Correspondence 0000950170-24-009399 from STAAR SURGICAL CO (STAA) (CIK 0000718937) (STAA)
STAAR SURGICAL CO (STAA) (CIK 0000718937)
Date: Jan. 31, 2024 · CIK: 0000718937 · Accession: 0000950170-24-009399
AI Filing Summary & Sentiment
File numbers found in text: 000-11634
Referenced dates: December 6, 2023
Letter
January 31, 2024
VIA EDGAR TRANSMISSION
United States Securities and Exchange Commission
Division of Corporation Finance
Office of Industrial Applications and Services
100 F Street, N.E.
Washington, D.C. 20549
Attention: Nudrat Salik, Terence O’Brien
RE: STAAR Surgical Company
Form 10-Q for Period Ended September 30, 2023
Form 8-K Filed November 1, 2023
File No. 000-11634
Ladies and Gentlemen:
STAAR Surgical Company (the “Company”) received your comment letter dated December 6, 2023, which sets out comments of the Staff of the Division of Corporation Finance (the “SEC” or the “Staff”) to the Company’s filings referenced above. This letter provides the Company’s responses to the Staff’s comments. For your convenience, we have reproduced below in bold the Staff’s comments numbered 1 through 4 and have provided responses immediately below each comment. The headings and numbered paragraphs in this letter correspond to the headings and numbered paragraphs in the comment letter from the Staff.
Form 10-Q for the Period Ended September 30, 2023
Note 1. Basis of Presentation and Significant Accounting Policies Revision of Financial Statements for Correction of Immaterial Misstatements, page 7
1.In regard to the error identified with the income tax provision, deferred tax asset and valuation allowance under the incremental cash tax method, please tell us how you determined that the error was not material to results of operations or financial position for any prior annual or interim period by providing us with your materiality analysis pursuant to SAB Topic 1:M and 1:N. We note that the adjustment represented approximately 11% of net income for 2021. Please also help us better understand the nature of the error and how it was corrected.
Response:
As disclosed in Note 1 to the financial statements of the Form 10-Q for the period ended September 29, 2023 (the “Form 10-Q”), during the third quarter ended September 29, 2023, the Company determined that it had not correctly deducted compensation expense in calculating its income tax provision, deferred tax asset and valuation allowance under the Incremental Cash Tax Method. The relevant compensation expense related to certain employee stock options granted on or prior to November 2, 2017 (such awards, the “Option Awards”). As discussed further below, prior to the correction, the Company had applied the deduction limitation established by Internal Revenue Code Section 162(m) (“Section 162(m)”) to the Option Awards. During the third quarter ended September 29, 2023, the Company determined that the Option Awards should not have been subject to the deduction limitation under Section 162(m), as they had been granted prior to the implementation of the Tax Cuts and Jobs Act (“TCJA”) (signed into law in December 2017), which allowed for “grandfathering” of these pre-existing awards. As a result, the Company should have elected to deduct compensation expense for the Option Awards and concluded that it had understated its deferred income tax asset, overstated the provision for income taxes, and understated net income, for the fiscal years ended December 31, 2021 and December 30, 2022, which it corrected in the Form 10-Q.
25651 Atlantic Ocean Drive | Lake Forest, CA 92630 | (626) 303-7902
The Company has experienced rapid revenue growth over the last several years, and as of the fiscal year ended December 28, 2018, had advanced from a history of net losses to profitability. As the Company has grown, it has brought in additional resources and enhanced its processes related to taxes. Under this backdrop, in June 2023, the Company conducted an evaluation of its tax provision, which included an assessment of its Section 162(m) deduction limitations (the “Assessment”). Given the increase in the Company’s stock price during the period 2017-2023, the Company had experienced an increase in the number of employee stock options exercised, as well as the dollar value thereof. Whereas in March 2017, the Company’s stock was trading near $10 per share, the stock reached an all-time high of $162.68 per share in September 2021, and was trading around $50 per share in June 2023. As the Company’s stock price increased, the tax gain realized upon exercise of employee stock options increased, which resulted in higher tax deductible stock-based compensation expense for the Company. The stock option exercises during this period included exercises by various employees who were “covered employees” under Section 162(m). As part of the Assessment, the Company identified that certain of the stock options exercised had been granted in 2017, prior to the implementation of the TCJA. The Company then revisited the applicability of the deduction limitation under Section 162(m) and the grandfathering of Section 162(m) deductibility under the TCJA transition rules. Based on the Company’s analysis of the relevant facts and circumstances, and the application of relevant tax law and guidance, the Company concluded that it had incorrectly applied the TCJA transition rules to the Option Awards and that it was more likely than not that the Option Awards qualified as performance-based compensation under Section 162(m), and accordingly, the Option Awards were not subject to the deduction limitation under Section 162(m).
For the three and nine months ended September 29, 2023, the Company’s provision for income tax expense and its deferred tax asset reported in the Form 10-Q reflect the amount of stock-based compensation expense associated with the Option Awards that qualified for deduction under Section162(m). The Company assessed the cumulative impact of the deductibility of the Option Awards and determined that the Company had overstated its provision for income tax expense by $3,920,000 and understated its deferred tax asset by $3,920,000, as of December 30, 2022. The Company then assessed the impact for each of the fiscal years ended December 31, 2021 and December 30, 2022, which is summarized in Note 1 to the Form 10-Q.
In assessing the materiality of the correction, the Company considered that the correction had no impact on revenue, gross profit or pre-tax income. Because the correction resulted in the Company’s tax deduction of a greater amount of its stock-based compensation expense, the correction led to a decrease in the Company’s provision for income taxes and an increase in income and earnings per share. The tables below reflects the impact of the correction under the Rollover and Iron Curtain methods as prescribed by Staff Accounting Bulletin (“SAB”) Topic 1:M and 1:N (dollars in thousands, expect per share amounts):
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Income Statement:
Provision for income taxes
$
6,803
$
3,793
$
(3,010
)
(44.2
)%
$
6,797
$
5,887
$
(910
)
(13.4
)%
$
(3,920
)
(57.7
)%
Net income
$
24,501
$
27,511
$
3,010
12.3
%
$
38,755
$
39,665
$
2.3
%
$
3,920
10.1
%
Comprehensive income
$
25,998
$
29,008
$
3,010
11.6
%
$
42,959
$
43,869
$
2.1
%
$
3,920
9.1
%
Basic earnings per share
$
0.52
$
0.58
$
0.06
11.5
%
$
0.81
$
0.83
$
0.02
2.5
%
$
0.08
9.9
%
Diluted earnings per share
$
0.50
$
0.56
$
0.06
12.0
%
$
0.78
$
0.80
$
0.02
2.6
%
$
0.08
10.3
%
- 2 -
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Cash flows from operating activities:
Net income
$
24,501
$
27,511
$
3,010
12.3
%
$
38,755
$
39,665
$
2.3
%
$
3,920
10.1
%
Deferred income taxes
$
1,495
$
(1,515
)
$
(3,010
)
(201.3
)%
$
(1,344
)
$
(2,254
)
$
(910
)
67.7
%
$
(3,920
)
291.7
%
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Balance Sheet:
Deferred income taxes
$
4,824
$
8,744
$
3,920
81.3
%
$
3,920
81.3
%
Total assets
$
414,898
$
418,818
$
3,920
0.9
%
$
3,920
0.9
%
Accumulated deficit
$
(111,390
)
$
(108,380
)
$
3,010
(2.7
)%
$
3,010
(2.7
)%
$
(72,635
)
$
(68,715
)
$
3,920
(5.4
)%
$
3,920
(5.4
)%
Total stockholders’ equity
$
258,558
$
261,568
$
3,010
1.2
%
$
3,010
1.2
%
$
332,192
$
336,112
$
3,920
1.2
%
$
3,920
1.2
%
Total liabilities and stockholders’ equity
$
414,898
$
418,818
$
3,920
0.9
%
$
3,920
0.9
%
The Company recognizes that the impact of the correction for fiscal year 2021 resulted in increases in net income and diluted earnings per share in excess of 10%. However, the correction did not impact the trend in such metrics. As set forth in the table below, prior to and after the correction, the Company’s results still reflected a steep increase in net income and diluted earnings per share from fiscal year 2020 to fiscal year 2021, which exceeded 300% (with and without the correction), and a further increase from fiscal 2021 to fiscal 2022, which exceeded 40% (with and without the correction) (dollars in thousands, expect per share amounts):
Net income
As stated
$
5,913
$
24,501
$
38,755
Increase Year Over Year
314.4
%
58.2
%
As revised
$
5,913
$
27,511
$
39,665
Increase Year Over Year
365.3
%
44.2
%
Diluted EPS
As stated
$
0.12
$
0.50
$
0.78
Increase Year Over Year
316.7
%
56.0
%
As revised
$
0.12
$
0.56
$
0.80
Increase Year Over Year
366.7
%
42.9
%
The Company considered the quantitative factors set forth in the tables above, as well as qualitative factors, with a focus on key metrics believed to be of greatest importance to the Company’s investors and shareholders. As a fast-growth company, investors and shareholders have generally focused on the Company’s revenue and revenue growth. As set forth above, the correction had no impact on revenue or gross profit (and the dollar amount of the correction was de-minimis in relation to the dollar amounts of both revenue and gross profit). Together with revenue, the Company’s investors and shareholders are keenly focused on metrics related to the Company’s implantable Collamer lens (“ICL”) (the Company’s key product), including ICL sales (and sales growth), and ICL units (and unit growth). This is supported by the fact that in each of the Company’s annual earnings press releases for fiscal year 2021 and fiscal year 2022, the top three bullets addressed net sales, ICL sales, and ICL units. The Company’s investors and shareholders have traditionally been less focused on taxes, net income and diluted earnings per share. Because the correction reduced the amount of tax expense, the correction resulted in an increase in net income and diluted earnings per share (i.e., the Company understated net income and diluted earnings per share).
- 3 -
In addition to the quantitative and qualitative considerations discussed above, the Company also noted the following in its qualitative analysis of materiality:
• The correction did not mask a change in earnings or other trends,
• The correction did not hide a failure to meet analysts’ consensus expectations for the enterprise,
• The correction did not change a loss into income or vice versa,
• The correction did not affect the Company’s compliance with regulatory requirements,
• The correction did not affect the Company’s compliance with loan covenants or other contractual requirements,
• The correction did not have the effect of increasing management’s compensation – for example, by satisfying requirements for the award of bonuses or other forms of incentive compensation, and
• The correction did not involve the concealment of an unlawful transaction.
In addition, the Company’s policy election is to apply the Incremental Cash Tax approach when analyzing the impact of Global Intangible Low Tax Income (“GILTI”) on its U.S. valuation allowance (“VA”). While updating the aforementioned prior years’ tax provisions, the Company had to consider the deductibility of the Option Awards in its U.S. VA calculation, which resulted in additional tax benefits from fiscal year 2020 through fiscal year 2022. Historically, the Company recognized net losses for fiscal year 2008 through fiscal year 2017 (other than with respect to fiscal year 2013, when there was minimal net income, which resulted in diluted earnings per share of $0.01) and had been in a full VA position given its history of U.S. tax losses. As set forth above the Company grew its revenue and net income from fiscal year 2020 through fiscal year 2022, and the VA release (due to higher NOLs attributable to the Section 162(m) adjustment) are directionally in line with the Company’s growth. Given the relatively small amount of tax expense recorded in fiscal year 2020 through fiscal year 2022, the impact of the correction had a greater percentage impact. As discussed above, the Company does not believe a key focus of its investors is tax expense, or taxes generally, and it does not believe the correction affected the total mix of information available to investors. This is supported by a review of the transcripts from the Company’s last four quarterly earnings calls, which the Company furnishes to the SEC on Form 8-K. The transcripts reflect that no questions were asked by investors regarding the Company’s tax expense, deferred income taxes or its VA position.
While the Company determined that a correction was appropriate to address the deductibility of the Option Awards under Section 162(m), the Company concluded that the impact of the correction on the Company’s financial statements, after assessing materiality under SAB Topic 1:M and 1:N and considering the quantitative and qualitative factors set forth above, was not material to the Company’s previously issued consolidated financial statements. The Company intends to include disclosure regarding the correction in future periodic reports filed with the SEC, as applicable, consistent with the disclosure included in the Form 10-Q.
Liquidity and Capital Resources, page 23
2.We note that cash flows from operating activities were impacted by working capital changes, including an increase in accounts receivable of $50.
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filename1.htm
CORRESP
January 31, 2024
VIA EDGAR TRANSMISSION
United States Securities and Exchange Commission
Division of Corporation Finance
Office of Industrial Applications and Services
100 F Street, N.E.
Washington, D.C. 20549
Attention: Nudrat Salik, Terence O’Brien
RE: STAAR Surgical Company
Form 10-Q for Period Ended September 30, 2023
Form 8-K Filed November 1, 2023
File No. 000-11634
Ladies and Gentlemen:
STAAR Surgical Company (the “Company”) received your comment letter dated December 6, 2023, which sets out comments of the Staff of the Division of Corporation Finance (the “SEC” or the “Staff”) to the Company’s filings referenced above. This letter provides the Company’s responses to the Staff’s comments. For your convenience, we have reproduced below in bold the Staff’s comments numbered 1 through 4 and have provided responses immediately below each comment. The headings and numbered paragraphs in this letter correspond to the headings and numbered paragraphs in the comment letter from the Staff.
Form 10-Q for the Period Ended September 30, 2023
Note 1. Basis of Presentation and Significant Accounting Policies
Revision of Financial Statements for Correction of Immaterial Misstatements, page 7
1.In regard to the error identified with the income tax provision, deferred tax asset and valuation allowance under the incremental cash tax method, please tell us how you determined that the error was not material to results of operations or financial position for any prior annual or interim period by providing us with your materiality analysis pursuant to SAB Topic 1:M and 1:N. We note that the adjustment represented approximately 11% of net income for 2021. Please also help us better understand the nature of the error and how it was corrected.
Response:
As disclosed in Note 1 to the financial statements of the Form 10-Q for the period ended September 29, 2023 (the “Form 10-Q”), during the third quarter ended September 29, 2023, the Company determined that it had not correctly deducted compensation expense in calculating its income tax provision, deferred tax asset and valuation allowance under the Incremental Cash Tax Method. The relevant compensation expense related to certain employee stock options granted on or prior to November 2, 2017 (such awards, the “Option Awards”). As discussed further below, prior to the correction, the Company had applied the deduction limitation established by Internal Revenue Code Section 162(m) (“Section 162(m)”) to the Option Awards. During the third quarter ended September 29, 2023, the Company determined that the Option Awards should not have been subject to the deduction limitation under Section 162(m), as they had been granted prior to the implementation of the Tax Cuts and Jobs Act (“TCJA”) (signed into law in December 2017), which allowed for “grandfathering” of these pre-existing awards. As a result, the Company should have elected to deduct compensation expense for the Option Awards and concluded that it had understated its deferred income tax asset, overstated the provision for income taxes, and understated net income, for the fiscal years ended December 31, 2021 and December 30, 2022, which it corrected in the Form 10-Q.
25651 Atlantic Ocean Drive | Lake Forest, CA 92630 | (626) 303-7902
The Company has experienced rapid revenue growth over the last several years, and as of the fiscal year ended December 28, 2018, had advanced from a history of net losses to profitability. As the Company has grown, it has brought in additional resources and enhanced its processes related to taxes. Under this backdrop, in June 2023, the Company conducted an evaluation of its tax provision, which included an assessment of its Section 162(m) deduction limitations (the “Assessment”). Given the increase in the Company’s stock price during the period 2017-2023, the Company had experienced an increase in the number of employee stock options exercised, as well as the dollar value thereof. Whereas in March 2017, the Company’s stock was trading near $10 per share, the stock reached an all-time high of $162.68 per share in September 2021, and was trading around $50 per share in June 2023. As the Company’s stock price increased, the tax gain realized upon exercise of employee stock options increased, which resulted in higher tax deductible stock-based compensation expense for the Company. The stock option exercises during this period included exercises by various employees who were “covered employees” under Section 162(m). As part of the Assessment, the Company identified that certain of the stock options exercised had been granted in 2017, prior to the implementation of the TCJA. The Company then revisited the applicability of the deduction limitation under Section 162(m) and the grandfathering of Section 162(m) deductibility under the TCJA transition rules. Based on the Company’s analysis of the relevant facts and circumstances, and the application of relevant tax law and guidance, the Company concluded that it had incorrectly applied the TCJA transition rules to the Option Awards and that it was more likely than not that the Option Awards qualified as performance-based compensation under Section 162(m), and accordingly, the Option Awards were not subject to the deduction limitation under Section 162(m).
For the three and nine months ended September 29, 2023, the Company’s provision for income tax expense and its deferred tax asset reported in the Form 10-Q reflect the amount of stock-based compensation expense associated with the Option Awards that qualified for deduction under Section162(m). The Company assessed the cumulative impact of the deductibility of the Option Awards and determined that the Company had overstated its provision for income tax expense by $3,920,000 and understated its deferred tax asset by $3,920,000, as of December 30, 2022. The Company then assessed the impact for each of the fiscal years ended December 31, 2021 and December 30, 2022, which is summarized in Note 1 to the Form 10-Q.
In assessing the materiality of the correction, the Company considered that the correction had no impact on revenue, gross profit or pre-tax income. Because the correction resulted in the Company’s tax deduction of a greater amount of its stock-based compensation expense, the correction led to a decrease in the Company’s provision for income taxes and an increase in income and earnings per share. The tables below reflects the impact of the correction under the Rollover and Iron Curtain methods as prescribed by Staff Accounting Bulletin (“SAB”) Topic 1:M and 1:N (dollars in thousands, expect per share amounts):
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Income Statement:
Provision for income taxes
2021
$
6,803
$
3,793
$
(3,010
)
(44.2
)%
2022
$
6,797
$
5,887
$
(910
)
(13.4
)%
$
(3,920
)
(57.7
)%
Net income
2021
$
24,501
$
27,511
$
3,010
12.3
%
2022
$
38,755
$
39,665
$
910
2.3
%
$
3,920
10.1
%
Comprehensive income
2021
$
25,998
$
29,008
$
3,010
11.6
%
2022
$
42,959
$
43,869
$
910
2.1
%
$
3,920
9.1
%
Basic earnings per share
2021
$
0.52
$
0.58
$
0.06
11.5
%
2022
$
0.81
$
0.83
$
0.02
2.5
%
$
0.08
9.9
%
Diluted earnings per share
2021
$
0.50
$
0.56
$
0.06
12.0
%
2022
$
0.78
$
0.80
$
0.02
2.6
%
$
0.08
10.3
%
- 2 -
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Cash flows from operating activities:
Net income
2021
$
24,501
$
27,511
$
3,010
12.3
%
2022
$
38,755
$
39,665
$
910
2.3
%
$
3,920
10.1
%
Deferred income taxes
2021
$
1,495
$
(1,515
)
$
(3,010
)
(201.3
)%
2022
$
(1,344
)
$
(2,254
)
$
(910
)
67.7
%
$
(3,920
)
291.7
%
Reported
As
Rollover Method
Iron Curtain Method
Reported Metric
Year
Amount
Revised
Amount
%
Amount
%
Balance Sheet:
Deferred income taxes
2022
$
4,824
$
8,744
$
3,920
81.3
%
$
3,920
81.3
%
Total assets
2022
$
414,898
$
418,818
$
3,920
0.9
%
$
3,920
0.9
%
Accumulated deficit
2021
$
(111,390
)
$
(108,380
)
$
3,010
(2.7
)%
$
3,010
(2.7
)%
2022
$
(72,635
)
$
(68,715
)
$
3,920
(5.4
)%
$
3,920
(5.4
)%
Total stockholders’ equity
2021
$
258,558
$
261,568
$
3,010
1.2
%
$
3,010
1.2
%
2022
$
332,192
$
336,112
$
3,920
1.2
%
$
3,920
1.2
%
Total liabilities and stockholders’ equity
2022
$
414,898
$
418,818
$
3,920
0.9
%
$
3,920
0.9
%
The Company recognizes that the impact of the correction for fiscal year 2021 resulted in increases in net income and diluted earnings per share in excess of 10%. However, the correction did not impact the trend in such metrics. As set forth in the table below, prior to and after the correction, the Company’s results still reflected a steep increase in net income and diluted earnings per share from fiscal year 2020 to fiscal year 2021, which exceeded 300% (with and without the correction), and a further increase from fiscal 2021 to fiscal 2022, which exceeded 40% (with and without the correction) (dollars in thousands, expect per share amounts):
2020
2021
2022
Net income
As stated
$
5,913
$
24,501
$
38,755
Increase Year Over Year
314.4
%
58.2
%
As revised
$
5,913
$
27,511
$
39,665
Increase Year Over Year
365.3
%
44.2
%
Diluted EPS
As stated
$
0.12
$
0.50
$
0.78
Increase Year Over Year
316.7
%
56.0
%
As revised
$
0.12
$
0.56
$
0.80
Increase Year Over Year
366.7
%
42.9
%
The Company considered the quantitative factors set forth in the tables above, as well as qualitative factors, with a focus on key metrics believed to be of greatest importance to the Company’s investors and shareholders. As a fast-growth company, investors and shareholders have generally focused on the Company’s revenue and revenue growth. As set forth above, the correction had no impact on revenue or gross profit (and the dollar amount of the correction was de-minimis in relation to the dollar amounts of both revenue and gross profit). Together with revenue, the Company’s investors and shareholders are keenly focused on metrics related to the Company’s implantable Collamer lens (“ICL”) (the Company’s key product), including ICL sales (and sales growth), and ICL units (and unit growth). This is supported by the fact that in each of the Company’s annual earnings press releases for fiscal year 2021 and fiscal year 2022, the top three bullets addressed net sales, ICL sales, and ICL units. The Company’s investors and shareholders have traditionally been less focused on taxes, net income and diluted earnings per share. Because the correction reduced the amount of tax expense, the correction resulted in an increase in net income and diluted earnings per share (i.e., the Company understated net income and diluted earnings per share).
- 3 -
In addition to the quantitative and qualitative considerations discussed above, the Company also noted the following in its qualitative analysis of materiality:
• The correction did not mask a change in earnings or other trends,
• The correction did not hide a failure to meet analysts’ consensus expectations for the enterprise,
• The correction did not change a loss into income or vice versa,
• The correction did not affect the Company’s compliance with regulatory requirements,
• The correction did not affect the Company’s compliance with loan covenants or other contractual requirements,
• The correction did not have the effect of increasing management’s compensation – for example, by satisfying requirements for the award of bonuses or other forms of incentive compensation, and
• The correction did not involve the concealment of an unlawful transaction.
In addition, the Company’s policy election is to apply the Incremental Cash Tax approach when analyzing the impact of Global Intangible Low Tax Income (“GILTI”) on its U.S. valuation allowance (“VA”). While updating the aforementioned prior years’ tax provisions, the Company had to consider the deductibility of the Option Awards in its U.S. VA calculation, which resulted in additional tax benefits from fiscal year 2020 through fiscal year 2022. Historically, the Company recognized net losses for fiscal year 2008 through fiscal year 2017 (other than with respect to fiscal year 2013, when there was minimal net income, which resulted in diluted earnings per share of $0.01) and had been in a full VA position given its history of U.S. tax losses. As set forth above the Company grew its revenue and net income from fiscal year 2020 through fiscal year 2022, and the VA release (due to higher NOLs attributable to the Section 162(m) adjustment) are directionally in line with the Company’s growth. Given the relatively small amount of tax expense recorded in fiscal year 2020 through fiscal year 2022, the impact of the correction had a greater percentage impact. As discussed above, the Company does not believe a key focus of its investors is tax expense, or taxes generally, and it does not believe the correction affected the total mix of information available to investors. This is supported by a review of the transcripts from the Company’s last four quarterly earnings calls, which the Company furnishes to the SEC on Form 8-K. The transcripts reflect that no questions were asked by investors regarding the Company’s tax expense, deferred income taxes or its VA position.
While the Company determined that a correction was appropriate to address the deductibility of the Option Awards under Section 162(m), the Company concluded that the impact of the correction on the Company’s financial statements, after assessing materiality under SAB Topic 1:M and 1:N and considering the quantitative and qualitative factors set forth above, was not material to the Company’s previously issued consolidated financial statements. The Company intends to include disclosure regarding the correction in future periodic reports filed with the SEC, as applicable, consistent with the disclosure included in the Form 10-Q.
Liquidity and Capital Resources, page 23
2.We note that cash flows from operating activities were impacted by working capital changes, including an increase in accounts receivable of $50.