INSEEGO CORP.
For the period ended Dec 31, 2025. Filed Feb 20, 2026.
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.
FY2025 · Filed Feb 20, 2026
INSG$3.88-1.4%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
0001022652-25-000005
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-20.
0001022652-26-000005
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 233 previous paragraphs and 235 current paragraphs.
205 unchanged; 24 reworded; 6 added; 4 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 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 (6)
Current report
•We may rely on borrowings under the Working Capital Facility and the accounts receivable securitization facility to provide funds to operate our business and make capital expenditures, and our business could be adversely affected if those facilities are not available to be drawn, or amounts available to be drawn are reduced.
Current report
•Tariffs and other trade restrictions may have an adverse impact on our business, operations and financial results.
Current report
We may rely on borrowings under the Working Capital Facility to provide funds to operate our business and make capital expenditures, and our business could be adversely affected if those facilities are not available to be drawn, or amounts available to be drawn are reduced.
Current report
In order to support our operations and make capital expenditures, we may borrow funds under the Working Capital Facility. The amount of borrowings permitted at any time under the Working Capital Facility is limited to a periodic borrowing base valuation of the collateral thereunder. Borrowings under the Working Capital Facility are principally supported by pledges of inventory and accounts receivable. As a result, our access to credit under the Working Capital Facility is potentially subject to significant fluctuations depending on the value of the borrowing base of eligible assets as of any measurement date, and, in the case of the Working Capital Facility, certain discretionary rights of the agent in respect of the calculation of such borrowing base value. If our access to such financing was unavailable or reduced, our liquidity, results of operations and financial position may be adversely affected, which could cause material harm to our business. In addition, if certain of our lenders experience difficulties that render them unable to fund future draws on the facilities, we may not be able to access all or a portion of these funds, which could have similar adverse consequences.
Current report
Tariffs and other trade restrictions may have an adverse impact on our business, operations and financial results.
Current report
We source materials from, and manufacture products in, foreign countries, including countries in Asia, and we also sell products in foreign countries. As a result, the price and availability of our products is susceptible to international trade risks and other international conditions. For example, any economic and political uncertainty caused by the tariffs imposed on goods from other countries by the current administration of the United States, and any corresponding tariffs or currency devaluations from other countries in response, may negatively impact demand and/or increase the cost for certain of our products. Furthermore, the imposition of additional tariffs, duties, border adjustment taxes or other trade restrictions by the United States could result in the adoption of additional or increased tariffs or other trade restrictions by other countries. Tariffs may in the future increase our cost of materials and may cause us to increase prices to our customers, which we believe may reduce demand for our products. Our price increases may not be sufficient to fully offset the impact of tariffs and may result in lowering our margin on products sold. In sum, if the United States Government increases or implements additional tariffs, or if additional tariffs or trade restrictions are implemented by other countries, the resulting trade barriers could have a significant adverse impact on our suppliers, our customers and on our business. The volatility and unpredictability of international trade policies and conditions add further complexity to our operations, making it challenging to forecast and plan effectively. We are not able to predict future trade policy of the United States or of any foreign countries in which we operate or purchase goods, or the terms of any trade agreements or their impact on our business. The adoption and expansion of trade restrictions and tariffs, quotas and embargoes, the occurrence or threat of a trade war or other governmental action related to tariffs or trade agreements or policies, has the potential to adversely impact demand for our products, our costs, our customers, our suppliers and the world and U.S. economies, which in turn could have a material adverse effect on our business, operating results and financial condition.
Removed paragraphs (4)
Previous report
•Our outstanding Series E Preferred Stock or future equity offerings could adversely affect the valuationand/or holdersof our common stock.
Previous report
The 2025 Convertible Notes are currently convertible at the option of the holders at any time until close of business on the business day immediately preceding the maturity date. The 2025 Convertible Notes are convertible into shares of the Company’s common stock at a conversion rate of 7.92896 shares of common stock per $1,000 principal amount of 2025 Convertible Notes (which is equivalent to an initial conversion price of $126.12 per share of common stock). The conversion rate is subject to adjustment if certain events occur, but in no event will the conversion rate exceed 9.51474 shares of common stock per $1,000 principal amount of 2025 Convertible Notes (which is equivalent to a conversion price of $105.10 per share of common stock). Holders of the 2025 Convertible Notes who convert may also be entitled to receive, under certain circumstances, an interest make-whole payment payable in, at our election, either cash or shares of common stock. If holders of our outstanding warrants exercise their warrants or holders of the 2025 Convertible Notes elect to convert their 2025 Convertible Notes into common stock, we elect to settle any interest make-whole payments due upon conversion of the 2025 Convertible Notes with shares of common stock, we issue shares of common stock in connection with a future refinancing of the 2025 Convertible Notes and/or we issue shares upon vesting of outstanding equity awards, this may cause significant dilution to our existing stockholders. Any sales in the public market of the common stock issued upon such exercises or conversions could adversely affect prevailing market prices of our common stock. If we do elect to settle any interest make-whole payments due upon conversion of the 2025 Convertible Notes with cash, such payments could adversely affect our liquidity.
Previous report
Our outstanding Series E Preferred Stock or future equity offerings could adversely affect the valuation and/or holders of our common stock.
Previous report
As of December 31, 2024, there were 25,000 shares of Series E Fixed-Rate Cumulative Perpetual Preferred Stock, par value $0.001 per share (the “Series E Preferred Stock”) outstanding with an aggregate liquidation preference of $38.4 million. The Series E Preferred Stock is senior to our shares of common stock in right of payment of dividends and other distributions. In the event of a liquidation, dissolution or winding up of the Company, the holders of the Series E Preferred Stock will be entitled to receive, after satisfaction of liabilities to creditors and subject to the rights of holders of any senior securities, but before any distribution of assets is made to holders of common stock or any other junior securities, the Series E Base Amount (as defined below) in Note 8 – Stockholders' Equity (Deficit) in the Notes to the Consolidated Financial Statements) plus (without duplication) any accrued and unpaid dividends. In the future, we may offer additional shares of Series E Preferred Stock or other equity, equity-linked or debt securities, which may have rights, preferences or privileges senior to our common stock. Because our decision to issue debt or equity securities or incur other borrowings in the future will depend on market conditions and other factors beyond our control, the amount, timing, nature or success of our future capital raising efforts is uncertain. Thus, holders of our common stock bear the risk that our future issuances of debt or equity securities or our incurrence of other borrowings may negatively affect the market price of our common stock.
Reworded paragraphs (24)
Previous wording
•We depend upon two customers for a substantial portion of our revenues, and our business would be negatively affected by an adverse change in our dealings with either of these customers.
Current wording
•We depend upon two customers for a substantial portion of our revenues, and our business would be negatively affected by an adverse change in our business with either of these customers.
Previous wording
•If customers do not adopt our software, we may not be able to monetize these software assets and realize a key part of our growth and profitability strategy.
Current wording
•If customers do not adopt and/or renew our software services, we may not be able to monetize these software assets and realize a key part of our growth and profitability strategy.
Previous wording
•We are required to comply with certain covenants under the terms of our 2029 Senior Secured Notes (as defined below) and, if we fail to meet those covenants or otherwise suffer a default thereunder, our lenders may accelerate the payment of such obligations.
Current wording
•We are required to comply with certain financial and other covenants under the terms of our 2029 Senior Secured Notes and our Working Capital Facility (as defined below) and, if we fail to meet those financial or other covenants or otherwise suffer a default thereunder, our lenders may accelerate the payment of such obligations.
Previous wording
•Future issuances of common stock upon exercise of warrants or pursuant to employee equity awards, or settlements of any conversion obligations with respect to the 2025 Convertible Notes, as defined below, may result in dilution to existing stockholders, lower prevailing market prices for our common stock or require a significant cash outlay.
Current wording
•Future issuances of common stock upon exercise of warrants or pursuant to employee equity awards may result in dilution to existing stockholders, lower prevailing market prices for our common stock or require a significant cash outlay.
Previous wording
We depend upon two customers for a substantial portion of our revenues, and our business would be negatively affected by an adverse change in our dealings with either of these customers.
Current wording
We depend upon two customers for a substantial portion of our revenues, and our business would be negatively affected by an adverse change in our business with either of these customers.
Previous wording
Sales to Verizon Wireless and T-Mobile collectively accounted for 76% and 69% of our consolidated revenues for the years ended December 31, 2024 and 2023, respectively. Revenues from T-Mobile generated through our wireless subscriber management solution (Inseego Subscribe) makes up a substantial majority of our Services and Other revenue. While we have accelerated our engagements with prospective new customers and continue to focus on growing revenue in other parts of our business, we expect that Verizon Wireless and T-Mobile will continue to account for a substantial portion of our revenues, and any impairment of our relationship or reduction in our services with Verizon Wireless or T-Mobile would adversely affect our business and financial position. Additionally, any change in the forecasted or actual product sell-through of Verizon Wireless or T-Mobile could have a detrimental impact on our revenue, bottom line and cash position.
Current wording
Sales to Verizon Wireless and T-Mobile collectively accounted for 89% and 76% of our consolidated revenues for the years ended December 31, 2025 and 2024, respectively. Revenues from T-Mobile generated through our wireless subscriber lifecycle management solution (Inseego Subscribe) makes up a substantial majority of our Software Services and Other revenue. While we have accelerated our engagements with prospective new customers and continue to focus on growing revenue in other parts of our business, we expect that Verizon Wireless and T-Mobile will continue to account for a substantial portion of our revenues, and any impairment of our relationship or reduction in our services with Verizon Wireless or T-Mobile would adversely affect our business and financial position. Additionally, any change in the forecasted or actual product sell-through of Verizon Wireless or T-Mobile could have a detrimental impact on our revenue, bottom line and cash position.
Previous wording
We generally seek to sell our software and enterprise solutions pursuant to customer agreements with multi-year terms and subscriptions. However, our customers have no obligation to renew these agreements after their initial terms expire. We also actively seek to sell additional solutions to our existing customers. If our efforts to satisfy our existing customers are not successful, we may not be able to retain them or sell additional functionality to them and, as a result, our revenue and ability to grow could be adversely affected. Customers may choose not to renew their subscriptions for many reasons, including the belief that our service is not required for their business needs or is otherwise not cost-effective, a desire to reduce discretionary spending, or a belief that our competitors’ services provide better value. Additionally, our customers may not renew for reasons entirely out of our control, such as the dissolution of their business or an economic downturn in their industry. A significant increase in our churn rate would have an adverse effect on our business, financial condition, and operating results.
Current wording
We generally seek to sell our software services and enterprise solutions pursuant to customer agreements with multi-year terms and subscriptions. However, our customers have no obligation to renew these agreements after their initial terms expire. We also actively seek to sell additional solutions to our existing customers. If our efforts to satisfy our existing customers are not successful, we may not be able to retain them or sell additional functionality to them and, as a result, our revenue and ability to grow could be adversely affected. Customers may choose not to renew their subscriptions for many reasons, including the belief that our service is not required for their business needs or is otherwise not cost-effective, a desire to reduce discretionary spending, or a belief that our competitors’ services provide better value. Additionally, our customers may not renew for reasons entirely out of our control, such as the dissolution of their business or an economic downturn in their industry. A significant increase in our churn rate would have an adverse effect on our business, financial condition, and operating results.
Previous wording
If customers do not adopt our software, we may not be able to monetize these software assets and realize a key part of our growth and profitability strategy.
Current wording
If customers do not adopt and/or renew our software services, we may not be able to monetize these software assets and realize a key part of our growth and profitability strategy.
Previous wording
•Mobile broadband – Companies such as Netgear, Franklin Wireless, TCL and ZTE
Current wording
•Mobile broadband – Companies such as Netgear, Franklin Wireless, TCL, ZTE, Orbic, and Sonim
Previous wording
•Fixed wireless access – Companies such as Nokia, Cradlepoint, ZTE, Huawei and Cisco
Current wording
•Fixed wireless access – Companies such as Nokia, Ericsson Wireless Solutions, ZTE, Peplink, Teltonika and Cisco
Previous wording
We currently outsource the manufacturing of many of our products to companies including Foxconn, Inventec Appliances Corporation and AsiaTelco Technologies Co. If one of these third-party manufacturers were to experience delays, disruptions, capacity constraints or quality control problems in its manufacturing operations, product shipments to our customers could be delayed or rejected or our customers could consequently elect to change product demand or cancel the underlying subscription or service. These disruptions would negatively impact our revenues, competitive position and reputation. Further, if we are unable to manage successfully our relationship with a manufacturer, the quality and availability of products used in our services and solutions may be harmed. None of our third-party manufacturers are obligated to supply us with a specific quantity of products, except as may be provided in a particular purchase order that we have submitted to, and that has been accepted by, such third-party manufacturer. Our third-party manufacturers could, under some circumstances, decline to accept new purchase orders from us or otherwise reduce their business with us. If a manufacturer stopped manufacturing our products for any reason or reduced manufacturing capacity, we may be unable to replace the lost manufacturing capacity on a timely and comparatively cost-effective basis, which would adversely impact our operations. In addition, we generally do not enter into long-term contracts with our manufacturers. As a result, we are subject to price increases due to availability, and subsequent price volatility, in the marketplace of the components and materials needed to manufacture our products. If a third-party manufacturer were to negatively change the product pricing and other terms under which it agrees to manufacture for us and we were unable to locate a suitable alternative manufacturer, our manufacturing costs could increase.
Current wording
We currently outsource the manufacturing of many of our products to companies including Foxconn and Inventec Appliances Corporation. If one of these third-party manufacturers were to experience delays, disruptions, capacity constraints or quality control problems in its manufacturing operations, product shipments to our customers could be delayed or rejected or our customers could consequently elect to change product demand or cancel the underlying subscription or service. These disruptions would negatively impact our revenues, competitive position and reputation. Further, if we are unable to manage successfully our relationship with a manufacturer, the quality and availability of products used in our services and solutions may be harmed. None of our third-party manufacturers are obligated to supply us with a specific quantity of products, except as may be provided in a particular purchase order that we have submitted to, and that has been accepted by, such third-party manufacturer. Our third-party manufacturers could, under some circumstances, decline to accept new purchase orders from us or otherwise reduce their business with us. If a manufacturer stopped manufacturing our products for any reason or reduced manufacturing capacity, we may be unable to replace the lost manufacturing capacity on a timely and comparatively cost-effective basis, which would adversely impact our operations. In addition, we generally do not enter into long-term contracts with our manufacturers. As a result, we are subject to price increases due to availability, and subsequent price volatility, in the marketplace of the components and materials needed to manufacture our products. If a third-party manufacturer were to negatively change the product pricing and other terms under which it agrees to manufacture for us and we were unable to locate a suitable alternative manufacturer, our manufacturing costs could increase.
Previous wording
Our services use hardware and software from various third parties, some of which are procured from single suppliers. For example our MiFi mobile hotspots and fixed wireless access devices rely substantially on chipsets from Qualcomm. From time to time, certain components used in our products or solutions have been in short supply or their anticipated commercial introduction has been delayed or their availability has been interrupted for reasons outside our control. If there is a shortage or interruption in the availability to us of any such components and we cannot timely obtain a commercially and technologically suitable substitute or make sufficient and timely design or other modifications to permit the use of such a substitute component, we may not be able to timely deliver sufficient quantities of our products or solutions to satisfy our contractual obligations and may not be able to meet particular revenue expectations. Moreover, even if we timely locate a substitute part or product, but its price materially exceeds the original cost of the component or product, then our results of operations could be adversely affected.
Current wording
Our services use hardware and software from various third parties, some of which are procured from single suppliers. For example our MiFi mobile hotspots and fixed wireless access devices rely substantially on chipsets from Qualcomm. From time to time, certain components used in our products or solutions have been in short supply or their anticipated commercial introduction has been delayed or their availability has been interrupted for reasons outside our control. As an example, there is currently a worldwide shortage of memory chips, which could impact our operations if we are unable to secure adequate supply of memory chips for our products. In addition our financial results could be impacted if we obtain memory chips at inflated prices and are unable to pass on these price increases to our customers. If there is a shortage or interruption in the availability to us of any such components and we cannot timely obtain a commercially and technologically suitable substitute or make sufficient and timely design or other modifications to permit the use of such a substitute component, we may not be able to timely deliver sufficient quantities of our products or solutions to satisfy our contractual obligations and may not be able to meet particular revenue expectations. Moreover, even if we timely locate a substitute part or product, but its price materially exceeds the original cost of the component or product, then our results of operations could be adversely affected.
Previous wording
As of December 31, 2024, we had outstanding indebtedness of approximately $55.8 million, including $40.9 million in outstanding principal amount of our 9.0% senior secured notes due in 2029 (the “2029 Senior Secured Notes”) and $14.9 million in outstanding principal amount of our 3.25% convertible senior notes due in 2025 (the “2025 Convertible Notes”). The 2029 Senior Secured Notes have a maturity date of May 1, 2029, and the 2025 Convertible Notes have a maturity date of May 1, 2025.
Current wording
As of December 31, 2025, we had outstanding indebtedness of approximately $40.9 million in outstanding principal amount of our 9.0% senior secured notes due in 2029 (the “2029 Senior Secured Notes”). On January 14, 2026 we issued an additional $8.0 million in principal amount of the 2029 Senior Secured Notes in connection with the repurchase of our Preferred Stock. The 2029 Senior Secured Notes have a maturity date of May 1, 2029.
Previous wording
We are required to comply with certain covenants under the terms of our 2029 Senior Secured Notes and, if we fail to meet those covenants or otherwise suffer a default thereunder, our lenders may accelerate the payment of such obligations.
Current wording
We are required to comply with certain financial and other covenants under the terms of our 2029 Senior Secured Notes and our Working Capital Facility and, if we fail to meet those financial or other covenants or otherwise suffer a default thereunder, our lenders may accelerate the payment of such obligations.
Previous wording
The Indenture that sets forth the terms of the 2029 Senior Secured Notes (the “2029 Senior Secured Notes Indenture”) contains various covenants which put certain restrictions on our ability to incur liens, sell or transfer assets, incur other indebtedness, pay dividends, make investments, enter into transactions with affiliates, make other distributions or payments on account of any redemption, retirement or purchase of any capital stock or pay certain other indebtedness. The restrictions in the 2029 Senior Secured Notes Indenture impose operating and financial restrictions on us and may limit our ability to compete effectively, take advantage of new business opportunities or take other actions that may be in our, or our stockholders’, best interests. Further, various risks and uncertainties may impact our ability to comply with our obligations under the 2029 Senior Secured Notes Indenture. Our obligations under the 2029 Senior Secured Notes are secured by a continuing security interest in all property (other than certain excluded collateral) of the Company and each of the borrower parties.
Current wording
The Indenture that sets forth the terms of the 2029 Senior Secured Notes (the “2029 Senior Secured Notes Indenture”) and the credit agreement that sets forth the terms of the Working Capital Facility (the “Working Capital Facility Agreement”) contain various covenants which put certain restrictions on our ability to incur liens, sell or transfer assets, incur other indebtedness, pay dividends, make investments, enter into transactions with affiliates, make other distributions or payments on account of any redemption, retirement or purchase of any capital stock or pay certain other indebtedness. The restrictions in the 2029 Senior Secured Notes Indenture and the Working Capital Facility impose operating and financial restrictions on us and may limit our ability to compete effectively, take advantage of new business opportunities or take other actions that may be in our, or our stockholders’, best interests. Further, various risks and uncertainties may impact our ability to comply with our obligations under the 2029 Senior Secured Notes Indenture and the Working Capital Facility Agreement. Our obligations under the 2029 Senior Secured Notes and the Working Capital Facility are secured by a continuing security interest in all property (other than certain excluded collateral) of the Company and each of the obligors or borrower parties thereunder, respectively.
Previous wording
Our inability to comply with any of the provisions of the 2029 Senior Secured Notes Indenture could result in a default under it. If such a default occurs, the lenders may elect to demand payment in full of all or any portion of our obligations under the 2029 Senior Secured Notes and, among other remedies, foreclose on our assets. The occurrence of any of these events could have a material adverse effect on our business, financial condition, results of operations and liquidity.
Current wording
Our inability to comply with any of the provisions of the 2029 Senior Secured Notes Indenture or the Working Capital Facility Agreement could result in a default under such applicable agreement. If such a default occurs, the noteholders or the lenders, as applicable may elect to demand payment in full of all or any portion of our obligations under the 2029 Senior Secured Notes or the Working Capital Facility, as applicable and, among other remedies, foreclose on our assets. The occurrence of any of these events could have a material adverse effect on our business, financial condition, results of operations and liquidity.
Previous wording
There is currently significant uncertainty about the future relationship between the United States and various other countries, most significantly China, with respect to trade policies, treaties, tariffs and taxes. Recent U.S. administrations have have implemented substantial changes to U.S. foreign trade policy with respect to China and other countries, including significant new and increased tariffs on goods imported into the United States. The current U.S. administration has announced increased tariffs and may put additional tariffs in place in the future. Our business may also be affected by tariffs set by countries into which we sell our products, whether as a response to U.S. foreign trade policy or otherwise. In addition, changes in international trade agreements, regulations, restrictions and tariffs, including new tariffs, may increase our operating costs, reduce our margins and make it more difficult for us to compete in the U.S. and overseas markets, and our business, financial condition and results of operations could be adversely impacted.
Current wording
There is currently significant uncertainty about the future relationship between the United States and various other countries, with respect to trade policies, treaties, tariffs and taxes. Recent U.S. administrations have have implemented substantial changes to U.S. foreign trade policy with respect to China and other countries, including significant new and increased tariffs on goods imported into the United States. The current U.S. administration has announced increased tariffs and may put additional tariffs in place in the future. Our business may also be affected by tariffs set by countries into which we sell our products, whether as a response to U.S. foreign trade policy or otherwise. In addition, changes in international trade agreements, regulations, restrictions and tariffs, including new tariffs, may increase our operating costs, reduce our margins and make it more difficult for us to compete in the U.S. and overseas markets, and our business, financial condition and results of operations could be adversely impacted.
Previous wording
At December 31, 2024, the Company had U.S. federal net operating loss carryforwards (“NOLs”) related to tax years 2022 and prior of approximately $355.4 million. Approximately $107.2 million of these NOLs have no expiration date. The remainder will begin to expire in 2030, unless previously utilized. Some of these NOLs may be limited by either past or future changes in control events. The Company has California NOLs at December 31, 2024 of approximately $64.4 million, which begin to expire in 2031, unless previously utilized, and no foreign NOLs for its active foreign subsidiaries . At December 31, 2024, the Company had federal research and development tax credit carryforwards, net of unrecognized tax benefits, of approximately $11.4 million, which begin to expire in 2026, unless previously utilized, and California research and development tax credit carryforwards, net of unrecognized tax benefits, of approximately $11.4 million, which have no expiration date. It is possible that we will not generate taxable income in time to use these NOLs before their expiration and additional NOLs will expire unused.
Current wording
At December 31, 2025, the Company had U.S. federal net operating loss carryforwards (“NOLs”) related to tax years 2025 and 2022 and prior of approximately $374.0 million. Approximately $119.6 million of these NOLs have no expiration date. The remainder will begin to expire in 2030, unless previously utilized. Some of these NOLs may be limited by either past or future changes in control events. The Company has California NOLs at December 31, 2025 of approximately $64.8 million, which begin to expire in 2031, unless previously utilized, and no foreign NOLs for its active foreign subsidiaries. At December 31, 2025, the Company had federal research and development tax credit carryforwards, net of unrecognized tax benefits, of approximately $11.7 million, which begin to expire in 2026, unless previously utilized, and California research and development tax credit carryforwards, net of unrecognized tax benefits, of approximately $11.9 million, which have no expiration date. It is possible that we will not generate taxable income in time to use these NOLs before their expiration and additional NOLs will expire unused.
Previous wording
Under legislative changes made in December 2017, as modified by federal tax law changes enacted in March 2020, U.S. federal net operating losses incurred in tax years beginning after December 31, 2017 and in future years may be carried forward indefinitely, but, for tax years beginning after December 31, 2020, the deductibility of such net operating losses is limited. In addition, the federal and state net operating loss carryforwards and certain tax credits may be subject to significant limitations under Section 382 and Section 383 of the Internal Revenue Code of 1986, as amended, or the Code, respectively, and similar provisions of state law. Under those sections of the Code, if a corporation undergoes an "ownership change," the corporation's ability to use its pre-change net operating loss carryforwards and other pre-change attributes, such as research tax credits, to offset its post-change income or tax may be limited. In general, an "ownership change" will occur if there is a cumulative change in our ownership by "5-percent shareholders" that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under state tax laws. We have completed a Section 382 review and have determined that none of the operating losses will expire solely due to Section 382 limitation(s). However, we may experience ownership changes in the future as a result of future shifts in our stock ownership, some of which may be outside of our control. If an ownership change occurs and our ability to use our net operating loss carryforwards and tax credits is materially limited, it would harm our business by effectively increasing our future tax obligations.
Current wording
Under legislative changes made in December 2017, as modified by federal tax law changes enacted in March 2020, U.S. federal net operating losses incurred in tax years beginning after December 31, 2017 and in future years may be carried forward indefinitely, but, for tax years beginning after December 31, 2020, the deductibility of such net operating losses is limited. Also, certain states have begun to limit the utilization of NOLs. In addition, the federal and state net operating loss carryforwards and certain tax credits may be subject to significant limitations under Section 382 and Section 383 of the Internal Revenue Code of 1986, as amended, or the Code, respectively, and similar provisions of state law. Under those sections of the Code, if a corporation undergoes an "ownership change," the corporation's ability to use its pre-change net operating loss carryforwards and other pre-change attributes, such as research tax credits, to offset its post-change income or tax may be limited. In general, an "ownership change" will occur if there is a cumulative change in our ownership by "5-percent shareholders" that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under state tax laws. We have completed a Section 382 review and have determined that none of the operating losses will expire solely due to Section 382 limitation(s). However, we may experience ownership changes in the future as a result of future shifts in our stock ownership, some of which may be outside of our control. If an ownership change occurs and our ability to use our net operating loss carryforwards and tax credits is materially limited, it would harm our business by effectively increasing our future tax obligations.
Previous wording
Future issuances of common stock upon exercise of our outstanding warrants or pursuant to employee equity awards, or settlements of any conversion obligations with respect to the 2025 Convertible Notes, may result in dilution to existing stockholders, lower prevailing market prices for our common stock or require a significant cash outlay.
Current wording
Future issuances of common stock upon exercise of our outstanding warrants or pursuant to employee equity awards may result in dilution to existing stockholders, lower prevailing market prices for our common stock or require a significant cash outlay.
Previous wording
As of December 31, 2024, we had approximately 3.0 million outstanding warrants which are currently exercisable at the option of the holders, at exercise prices ranging from $11.03 to $15.77 per share. We also have granted equity awards to our executive officers and certain employees, including in connection with our recent appointment of a new Chief Executive Officer.
Current wording
As of December 31, 2025, we had approximately 2.9 million outstanding warrants which are currently exercisable at the option of the holders, at exercise prices ranging from $11.27 to $15.77 per share. We also have granted equity awards to our executive officers and certain employees. As of December 31, 2025 there were 1,517,039 stock options outstanding, with a weighted average exercise price of $16.70, and 1,846,156 non-vested restricted stock units.
Previous wording
Certain provisions in the 2029 Senior Secured Notes Indenture and/or the indenture governing the 2025 Convertible Notes (as amended or supplemented, the “Indenture”) could delay or prevent an otherwise beneficial takeover or takeover attempt of us.
Current wording
Certain provisions in the 2029 Senior Secured Notes Indenture could delay or prevent an otherwise beneficial takeover or takeover attempt of us.
Previous wording
Certain provisions in the 2029 Senior Secured Notes Indenture and or in the Indenture could make it more difficult or more expensive for a third party to acquire us and could delay or prevent an otherwise beneficial takeover or takeover attempt. For example, if a takeover would constitute a fundamental change (as defined in the 2029 Senior Secured Notes Indenture and/or the Indenture), holders of the 2029 Senior Secured Notes and/or the 2025 Convertible Notes will have the right to require us to repurchase their notes in cash. As a result, our obligations under the 2029 Senior Secured Notes and/or the 2025 Convertible Notes and the related indentures could increase the cost of acquiring us or otherwise discourage a third party from acquiring us.
Current wording
Certain provisions in the 2029 Senior Secured Notes Indenture could make it more difficult or more expensive for a third party to acquire us and could delay or prevent an otherwise beneficial takeover or takeover attempt. For example, if a takeover would constitute a fundamental change (as defined in the 2029 Senior Secured Notes Indenture and/or the Indenture), holders of the 2029 Senior Secured Notes will have the right to require us to repurchase their notes in cash. As a result, our obligations under the 2029 Senior Secured Notes could increase the cost of acquiring us or otherwise discourage a third party from acquiring us.
Previous wording
As of December 31, 2024, Golden Harbor Ltd. and North Sound Management Inc. (together the “Investors”) and their affiliates beneficially owned an aggregate of approximately 19.3% and 19.9%, respectively, for an aggregate of approximately 39.2%, of the outstanding shares of our common stock. As a result, the Investors have the ability to significantly influence the outcome of any matter submitted for the vote of the holders of our common stock.
Current wording
As of December 31, 2025, Golden Harbor Ltd. and North Sound Management Inc. (together the “Investors”) and their affiliates beneficially owned an aggregate of approximately 18.3% and 13.9%, respectively, for an aggregate of approximately 32.2%, of the outstanding shares of our common stock. As a result, the Investors have the ability to significantly influence the outcome of any matter submitted for the vote of the holders of our common stock.