, but the legality of the arrangement will be evaluated on a case-by-case basis

based on the totality of the facts and circumstances.

A number of states also have anti-kickback laws that establish similar prohibitions

that may apply to items or services reimbursed by government programs, as well as by any third-party payors, including commercial payors.

The civil False

Claims Act prohibits, among other things, knowingly presenting or causing the presentation of a false or fraudulent claim for payment

of federal funds, or knowingly making, or causing to be made, a false record or statement material to a false or fraudulent claim to

avoid, decrease or conceal an obligation to pay money to the federal government.

A claim including items or services resulting from a

violation of the Anti- Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act.

Actions under the

False Claims Act may be brought by the government or as a qui tam action by a private individual in the name of the government.

federal Anti-Kickback Statute prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering, or

paying remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the

purchase, order or recommendation of, items or services for which payment may be made, in whole or in part, under federal healthcare

The term “remuneration” has been broadly interpreted to include anything of value, and the government can establish

a violation of the Anti-Kickback Statute without proving that a person or entity had actual knowledge of, or a specific intent to violate,

The Anti-Kickback Statute is subject to evolving interpretations and has been applied by government enforcement officials to

a number of common business arrangements in the medical device industry.

There are a number of statutory exceptions and regulatory safe

harbors protecting some common activities from prosecution;

however, those exceptions and safe harbors are drawn narrowly, and there

is no exception or safe harbor for many common business activities.

Failure to meet all of the requirements of a particular statutory

exception or regulatory safe harbor does not make the conduct per se illegal under the Anti-Kickback Statute, but the legality of the

arrangement will be evaluated on a case-by-case basis based on the totality of the facts and circumstances.

A number of states also have

anti-kickback laws that establish similar prohibitions that may apply to items or services reimbursed by government programs, as well

as by any third-party payors, including commercial payors.

civil False Claims Act prohibits, among other things, knowingly presenting or causing the presentation of a false or fraudulent claim

for payment of federal funds, or knowingly making, or causing to be made, a false record or statement material to a false or fraudulent

claim to avoid, decrease or conceal an obligation to pay money to the federal government.

A claim including items or services resulting

from a violation of the Anti- Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act.

under the False Claims Act may be brought by the government or as a qui tam action by a private individual in the name of the

Qui tam actions are filed under seal and impose a mandatory duty on the U.S.

Department of Justice to investigate such allegations.

Department of Justice to investigate

such allegations.

Most private citizen actions are declined by the Department of Justice or dismissed by federal courts.

However, the investigation costs

for a company can be significant and material even if the allegations are without merit.

There are also criminal penalties, including

imprisonment and criminal fines, for making or presenting a false or fictitious or fraudulent claim to the federal government.

False Claims Act

liability is potentially significant in the healthcare industry because the statute provides for treble damages and mandatory penalties

of $11,181 to $22,363 per claim (adjusted annually for inflation).

Because of the potential for large monetary exposure, healthcare companies

often resolve allegations without admissions of liability for significant and sometimes material amounts to avoid the uncertainty of

treble damages and per claim penalties that may awarded in litigation proceedings.

investigation costs for a company can be significant and material even if the allegations are without merit.

There are also criminal

penalties, including imprisonment and criminal fines, for making or presenting a false or fictitious or fraudulent claim to the federal

Claims Act liability is potentially significant in the healthcare industry because the statute provides for treble damages and mandatory

penalties of $11,181 to $22,363 per claim (adjusted annually for inflation).

Because of the potential for large monetary exposure, healthcare

companies often resolve allegations without admissions of liability for significant and sometimes material amounts to avoid the uncertainty

of treble damages and per claim penalties that may awarded in litigation proceedings.

Moreover, to avoid the risk of exclusion from federal

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which may impose substantial costs on companies to ensure compliance.

In addition, HIPAA

created federal criminal statutes that prohibit, among other actions, knowingly and willfully executing, or attempting to execute, a

scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing

from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully

falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection

with the delivery of or payment for healthcare benefits, items or services.

The federal Physician

Payment Sunshine Act, implemented by CMS as the Open Payments program, requires manufacturers of drugs, devices, biologics and medical

supplies for which payment is available under Medicare, Medicaid, or the Children’s Health Insurance Program to report annually

to CMS information related to payments or other “transfers of value” made to physicians and teaching hospitals, and requires

applicable manufacturers to report annually to CMS ownership and investment interests held by physicians and their immediate family members

and payments or other “transfers of value” to such physician owners.

Certain states

also mandate implementation of corporate compliance programs, impose restrictions on device manufacturer marketing practices, and/or

require tracking and reporting of gifts, compensation, and other remuneration to healthcare professionals and entities.

The Foreign Corrupt

Practices Act and similar anti-bribery laws in other countries, such as the UK Bribery Act, generally prohibit companies and their intermediaries

from making improper payments to government officials and/or other persons for the purpose of obtaining or retaining business.

mandate compliance with these anti-bribery laws.

Violations of these

federal and state fraud abuse laws can subject us to administrative, civil, and criminal penalties, including imprisonment, substantial

fines, penalties, damages, and exclusion from participation in federal healthcare programs, including Medicare and Medicaid.

and Security Laws

HIPAA requires

the notification of patients, and other compliance actions, in the event of a breach of unsecured PHI.

If notification to patients of

a breach is required, such notification must be provided without unreasonable delay and in no event later than 60 calendar days after

addition, HIPAA created federal criminal statutes that prohibit, among other actions, knowingly and willfully executing, or attempting

to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling

or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly

and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement

in connection with the delivery of or payment for healthcare benefits, items or services.

federal Physician Payment Sunshine Act, implemented by CMS as the Open Payments program, requires manufacturers of drugs, devices, biologics

and medical supplies for which payment is available under Medicare, Medicaid, or the Children’s Health Insurance Program to report

annually to CMS information related to payments or other “transfers of value” made to physicians and teaching hospitals,

and requires applicable manufacturers to report annually to CMS ownership and investment interests held by physicians and their immediate

family members and payments or other “transfers of value” to such physician owners.

states also mandate implementation of corporate compliance programs, impose restrictions on device manufacturer marketing practices,

and/or require tracking and reporting of gifts, compensation, and other remuneration to healthcare professionals and entities.

Foreign Corrupt Practices Act and similar anti-bribery laws in other countries, such as the UK Bribery Act, generally prohibit companies

and their intermediaries from making improper payments to government officials and/or other persons for the purpose of obtaining or retaining

Our policies mandate compliance with these anti-bribery laws.

of these federal and state fraud abuse laws can subject us to administrative, civil, and criminal penalties, including imprisonment,

substantial fines, penalties, damages, and exclusion from participation in federal healthcare programs, including Medicare and Medicaid.

Privacy and Security Laws

requires the notification of patients, and other compliance actions, in the event of a breach of unsecured PHI.

If notification to patients

of a breach is required, such notification must be provided without unreasonable delay and in no event later than 60 calendar days after

discovery of the breach.

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certain circumstances, criminal penalties with fines up to $250,000 per violation and/or imprisonment.

In addition, even

when HIPAA does not apply, according to the FTC, failing to take appropriate steps to keep consumers’ personal information secure

constitutes unfair acts or practices in or affecting commerce in violation of Section 5(a) of the FTCA, 15 U.S.C § 45(a).

FTC expects a company’s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer

addition, even when HIPAA does not apply, according to the FTC, failing to take appropriate steps to keep consumers’ personal information

secure constitutes unfair acts or practices in or affecting commerce in violation of Section 5(a) of the FTCA, 15 U.S.C § 45(a).

The FTC expects a company’s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer

information it holds, the size and complexity of its business, and the cost of available tools to improve security and reduce vulnerabilities.

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personal information is similar to what is required by the HIPAA Security Rule.

We are subject

to the supervision of local data protection authorities in those jurisdictions where we are established or otherwise subject to applicable

We depend on a number of third parties in relation to our provision of our services, a number of which process personal data on

With each such provider we enter into contractual arrangements to ensure that they only process personal data according to

our instructions, and that they have sufficient technical and organizational security measures in place.

Where we transfer personal data

outside the EEA, we do so in compliance with the relevant data export requirements.

are subject to the supervision of local data protection authorities in those jurisdictions where we are established or otherwise subject

to applicable law.

We depend on a number of third parties in relation to our provision of our services, a number of which process personal

data on our behalf.

With each such provider we enter into contractual arrangements to ensure that they only process personal data according

to our instructions, and that they have sufficient technical and organizational security measures in place.

Where we transfer personal

data outside the EEA, we do so in compliance with the relevant data export requirements.

We take our data protection obligations seriously,

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and/or our reputation.

Manufacturing and Supply

We do not manufacture

any products or component parts and currently use five contract manufacturers to produce all of our instruments, implants and sterilization

The majority of our instruments have a secondary manufacturing supplier, and we continually work with additional manufacturers

to establish secondary manufacturing suppliers.

Our contract manufacturers source and purchase all raw materials used in the manufacture

of The Catamaran System which includes mainly stainless steel and aluminum for our instruments and sterilization cases and titanium for

our implants.

We do not currently

have manufacturing agreements with any of our contract manufacturers and orders are controlled through purchase orders.

The Company does

not believe its relationship with any one contract manufacturer is material to its business.

We believe the

manufacturing operations of our contract manufacturers, and those of the suppliers of our manufacturers, comply with regulations mandated

by the FDA, as well as Medical Devices Directive regulations in the EEA.

Manufacturing facilities that produce medical devices or component

parts intended for distribution world-wide are subject to regulation and periodic planned and unannounced inspection by the FDA and other

domestic and international regulatory agencies.

In the United States,

the product we sell is required to be manufactured in compliance with the QSR, which covers the methods used in, and the facilities used

for, the design, testing, control, manufacturing, labelling, quality assurance, packaging, storage, and shipping.

We are required

to demonstrate continuing compliance with applicable regulatory requirements and will be subject to FDA inspections.

Further, we and

certain of our contract manufacturers are required to comply with all applicable regulations and current good manufacturing practices.

Manufacturing

do not manufacture any products or component parts and currently use five contract manufacturers to produce all of our instruments, implants

and sterilization cases.

The majority of our instruments have a secondary manufacturing supplier, and we continually work with additional

manufacturers to establish secondary manufacturing suppliers.

Our contract manufacturers source and purchase all raw materials used in

the manufacture of The Catamaran System and The SImmetry + System which includes mainly stainless steel and aluminum for our

instruments and sterilization cases and titanium for our implants.

do not currently have manufacturing agreements with any of our contract manufacturers and orders are controlled through purchase orders.

The Company does not believe its relationship with any one contract manufacturer is material to its business.

believe the manufacturing operations of our contract manufacturers, and those of the suppliers of our manufacturers, comply with regulations

mandated by the FDA, as well as Medical Devices Directive regulations in the EEA.

Manufacturing facilities that produce medical devices

or component parts intended for distribution world-wide are subject to regulation and periodic planned and unannounced inspection by

the FDA and other domestic and international regulatory agencies.

In addition, the cost and availability of certain of these items can

be subject to shifting trade policies around the world, including tariffs and trade protectionism measures that can impact the cost and/or

availability of components.

Prices of oil and gas also affect our costs for freight and utilities and have an indirect impact on the

cost of other purchased materials and components.

the United States, the products we sell are required to be manufactured in compliance with the QSR, which covers the methods used in,

and the facilities used for, the design, testing, control, manufacturing, labelling, quality assurance, packaging, storage, and shipping.

are required to demonstrate continuing compliance with applicable regulatory requirements and will be subject to FDA inspections.

we and certain of our contract manufacturers are required to comply with all applicable regulations and current good manufacturing practices.

As set forth above, these FDA regulations cover, among other things, the methods and documentation of the design, testing, production,

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which could, in turn, have a material adverse effect on our financial condition or results of operations.

Product Liability

and Insurance

The manufacture

and sale of our products subjects us to the risk of financial exposure to product liability claims.

Our products are used in situations

in which there is a risk of serious injury or death.

We carry insurance policies which we believe to be customary for similar companies

in our industry.

We cannot assure you that these policies will be sufficient to cover all or substantially all losses that we experience.

We endeavor to

maintain executive and organization liability insurance in a form and with aggregate coverage limits that we believe are adequate for

our business purposes.

Human Capital

As of March 26, 2025, we have a total of 27 employees, all of whom

are full-time, and four senior consulting advisors of various specialty including product development, general administrative and accounting.

None of our employees is subject to a collective bargaining agreement, and we consider our relationship with our employees to be good.

Our human capital

resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and new employees,

advisors and consultants.

The principal purposes of our equity and cash incentive plans are to attract, retain and reward personnel through

the granting of stock-based and cash-based compensation awards, in order to increase stockholder value and the success of our Company

by motivating such individuals to perform to the best of their abilities and achieve our objectives.

Corporate Information

We were incorporated

on June 6, 2012, in Delaware.

Our principal executive offices are located at 104 Cooper Court, Los Gatos, CA 95032 and our telephone

number is (408) 649-5760.

Liability and Insurance

manufacture and sale of our products subject us to the risk of financial exposure to product liability claims.

Our products are used

in situations in which there is a risk of serious injury or death.

We carry insurance policies which we believe to be customary for similar

companies in our industry.

We cannot assure you that these policies will be sufficient to cover all or substantially all losses that

we experience.

endeavor to maintain executive and organization liability insurance in a form and with aggregate coverage limits that we believe are

adequate for our business purposes.

Capital Resources

of March 27, 2026, we have a total of 26 employees, all of whom are full-time, and nine senior consulting advisors of various specialty

including product development, general administrative and quality control.

None of our employees is subject to a collective bargaining agreement,

and we consider our relationship with our employees to be good.

human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing

and new employees, advisors and consultants.

The principal purposes of our equity and cash incentive plans are to attract, retain and

reward personnel through the granting of stock-based and cash-based compensation awards, in order to increase stockholder value and the

success of our Company by motivating such individuals to perform to the best of their abilities and achieve our objectives.

were incorporated on June 6, 2012, in Delaware.

Our principal executive offices are located at 104 Cooper Court, Los Gatos, CA 95032

and our telephone number is (408) 649-5760.

Our website address is www.tenonmed.com.

The information on, or that can be accessed through,

our website is not part of this report.

The information on, or that can be

accessed through, our website is not part of this report.

We have included our website address as an inactive textual reference only.

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

What changed 10-K

Item 1. Business