What changed in this filing

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Item 1. Legal Proceedings

2022-11-10 compared with 2022-08-15 · 45 added, 43 removed, 628 unchanged (12% of the section changed)

14 unchanged sentences

the COVID-19 pandemic and responsive measures;

the success of our partnership with Topcon;

natural disasters, economic downturns, public health crises or political crises.

worldwide economic downturns and related uncertainties;

Operational factors

our relationship with our strategic partner and main distributor, Topcon;

the success of our relationship with our strategic partner and main distributor Topcon.

quality control and production issues;

1 unchanged sentence

defects in our laser systems;

costs, sales volumes, results of operations, and revenues;

direct and independent sales forces and a network of international distributors to sell our products;

5 unchanged sentences

the collaborative relationships used to enhance products and applications;

costs, sales volumes, results of operations, and revenues;

the loss of key personnel;

1 unchanged sentence

dependence on sole source and limited source suppliers;

catastrophic loss;

disruptions to our information technology system and breaches of data security;

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recalls of our products;

managing growth effectively.

Regulatory and legal factors

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Financing and transactional risks

our ability to repay indebtedness;

efforts to acquire additional companies or product lines;

divestitures of our businesses or product lines;

efforts to acquire additional companies or product lines;

raising additional capital;

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If the volume of elective procedures continues to remain lower than normal, our results of operations and financial condition will continue to be adversely affected.

As a result of the COVID-19 outbreak around the world, we have adopted several measures including allowing employees to work from home, slowing our manufacturing operations, and restricting non-critical business travel by our employees.

As a result of the COVID-19 outbreak around the world, we have adopted several measures including allowing employees to work from home and slowing our manufacturing operations.

The COVID-19 pandemic has caused disruption and delays in our ability to operate and manufacture, test and assemble products in our internal facilities, particularly in our Mountain View, California facility, and has limited our ability to continue certain research and development activities which could materially and adversely affect our ability to develop new products and technologies on the timelines we previously anticipated.

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operations have been disrupted by the COVID-19 pandemic, as travel is restricted and some services are being performed from home, all of which could have an impact on our ability to sell and distribute our products.

Growth in our sales and marketing organization may create operational challenges without immediately offsetting benefits.

Growth in our sales and marketing organization may increase costs and create operational challenges without immediately offsetting benefits.

We have increased and continue to increase our internal sales and marketing functions.

This growth may place a significant strain on our management, operating and financial systems and our sales, marketing, training and administrative resources.

As a result of our growth, our operating costs may escalate even faster than planned, and some of our internal systems may need to be enhanced or replaced.

This growth may place a strain on our management, operating and financial systems and our sales, marketing, training and administrative resources.

As a result, our operating costs may escalate even faster than planned, and some of our internal systems may need to be enhanced or replaced.

For example, if we are unable to provide adequate training for our expanding sales force, our ability to fully utilize new sales and marketing resources may be adversely impacted, we could suffer reputational harm and our ability to maintain our installed base of customers may be negatively impacted.

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We derive, and expect to continue to derive, a large portion of our revenues from international sales.

For the second fiscal quarter of fiscal year 2022, our international sales were $6.9 million, or 50.2% of total revenues.

For the third fiscal quarter of fiscal year 2022, our international sales were $7.2 million, or 49.3% of total revenues.

We anticipate that international sales will continue to account for a significant portion of our revenues in the foreseeable future.

All of our international revenues and costs for the second fiscal quarter of fiscal year 2022 have been denominated in U.S.

All of our international revenues and costs for the third fiscal quarter of fiscal year 2022 have been denominated in U.S.

dollars except for sales transacted through our German subsidiary.

44 unchanged sentences

and worldwide economy including inflationary pressures that may cause the cost of manufacturing our products or servicing our products to increase.

Concerns about consumer and investor confidence, volatile corporate profits and reduced capital spending, international conflicts, terrorist and military activity, civil unrest and pandemic-related illness could reduce customer orders or cause customer order cancellations.

Concerns about consumer and investor confidence, volatile corporate profits and reduced capital spending, international conflicts, terrorist and military activity, civil unrest and

pandemic-related illness could reduce customer orders or cause customer order cancellations.

For example, the COVID-19 pandemic has and may continue to cause adverse impacts on global economic activity which could negatively impact our business.

political and social turmoil related to international conflicts, such as that occurring in Russia and Ukraine, and terrorist acts may put further pressure on economic conditions in the United States and abroad.

In addition, political and social turmoil related to international conflicts, such as that occurring in Russia and Ukraine, and terrorist acts may put further pressure on economic conditions in the United States and abroad.

Weak economic conditions and declines in consumer spending and consumption may harm our operating results.

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Any such developments could have a material adverse effect on our business, financial condition and results of operations.

Divestitures of our businesses or product lines may materially and adversely affect our financial condition, results of operations or cash flows and require us to raise additional capital to replace revenue from those business units or product lines.

We have two main businesses:

glaucoma and retina, domestic and international operations within each and many product lines within the two businesses.

We periodically evaluate the performance and strategic fit of our businesses and may sell businesses or product lines.

Divestitures involve risks, including difficulties in the separation of operations, services, products and personnel, the diversion of management's attention from other business concerns, the disruption of our business, the potential loss of key employees and the retention of uncertain environmental or other contingent liabilities related to the divested business.

In addition, divestitures may result in significant asset impairment charges, including those related to goodwill and other intangible assets, and the loss of revenue which could have a material adverse effect on our financial condition and results of operations.

In addition, we may not realize the expected value from the divestiture of a business or product lines and may need to raise additional capital to replace the revenue generated from the business or product line that is divested.

We can provide no assurance that such capital will be available or available on terms that are acceptable to us.

We cannot assure you that we will be successful in managing these or any other

significant risks that we encounter in divesting a business or product line, and any divestiture we undertake could materially and adversely affect our business, financial condition, results of operations and cash flows, and may also result in a diversion of management attention, operational difficulties and losses.

Our operating results may be adversely affected by uncertainty regarding healthcare reform measures and changes in third-party coverage and reimbursement policies.

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Among other things, Congress has in the past proposed changes to and the repeal of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010, collectively, the “Affordable Care Act”, and the current U.S.

presidential administration has announced certain policy changes that could impact the availability of benefits under

the Affordable Care Act.

presidential administration has announced certain policy changes that could impact the availability of benefits under the Affordable Care Act.

For example, tax reform legislation enacted at the end of 2017 eliminated the tax penalty for individuals who did not maintain sufficient health insurance coverage beginning in 2019 (the “individual mandate”).

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Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results.

The risk of our being found in violation of these laws is increased by the fact that their provisions are open to a variety of evolving interpretations and enforcement discretion.

The risk of our being found in violation of these laws is increased by the fact that their provisions are open to a variety of evolving interpretations and

enforcement discretion.

Compliance with Open Payments, commonly known as the Sunshine Act, has presented a number of challenges to companies such as ours, in terms of interpretation of the law and its implementation.

8 unchanged sentences

Commercially, we currently have a distribution and licensing agreement with Alcon for our GreenTip SoftTip Cannula.

royalties from the GreenTip SoftTip Cannula are dependent upon the sales performance of Alcon, which depends on their efforts and is beyond our control.

Sales of and royalties from the GreenTip SoftTip Cannula are dependent upon the sales performance of Alcon, which depends on their efforts and is beyond our control.

The failure to obtain any additional future clinical or commercial collaborations and the resulting failure or success of such collaboration relationships could have a material adverse effect on our ability to introduce new products or applications and therefore could have a material adverse effect on our business, results of operations and financial condition.

11 unchanged sentences

We may be subject to liability based on the actions of individual employees and contractors carrying out activities on our behalf, including sales representatives who may interact with healthcare professionals.

If we fail to manage growth effectively, our business could be disrupted which could harm our operating results.

We have experienced and may in the future experience growth in our business, both organically and through the acquisition of businesses and products.

We have made and expect to continue to make significant investments to enable our future growth through, among other things, new product innovation and clinical trials for new applications and products.

We must also be prepared to expand our work force and to train, motivate and manage additional employees as the need for additional personnel arises.

Our personnel, systems, procedures and controls may not be adequate to support our future operations.

Any failure to effectively manage future growth could have a material adverse effect on our business, results of operations and financial condition.

We rely on patents and proprietary rights to protect our intellectual property and business.

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We file patent applications to protect technology, inventions and improvements that are significant to the development of our business.

As of July 2, 2022, our patent portfolio includes 60 active United States patents and 96 active international patents on the technologies related to our products and processes.

In addition, as of July 2, 2022, we have 12 patent applications pending in the United States and 22 international patent applications pending.

As of October 1, 2022, our patent portfolio includes 62 active United States patents and 96 active international patents on the technologies related to our products and processes.

In addition, as of October 1, 2022, we have 12 patent applications pending in the United States and 24 international patent applications pending.

Our patent applications may not be approved.

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If it appears necessary or desirable, we may seek licenses under such patents or proprietary intellectual property.

patent holders commonly offer such licenses, licenses under such patents or intellectual property may not be offered or the terms of any offered licenses may not be reasonable.

Although patent holders commonly offer such licenses, licenses under such patents or intellectual property may not be offered or the terms of any offered licenses may not be reasonable.

Any claims, with or without merit, and regardless of whether we are successful on the merits, would be time-consuming, result in costly litigation and diversion of technical and management personnel, cause shipment delays or require us to develop non-infringing technology or to enter into royalty or licensing agreements.

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Any failures by our vendors to adequately supply limited and sole source components or products may impair our ability to offer our existing products, delay the submission of new products for regulatory approval and market introduction, materially harm our business and financial condition and cause our stock price to decline.

Establishing our own capabilities to manufacture these components or products would

be expensive and could significantly decrease our profit margins.

Establishing our own capabilities to manufacture these components or products would be expensive and could significantly decrease our profit margins.

Our business, results of operations and financial condition would be adversely affected if we are unable to continue to obtain components or fully-assembled products in the quantity and quality desired and at the prices we have budgeted.

31 unchanged sentences

Under the FD&C Act and the related regulations, the FDA regulates the design, development, clinical testing, manufacture, labeling, sale, distribution and promotion of medical devices.

Before a new device can be introduced into the market, the

product must be shown to meet regulatory requirements established by the FD&C Act and implemented by the FDA.

Before a new device can be introduced into the market, the product must be shown to meet regulatory requirements established by the FD&C Act and implemented by the FDA.

Unless otherwise exempt, a device manufacturer must obtain marketing “clearance”

44 unchanged sentences

The laser performance standard imposes specific record-keeping, reporting, product testing and product labeling requirements.

These requirements include affixing warning labels to laser products, as

well as incorporating certain safety features in the design of laser products.

These requirements include affixing warning labels to laser products, as well as incorporating certain safety features in the design of laser products.

The FDA enforces the QSR and laser performance standards through periodic unannounced inspections.

60 unchanged sentences

A successful claim brought against us in excess of our insurance coverage could have a material adverse effect on our business, results of operations and financial condition.

If we fail to manage growth effectively, our business could be disrupted which could harm our operating results.

We have experienced and may in the future experience growth in our business, both organically and through the acquisition of businesses and products.

We must also be prepared to expand our work force and to train, motivate and manage additional employees as the need for additional personnel arises.

Our personnel, systems, procedures and controls may not be adequate to support our future operations.

Any failure to effectively manage future growth could have a material adverse effect on our business, results of operations and financial condition.

Significant developments resulting from recent and potential changes in U.S.

51 unchanged sentences

The price per share at which we sell additional shares of our common stock, or securities convertible or exchangeable into common stock, in future transactions may be higher or lower than the price per share paid by existing investors.

Divestitures of some of our businesses or product lines may materially and adversely affect our financial condition, results of operations or cash flows and require us to raise additional capital to replace revenue from those business units or product lines.

We evaluate the performance and strategic fit of all of our businesses and may sell businesses or product lines.

In addition, we may need to raise additional capital to replace the revenue generated from the business or product line that is divested and we can provide no assurance that such capital will be available or available on terms that are acceptable to us.

We cannot assure you that we will be successful in managing these or any other significant risks that we encounter in divesting a business or product line, and any divestiture we undertake could materially and adversely affect our business, financial condition, results of operations and cash flows, and may also result in a diversion of management attention, operational difficulties and losses.

If we fail to comply with environmental requirements, our business, financial condition, operating results and reputation could be adversely affected.

11 unchanged sentences

The trading price of our common stock has been subject to wide fluctuations in response to a variety of factors, some of which are beyond our control, including changes in foreign currency exchange rates, quarterly variations in our operating results, announcements by us or our competitors of new products or of significant clinical achievements, changes in market valuations of other similar companies in our industry and general market conditions, including deteriorating market conditions due to investor concerns regarding inflation and hostilities between Russia and Ukraine.

During the second quarter of fiscal year 2022, the trading price of our common stock fluctuated from a low of $2.47 per share to a high of $4.55 per share.

During the third quarter of fiscal year 2022, the trading price of our common stock fluctuated from a low of $2.41 per share to a high of $3.41 per share.

There can be no assurance that our common stock trading price will not suffer declines.

7 unchanged sentences

The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us, our market and our competitors.

If no or few securities or industry analysts cover our company, the trading price for our

stock could be negatively impacted.

If no or few securities or industry analysts cover our company, the trading price for our stock could be negatively impacted.

If one or more of the analysts who covers us downgrades our stock or publishes incorrect or unfavorable research about our business, our stock price could decline.

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Ineffective disclosure controls and procedures or internal control over financial reporting could also cause investors to lose confidence in our reported financial and other information, which could likely have a negative effect on the trading price of our common stock.

Implementing any appropriate changes to our internal controls may require specific compliance training of our directors, officers and employees, entail substantial costs in order to modify our existing accounting systems, and take a significant period of time to complete.

time to complete.

Such changes may not, however, be effective in maintaining the adequacy of our internal controls, and any failure to maintain that adequacy, or consequent inability to produce accurate financial statements on a timely basis, could increase our operating costs and could materially impair our ability to operate our business.

18 unchanged sentences

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-Q

Item 1. Legal Proceedings