What changed in this filing

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Item 1A. Risk Factors

2022-11-25 compared with 2021-11-24 · 83 added, 113 removed, 209 unchanged (48% of the section changed)

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You should carefully consider the risks described below and the other information in this Form 10-K before deciding to invest in shares of our common stock.

These are the risks and uncertainties applicable to our businesses, including our semiconductor automation business, that we believe are most important for you to consider.

These are the risks and uncertainties applicable to our businesses that we believe are most important for you to consider.

Additional risks and uncertainties not presently known to us, which we currently deem immaterial or which are similar to those faced by other companies in our industry or business in general, may also impair our business operations.

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In that event, the market price of our common stock could decline, and you could lose all or part of your investment.

Risks Relating to the COVID-19 Pandemic

Our financial condition and results of operations could be adversely affected by the COVID-1 pandemic.

In December 2019, a novel strain of coronavirus, causing a disease referred to as COVID-19, was first identified in Wuhan, Hubei Province, China, resulting in shutdowns of manufacturing and commerce in the months that followed.

Since then, COVID-19 has spread worldwide, including in the United States, and has resulted in authorities implementing numerous measures to try to contain the disease, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns.

We have followed the guidelines from the U.S.

Center for Disease Control, or CDC, and implemented the recommended safety protocols, and the spread of COVID-19 has also caused us to modify our business practices (including curtailing employee travel, implementing vaccination and testing policies and extending work-from-home policies where necessary), and we may take further actions as required by government authorities or that we determine are in the best interests of our employees, customers, partners and suppliers.

There is no certainty that such measures will be sufficient to mitigate the risks posed by the disease, and our ability to perform critical functions could be harmed.

As a result of the COVID-19 pandemic and the measures designed to contain its spread, our suppliers may not have the materials, capacity, or capability to supply our components according to our schedule and specifications.

Further, there may be logistics issues, including our ability and our supply chain’s ability to maintain production, as well as transportation demands that may cause further delays.

If our suppliers’ operations are curtailed, we may need to seek alternate sources of supply, which may be more expensive.

Alternate sources may not be available or may result in delays in shipments to us from our suppliers and subsequently to our customers.

In addition, the COVID-19 pandemic and the measures designed to stop the spread of the virus may have similar effects on our customers.

The current pandemic may also give rise to force majeure contractual protections being asserted by customers and/or suppliers that we maintain contracts with, potentially relieving contractual obligations these parties have to us.

In any case, any disruption of our suppliers’ or customers’ businesses would likely negatively impact our sales and operating results.

While the disruptions and restrictions on the ability to travel, quarantines and other measures taken as a result of the COVID-19 pandemic are expected to be temporary, the duration of any of these measures, and related financial impact, cannot be estimated at this time.

Should these measures continue for an extended period of time or be re-implemented after, the impact on our supply chain and customers could have a material adverse effect on our results of operations and cash flows.

Further, while the potential impact and duration of the COVID-19 pandemic on the global economy and our business in particular may be difficult to assess or predict, the COVID-19 pandemic has resulted in, and may continue to result in, significant disruption of global financial markets and an economic downturn that may affect demand for our

products and services, reduce our ability to access capital or our customers’ ability to pay us for past or future purchases, impact our operating results, and have a negative impact on our liquidity and stock price.

In addition, an extended recession or an additional financial market correction resulting from the spread of COVID-19 could, adversely affect demand for our products and services, our business and the value of our common stock.

The global pandemic of COVID-19 continues to rapidly evolve, and we will continue to monitor the COVID-19 situation closely.

Although the magnitude of the impact of the pandemic on our business and operations remains uncertain, the continued spread of COVID-19 and actions taken to mitigate such spread as well as the prolonged nature of the pandemic or the occurrence of other outbreaks of contagious diseases could adversely impact our business, financial condition, operating results and cash flows.

Risks Relating to the Sale of our Semiconductor Automation Business

The announcement and pendency of the sale of our semiconductor automation business to Thomas H.

Lee Partners, L.P.

could have an adverse effect on our stock price and/or our business, results of operations, financial condition and prospects.

The announcement and pendency of the sale of our semiconductor automation business to Thomas H.

Lee Partners, L.P., or THL, pursuant to the equity interest purchase agreement we entered into on September 20, 2021 could disrupt our business in the following ways, among others:

● customers may determine to delay or defer purchase decisions with regard to our semiconductor products and services or terminate and/or attempt to renegotiate their relationships with us as a result of the pending sale, whether pursuant to the terms of their existing agreements with us or otherwise;

● investors and customers may perceive that the loss of annual revenue generated by our semiconductor automation business, which was $680.1 million in fiscal year 2021, will negatively impact our growth potential and future financial results;

● the attention of our management may be directed toward the completion of the pending sale and related matters, and their focus may be diverted from the day-to-day business operations of our company, including from other opportunities that might otherwise be beneficial to us.

Should any of these matters occur, they could adversely affect our stock price or harm our business, results of operations, financial condition, and prospects.

Obtaining required approvals necessary to satisfy the conditions to the completion of the sale of our semiconductor automation business may delay or prevent completion of the pending sale.

The completion of the sale of our semiconductor automation business to THL is conditioned upon obtaining certain regulatory approvals.

We intend to pursue all required approvals in accordance with the terms of the equity interest purchase agreement.

No assurance, however, can be given that the required approvals will be obtained and, even if all such approvals are obtained, no assurance can be given as to the terms, conditions and timing of the approvals or that the approvals will satisfy the terms of the equity interest purchase agreement.

Inability to complete the sale of our semiconductor automation business could negatively impact our business, financial condition, results of operations or our stock price.

The completion of the sale of our semiconductor automation business to THL is subject to a number of conditions, including, among others, receipt of certain regulatory approvals, and there not having been a material adverse effect with respect to such business, and there can be no assurance that the conditions to the completion of the pending sale will be satisfied.

The equity interest purchase agreement may also be terminated by us and/or THL in certain specified circumstances, including in certain circumstances if the sale has not been consummated by June 30, 2022.

While the potential sale is pending and if the pending sale is not completed, we will be subject to several risks, including:

● the current trading price of our common stock may reflect a market assumption that the sale will be completed;

● we have incurred and expect to continue to incur substantial transaction costs in connection with the pending sale whether or not it is completed;

● under the equity interest purchase agreement, we are subject to certain restrictions on the conduct of our business prior to the completion of the pending sale, which restrictions could adversely affect our ability to realize certain of our business strategies or take advantage of certain business opportunities;

● the negative perception of investors and customers of our semiconductor automation business if the sale is not consummated and our inability to operate the business in the same manner as before the announcement of the proposed sale

● the failure to receive the purchase price from the sale and our inability to use these funds as expected to expand our life sciences businesses;

● the risks inherent and specific to the semiconductor automation business, including the historical cyclicality in demand for semiconductor capital equipment, the critical importance of supply chain stability, and potential international trade restrictions and other geopolitical risks.

Any of these risks could have a material adverse effect on our business, financial condition, results of operations and stock price.

Macroeconomic and External Risks

We are subject to risks associated with public health threats and epidemics, including COVID-19.

We are subject to risks associated with public health threats and epidemics, including the global health concerns relating to the ongoing COVID-19 pandemic.

The global COVID-19 pandemic has adversely impacted and may further adversely impact our business and markets, including our workforce and operations and the operations of our customers, suppliers, and business partners.

In particular, we may experience material financial or operational impacts, including:

● significant volatility or reductions in demand for our products and/or services;

● the inability to meet our customers’ needs or other obligations due to disruptions to our operations or the operations of our third-party partners, suppliers, contractors, logistics partners, or customers.

These impacts may be of greater magnitude in certain jurisdictions in which we and our customers operate that continue to maintain stringent COVID-19 policies, in particular China.

The depth and extent to which the COVID-19 pandemic may directly or indirectly impact our business, results of operations, financial condition and individual markets is dependent upon various factors, including the spread of additional variants, the availability of vaccinations, and government interventions to reduce the spread of the virus.

While we have developed and implemented and continue to develop and implement health and safety protocols, business continuity plans and crisis management protocols in an effort to try to mitigate the negative impact of COVID-19 on our employees and our business, there can be no assurance that we will be successful in our efforts or that such efforts may not have detrimental unintended consequences, and as a result, our business, financial condition and results of operations may be materially and adversely affected.

A prolonged downturn in macroeconomic conditions may materially adversely affect our business.

An economic downturn in the United States and elsewhere, including as a result of continued or future outbreaks of COVID-19 or a similar infectious disease, reductions in the level of government funding for scientific research, increases in interest rates, inflation, among other factors, may cause our current or potential customers to delay or reduce purchases, which could, in turn, result in reductions in sales of our products, materially and adversely affecting our results of operations and cash flows.

Volatility and disruption of global financial markets could limit our customers’ ability to obtain adequate financing to maintain operations and proceed with planned or new capital spending initiatives, leading to a reduction in sales volume that could materially and adversely affect our results of operations and cash flow.

In addition, a decline in our customers’ ability to pay as a result of the economic downturn may lead to increased difficulties in the collection of our accounts receivable, higher levels of reserves for doubtful accounts and write-offs of accounts receivable, and higher operating costs as a percentage of revenues.

Global climate change and related legal and regulatory developments could negatively affect our business, financial condition and results of operations.

Climate change presents risks to us and to our customers, with the risks expected to increase over time.

Our products and services are subject to and affected by environmental regulation by federal, state, and local authorities in the United States and regulatory authorities with jurisdiction over our international operations.

Future regulations or voluntary actions on our part in response to climate change could result in costly changes to our facilities to reduce carbon emissions and could increase energy costs as a result of switching to less carbon-intensive, but more expensive, sources of energy to operate our facilities and to transport and ship products and samples.

There can be no assurance that climate change or environmental regulation and response will not have a negative competitive impact on our ability to provide sample management, automated storage, and genomic services or that economic returns will match the investment that we are making in the development of new products and services.

We will likely face increasing complexity related to product design, the use of regulated materials, energy consumption and efficiency, and the reuse, recycling, or disposal of products and their components at end-of-use or useful life.

There continues to be a lack of consistent climate legislation, which creates economic and regulatory uncertainty regarding future incentives for energy-efficiency and costs of compliance, which may impact the demand for our products and services, and our results of operations and financial condition.

In addition, the potential physical impacts of climate change on our operations are highly uncertain and would be particular to the geographic circumstances in areas in which we operate.

These may include changes in global weather patterns, which could include local changes in rainfall and storm patterns and intensities, water shortages, changing sea levels, and changing temperature averages or extremes.

These impacts may also adversely affect our properties, our business, financial condition and results of operations.

Unfavorable currency exchange rate fluctuations may impact our significant foreign currency holdings, lead to lower operating margins, or may cause us to raise prices, which could result in reduced sales.

Currency exchange rate fluctuations could have an adverse effect on our sales, cost of sales and results of operations, and we could experience losses with respect to forward exchange contracts into which we may enter.

Unfavorable currency fluctuations could require us to increase prices to customers, which could result in lower net sales by us to such customers.

Alternatively, if we do not adjust the prices for our products and services in response to unfavorable currency fluctuations, our results of operations could be materially and adversely affected.

In addition, most sales made by our foreign subsidiaries are denominated in the currency of the country in which these products are sold or these services are provided and the currency they receive in payment for such sales could be less valuable as compared

dollar at the time of receipt as a result of exchange rate fluctuations.

From time to time, we enter into forward exchange contracts to reduce currency exposure.

However, we cannot be certain that our efforts will be adequate to protect us against significant currency fluctuations or that such efforts will not expose us to additional exchange rate risks, which could materially and adversely affect our results of operations.

In addition, approximately $1 billion of the cash was received upon the completion of the sale of our semiconductor automation business on February 1, 2022, is denominated in Euro, which represents a substantial portion of our current cash balance.

As a result of our increased foreign currency holdings, our financial results and capital ratios may be impacted by the movements in exchange rates, and a significant portion of our assets must be translated into U.S.

dollars for external reporting purposes or converted into U.S.

dollars to meet our strategic needs, including with respect to our recently approved share repurchase program, and service obligations such as any future U.S.

dollar-denominated indebtedness or dividends.

We may seek to mitigate our exposure to currency exchange rate fluctuations, but our efforts may not be successful.

Our business could be negatively impacted by environmental, social and governance (ESG) matters.

There has been an increased focus from investors, customers, employees and other stakeholders concerning environmental, social and governance, or ESG, matters, including addressing climate change, which may result in increases in our costs to operate our business or restrict certain aspects of our activities.

The standards by which ESG efforts and related matters are measured are developing and evolving, and certain areas are subject to assumptions that could change over time and the extent and severity of climate change impacts are unknown.

In addition, we could be criticized for the scope of such initiatives or goals or perceived as not acting responsibly in connection with these matters.

Any such matters could have a material adverse impact on our future results of operations, financial position and cash flows.

Risks Relating to Our Operations

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● changes in the demand for the mix of products and services that we offer;

● the timing and amount of any repurchases of our common stock under our recently approved share repurchase program;

● timing and market acceptance of our new product and services introductions;

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● competitive pricing pressures;

● increased amount of investment into the infrastructure to support our growth, including capital equipment, research and development, as well as selling and marketing initiatives to support continuous product and services innovation, technological capability enhancements and sales efforts.

● increased investment into our infrastructure to support our growth, including capital equipment, research and development, as well as selling and marketing initiatives to support continuous product and services innovation, technological capability enhancements and sales efforts.

The timing of revenue generation coupled with the increased amount of investment may result in operating losses.

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Negative developments in any of these areas in one or more countries could result in a reduction in demand for our products, the cancellation or delay of orders already placed, threats to our intellectual property, difficulty in collecting receivables, and a higher cost of doing business, any of which could materially harm our business and profitability.

In addition, approximately $1 billion of the proceeds from the recently completed sale of the semiconductor automation business is held outside the United States and our ability to repatriate any of the funds for use in the United States or elsewhere in our business may be limited, which could negatively impact our opportunities to deploy capital, including for our recently approved share repurchase program.

Our business could be materially harmed if we fail to adequately integrate the operations of the businesses that we have acquired or may acquire.

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The failure to adequately address these risks or the impairment of any assets could materially harm our business and financial results.

The possibility of these risks impacting our business will likely expand after the expected completion of the sale our semiconductor automation businesses.

Expanding within current markets introduces new competitors and commercial risks.

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The same could be true if we were to experience a high turnover rate among engineering and scientific personnel and we were unable to replace them.

Global climate change and related legal and regulatory developments could negatively affect our business, financial condition and results of operations.

Climate change presents immediate and long-term risks to us and to our customers, with the risks expected to increase over time.

In addition, the potential physical impacts of climate change on our operations are highly uncertain and would be particular to the geographic circumstances in areas in which we operate.

These impacts may also adversely affect our properties, our business, financial condition and results of operations.

Our ability to attract and retain employees may be negatively impacted by employees’ reactions to our health and safety policies related to COVID-19 vaccinations, masks, and/or flexibility to work remotely, particularly in the United States.

Any failure to attract, recruit, train, retain, motivate and integrate qualified personnel could materially harm our operating results and growth prospects.

Unexpected events could disrupt our sample storage operations and adversely affect our reputation and results of operations.

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Changes in applicable tax laws could significantly impact the estimates of our tax assets and liabilities, as well as expectations of future effective tax rates.

Recently proposed U.S.

corporate income tax reform could drive negative impacts to our tax position depending upon final enacted legislation.

Based on the nature of the uncertainties around specific legislation to be agreed-upon by congress, we have not quantified the impact of this risk.

In addition, we are subject to regular examination by the U.S.

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International trade disputes could result in additional or increased tariffs, export controls or other trade restrictions that may have a material impact on our business.

We sell a significant number of products outside the United States, including in China, Taiwan, Japan and South Korea.

Based on the complex relationships among these countries and the United States, there is inherent risk that political, diplomatic and national security influences might lead to trade disputes, impacts and/or disruptions, in particular, with respect to those affecting the semiconductor industry.

We sell a significant number of products outside the United States, including in China and Japan.

The United States and other countries have imposed and may continue to impose trade restrictions and have also levied tariffs and taxes on certain goods.

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We are subject to numerous governmental regulations.

We are subject to federal, state, local and foreign regulations, including environmental regulations, regulations relating to the design and operation of our products and control systems and regulations relating to certain of our service offerings.

We might incur significant costs as we seek to ensure that our products meet safety and emissions standards, many of which vary across the states and countries in which our products are used.

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We may face difficulties in satisfying customers who may require that all of the components of our products are certified as conflict mineral free and/or free of numerous other hazardous materials.

Unfavorable currency exchange rate fluctuations may lead to lower operating margins, or may cause us to raise prices, which could result in reduced sales.

Unfavorable currency fluctuations could require us to increase prices to customers, which could result in lower net sales by us to such customers.

Alternatively, if we do not adjust the prices for our products and services in response to unfavorable currency fluctuations, our results of operations could be materially and adversely affected.

dollar at the time of receipt as a result of exchange rate fluctuations.

From time to time, we enter into forward exchange contracts to reduce currency exposure.

However, we cannot be certain that our efforts will be adequate to

protect us against significant currency fluctuations or that such efforts will not expose us to additional exchange rate risks, which could materially and adversely affect our results of operations.

Our indebtedness may adversely affect our ability to operate our business, generate cash flows and make payments on such indebtedness

On October 4, 2017, we entered into a $200.0 million Senior Secured Term Loan Facility, or term loan, with Morgan Stanley Senior Funding, Inc., JPMorgan Chase Bank, N.A.

and Wells Fargo Securities, LLC pursuant to the terms of a credit agreement with the lenders.

At September 30, 2021, the outstanding term loan principal balance was $49.7 million, excluding unamortized deferred financing costs of $0.3 million.

The term loan matures and becomes fully payable on October 4, 2024.

We are required to redeem the term loan at the principal amount then outstanding upon occurrence of certain events, as described in the credit agreement.

For further information on this transaction, please refer to Note 11, "Debt"

to our Consolidated Financial Statements included in Item 8, "Financial Statements and Supplementary Data"

of this Form 10-K.

Our ability to pay interest and repay the principal for our indebtedness, including the term loan, is dependent upon our ability to manage our business operations and maintain sufficient liquidity to service such debt.

The loan borrowings are subject to variable interest rates which create exposure to interest rate risk.

Interest rate increases may result in higher cost of servicing our loans and reduce our profitability and cash flows.

The terms of our debt covenants in the credit agreement for the term loan could limit our ability to raise additional funds and the manner in which we conduct our business.

We have the ability to refinance the term loan and obtain additional indebtedness as long as we maintain a certain level of liquidity and earnings, as specified in the credit agreement for the term loan.

If our liquidity and earnings are reduced below a certain level, we will have limited ability to service the term loan and obtain additional debt financing.

Our failure to comply with the restrictive covenants under the term loan and our other indebtedness could also result in an event of default under the term loan which, if not cured or waived, could result in the acceleration of all or a portion of our indebtedness, including under the term loan.

Accordingly, a default under the term loan would have a material adverse effect on our business and our lender would have the right to exercise its rights and remedies to collect, which would include the right to foreclose on our assets.

Our failure to protect our intellectual property could adversely affect our future operations.

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In addition, the laws of some countries in which our products are or may be developed, manufactured, or sold may not fully protect our products.

Due to the rapid technological change that characterizes the life sciences and related process equipment industries, we believe that the improvement of existing technology, reliance upon trade secrets, unpatented proprietary know-how and the development of new products may be as important as patent protection in establishing and maintaining a competitive advantage.

maintaining a competitive advantage.

To protect trade secrets and know-how, it is our policy to require all technical and management personnel to enter into nondisclosure agreements.

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Our inability to obtain components or materials in required quantities or of acceptable cost and quality and with the necessary continuity of supply could result in delays or reductions in product shipments to our customers.

In addition, if a supplier or sub-supplier suffers a production stoppage or delay for any reason, including natural disasters such as the tsunamis that affected Japan in 2011 and Thailand in 2004, this could result in a delay or reduction in our product shipments to our customers.

In addition, if a supplier or sub-supplier suffers a production stoppage or delay for any reason, including natural disasters, this could result in a delay or reduction in our product shipments to our customers.

Any of these contingencies could cause us to lose customers, result in delayed or lost revenue and otherwise materially harm our business.

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We are dependent on the availability of certain key raw materials and natural resources used in our products and various manufacturing processes, and we rely on third parties to supply us with these materials in a cost-effective and timely manner.

Our access to raw materials may be adversely affected if our suppliers’ operations were disrupted as a result of limited or delayed access to key raw materials and natural resources which may result in increased cost of these items.

Our access to raw materials may be adversely affected if our suppliers’ operations were disrupted as a

result of limited or delayed access to key raw materials and natural resources which may result in increased cost of these items.

Our outsource providers may fail to perform as we expect.

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Many of these outsourced service providers, including certain hosted software applications that we use for confidential data storage, employ cloud computing technology for such storage.

These providers’ cloud computing systems may be susceptible to “cyber incidents,” such as intentional cyber-attacks aimed at theft of sensitive data or inadvertent cyber-security compromises,

which are outside of our control.

These providers’ cloud computing systems may be susceptible to “cyber incidents,” such as intentional cyber-attacks aimed at theft of sensitive data or inadvertent cyber-security compromises, which are outside of our control.

Although we attempt to select reputable providers and secure their performance on terms documented in written contracts, it is possible that one or more of these providers could fail to perform or adequately protect our data from cyber-related security breaches as we expect and any such failure could have an adverse impact on our business.

Risks Relating to Our Customers

Because we rely on a limited number of customers for a large portion of our revenue, the loss of one or more of these customers could materially harm our business.

We receive a significant portion of our revenue in each fiscal period from a relatively limited number of customers, and that trend is likely to continue.

Sales to our ten largest customers accounted for approximately 19%, 19% and 21%, respectively, of our total revenue in the fiscal years ended September 30, 2021, 2020 and 2019.

The loss of one or more of these major customers, a significant decrease in orders from one of these customers, or the inability of one or more customers to make payments to us when they are due could materially affect our revenue, business and reputation.

Because of the lengthy sales cycles of many of our products, we may incur significant expenses before we generate any revenue related to those products.

Our customers may need several months to test and evaluate our products.

This increases the possibility that a customer may decide to cancel an order or change its plans, which could reduce or eliminate our sales to that customer.

The impact of this risk can be magnified during the periods in which we introduce a number of new products and services, as has been the case in recent years.

As a result of this lengthy sales cycle, we may incur significant research and development expenses, and selling, general and administrative expenses before we generate the related revenue for these products, and we may never generate the anticipated revenue if our customer cancels an order or changes its plans.

Customers generally do not make long term commitments to purchase our products and our customers may cease purchasing our products at any time.

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Accordingly, we are exposed to competitive pricing pressures on each order.

Our customers also engage in the practice of purchasing products from more than one manufacturer to avoid dependence on sole-source suppliers for certain of their needs.

The existence of these practices makes it more difficult for us to increase price, gain new customers and win repeat business from existing customers.

We may face claims for liability related to damages of customer materials attributed to the failure of our products or services, exposing us to significant financial or reputational harm.

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From the beginning of fiscal year 2021 through the end of fiscal year 2022, our stock price fluctuated between a high of $124.15 per share and a low of $42.86 per share.

Consequently, the current market price of our common stock may not be indicative of future market prices, and we may

be unable to sustain or increase the value of an investment in our common stock.

Consequently, the current market price of our common stock may not be indicative of future market prices, and we may be unable to sustain or increase the value of an investment in our common stock.

Factors affecting our stock price may include:

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● changes in the market price per share of our public company customers;

● market conditions in the semiconductor, life sciences sample management and genomic services and other industries into which we sell products and services;

● the timing and amount of any repurchases of our common stock under our recently approved share repurchase program;

● market conditions in the life sciences sample management and genomic services and other industries into which we sell products and services;

● global economic conditions;

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● low trading volume of our common stock;

● the change in stockholders expected upon the completion of the sale of our semiconductor automation business;

● the number of firms making a market in our common stock.

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These market fluctuations could adversely affect the market price of our common stock.

Although we have initiated a share repurchase program, we cannot guarantee that our share repurchase program will limit our ability to further develop our business or whether the share repurchase program will be fully implemented or that it will enhance long-term stockholder value.

On November 4, 2022, our Board of Directors approved a new share repurchase program authorizing the repurchase of up to $1.5 billion of our common stock, or the 2022 Repurchase Program.

Repurchases under the 2022 Repurchase Program may be made in the open market or through privately negotiated transactions (including under an accelerated share repurchase, or ASR, agreement), or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, subject to market and business conditions, legal requirements, and other factors.

We are not obligated to acquire any particular amount of common stock under the 2022 Repurchase Program, and share repurchases may be commenced or suspended at any time at our discretion.

Our ability to repurchase common stock under the 2022 Repurchase Program will depend upon, among other factors, our cash balances and potential future capital requirements for strategic investments, whether organic or through acquisitions, our results of operations, our financial condition and other factors beyond our control that we may deem relevant to a decision to repurchase common stock under the 2022 Repurchase Program.

Repurchases pursuant to our share repurchase program could affect the price of our common stock and increase its volatility.

The existence of our share repurchase program could also cause the price of our common stock to be higher than it would be in the absence of such a program and could reduce the market liquidity for our common stock.

Additionally, repurchases under our share repurchase program will diminish our cash reserves, which could impact our ability to further develop our business organically or through acquisitions or service any indebtedness we may incur in the future as a result of the reduction of our cash balances from the 2022 Repurchase Program or otherwise.

There can be no assurance that any repurchases will enhance shareholder value because the market price of our common stock may decline below the levels at which we repurchased such shares.

Any failure to repurchase shares after we have announced our intention to do so may negatively impact our reputation and investor confidence in us and may negatively impact our stock price.

Although our share repurchase program is intended to enhance long-term stockholder value, short-term price fluctuations could reduce the program’s effectiveness.

Our business and operations could be negatively affected by stockholder activism, which could impact the trading price and volatility of our common stock and may constrain capital deployment opportunities and adversely impact our ability to expand our business.

Our business and operations could be negatively affected if we become subject to any securities litigation or stockholder activism, which could cause us to incur significant expenses, hinder the execution of our business and growth strategy, constrain our capital deployment opportunities, and impact the price of our common stock.

Stockholder activism, which could take many forms or arise in a variety of situations, has been increasing recently.

Volatility in the price of our common stock, our cash balance or other reasons may cause us to become the target of securities litigation or stockholder activism.

Securities litigation and stockholder activism, including potential proxy contests, could result in substantial costs and divert management’s and our Board of Director’s attention and resources from our business.

Additionally, such securities litigation and stockholder activism could give rise to perceived uncertainties as to our future, adversely affect our relationships with service providers and make it more difficult to

attract and retain qualified personnel.

Also, we may be required to incur significant legal fees and other expenses related to any securities litigation and activist stockholder matters.

Further, the price of our common stock could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and stockholder activism.

If we become the focus of stockholder activism for any other reasons, we may be constrained in our capital deployment opportunities and may be limited in the types of investments that are available to us.

Provisions in our charter documents and Delaware law may delay or prevent an acquisition of us, which could decrease the value of your shares.

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Our restated certificate of incorporation authorizes the issuance of shares of blank check preferred stock.

Our restated certificate of incorporation provides that our Board of Directors is authorized to issue from time to time, without further stockholder approval, up to 1,000,000 shares of preferred stock in one or more series and to fix and designate the rights, preferences, privileges and restrictions of the preferred stock, including dividend rights, conversion

rights, voting rights, redemption rights and terms of redemption and liquidation preferences.

Such shares of preferred stock could have preferences over our common stock with respect to dividends and liquidation rights.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors