HARVARD BIOSCIENCE INC
For the period ended Dec 31, 2025. Filed Mar 13, 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 Mar 13, 2026
HBIO$8.36-1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-14.
0001171843-25-001472
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-13.
0001171843-26-001548
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe 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 58 previous paragraphs and 65 current paragraphs.
26 unchanged; 19 reworded; 20 added; 13 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 6 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 (20)
Current report
As the life sciences industry accelerates toward New Approach Methodologies (“NAMs”), Harvard Bioscience expects to evolve from a traditional tools provider into a leading enabler of Translational Medicine – positioned to bridge the gap between laboratory research and human clinical success. Building on its gold-standard preclinical foundation, the Company plans to align its portfolio, innovation pipeline, and operating model around four strategic pillars:
Current report
In addition, we have taken steps to rationalize our product portfolio and improve our operating cost structure. These activities have included the discontinuation of certain non-strategic products, the consolidation of our global operating footprint, and the reduction of our headcount in Europe and North America.
Current report
In January 2026, the Company developed a comprehensive plan, referred to as Project Viking, for the strategic consolidation of its manufacturing operations to improve efficiency and support long-term growth. The Company expects to close its manufacturing facility in Holliston, MA and transition U.S. production to its manufacturing hub in Minneapolis, MN, and to relocate certain operations to facilities in Germany, Sweden, and the UK, aligning specific product lines with their designated center of excellence and most strategically advantageous logistical location. The Company expects the initiative to deliver approximately $3 million in cost savings in 2027, and approximately $4 million in annual cost savings beginning in 2028, while improving throughput and execution. The Company expects to incur pre-tax restructuring charges related to Project Viking in the range of approximately $3.4 to $4.4 million, including non-cash asset write-off and/or accelerated depreciation charges in the range of approximately $0.6 to $0.7 million, primarily related to the exit of production activities and manufacturing operations at the Holliston, MA manufacturing site. These amounts are estimates and are subject to future changes.
Current report
Goodwill impairment
Current report
Based on the Company’s quantitative impairment analysis as of March 31, 2025, the Company determined that the carrying value of the reporting unit exceeded its fair value by $48.0 million. Accordingly, the Company recorded such amount as a goodwill impairment charge for the three months ended March 31, 2025.
Current report
Interest expense increased $1.4 million, or 39.1%, to $4.9 million for the year ended December 31, 2025, compared with $3.5 million for the year ended December 31, 2024. The increase was primarily due to the increase in the interest rate margin pursuant to the March 2025 and August 2025 amendments to the Company’s prior term loan and senior revolving credit facility.
Current report
Loss on pension settlement
Current report
For the year ended December 31, 2025, the Company used $1.4 million of plan assets to purchase non-participating annuity contracts resulting in the full settlement of the benefit obligations for one of its pension programs in the UK. As a result, the Company recorded a non-cash pension settlement charge of approximately $1.2 million, primarily consisting of unrecognized actuarial losses.
Current report
Other expense, net
Current report
Other expense, net for the year ended December 31, 2025, was $2.7 million and included costs of $1.8 million in connection with exploring alternative sources of capital that would allow the Company to refinance the outstanding indebtedness due to its former lenders, $0.6 million related to loss on foreign currency, and a $0.1 million loss on extinguishment of debt. Other expenses, net for the year ended December 31, 2024, were $0.3 million, which was primarily related to $0.2 million of loss on foreign currency.
Current report
Under the 2025 Loan Agreement, the Company is required to maintain certain financial covenants that are based on financial measures not presented in accordance with U.S. generally accepted accounting principles. The Company was in compliance with the minimum liquidity requirement and the minimum adjusted EBITDA requirement, each as defined in the 2025 Loan Agreement, measured on a trailing 12-month basis, of at least $6,000,000 for the fiscal quarter ending December 31, 2025.
Current report
As of December 31, 2024 and in the quarters ended March 31, 2025, June 30, 2025 and September 30, 2025, the anticipated maturity of the Company’s Amended Credit Agreement (defined in Note 10) on December 22, 2025, together with uncertainty as to the Company’s ability to comply with future covenants under the terms of the Amended Credit Agreement, raised substantial doubt about the Company’s ability to continue as a going concern. On December 17, 2025, the Company entered into the 2025 Loan Agreement and completed a comprehensive refinancing of its credit facility, resulting in a new maturity date and improved covenant compliance. For additional details on the 2025 Loan Agreement and refinancing, see the discussion in Note 10 to the consolidated financial statements included in “Part IV, Item 15. Exhibits, Financial Statement Schedules” of this report. Management evaluated the Company’s ability to continue as a going concern for the twelve months following the issuance of these financial statements and concluded that (1) the conditions and events that initially raised substantial doubt have been alleviated and (2) substantial doubt does not exist as of the issuance date. These financial statements are therefore prepared on a going-concern basis.
Current report
Consolidated Cash Flow Statements
Current report
Cash provided by operations was $6.7 million and $1.4 million for the years ended December 31, 2025 and 2024, respectively, an increase of $5.3 million. Cash flow from operations, adjusted for non-cash items, for the year ended December 31, 2025 was $1.1 million, compared to $1.4 million for the year ended December 31, 2024. The increase in cash provided by operations was primarily due to a decrease in inventory of $3.0 million, an increase in accounts payable and other liabilities of $2.3 million compared to a decrease of $1.8 million in the prior year, and a decrease in contract liabilities of $0.2 million compared to a decrease of $0.7 million in the prior year, partially offset by an increase in accounts receivable of $0.9 million compared to a decrease of $1.0 million in the prior year.
Current report
During the quarter ended March 31, 2025, the Company determined that a sustained decrease in its stock price that occurred during the three months ended March 31, 2025 indicated that the carrying values of its goodwill and other long-lived assets may not be recoverable. Additional factors that contributed to this conclusion were the Company’s recent operating results, liquidity risk and the macroeconomic conditions then impacting the life sciences industry. Based on this determination, the Company performed interim quantitative impairment tests on its goodwill and other long-lived assets as of March 31, 2025 and June 30, 2025, as well as a qualitative analysis as of September 30, 2025.
Current report
Based on the quantitative impairment analysis as of March 31, 2025, the Company determined that the carrying value of the reporting unit exceeded its fair value by $48.0 million. Accordingly, the Company recorded such amount as a goodwill impairment charge for the three months ended March 31, 2025. Based on the quantitative impairment analysis performed as of June 30, 2025 and qualitative analysis performed as of September 30, 2025, an additional impairment charge was not required during the three months ended June 30, 2025, and September 30, 2025.
Current report
The Company evaluated its goodwill for impairment as of October 1, 2025 by performing a qualitative analysis and determined that it was more likely than not that the fair value of the reporting unit exceeded the carrying value.
Current report
Filer Status
Current report
The Company performed its public float calculation pursuant to the SEC's Public Float Test as of the last business day of its second fiscal quarter ended June 30, 2025. Based on this calculation, the Company concluded that its public float did not exceed the threshold to retain its filer status as an accelerated filer. As a result, the Company's filer status has changed and it is now classified as a non-accelerated filer. Accordingly, the Company will be subject to the requirements within this classification, including a non-accelerated timeline to file certain periodic reports, and it will be eligible for the scaled-down financial disclosure requirements provided to entities that meet the definition of a non-accelerated filer. This change in filer status takes effect with this Form 10-K for the fiscal year ended December 31, 2025, which is the first annual report filed for the fiscal year in which the Company lost its accelerated filer status.
Current report
**Item 7A.*****Quantitative and Qualitative Disclosures about Market Risk.
Removed paragraphs (13)
Previous report
Restructuring Activities
Previous report
During the year ended December 31, 2023, the Company initiated a restructuring and incurred $0.4 million in inventory charges, severance and other expenses related to the restructuring program. During the year ended December 31, 2024, the Company continued and completed additional restructurings and incurred expenses of $0.8 million, primarily consisting of severance recorded in connection with headcount reductions in Europe and North America.
Previous report
Interest expense decreased $0.4 million, or 10.6%, to $3.2 million for the year ended December 31, 2024, compared with $3.6 million for the year ended December 31, 2023. The decrease was primarily due to lower average borrowings during the period.
Previous report
We maintain a Credit Agreement that provides for a term loan of $40.0 million and a $25.0 million revolving credit facility both maturing on December 22, 2025. On March 28, 2024, we entered into an amendment to the Credit Agreement pursuant to which the Lenders and administrative agent modified the definition of Consolidated EBITDA used in the calculation of certain financial covenants to adjust for charges related to an abandoned property audit and commission fees in connection with our employee retention tax credit filings. On August 6, 2024, we entered into an amendment to the Credit Agreement that, among other things, modified the financial covenants relating to the consolidated net leverage ratio and consolidated fixed charge coverage ratio through the period ended December 31, 2024. The amendment also added a net leverage ratio requirement with respect to additional borrowing under our revolving credit facility and restrictions on certain additional indebtedness and investments. In addition, the applicable interest rate margin was increased by 50bps during such time as the consolidated net leverage ratio is greater than 3.0. We paid fees of $0.2 million to the Lenders in connection with the August 6 th amendment.
Previous report
We were not in compliance with the consolidated net leverage ratio covenant contained in the Credit Agreement as of the December 31, 2024 test date. On March 10, 2025, we entered into an amendment to the Credit Agreement (the “March 2025 Amendment”) pursuant to which the lenders and administrative agent agreed to waive such non-compliance, subject to the terms contained in the March 2025 Amendment. The March 2025 Amendment provides, among other things, that the lender’s commitment under our revolving credit facility is capped at the amount outstanding thereunder as of the date thereof and thus we are unable to make additional borrowings under our revolving credit facility. The March 2025 Amendment also establishes certain milestones with respect to the refinancing of the debt underlying the Credit Agreement (the “Refinancing”) and dates by which such milestones must be met. These milestones include: (1) continuing to retain an investment banker for the purpose of assisting with the consummation of the Refinancing; (2) by March 14, 2025, the engagement of a financial advisor acceptable to the administrative agent; (3) by April 30, 2025, the delivery to the administrative agent of an executed bona fide indication of interest from one or more potential lenders with respect to the Refinancing on terms and conditions acceptable to the administrative agent; (4) by May 23, 2025, the delivery to the administrative agent of a term sheet or commitment letter from one or more potential lenders that provides for the Refinancing on terms and conditions acceptable to the administrative agent; (5) by June 13, 2025, delivery to the administrative agent of: (i) a statement of sources and uses of transaction proceeds; and (ii) evidence that the potential lender’s conditions to closing (other than customary closing deliveries) of the Refinancing, such as business commitments, are satisfied; and (6) by June 30, 2025, the closing of the Refinancing. The lenders also agreed not to assert the financial covenants included in the Credit Agreement for the first quarter of fiscal year 2025 provided that we continue to comply with our payment obligations, achieve the refinancing milestones, maintain minimum liquidity (defined as the sum of (a) unrestricted cash and cash equivalents and (b) the amount by which the aggregate amount committed under the Company’s revolving credit facility exceeds the total amount drawn under the credit facility) of $3.5 million and provide the administrative agent with certain financial reports. In addition, pursuant to the terms of the March 2025 Amendment the applicable interest rate margin is increased such that interest rate is equal to a rate per annum based on the Secured Overnight Financing Rate (“SOFR”) plus 400 bps and amortization payments were revised so that a proportionate payment must be made on a monthly rather than a quarterly basis.
Previous report
If we are not able to comply with the terms and conditions of the March 2025 Amendment, or if we are otherwise unable to regain and maintain compliance with the covenants under the Credit Agreement, as amended, or are unsuccessful in obtaining waivers or amendments for any covenant in the future, in addition to other actions our lenders may require, the amounts outstanding under the Credit Agreement may become immediately due and payable. We paid fees of $0.1 million to the Lenders in connection with the March 2025 Amendment.
Previous report
We continue to take actions intended to improve liquidity, including actions related to cost containment and inventory reduction. Based on its current operating plans, the Company expects that its available cash and cash generated from operations will be sufficient to finance operations and capital expenditures while the Company works to refinance the Credit Agreement.
Previous report
Condensed Consolidated Cash Flow Statements
Previous report
Cash provided by operations was $1.4 million and $14.0 million for the years ended December 31, 2024 and 2023, respectively. Cash flow from operations for the year ended December 31, 2024 was negatively impacted by $8.1 million as a result of a larger net loss for the period adjusted for non-cash items, along with a $7.7 million decrease due to changes in operating assets and liabilities, which was offset by the receipt of $3.2 million of employee retention tax credits.
Previous report
Going Concern and Management Plans
Previous report
As of December 31, 2024, there was indebtedness of $37.4 million outstanding under our term loan and senior revolving credit facility (collectively, the “Credit Agreement”). We were not in compliance with the consolidated net leverage ratio covenant contained in the Credit Agreement as of the December 31, 2024 test date. On March 10, 2025, we entered into an amendment to the Credit Agreement (the “March 2025 Amendment”) pursuant to which the lenders and administrative agent agreed to waive such non-compliance, subject to the terms contained in the March 2025 Amendment. The March 2025 Amendment provides, among other things, that our failure to achieve certain refinancing milestones, including receipt of a term sheet or commitment letter from one or more potential lenders, by the dates provided in the March 2025 Amendment or our failure to consummate a refinancing of the Credit Agreement by June 30, 2025, would, in either case, constitute an event of default under the Credit Agreement. In such event, in addition to other actions our lenders may require, the amounts outstanding under the Credit Agreement may become immediately due and payable.
Previous report
We are exploring alternative sources of capital that would allow us to refinance our outstanding indebtedness by June 30, 2025, in order to avoid default under the Credit Agreement, but our ability to access such other sources of capital is uncertain. There is no assurance that such capital will be available to us, be obtainable on commercially acceptable terms, or provide us with sufficient funds to meet our objectives. Based on our anticipated cash flows from operations, unless we are able to access other sources of capital or extend the date for repayment under the Credit Agreement, we will be unable to pay our debt obligations and fund our operations for at least twelve months from the date of issuance of the consolidated financial statements contained in this Annual Report on Form 10-K. As a result, there is substantial doubt about our ability to continue as a going concern.
Previous report
As discussed in Note 2 to the Consolidated Financial Statements included in “Part IV, Item 15. Exhibits, Financial Statement Schedules” of this report, our consolidated financial statements include an explanatory paragraph that such financial statements were prepared assuming that we will continue as a going concern, continue our operations for the foreseeable future and realize assets and settle liabilities in the normal course of business. The financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Such adjustments could be material.
Reworded paragraphs (19)
Previous wording
Harvard Bioscience is a leading developer, manufacturer and seller of technologies, products and services that enable fundamental advances in life science applications, including research, pharmaceutical and therapy discovery, bioproduction and preclinical testing for pharmaceutical and therapy development. Our products and services are sold globally to customers ranging from renowned academic institutions and government laboratories to the world’s leading pharmaceutical, biotechnology and CROs. With operations in the United States, Europe and China, we sell through a combination of direct and distribution channels to customers around the world.
Current wording
Harvard Bioscience, Inc., a Delaware corporation, is a leading developer, manufacturer and seller of technologies, products and services that enable fundamental advances in life science applications, including research, pharmaceutical and therapy discovery, bioproduction and preclinical testing for pharmaceutical and therapy development. Our products and services are sold globally to customers ranging from renowned academic institutions and government laboratories to the world’s leading pharmaceutical, biotechnology and CROs. With operations in the United States, Europe and China, we sell through a combination of direct and distribution channels to customers around the world.
Previous wording
Revenues decreased $18.2 million, or 16.1%, to $94.1 million for the year ended December 31, 2024, compared to $112.3 million for the year ended December 31, 2023. The decrease in revenues was primarily due to softening of worldwide demand from distributors, CRO’s and academic medical research institutions. Changes in foreign currency exchange rates had a $0.2 million favorable effect on revenues during the year ended December 31, 2024.
Current wording
Revenues decreased $7.5 million, or 8.1%, to $86.6 million for the year ended December 31, 2025, compared to $94.1 million for the year ended December 31, 2024. The decrease in revenues was primarily due to softening of worldwide demand from distributors, CROs and academic medical research institutions. Changes in foreign currency exchange rates had a $1.2 million favorable effect on revenues during the year ended December 31, 2025.
Previous wording
Gross profit decreased $11.3 million, or 17.1%, to $54.8 million for the year ended December 31, 2024, compared with $66.1 million for the year ended December 31, 2023, primarily due to the decreases in revenues. Gross margin decreased to 58.2% for the year ended December 31, 2024, compared with 58.9% for the year ended December 31, 2023. Gross margin was unfavorably impacted by the under-absorption of fixed manufacturing overhead costs due to the decrease in revenues which was partially offset by a better mix of high margin products and lower labor costs.
Current wording
Gross profit decreased $4.9 million, or 8.9%, to $49.9 million for the year ended December 31, 2025, compared with $54.8 million for the year ended December 31, 2024, primarily due to the decreases in revenues. Gross margin decreased to 57.7% for the year ended December 31, 2025, compared with 58.2% for the year ended December 31, 2024. Gross margin was unfavorably impacted by the under-absorption of fixed manufacturing overhead costs due to the decrease in revenues which was partially offset by a better mix of high margin products and lower labor costs.
Previous wording
Sales and marketing expenses decreased $1.9 million, or 7.7%, to $22.2 million for the year ended December 31, 2024, compared to $24.1 million for the year ended December 31, 2023. The decrease was primarily due to a decrease in compensation costs of $1.3 million, a decrease in consulting costs of $0.2 million and a decrease in travel costs of $0.2 million, in each case as compared to the year ended December 31, 2023.
Current wording
Sales and marketing expenses decreased $3.0 million, or 13.5%, to $19.2 million for the year ended December 31, 2025, compared to $22.2 million for the year ended December 31, 2024. The decrease was primarily due to a decrease in compensation costs of $1.9 million, a decrease in travel and entertainment costs of $0.4 million, and a decrease in tradeshow costs of $0.4 million, in each case as compared to the year ended December 31, 2024.
Previous wording
General and administrative expenses decreased by $1.3 million, or 5.6%, to $21.5 million for the year ended December 31, 2024, compared with $22.8 million for the year ended December 31, 2023. The decrease was primarily due to a decrease in compensation costs of $1.3 million, a decrease of $0.5 million due to the capitalization of labor and consulting expenses associated with our U.S. ERP consolidation project and a decrease in travel and entertainment costs of $0.2 million, partially offset by an increase in professional fees of $0.4 million and an increase in depreciation expense of $0.2 million, in each case as compared to the year ended December 31, 2023.
Current wording
General and administrative expenses decreased by $3.8 million, or 17.5%, to $17.7 million for the year ended December 31, 2025, compared with $21.5 million for the year ended December 31, 2024. The decrease was primarily due to a decrease in compensation costs of $1.7 million, a decrease in stock based compensation costs of $2.2 million, partially offset by increases in professional fees of $0.2 million and legal fees of $0.2 million, in each case as compared to the year ended December 31, 2024.
Previous wording
Research and development expenses decreased $1.4 million, or 11.5%, to $10.4 million for the year ended December 31, 2024, compared with $11.8 million for the year ended December 31, 2023. The decrease was primarily due to a decrease in compensation costs of $0.9 million and a decrease of $0.3 million due the capitalization of software development costs, as compared to the year ended December 31, 2023.
Current wording
Research and development expenses decreased $1.6 million, or 15.2%, to $8.8 million for the year ended December 31, 2025, compared with $10.4 million for the year ended December 31, 2024. The decrease was primarily due to a decrease in compensation costs of $1.3 million and a decrease of $0.3 million in project costs and consulting fees, as compared to the year ended December 31, 2024.
Previous wording
Amortization of intangible assets decreased $0.2 million, or 4.9%, to $5.3 million for the year ended December 31, 2024, compared with $5.5 million for the year ended December 31, 2023.
Current wording
Amortization of intangible assets decreased $1.3 million, or 23.4%, to $4.0 million for the year ended December 31, 2025, compared with $5.3 million for the year ended December 31, 2024.
Previous wording
Other operating expenses for the year ended December 31, 2024, were $1.6 million and included restructuring costs of $0.8 million in connection with headcount reductions, a fee of $0.5 million in connection with the receipt of employee retention tax credits, and $0.3 million related to settlement of an unclaimed property audit. Other operating expenses for the year ended December 31, 2023, were $0.1 million and included restructuring costs in connection with headcount reductions.
Current wording
Other operating expenses for the year ended December 31, 2025, were $0.7 million, including a fee of $0.5 million in connection with the receipt of employee retention tax credits and restructuring costs of $0.2 million in connection with headcount reductions. Other operating expenses for the year ended December 31, 2024, were $1.6 million, including $0.8 million in connection with headcount reductions, a fee of $0.5 million in connection with the receipt of employee retention tax credits, and $0.3 million related to settlement of an unclaimed property audit.
Previous wording
As of December 31, 2023, we held shares of common stock of HRGN with an estimated fair value of $3.5 million. These shares were received in connection with the settlement of indemnification obligations related to litigation which was resolved during the year ended December 31, 2022. During the year ended December 31, 2024, we sold all of our HRGN shares for $1.9 million and recorded a loss on sale of $1.6 million. During the year ended December 31, 2023, we recorded unrealized losses of $0.6 million related to these shares.
Current wording
As of December 31, 2023, we held shares of common stock of Harvard Apparatus Regenerative Technology, Inc. (“HRGN”) with an estimated fair value of $3.5 million. These shares were received in connection with the settlement of indemnification obligations related to litigation which was resolved during the year ended December 31, 2022. During the year ended December 31, 2024, we sold all of our HRGN shares for $1.9 million and recorded a loss on sale of $1.6 million.
Previous wording
Income tax expense for the year ended December 31, 2024, was $0.7 million compared to $0.9 million for the year ended December 31, 2023. The effective tax rates for the years ended December 31, 2024 and 2023, were (6.3)% and (33.5)%, respectively. The lower effective tax rate during the year ended December 31, 2024, compared to the year ended December 31, 2023, was primarily related to changes to tax attribute carryforwards, a decrease in the Company’s Global Intangible Low-Taxed Income (“GILTI”) inclusion, and a difference in the company’s excess tax benefits related to stock compensation. Our effective tax rate for the year ended December 31, 2024, was different than the U.S. statutory rate primarily due to changes in valuation allowances associated with our assessment of the likelihood of the recoverability of deferred tax assets and the impact of changes to prior year tax accruals. Our effective tax rate for the year ended December 31, 2023, was different than the U.S. statutory rate primarily due to the mix of forecasted income or losses in the U.S. and foreign tax jurisdictions, a GILTI inclusion to taxable income and the impact of changes to tax attribute carryforwards.
Current wording
Income tax (benefit) expense for the year ended December 31, 2025, was ($0.7) million benefit compared to $0.7 million expense for the year ended December 31, 2024. The effective tax rates for the years ended December 31, 2025 and 2024, were (1.1%) and 6.3%, respectively. The lower effective tax rate during the year ended December 31, 2025, compared to the year ended December 31, 2024, was primarily attributable to goodwill impairment, an increase in the Company’s GILTI inclusion, and a decrease in the change in the Company’s valuation allowance. Our effective tax rates for the years ended December 31, 2025 and December 31, 2024 were different than the U.S. statutory rates primarily due to changes in valuation allowances associated with our assessment of the likelihood of the recoverability of deferred tax assets and the impact of changes to prior year tax accruals.
Previous wording
Our primary sources of liquidity are cash and cash equivalents, internally generated cash flow from operations and our shelf registration statement that provides for the issuance of common stock, preferred stock, warrants and units up to an amount equal to $100 million (the “2024 Shelf Registration Statement”). Our expected cash outlays relate primarily to cash payments due under our Credit Agreement described below as well as salaries, inventory, and capital expenditures. We held cash and cash equivalents of $4.1 million and $4.3 million as of December 31, 2024 and December 31, 2023, respectively. Borrowings outstanding were $37.4 million and $37.1 million as of December 31, 2024 and December 31, 2023, respectively.
Current wording
Our primary sources of liquidity are cash and cash equivalents, internally generated cash flow from operations and our shelf registration statement that provides for the issuance of common stock, preferred stock, warrants and units up to an amount equal to $100 million (the “2024 Shelf Registration Statement”). Our expected cash outlays relate primarily to cash payments due under our Loan and Security Agreement (the “2025 Loan Agreement”), entered into with certain financial institutions party thereto as lenders and BroadOak Income Fund, L.P., as the administrative agent and collateral agent on December 17, 2025, as well as salaries, inventory, capital expenditures, and other operating costs. We held cash and cash equivalents of $8.6 million and $4.1 million as of December 31, 2025 and December 31, 2024, respectively. Borrowings outstanding were $40.0 million and $37.4 million as of December 31, 2025 and December 31, 2024, respectively.
Previous wording
The Coronavirus Aid, Relief, and Economic Security Act of 2020 (“CARES Act”) provided an employee retention tax credit (“ERTC”) that was a refundable tax credit against certain employer taxes. The Company received ERTC refunds of $3.2 million during the year ended December 31, 2024. In January 2025, the Company received an additional $1.0 million of ERTC refunds. The Company’s compliance with the program’s qualifications may be subject to audit until May 2028, which is when the statute of limitation expires.
Current wording
The Coronavirus Aid, Relief, and Economic Security Act of 2020 provided an employee retention tax credit (“ERTC”) that was a refundable tax credit against certain employer taxes. The Company received ERTC refunds of $3.6 million and $3.2 million during the year ended December 31, 2025 and December 31, 2024. The Company’s compliance with the program’s qualifications may be subject to audit until May 2029, which is when the statute of limitation expires.
Previous wording
Cash used in investing activities was $1.3 million for the year ended December 31, 2024, and consisted of $3.2 million of capital expenditures for manufacturing and information technology infrastructure and software development, offset by $1.9 million in proceeds from the sale of marketable equity securities. Cash used in investing activities was $1.8 million for the year ended December 31, 2023, and primarily consisted of $2.3 million of capital expenditures in manufacturing, information technology infrastructure, and capitalized software costs, offset by $0.5 million from proceeds from the sale our Hoefer product line.
Current wording
Cash used in investing activities was $1.9 million for the year ended December 31, 2025, and consisted of $1.3 million of capital expenditures for manufacturing and information technology infrastructure and $0.6 million of capitalized software development. Cash used in investing activities was $1.3 million for the year ended December 31, 2024, and consisted of $2.6 million of capital expenditures for manufacturing and information technology infrastructure and $0.6 million of capitalized software development, partially offset by $1.9 million in proceeds from the sale of marketable equity securities.
Previous wording
Cash used in financing activities was $12.1 million for the year ended December 31, 2023. During this period, we made term loan installments payments under the Credit Agreement of $4.1 million, with net payments of $6.4 million under the revolving credit facility. We also received proceeds of $0.9 million from the exercise of stock options and the employee stock purchase plan and paid $2.5 million for taxes related to net share settlement of equity awards.
Current wording
Cash used by financing activities was $1.3 million for the year ended December 31, 2025. During this period, the Company made total debt payments of $37.4 million, including repayment of debt outstanding of $33.7 million. Net borrowing under the new credit facility was $39.2 million and we paid debt issuance costs of $2.9 million. Additionally, we paid $0.1 million for taxes related to net share settlement of equity awards.
Previous wording
Cash used by financing activities was $0.1 million for the year ended December 31, 2024. During this period, debt outstanding under our credit facility increased by $0.2 million, due to net borrowings under our revolver of $6.2 million and payments of $6.0 million against the term loan. Additionally, we paid debt issuance costs of $0.2 million. We also received proceeds of $0.4 million from the exercise of stock options and employee stock purchase plan purchases and paid $0.6 million for taxes related to net share settlement of equity awards.
Current wording
Cash used by financing activities was $0.1 million for the year ended December 31, 2024. During this period, debt outstanding under our credit facility increased by $0.2 million, due to net borrowings under our revolver of $8.8 million and payments of $8.6 million against the revolver and term loan. Additionally, we paid debt issuance costs of $0.2 million. We also received proceeds of $0.4 million from the exercise of stock options and employee stock purchase plan purchases and paid $0.6 million for taxes related to net share settlement of equity awards.
Previous wording
Our international operations in some instances operate as a natural hedge as we sell our products in many countries and a substantial portion of our revenues, costs and expenses are denominated in foreign currencies, primarily the euro and the British pound. During the year ended December 31, 2024, changes in foreign currency exchange rates resulted in a favorable effect on revenues of $0.2 million and an unfavorable effect on expenses of $0.3 million.
Current wording
Our international operations in some instances operate as a natural hedge as we sell our products in many countries and a substantial portion of our revenues, costs and expenses are denominated in foreign currencies, primarily the euro and the British pound. During the year ended December 31, 2025, changes in foreign currency exchange rates resulted in a favorable effect on revenues of $1.2 million and an unfavorable effect on expenses of $1.5 million.
Previous wording
During the years ended December 31, 2024 and 2023, the translation of foreign currency into U.S. dollars included as a component of comprehensive loss resulted in a (loss) gain of $(1.4) million and $1.5 million, respectively. In addition, the currency exchange rate fluctuations included as a component of net loss resulted in currency losses of $(0.2) million during both years ended December 31, 2024 and 2023.
Current wording
During the years ended December 31, 2025 and 2024, the translation of foreign currency into U.S. dollars included as a component of comprehensive income (loss) resulted in a gain (loss) of $3.2 million and $(1.4) million, respectively. In addition, the currency exchange rate fluctuations included as a component of net loss resulted in currency losses of $(0.6) million and $(0.2) million during the years ended December 31, 2025 and 2024, respectively.
Previous wording
Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment analysis for goodwill consists of an qualitative assessment potentially followed by a quantitative analysis. If we determine that the carrying value of our reporting unit exceeds its fair value, an impairment charge to goodwill is recorded for the excess. The critical judgments involved in our annual qualitative test of goodwill include an assessment of unfavorable events and a judgment of whether those events put our goodwill at risk of impairment, which if determined to be at risk would require us to perform a quantitative test. The critical judgments and estimates in our quantitative tests for goodwill and long-lived assets include selection and weighting of available valuation methods and the selection of assumptions that may be used in those methods.
Current wording
Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment analysis for goodwill consists of a qualitative assessment potentially followed by a quantitative analysis. If we determine that the carrying value of our reporting unit exceeds its fair value, an impairment charge to goodwill is recorded for the excess. The critical judgments involved in our annual test of goodwill include an assessment of unfavorable events and a judgment of whether those events put our goodwill at risk of impairment, which if determined to be at risk would require us to perform a quantitative test. The critical judgments and estimates in our quantitative tests for goodwill and long-lived assets include selection and weighting of available valuation methods and the selection of assumptions that may be used in those methods.
Previous wording
During the year ended December 31, 2024, we determined that indicators of impairment were present for our goodwill and certain assets included in a long-lived asset group, including liquidity risk associated with inability to borrow under our Credit Agreement and reduced operating profits. Based on the quantitative analysis, we concluded that our goodwill and certain assets included in a long-lived asset group were not impaired due to the excess of fair value over the carrying value of these assets at December 31, 2024. Based on declines in our stock price subsequent to December 31, 2024, the carrying value of our stockholders’ equity currently exceeds its fair value, which could lead to future impairment.
Current wording
During the year ended December 31, 2024, we determined that indicators of impairment were present for our goodwill and certain assets included in a long-lived asset group, including liquidity risk associated with inability to borrow under our Credit Agreement and reduced operating profits. Based on the quantitative analysis, we concluded that our goodwill and certain assets included in a long-lived asset group were not impaired due to the excess of fair value over the carrying value of these assets at December 31, 2024.