Tenon Medical, Inc.
For the period ended Dec 31, 2024. Filed Mar 26, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 26, 2025
TNON$1.640.0%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-29.
0001213900-24-028010
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-26.
0001013762-25-002734
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 192 previous paragraphs and 192 current paragraphs.
170 unchanged; 7 reworded; 14 added; 15 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 116 previous and 115 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Our business is subject to many risks and uncertainties, which may affect our future financial performance. If any of the events or circumstances described below occur, our business and financial performance could be adversely affected, our actual results could differ materially from our expectations, and the price of our stock could decline. The risks and uncertainties discussed below are not the only ones we face. There may be additional risks and uncertainties not currently known to us or that we currently do not believe are material that may adversely affect our business and financial performance. You should carefully consider the risks described below, together with all other information included in this Annual Report on Form 10-K, including our financial statements and related notes, before making an investment decision. If any of the adverse developments described in the following risk factors actually occurs, our business, financial condition, or results of operations could be harmed. In that case, the trading price of our common stock could decline, and investors in our securities may lose all or part of their investment.
Current report
An active trading market for our shares may not be sustained.
Current report
Although our shares are listed on The Nasdaq Stock Market LLC, the market for our shares has demonstrated varying levels of trading activity. The current level of trading may not be sustained in the future. The lack of an active market for our shares may impair investors’ ability to sell their shares at the time they wish to sell them or at a price that they consider reasonable, may reduce the fair market value of their shares and may impair our ability to raise capital to continue to fund operations by selling shares and may impair our ability to acquire additional intellectual property assets by using our shares as consideration.
Current report
We may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. If additional capital is raised through the sale of equity or convertible debt securities, or perceptions that those sales could occur, the issuance of these securities could result in further dilution to investors purchasing our common stock in this offering or result in downward pressure on the price of our common stock, and our ability to raise capital in the future. We currently have an equity financing facility with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which we may sell up to $10 million in shares of common stock to Lincoln Park, all of which are covered by an effective registration statement that we have filed with the SEC. As of March 26, 2025, we have issued and sold 48,848 shares to Lincoln Park and may further sell approximately $9.7 million in additional shares to Lincoln Park.
Current report
We have effected one for eight and a one for ten reverse stock splits in the last two years and we may not be able to cure a Nasdaq listing deficiency if our stock price falls below $0.32 per share.
Current report
Under Nasdaq rules, a reverse stock split taken together with all other reverse stock splits that are effected in a two year period that is in excess of one for two hundred fifty (1:250) will not be accepted by Nasdaq as a method to regain compliance with the Bid Price Rule. Since November 2, 2023, we have affected two reverse stock splits which collectively are considered to have a ratio of one for eighty (1:80). Therefore, until November 3, 2025, Nasdaq will not accept additional reverse stock splits effected by us with a ratio greater than 1:3.125 as a method to regain compliance with the Bid Price Rule. Accordingly, until November 3, 2025, a reverse stock split acceptable to Nasdaq would likely not cure noncompliance with the Bid Price Rule if our stock was trading at or about $0.32 per share. If such an event were to occur, there is no certainty that any corporate action we could take or any event would occur that would result in an increase in our stock price necessary for us to regain compliance prior or allow for a reverse stock split with a ratio of 1:3.125 or less to result in compliance prior to a delisting of our common stock.
Current report
A delisting of our common stock and our inability to list on another national securities market could negatively impact us by: (i) reducing the liquidity and market price of our common stock; (ii) reducing the number of investors willing to hold or acquire our common stock, which could negatively impact our ability to raise equity financing; (iii) limiting our ability to use certain registration statements to offer and sell freely tradable securities, thereby limiting our ability to access the public capital markets; and (iv) impairing our ability to provide equity incentives to our employees.
Current report
Our share price is highly volatile. During the period from January 1, 2023, to March 26, 2025 the closing price of our common stock ranged from a high of $208.80 per share to a low of $0.98 per share. The stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, you may not be able to sell your common stock at or above the public offering price and you may lose some or all of your investment.
Current report
Our Series A Preferred Stock and Series B Preferred Stock rank senior to our common stock.
Current report
Our Series A Preferred Stock and Series B Preferred Stock rank, with respect to rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of our company, and redemption rights, senior to our common stock and each other class or series of securities now existing or hereafter authorized classified or reclassified, the terms of which do not expressly provide that such class or series ranks on a parity basis with or senior to the Series A Preferred Stock and Series B Preferred Stock as to rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of our company, and redemption rights.
Current report
Conversion of Series A Preferred Stock, the Series B Preferred Stock or the exercise of the Tradeable Warrants, Note Warrants, the Series A Warrants, the Series B Warrants, the New Warrants may cause significant dilution to our stockholders.
Current report
As of March 26, 2025, we have issued 256,968 shares of Series A Preferred Stock, which are convertible into 788,587 shares of common stock; 86,454 shares of Series B Preferred Stock, which are convertible into 108,074 shares of common stock; Tradeable Warrants with 250,000 underlying shares of common stock; Note Warrants with 5,625 underlying shares of common stock; Series A Warrants with 48,187 underlying shares of common stock, Series B Warrants with 16,214 underlying shares of common stock and New Warrants with 3,668,550 underlying shares of common stock. The issuance of shares of common stock upon the conversion of such shares of preferred stock or exercise of any of such warrants would dilute the percentage ownership interest of holders of our common stock, dilute the book value per share of our common stock, and increase the number of our publicly traded shares, which could further depress the market price of our common stock.
Current report
In addition, the Series A Warrants, Series B Warrants and the Note Warrants contain weighted average anti-dilution provisions which, subject to limited exceptions, would increase the number of shares issuable upon exercise of such securities (by reducing the exercise price) in the event that we in the future issue common stock, or securities convertible into or exercisable to purchase common stock, at a price per share lower than the exercise price then in effect.
Current report
We are required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely impact our public disclosures regarding our business, financial condition, or results of operations. In addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting, disclosure of management’s assessment of our internal controls over financial reporting or disclosure of our public accounting firm’s attestation to our report on management’s assessment of our internal controls over financial reporting may have an adverse impact on the price of our common stock.
Removed paragraphs (15)
Previous report
Investing in our common stock is highly speculative and involves a significant degree of risk. Before you invest in our securities, you should give careful consideration to the following risk factors, in addition to the other information included in this Annual Report on Form 10-K, including our financial statements and related notes, before deciding whether to invest in our securities. The occurrence of any of the adverse developments described in the following risk factors could materially and adversely harm our business, financial condition, results of operations or prospects. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment.
Previous report
Practice trends or other factors, including the COVID-19 pandemic, may cause procedures to shift from the hospital environment to ambulatory surgical centers (“ASCs”), where pressure on the prices of our products is generally more acute.
Previous report
To protect health care professionals involved in surgical care and their patients, we anticipate that more outpatient eligible procedures will be performed in ASCs during the COVID-19 pandemic, and as its acuity declines and the healthcare system returns to a more normalized state. Since patients do not stay overnight in ASCs and COVID-19 patients would not otherwise be treated in ASCs, it is likely that the ASC will be viewed as a safer site of service for patients and health care providers, where the risk of transmission of COVID-19 can be more effectively controlled. Because ASC facility fee reimbursement is typically less than facility fee reimbursement for hospitals, we typically experience more pressure on the pricing of our products by ASCs than by hospitals, and the average price for which we sell our products to ASCs is less than the average prices we charge to hospitals. An accelerated shift of procedures using our products to ASCs as a result of the COVID-19 pandemic could adversely impact the average selling prices of our products and our revenues could suffer as a result.
Previous report
The failure of Silicon Valley Bank could cause us to lose our deposits in excess of the federally insured bank deposit limitation.
Previous report
On March 10, 2023, the Federal Deposit Insurance Corporation (the “FDIC”) took control of Silicon Valley Bank (“SVB”) and created the National Bank of Santa Clara to hold the deposits of SVB after SVB was unable to continue their operations. SVB’s deposits are insured by the FDIC in amount up to $250,000 for any depositor and any deposit in excess of this insured amount could be lost. As of March 10, 2023, we had approximately $585,000 on deposit with SVB, of which approximately $335,000 will not be insured by the FDIC (the “Uninsured Amount”). We expect to have access to the insured portion of our SVB deposit in the coming days, but do not know when, if ever, we will have access to the Uninsured Amount. The loss of all or a significant portion of the Uninsured Amount would not have an adverse effect on our ability to pay our operational expenses or make other payments, but may require the Company to move our accounts to another bank which could cause a temporary delay in making payments to our vendors and employees and cause other operational inconveniences.
Previous report
The market for our common stock is new and may not develop to provide investors with adequate liquidity.
Previous report
We conducted our initial public offering in April of 2022. Therefore, the market for our common stock is new, and we cannot assure you that an active trading market for our common stock will develop, or if it does develop, it may not be maintained. You may not be able to sell your common stock quickly or at the market price if trading in our securities is not active.
Previous report
The price and volume of our common stock may rapidly fluctuate or may decline regardless of our operating performance, resulting in substantial losses for investors.
Previous report
Sales of a substantial number of shares of our common stock in the public or the perception that these sales could occur, could adversely affect the market price of our common stock, and may make it more difficult for holders of our common stock to sell their common stock at a time and price that you deem appropriate and affect our ability to raise capital through the sale of equity securities.
Previous report
We may issue our shares of common stock or securities convertible into our common stock from time to time in connection with a financing, acquisition, investments or otherwise. Any such issuance could result in substantial dilution to our existing stockholders and cause the trading price of our common stock to decline.
Previous report
We may not be able to satisfy listing requirements of Nasdaq to maintain a listing of our common stock.
Previous report
We must meet certain financial and liquidity criteria to maintain the listing of our common stock on the Nasdaq Stock Market LLC (“Nasdaq”). If we violate the maintenance requirements for continued listing of our common stock, our common stock may be delisted. In addition, our board of directors may determine that the cost of maintaining our listing on a national securities exchange outweighs the benefits of such listing. A delisting of our common stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock. In addition, the delisting of our common stock could significantly impair our ability to raise capital.
Previous report
On January 4, 2024, we received a written notice (the “Notice”) from Nasdaq dated January 4, 2024, indicating that, as a result of Frank Fischer’s resignation from the Board, audit committee of the Board (the “Audit Committee”) and compensation committee of the Board (the “Compensation Committee”), effective November 30, 2023, that the Company was not currently in compliance with Nasdaq Listing Rule 5605, which requires that (i) a majority of the Board be comprised of independent directors, (ii) the Audit Committee is comprised of at least three independent directors and (iii) the Compensation Committee is comprised of at least two independent directors. Kristine Jacques was appointed to the Board on March 25, 2024 and as a result, as of March 25, 2024, the Company partly complied with Nasdaq Listing Rule 5605, specifically the requirement that a majority of the Board be comprised of independent directors. The Audit Committee, however, currently is comprised of only two independent directors and the Compensation Committee is only comprised of one independent director. In accordance with Nasdaq Listing Rule 5605(b)(1)(A), the Company has a “cure period” of until the earlier of the Company’s next annual shareholders’ meeting or November 30, 2024, or if the next annual shareholders’ meeting is held before May 28, 2024, then the Company must evidence compliance no later than May 28, 2024. The Company intends to elect one or more independent directors to serve as a member of the Audit Committee and the Compensation Committee during this cure period.
Previous report
The Notice has no immediate effect on v listing or trading of the Company’s common stock on The Nasdaq Capital Market.
Reworded paragraphs (7)
Previous wording
The Medicare 2022 national average hospital inpatient payment ranges from approximately $25,000 to approximately $59,000 depending on the procedural approach and the presence of Complication and Comorbidity (CC)/Major Complication and Comorbidity**(MCC)**.
Current wording
The Medicare 2023 national average hospital inpatient payment ranges from approximately $25,661 to approximately $46,437 depending on the procedural approach and the presence of Complication and Comorbidity (CC)/Major Complication and Comorbidity**(MCC)**.
Previous wording
The Medicare 2022 national average hospital outpatient clinic payment is $21,897. We believe that insurer payments to facilities are generally adequate for these facilities to offer the Catamaran System. However, there can be no guarantee that these facility payments will not decline in the future. The number of procedures performed, and the prices paid for our implants may in the future decline if payments to facilities for SI-Joint fusions decline.
Current wording
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. However, there can be no guarantee that these facility payments will not decline in the future. The number of procedures performed, and the prices paid for our implants may in the future decline if payments to facilities for SI-Joint fusions decline.
Previous wording
The Tax Act as modified by the CARES Act is unclear in many respects and could be subject to potential amendments and technical corrections, as well as interpretations and implementing regulations by the Treasury and IRS, any of which could lessen or increase certain adverse impacts of the legislation. In addition, it is unclear how these U.S. federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities. Our analysis and interpretation of this legislation is preliminary and ongoing and there may be material adverse effects resulting from the legislation that we have not yet identified. While some of the changes made by the tax legislation may adversely affect us, other changes may be beneficial. We continue to work with our tax advisors and auditors to determine the full impact that the recent tax legislation as a whole will have on us. We urge our investors to consult with their legal and tax advisors with respect to such legislation and its potential effect on an investment in our common stock.
Current wording
The Tax Act as modified by the CARES Act is unclear in many respects and could be subject to potential amendments and technical corrections, as well as interpretations and implementing regulations by the Treasury and IRS, any of which could lessen or increase certain adverse impacts of the legislation. In addition, it is unclear how these U.S. federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities. Our analysis and interpretation of this legislation is preliminary and ongoing and there may be material adverse effects resulting from the legislation that we have not yet identified. While some of the changes made by the tax legislation may adversely affect us, other changes may be beneficial. We continue to work with our tax advisors to determine the full impact that the recent tax legislation as a whole will have on us. We urge our investors to consult with their legal and tax advisors with respect to such legislation and its potential effect on an investment in our common stock.
Previous wording
We rely primarily on patent, copyright, trademark and trade secret laws, as well as confidentiality and non- disclosure agreements and other methods, to protect our proprietary technologies and know-how. As of March 29, 2024, we owned eight issued patents (four domestic and four foreign), eighteen pending patent applications (sixteen domestic and two foreign), thirteen registered trademarks (seven domestic and six foreign) and twelve pending domestic trademark applications.
Current wording
We rely primarily on patent, copyright, trademark and trade secret laws, as well as confidentiality and non- disclosure agreements and other methods, to protect our proprietary technologies and know-how. As of March 26, 2025, we owned 12 issued patents (eight domestic and four foreign), 23 pending patent applications (21 domestic and two foreign), thirteen registered trademarks (seven domestic and six foreign) and twelve pending domestic trademark applications.
Previous wording
Sales of substantial amounts of our common stock in the public markets, or the perception that sales might occur, could reduce the price of our common stock and may dilute our current stockholders voting power and their ownership interest in us.
Current wording
Future sales of substantial amounts of our common stock could adversely affect the market price of our common stock.
Previous wording
The trading price of our common stock may be subject to instances of extreme stock price run-ups followed by rapid price declines and stock price volatility unrelated to both our actual and expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our stock. Further, the trading price of our common stock could be highly volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control, including limited trading volume, actual or anticipated fluctuations in our results of operations; the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; failure of securities analysts to initiate or maintain coverage of our Company, changes in financial estimates or ratings by any securities analysts who follow our Company or our failure to meet these estimates or the expectations of investors; announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures, operating results or capital commitments; changes in operating performance and stock market valuations of other companies in our industry; price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; changes in our Board or management; sales of large blocks of our Common Stock, including sales by our executive officers, directors and significant stockholders; lawsuits threatened or filed against us; changes in laws or regulations applicable to our business; the expiration of lock-up agreements; changes in our capital structure, such as future issuances of debt or equity securities; short sales, hedging and other derivative transactions involving our capital stock; general economic and geopolitical conditions, including the current or anticipated impact of military conflict and related sanctions imposed on Russia by the United States and other countries due to Russia’s recent invasion of Ukraine; and the other factors described in this section of the report captioned “Risk Factors.”
Current wording
The trading price of our common stock has been and is likely to continue to be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control.
Previous wording
At present, management has identified a material weakness due to lack of segregation of duties. The lack of segregation of duties existed as a result of the Company having no employees until June 2021. Management has taken initial steps to remedy this weakness by hiring a Chief Financial Officer, a director of SEC reporting and compliance, and a senior accountant, and engaging a cost accounting consultant and external financial consultants, and plans to continue to add additional resources, technology and headcount as warranted by the growth of the Company. While we believe these efforts will improve our internal controls and address the underlying causes of the material weakness, such material weakness will not be remediated until our remediation plan has been fully implemented and we have concluded that our controls are operating effectively for a sufficient period of time. We cannot be certain that the steps we are taking will be sufficient to remediate the control deficiencies that led to our material weakness in our internal control over financial reporting or prevent future material weaknesses or control deficiencies from occurring. While we are working to remediate the material weakness as timely and efficiently as possible, at this time we cannot provide an estimate of costs expected to be incurred in connection with the implementation of this remediation plan, nor can we provide an estimate of the time it will take to complete this remediation plan. Even if management does establish effective remedial measures, we cannot guarantee that those internal controls and disclosure controls that we put in place will prevent all possible errors, mistakes, or all fraud.
Current wording
While we believe these efforts will improve our internal controls and address the underlying causes of the material weakness, such material weakness will not be remediated until our remediation plan has been fully implemented and we have concluded that our controls are operating effectively for a sufficient period of time. We cannot be certain that the steps we are taking will be sufficient to remediate the control deficiencies that led to our material weakness in our internal control over financial reporting or prevent future material weaknesses or control deficiencies from occurring. While we are working to remediate the material weakness as timely and efficiently as possible, at this time we cannot provide an estimate of costs expected to be incurred in connection with the implementation of this remediation plan, nor can we provide an estimate of the time it will take to complete this remediation plan. Even if management does establish effective remedial measures, we cannot guarantee that those internal controls and disclosure controls that we put in place will prevent all possible errors, mistakes, or all fraud.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
At present, management has identified a material weakness due to lack of segregation of duties. The lack of segregation of duties existed as a result of our having no employees until June 2021. Management has taken steps to remedy this deficiency by its hiring of a Chief Financial Officer, a director of SEC reporting and compliance, a senior accountant, a cost accountant and external financial consultants, and plans to continue to add additional resources, technology and headcount as warranted by our growth. We are in the process of putting proper policies and procedures in place to ensure that proper documentation is established and maintained for transactions that we enter into. On May 20, 2024, it was announced that our Chief Financial Officer was retiring effective July 31, 2024 while continuing to assist us as Chief Financial Officer Advisor. On August 27, 2024, we announced the hiring of our new Chief Financial Officer, effective September 3, 2024.