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Our investments in new business strategies or initiatives, including our transition to selling more products and services on a subscription basis, are inherently risky and may not be successful or we may be unable to maintain our Advanced Services customers.
−Removed: In addition, we may be unable to realize the potential benefits of our expense containment measures or our acquired businesses, including RxInnovation Inc., operating as FDS Amplicare ® (“FDS Amplicare”), ReCept Holdings, Inc., (“ReCept”), which was subsequently renamed Omnicell Specialty Pharmacy Services, Inc., MarkeTouch Media, LLC (“MarkeTouch Media”), and Hub and Spoke Innovations, and risks related to investments in new business strategies and initiatives could disrupt ongoing business and present risks not originally contemplated.
+Added: In addition, we may be unable to realize the potential benefits of our expense containment measures or our acquired businesses, including RxInnovation Inc., operating as FDS Amplicare ® (“FDS Amplicare”), ReCept Holdings, Inc., (“ReCept”), which was subsequently renamed Omnicell Specialty Pharmacy Services, Inc.
+Added: (“Omnicell Specialty Pharmacy Services”), MarkeTouch Media, LLC (“MarkeTouch Media”), and Hub and Spoke Innovations, and risks related to investments in new business strategies and initiatives could disrupt ongoing business and present risks not originally contemplated.
• Market Risks.
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We may fail to meet the demands of, or maintain relationships with, our institutional and retail pharmacy customers and we may be unable to secure or maintain access to existing and future specialty drugs.
−Removed: • COVID-19 Risks .
−Removed: The impact of the COVID-19 pandemic could continue to adversely affect our workforce and operations, as well as those of our customers and suppliers.
• Debt Risks.
−Removed: We have substantial debt, which could impair our financial flexibility and access to capital, and are subject to covenants in our A&R Credit Agreement (as defined below) that restrict our business and operations.
+Added: We have substantial debt, which could impair our financial flexibility and access to capital, and are subject to covenants in our Second A&R Credit Agreement (as defined below) that restrict our business and operations.
• Legal, Regulatory, and Healthcare Industry Risks.
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• International Operations Risks.
−Removed: Our operations in foreign countries expose us to additional risks, including distribution, management, and systems integration issues, reduced intellectual property protections, adverse changes in international laws, fluctuations in currency exchange rates, political unrest, and pandemics or other major public health crises.
+Added: Our operations in foreign countries expose us to additional risks, including distribution, management, and systems integration issues, reduced intellectual property protections, adverse changes in international laws, fluctuations in currency exchange rates, political unrest, foreign conflicts, and pandemics or other major public health crises.
• Workforce Risks.
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From time to time, the U.S.
−Removed: and global economy has experienced cyclical downturns impacting economic activity, the results of which include decreased demand for goods and services, reduced government spending, rising inflation, liquidity or credit constraints, declines in corporate profitability, credit, equity, or foreign exchange market volatility, increased bankruptcies, and general economic uncertainty.
−Removed: If decreases in demand for capital equipment caused by weak or uncertain economic conditions and decreased corporate and government spending, any effects of fiscal budget balancing at the federal level or proposed legislative changes, deferrals or delays (including due to customer labor shortages) of capital equipment projects, longer timeframes for capital equipment purchasing decisions, or generally reduced expenditures for capital solutions occur, we will experience decreased revenues and lower revenue growth rates, and our business, operating results, cash flow, or financial condition could be materially and adversely affected.
−Removed: In addition, the foregoing factors may also impact the willingness or ability of our customers to pay their existing obligations or honor their contractual commitments, which could result in decreased revenue and negatively impact our business, operating results, cash flow, or financial condition.
−Removed: Furthermore, the broader U.S.
+Added: and global economy has experienced cyclical downturns impacting economic activity, the results of which include decreased demand for goods and services, reduced government spending, rising inflation, increasing interest rates, liquidity or credit constraints, declines in corporate profitability, credit, equity, or foreign exchange market volatility, increased bankruptcies, and general economic uncertainty.
+Added: If decreases in demand for capital equipment caused by weak or uncertain economic conditions and decreased corporate and government spending, any effects of fiscal budget balancing at the federal level or proposed legislative changes, or generally reduced expenditures for capital solutions occur, we will experience decreased revenues and lower revenue growth rates, and our business, operating results, cash flow, or financial condition could be materially and adversely affected.
+Added: In addition, within the current macroeconomic environment, we have seen some customers defer or delay implementation of capital equipment projects, including due to customer labor shortages and increased healthcare worker turnover, along with longer timeframes both for capital equipment purchasing decisions and for entering into agreements for our products or solutions due to customer capital budget constraints or customers seeking to stagger or elongate the timeframes between the adoption of new or updated technologies, which has resulted in moderated demand, and may lead to decreased revenues and could result in our business, operating results, cash flow, or financial condition being materially and adversely affected.
+Added: Furthermore, the foregoing factors may also impact the willingness or ability of our customers to pay their existing obligations or honor their contractual commitments, which could result in decreased revenue and negatively impact our business, operating results, cash flow, or financial condition.
+Added: The broader U.S.
and global economy has experienced elevated inflationary pressures as well as continued supply chain disruptions, labor shortages and geopolitical instability.
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We may not realize the benefits of our expense containment efforts.
−Removed: In November 2022, we announced a restructuring initiative through which we expect to achieve certain efficiencies, which was further updated in February 2023.
−Removed: As part of this initiative, the Company has reduced its workforce across many of its functions and is in the process of reducing its real estate footprint.
+Added: In November 2022 and November 2023, we announced restructuring initiatives through which we expect to achieve certain efficiencies.
+Added: As part of these initiatives, the Company has reduced its workforce across many of its functions and is in the process of reducing its real estate footprint.
The estimates of the charges and costs that the Company expects to incur and the potential benefits that the Company expects to achieve in connection with the foregoing, and the timing thereof, are subject to a number of assumptions and actual results may differ materially.
−Removed: In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur as a result of or in connection with the implementation of this initiative.
+Added: In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur as a result of or in connection with the implementation of these initiatives.
There can be no assurance that these initiatives will achieve the expected benefits to our business as intended.
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Our ability to fund product development and enhancements partially depends on our ability to generate revenues from our existing products.
−Removed: If we inaccurately anticipate technological innovations or market trends or fail to generate sufficient revenue to develop new products, enhance existing products to meet customer needs or technological or regulatory change, or are unable to fund product development investments, our ability to generate future revenues or revenue growth may be negatively impacted, which could have a material adverse effect on our business, operating results, cash flow, or financial condition.
−Removed: New product and service developments or enhancements may be delayed, have technical problems (including software defects or errors), fail to meet customer or market specifications or industry standards, which could result in increased or unexpected expenses related to further developments or modifications.
−Removed: In addition, they also may not be competitive with other products using new or alternative technologies that offer comparable performance and functionality or may not be accepted in new or existing markets.
−Removed: Any of the foregoing could make our existing and future software solutions obsolete and unmarketable or result in loss of market share, damage our reputation or otherwise harm our business, operating results, cash flow, or financial condition.
+Added: If we inaccurately anticipate technological innovations or market trends or fail to generate sufficient revenue to develop new products, enhance existing products to meet customer needs or technological or regulatory change, or are unable to fund investment in, or achieve expected return on investment from, future product development, our ability to generate future revenues or revenue growth may be negatively impacted, which could have a material adverse effect on our business, operating results, cash flow, or financial condition.
+Added: New product and service developments or enhancements may be delayed, have technical problems (including software defects or errors), fail to meet customer or market specifications, regulatory requirements, or industry standards, which could result in increased or unexpected expenses related to further developments or modifications.
+Added: In addition, they also may not be competitive with other products using new or alternative technologies that offer comparable performance and functionality, may not be accepted in new or existing markets, or may not achieve expected return on investment.
+Added: Any of the foregoing could
+Added: make our existing and future solutions obsolete and unmarketable, or result in loss of market share or a determination to exit a particular business or product line, damage our reputation or otherwise harm our business, operating results, cash flow, or financial condition.
Our ability to execute successfully on the industry vision of the Autonomous Pharmacy depends on our ability to continue to develop and introduce new products and services or product and service enhancements, and integrate new products and services with existing offerings, in furtherance of this vision in a timely manner and on a cost-effective basis.
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As a result, we must continuously educate existing and prospective customers about the potential advantages of our medication management solutions and medication packaging systems, which requires significant sales efforts and can cause longer sales cycles.
−Removed: Despite our significant efforts and extensive time commitments in sales to healthcare facilities, we cannot be assured that our efforts will result in sales to these customers.
−Removed: In addition, our medication management solutions and our more complex automated packaging systems typically represent a sizable initial capital expenditure for healthcare organizations.
−Removed: Changes in the budgets of these organizations and the timing of spending under these budgets can have a significant effect on the demand for our medication management solutions, medication packaging systems, and related services.
−Removed: These budgets are often supported by cash flows that can be negatively affected by declining investment income and influenced by limited resources, increased operational and financing costs, macroeconomic conditions, and conflicting spending priorities among different departments.
−Removed: Any decrease in expenditures or change in spending priorities by healthcare facilities or increased financing costs, including as a result of the impacts of public health crises such as the ongoing COVID-19 pandemic, could decrease demand for our medication management solutions, medication packaging systems, and related services, and reduce our revenues.
+Added: Despite our significant efforts and extensive time commitments targeting sales to healthcare facilities, we cannot be assured that our efforts will result in sales to these customers.
+Added: In addition, our medication management solutions and our more complex automated packaging systems typically represent a sizable initial capital expenditure and potential time and labor commitment to implement for healthcare organizations.
+Added: Changes in the budgets of these organizations and the timing of spending under these budgets, as well as customer labor shortages, can have a significant effect on the demand for our medication management solutions, medication packaging systems, and related services.
+Added: Customer budgets are often supported by cash flows that can be negatively affected by declining investment income and influenced by limited resources, increased operational and financing costs, macroeconomic conditions, and conflicting spending priorities among different departments.
+Added: Any decrease in expenditures or change in spending priorities by healthcare facilities or increased financing costs, including as a result of the impacts of public health crises such as the COVID-19 pandemic, could decrease demand for our medication management solutions, medication packaging systems, and related services, and reduce our revenues.
Also, the continuing gradual transition to a value-based care healthcare delivery model could shift more of the burden of financial risk onto healthcare provider organizations and could decrease utilization of healthcare per patient.
Value-based care could also cause a shift in sites of care from traditional venues, such as hospitals and clinics, to the home, and could impact our revenues.
−Removed: Delays in installations of our medication management solutions or our more complex medication packaging systems could harm our competitive position, operating results, and financial condition.
−Removed: The purchase of our medication management solutions or our more complex medication packaging systems is often part of a customer’s larger initiative to re-engineer its pharmacy and distribution and materials management systems.
+Added: Delays in installations of our medication management solutions, including our central pharmacy automation solutions, could harm our competitive position, operating results, and financial condition.
+Added: The purchase of our medication management solutions, including our central pharmacy automation solutions, is often part of a customer’s larger initiative to re-engineer its pharmacy and distribution and materials management systems.
The purchase of our systems often entails larger strategic purchases by customers that generally require more complex and stringent contractual requirements, involve a significant commitment of management attention and resources by prospective customers, and require the input and approval of many decision-makers.
In addition, new product announcements can cause a delay in our customers’ decisions to purchase our products or convert pending orders for our older products to those of our newer products.
−Removed: For these and other reasons, the sales cycle associated with sales of our systems is often lengthy and subject to a number of
−Removed: delays over which we have little or no control.
−Removed: A delay in, or loss of, sales of these systems (including as a result of the impacts of public health crises such as the ongoing COVID-19 pandemic or due to customer labor shortages or customer budgetary constraints) could have an adverse effect upon our business, operating results and could harm our business, cash flow, or financial condition.
−Removed: In addition, and in part as a result of the complexities inherent in larger transactions, the time between the purchase and installation of our systems can generally range from two weeks to more than one year.
−Removed: Delays in installation can occur for reasons that are often outside of our control, such as customer labor shortages.
+Added: For these and other reasons, the sales cycle associated with sales of our systems is often lengthy and subject to a number of delays over which we have little or no control.
+Added: A delay in, or loss of, sales of these systems (including as a result of the impacts of public health crises such as the COVID-19 pandemic or due to customer labor shortages , increased healthcare worker turnover, or customer budgetary constraints) could have an adverse effect upon our business, operating results and could harm our business, cash flow, or financial condition.
+Added: In addition, and in part as a result of the complexities inherent in larger transactions, the time between the purchase and installation of our systems can generally range up to 24 months.
+Added: Delays in installation can occur for reasons that are often outside of our control, such as customer labor shortages or increased healthcare worker turnover, as well as customers seeking to stagger or elongate the timeframes between the adoption of new or updated technologies.
We have also experienced fluctuations in our customer and transaction size mix, which makes our ability to forecast our bookings more difficult.
−Removed: Because we recognize revenues for our medication management solutions and our more complex medication packaging systems only upon installation at a customer’s site, any delay in installation (including as a result of the impacts of public health crises such as the ongoing COVID-19 pandemic or due to customer labor shortages) will also cause a delay in the recognition of the revenues for those systems.
+Added: Because we recognize revenues for our medication management solutions and our more complex medication packaging systems only upon installation at a customer’s site, any delay in installation (including as a result of the impacts of public health crises such as the COVID-19 pandemic or due to customer labor shortages or healthcare worker turnover) will also cause a delay in the recognition of the revenues for those systems.
The transition to selling more Advanced Services, which include a software as a service or solution as a service subscription, presents a number of risks.
−Removed: We currently offer Advanced Services, which often contain a combination of equipment, software (cloud based or on-premise), onsite personnel to operate equipment, and advisory services that provide recommendations which, if implemented, are intended to help optimize utilization.
−Removed: These offerings include, but are not limited to, Central Pharmacy Dispensing Service and IV Compounding Service.
−Removed: We also offer our Inventory Optimization Service, certain patient engagement products and services under EnlivenHealth, Specialty Pharmacy Services, and 340B solutions, as a subscription.
+Added: We currently offer Advanced Services, which often contain a combination of robotics, smart devices, intelligent software, and expert services.
+Added: These offerings include, but are not limited to, Central Pharmacy Dispensing Service, IV Compounding Service, and Point of Care Service.
+Added: We also offer our Inventory Optimization Service, certain patient engagement, clinical and financial products and services under EnlivenHealth, Specialty Pharmacy Services, and 340B solutions, as a subscription.
As we continue to execute on the industry vision of the Autonomous Pharmacy and grow subscription and cloud-based offerings, we may offer additional products and services on a subscription basis.
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If any of our subscription solutions do not substantially meet customer requirements, contracts may be modified, causing a decline in revenue.
−Removed: Customers may elect not to renew their subscriptions upon expiration, or they may attempt to renegotiate pricing or other contractual terms at or prior to renewal on terms that are less favorable to us.
+Added: Customers may elect not to renew their subscriptions upon expiration, or they may attempt to renegotiate pricing or other contractual terms at or prior to renewal to terms that are less favorable to us.
In addition, since revenues are generally recognized over the term of the subscription, any decrease in customer purchases of our subscription-based products and services will not be fully reflected in our operating results until future periods, which may result in inflated revenue growth rates that do not reflect such decreases initially.
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If errors occur during the provision of certain of our Advanced Services, or if we fail to maintain expected service levels, we may be liable to our customers or third parties which may result in a decline in our Advanced Services offerings revenue.
−Removed: Certain of our Advanced Services offerings are highly complex and may be susceptible to errors, including as a result of human or technological error.
+Added: Certain of our Advanced Services offerings are highly complex and may be susceptible to errors, including human or technological error.
We may be required to bear the cost of correcting any errors and the cost of such corrections may be significant, which could adversely affect our business, operating results, cash flow, or financial condition.
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In connection with those offerings, our customers, generally, have no obligation to renew their subscriptions.
−Removed: If our Advanced Services customers decline to renew their subscriptions or decide to terminate their agreements early for any reason, we would not derive the expected financial benefits from that customer, which could have a material adverse effect on our business, operating results, cash flow, or financial condition.
−Removed: In addition, some of our Advanced Services agreements require us to adhere to additional data, security, network access, and other institutional procedures and requirements of our customers, and in certain cases may obligate us to agreed
−Removed: upon services levels.
+Added: If our Advanced Services customers decline to renew their subscriptions or decide to terminate their agreements early, we would not derive the expected financial benefits from that customer, which could have a material adverse effect on our business, operating results, cash flow, or financial condition.
+Added: In addition, some of our Advanced Services agreements require us to adhere to additional data, security, network access, and other institutional procedures and requirements of our customers, and in certain cases may obligate us to agreed upon services levels.
If we do not meet our obligations under any such Advanced Services agreement, we could be liable for damages.
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These contracts enable us to sell our products and services more readily to customers represented by these organizations.
−Removed: Some of our contracts with these organizations are terminable at the convenience of either party.
−Removed: The loss of any of these relationships could impact the breadth of our customer base and could impair our ability to meet our revenue or revenue growth rate targets or our ability to increase our revenues.
−Removed: These organizations may not renew our contracts on similar terms, if at all, and they may choose to terminate our contracts before they expire, any of which could cause our revenues to decline.
+Added: Some of our contracts with these organizations are terminable at the convenience of the applicable customer.
+Added: The loss of any of these relationships could impact the breadth of our customer base and could impair our ability to meet our revenue or revenue growth
+Added: rate targets or our ability to increase our revenues.
+Added: The GPOs may increase the fees we pay or these organizations may not renew our contracts on similar terms, if at all, and they may choose to terminate our contracts before they expire, any of which could cause our revenues to decline.
If we are unable to meet the demands of, or maintain our relationships with, our institutional and retail pharmacy customers, our revenue from sales of medication packages, other consumables, or our Advanced Services may decline .
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Any disruption in the production capabilities of our St.
−Removed: Petersburg facilities, including as a result of extreme weather conditions or natural disasters, which may be more frequent as a result of climate change, will adversely affect our ability to ship our consumable medication packages globally and would reduce our revenues.
+Added: Petersburg facilities, including as a result of extreme weather conditions or natural disasters, which may become more frequent as a result of climate change, will adversely affect our ability to ship our consumable medication packages globally and would reduce our revenues.
In addition, the institutional pharmacy market consists of significant national suppliers of medications to non-acute care facilities, smaller regional suppliers, and very small local suppliers.
If we are unable to maintain our relationships with the major institutional pharmacies we do business with, they may purchase consumable blister card components from alternative sources, or choose to use alternatives to blister cards for medication control, and our revenues would decline.
−Removed: Similarly, EnlivenHealth offers a portfolio of web-based, mobile, and telephonic patient engagement, medication management, financial management, analytics, and population health solutions to pharmacies, which is designed to support improvement in health outcomes related to medication use.
+Added: Similarly, our EnlivenHealth brand offers a portfolio of web-based, mobile, and telephonic patient engagement, medication management, financial management, clinical, analytics, and population health solutions to pharmacies, which is designed to support improvement in health outcomes related to medication use.
The success of these offerings depends on the trust our customers place in us and our reputation and ability to provide high-quality service.
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The competitive challenges we face in the markets in which we operate include, but are not limited to, the following:
−Removed: • current or future competitors may offer or have the ability to offer a broader range of solutions than us, develop alternative solutions that provide a better customer outcome or lower cost of operation, develop new features or capabilities for their products that could compete with ours, respond more quickly and efficiently to new or changing technologies, standards, or regulations, or devote greater resources to the development, promotion, and sale of their products than we do;
+Added: • current or future competitors may offer or have the ability to offer a broader range of solutions than us, develop alternative solutions that provide a better customer outcome or lower cost of operation, develop new features or capabilities for their products, including artificial intelligence (“AI”), machine learning, and generative AI capabilities, which are part of an intensely competitive and rapidly evolving market, that could compete with our solutions, respond more quickly and efficiently to new or changing technologies, standards, or regulations, or devote greater resources to the development, promotion, and sale of their products than we do;
• competitive pressures could result in increased price competition for our products and services, fewer customer orders, and reduced gross margins;
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If we fail to compete successfully against current or future competitors, it could materially adversely affect our business, operating results, cash flow, or financial condition.
−Removed: We face risks related to adverse public health epidemics, including the ongoing global COVID-19 pandemic (including new variants of the virus), which could continue to adversely affect our business, operating results, cash flow, or financial condition.
−Removed: The continued spread of COVID-19 (including new variants of the virus), concerns over the pandemic, and related international, federal, state and local containment measures have adversely impacted our workforce and operations, as well as those of our customers and suppliers, and could continue to adversely affect our business, operating results, cash flow, or financial condition.
−Removed: Continued disruption to the operations of our suppliers as a result of the COVID-19 pandemic and related mitigation measures could significantly disrupt our supply chain, increase our procurement costs, and/or impact our ability to manufacture our products, which would negatively impact our business, operating results, cash flow, or financial condition.
−Removed: As a result of disruptions in the supply chain, we are experiencing the impact of price inflation, primarily due to semiconductor and other component costs and, to a lesser extent, freight and raw materials.
−Removed: Furthermore, the COVID-19 pandemic has significantly increased economic and demand uncertainty and has led to disruption and volatility in the global capital markets, which could increase the cost of capital and adversely impact access to capital not only for us, but also for our customers and suppliers.
−Removed: Weak or uncertain economic conditions and inability to access capital in a timely manner, or at all, could reduce our customers’ demand for our products and services, which would adversely affect our business, operating results, cash flow, or financial condition—perhaps materially.
−Removed: Similarly, in the event our access to the capital markets is constrained, our cost of borrowing could increase or we may be unable to obtain new or additional financing or refinancing in the future, either of which could have a material effect on our operations.
−Removed: The COVID-19 pandemic continues to evolve, and the full extent to which COVID-19 (including new variants of the virus) will continue to impact our business, operating results, cash flow or financial condition will depend on future developments, which cannot be predicted with confidence.
−Removed: To the extent the COVID-19 pandemic continues to adversely affect our business and financial results, it may also have the effect of heightening certain other risks described in this “Risk Factors”
−Removed: section, including, but not limited to, those relating to unfavorable economic and market conditions, our ability to develop new products or services or enhance existing products or services, the need to compete successfully against new product or service entrants, our need to generate sufficient cash flows to service our indebtedness, our tax rates, and our international operations.
We have incurred substantial debt, which could impair our flexibility and access to capital and adversely affect our financial position.
−Removed: On November 15, 2019, we refinanced our existing senior secured credit facility pursuant to an amended and restated agreement with certain lenders, and Wells Fargo Bank, National Association, as administrative agent (as amended, the “A&R Credit Agreement”).
−Removed: The A&R Credit Agreement provides for a five-year revolving credit facility of $500.0 million and an uncommitted incremental loan facility of up to $250.0 million.
−Removed: As of December 31, 2022, there were no outstanding balances under the A&R Credit Agreement.
−Removed: In addition, on September 25, 2020, we issued $575.0 million aggregate principal amount of 0.25% Convertible Senior Notes due 2025 (the “Notes”), pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between us and U.S.
−Removed: Bank National Association, as trustee.
−Removed: We used a portion of the proceeds from the issuance of the Notes to repay all outstanding borrowings under the revolving credit facility at the time.
Our debt may limit our ability to borrow additional funds or use our existing cash flow for working capital, capital expenditures, acquisitions, or other general business purposes or may require us to use a substantial portion of our cash flow for debt service payments;
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Any of these actions still may not be sufficient to allow us to service our debt obligations, could increase the risks related to our business or our ability to service or repay our indebtedness or may otherwise have an adverse effect on our business.
−Removed: Our ability to refinance our indebtedness will depend on the capital markets and our financial condition at such time.
+Added: Our ability to refinance our indebtedness will depend on the capital markets and our financial condition at the time of any such refinancing.
We may not be able to engage in any of these activities or to do so on desirable terms, which could result in a default on our debt obligations.
−Removed: In addition, as more fully described below in the risk factor captioned “ Covenants in our A&R Credit Agreement restrict our business and operations in many ways, and if we do not effectively manage our compliance with these covenants, our business, operating results, cash flow, or financial condition could be adversely affected, ” the A&R Credit Agreement includes customary restrictive covenants that impose operating and financial restrictions on us.
−Removed: In addition, borrowings under the A&R Credit Agreement currently bear interest based on the London Interbank Offered Rate (“LIBOR”), however as of December 31, 2021, LIBOR has started being phased out, and LIBOR is expected to be entirely discontinued on June 30, 2023.
−Removed: The phasing out or discontinuance of LIBOR and other pressures may cause LIBOR to disappear entirely or to perform differently than in the past.
−Removed: In addition, the A&R Credit Agreement provides that upon the occurrence of certain triggering events relating to the end of LIBOR, we and the administrative agent will select a different benchmark rate to replace LIBOR.
−Removed: Upon, or prior to, the phasing out of LIBOR, we will work with our lenders to establish an alternative benchmark rate (such as the Secured Overnight Financing Rate) taking into account any relevant government authority’s selection or recommendation of a replacement rate and/or the then-prevailing market convention for determining an alternative benchmark rate.
−Removed: Although, the consequences of these developments cannot be entirely predicted, and changes in, or the inability to agree on, an alternative rate or benchmark could result in an increase in the cost of borrowings under the A&R Credit Agreement and other financial contracts that we may enter into that are currently indexed to LIBOR.
+Added: In addition, as more fully described below in the risk factor captioned “ Covenants in our Second A&R Credit Agreement restrict our business and operations in many ways, and if we do not effectively manage our compliance with these covenants, our business, operating results, cash flow, or financial condition could be adversely affected, ” our second amended and restated agreement with certain lenders, and Wells Fargo Bank, National Association, as administrative agent (the “Second A&R Credit Agreement”) includes customary restrictive covenants that impose operating and financial restrictions on us.
We are subject to laws, regulations, and other legal obligations related to privacy, data protection, and information security, and the costs of compliance with, and potential liability associated with, our actual or perceived failure to comply with such obligations could harm our business.
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In addition, our customers use our solutions to obtain and store personal information, including health information.
−Removed: For example, our customers use our EnlivenHealth patient engagement platform to guide and track patient notes, interventions, and appointments, which involves the collection of personal health information of patients.
−Removed: Our handling of data is subject to a variety of laws and regulations by federal, state, local, and foreign agencies, as well as
−Removed: contractual obligations and industry standards.
+Added: For example, our customers use our EnlivenHealth platform to guide and track patient notes, interventions, and appointments, which involves the collection of personal health information of patients.
+Added: Our handling of data is subject to a variety of laws and regulations by federal, state, local, and foreign agencies, as well as contractual obligations and industry standards.
Regulatory focus on data privacy and security concerns continues to increase globally, and laws and regulations concerning the collection, use, and disclosure of personal information are expanding and becoming more complex.
−Removed: In the United States, these include federal health information privacy laws (such as the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), discussed below), security breach notification laws, and consumer protection laws, as well as state laws addressing privacy and data security (such as the California Consumer Privacy Act of 2018 (“CCPA”) and the California Privacy Rights Act of 2020 (“CPRA”)).
+Added: In the United States, these include federal health information privacy laws (such as the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), discussed below), security breach notification laws, and consumer protection laws, as well as state laws addressing privacy and data security (such as the California Consumer Privacy Act of 2018 (“CCPA”), as amended by the California Privacy Rights Act of 2020 (“CPRA”)).
While HIPAA does not create a private right of action, its standards have been used as the basis for civil suits and HIPAA is enforced by the U.S.
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While a final rule has not yet been issued, if adopted, these proposed changes may require us to update our HIPAA policies and procedures to comply with the new requirements.
−Removed: Finally, pursuant to legislation passed in 2021, OCR recently issued guidance on recognized security practices for covered entities and business associates.
+Added: Additionally, pursuant to legislation passed in 2021, OCR recently issued guidance on recognized security practices for covered entities and business associates.
OCR indicated that recognized security practices will not be an aggravating factor in OCR investigations, but that implementation of recognized security practices strengthen an organization’s cybersecurity and regulatory posture, as well as possibly lessening enforcement penalties in a potential regulatory enforcement action.
+Added: Moreover, compliance with state laws related to health privacy may result in additional compliance costs.
+Added: We may encounter vendors that engage in information blocking practices that may inhibit our ability to access the relevant data on behalf of patients or impose new or additional costs.
+Added: Specifically, the information blocking rules were implemented as part of the 21st Century Cures Act, and are primarily designed to facilitate technology interoperability and enable the free flow of healthcare information for healthcare treatment, payment or operation purposes.
+Added: HHS-OIG may impose penalties for information blocking that has occurred after September 1, 2023, and ONC and HHS proposed a rule on November 1, 2023 listing certain disincentives for actors that conduct information blocking.
+Added: The impact on the information blocking rules to our business is currently unclear.
The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches which is expected to increase data breach litigation.
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Additionally, the FTC recently published an advance notice of proposed rulemaking on commercial surveillance and data security, and is seeking comment on whether it should implement new trade regulation rules or other regulatory alternatives concerning the ways in which companies (1) collect, aggregate, protect, use, analyze, and retain consumer data, as well as (2) transfer, share, sell, or otherwise monetize that data in ways that are unfair or deceptive.
−Removed: Internationally, various foreign jurisdictions in which we operate have established, or are currently developing, their own data privacy and security legal frameworks with which we or our customers must comply.
+Added: Additionally, data and digital services regulation continues to expand, particularly with respect to the artificial intelligence (“AI”) and automated decision making, which may further impact our business and regulatory compliance strategies.
+Added: For example, AI regulation or regulatory guidance continues to emerge in response to President Biden’s Executive Order on Safe, Secure, and Trustworthy Artificial Intelligence issued on October 30, 2023.
+Added: Internationally, various jurisdictions outside of the United States in which we operate have established, or are currently developing, their own data privacy and security legal frameworks with which we or our customers must comply.
In certain cases, these international laws and regulations are more restrictive than many regulations in the United States.
For example, within the European Union (“EU”), the General Data Protection Regulation 2016/679 (“EU GDPR”) went into effect on May 25, 2018, and introduced strict requirements for the processing of personal information of individuals.
−Removed: The EU GDPR governs the collection, use, disclosure, transfer, and other processing of personal information and has direct effect in all EU Member States, and has extraterritorial effect where organizations outside of the European Economic Area (“EEA”) process personal information of individuals in the EEA in relation to the offering of goods or services to those individuals (the “targeting test”) or the monitoring of their behavior (the “monitoring test”).
−Removed: As such, the EU GDPR applies to us to the extent we are established in an EU Member State, we are processing personal information in the context of an establishment in an EU Member State or we meet the requirements of either the targeting test or the monitoring test.
−Removed: The EU GDPR imposes stringent data protection requirements on companies that fall within its scope, including inter alia:
−Removed: (i) contractual privacy, data protection, and data security commitments, including the requirement to implement appropriate technical and organizational measures to safeguard personal information processed;
−Removed: (ii) establishing means for individuals to exercise their data protection rights (e.g., the right to erasure of personal information);
−Removed: (iii) obligations to consider data protection as any new products or services are developed and to limit the amount of personal information processed;
−Removed: (iv) additional requirements pertaining to sensitive information (such as health data);
−Removed: (v) obligations to report certain personal data breaches to:
−Removed: (a) the supervisory authority without undue delay (and no later than 72 hours where feasible), and/or (b) data subjects;
−Removed: and (vi) enhanced requirements for obtaining valid consent from data subjects.
+Added: The EU GDPR governs the collection, use, disclosure, transfer, and other processing of personal information (i.e., data which identifies an individual or from which an individual is identifiable).
+Added: The UK has implemented the EU GDPR as the UK GDPR which sits alongside the UK Data Protection Act 2018 (the UK GDPR, together with the EU GDPR, the “GDPR”).
+Added: The GDPR has direct effect where an entity is established in the European Economic Area (“EEA”) or the UK (as applicable) and has extraterritorial effect, including where an organization outside of the EEA or the UK processes personal information in relation to the offering of goods or services to those individuals or the monitoring of their behavior.
+Added: The GDPR imposes stringent obligations on companies that fall within its scope, including inter alia:
+Added: (i) accountability and transparency requirements, requiring controllers to demonstrate and record compliance with the GDPR and to provide more detailed information to data subjects regarding processing of their personal information;
+Added: (ii) obligations to comply with data protection rights of data subjects including a right:
+Added: (x) of access to, erasure of, or rectification of personal data;
+Added: (y) to restriction of processing or to withdraw consent to processing;
+Added: and (z) to object to processing or to ask for a copy of personal data to be provided to a third party;
+Added: (iii) obligations to consider data protection as any new products or services are developed and designed (including e.g., to limit the amount of personal information processed);
+Added: (iv) requirements to process personal information lawfully including specific requirements for obtaining valid consent where consent is the lawful basis for processing;
+Added: (v) an obligation to report personal data breaches to:
+Added: (x) the data supervisory authority without undue delay (and no later than 72 hours after discovering the personal data breach, where feasible), unless the personal data breach is unlikely to result in a risk to the data subjects’ rights and freedoms;
+Added: and (y) affected data subjects, where the personal data breach is likely to result in a high risk to their rights and freedoms.
The EU GDPR also provides that EU Member States may introduce further laws and regulations limiting the processing of genetic, biometric, or health data, which could limit our ability to collect, use, and share EU personal information, cause our compliance costs to increase, require us to change our practices, adversely impact our business, and harm our financial condition.
−Removed: In addition, the EU GDPR prohibits the transfer of personal information from the EEA to the United States and other jurisdictions that the European Commission does not recognize as having “adequate” data protection laws unless the parties to the transfer have implemented specific safeguards to protect the transferred personal information.
−Removed: Data protection laws in the UK (as discussed below) and Switzerland impose similar restrictions.
−Removed: One of the primary safeguards allowing U.S.
−Removed: companies to import personal information from the EU and Switzerland has historically been certification to the EU-U.S.
−Removed: Privacy Shield framework, which is administered by the U.S.
−Removed: Department of Commerce, and the Swiss-U.S.
−Removed: Privacy Shield framework, respectively.
−Removed: However, in July 2020, the Court of Justice of the EU in the Schrems II decision limited how organizations could lawfully transfer personal information from the EEA to the United States by invalidating the EU-U.S.
−Removed: Privacy Shield for purposes of international transfers.
−Removed: Similarly, the Swiss-U.S.
−Removed: Privacy Shield framework was declared as inadequate by the Swiss Federal Data Protection and Information Commissioner in light of the Schrems II decision.
−Removed: The Schrems II decision also led to a requirement for companies to carry out a transfer privacy impact assessment, which among other things, assesses laws governing access to personal information in the recipient country and considers whether supplementary measures that provide privacy protections additional to those provided under EU Standard Contractual Clauses (“SCCs”) will need to be implemented to ensure an essentially equivalent level of data protection to that afforded in the EEA.
−Removed: Moreover, new versions of the SCCs (new “EU SCCs”), now the primary safeguard available for the lawful transfer of personal information from the EU to the U.S., were adopted in June 2021.
−Removed: These new EU SCCs impose onerous obligations on contracting parties and must be used in all new contracts going forward (where there are restricted transfers of personal information), with existing contracts entered into before September 27, 2021 required to be updated by December 27, 2022.
−Removed: As such, any transfers by us or our vendors of personal information from the EU may not comply with European data protection law, may increase our exposure to the EU GDPR’s heightened sanctions for violations of its cross-border data transfer restrictions, and may reduce demand from companies subject to European data protection laws.
−Removed: Furthermore, on October 7, 2022, the U.S.
−Removed: President introduced an executive order to facilitate a new Trans-Atlantic Data Privacy Framework, which is the new EU-U.S.
−Removed: adequacy mechanism following Privacy Shield.
−Removed: On December 13, 2022, the European Commission also published its draft adequacy decision which stated that the new executive order and Trans-Atlantic Data Privacy Framework is able to meet the concerns raised in Schrems II .
−Removed: If the draft adequacy decision is approved by the European Commission and implemented, the agreement will facilitate the transatlantic flow of personal information and provide additional safeguards to data transfer mechanisms (including EU SCCs and Binding Corporate Rules) for companies transferring personal information from the EU to the U.S.
−Removed: However, before parties can rely on the new Trans-Atlantic Data Privacy Framework there are still legislative and regulatory steps that must be undertaken in both the EU and the U.S..
−Removed: Administrative fines for non-compliance with the EU GDPR can be significant and can amount to fines of up to the greater of €20.0 million or 4% of global annual turnover, and restrictions or prohibitions on data processing.
−Removed: The EU GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies and obtain compensation for damages resulting from violations of the EU GDPR.
−Removed: Relatedly, following the United Kingdom’s (“UK”) withdrawal from the EU (known as, “Brexit”), the EU GDPR has been implemented in the UK as the “UK GDPR”.
−Removed: The UK GDPR sits alongside the UK Data Protection Act 2018 and implements certain derogations in the EU GDPR into English law.
−Removed: Under the UK GDPR, companies established in the UK and companies not established in the UK but who process personal information in relation to the offering of goods or services to individuals in the UK, or to the monitoring of their behavior will be subject to the UK GDPR.
−Removed: The requirements of the UK GDPR are (at this time) largely aligned with those under the EU GDPR and as such, may lead to similar compliance and operational costs with potential fines for non-compliance of up to £17.5 million or 4% of global annual turnover.
−Removed: As a result, we are potentially exposed to two parallel data protection regimes, each of which authorizes fines and the potential for divergent enforcement actions.
−Removed: It should also be noted that the UK Information Commissioner’s Office (“ICO”) has published its own form of EU SCCs known as the UK International Data Transfer Agreement together with an International Data Transfer Addendum to the new EU SCCs.
−Removed: The ICO has also published its version of the transfer impact assessment and guidance on
−Removed: international transfers (although entities may choose to adopt either the EU or UK style transfer impact assessment).
−Removed: In terms of international data transfers between the UK and the U.S., it is understood that the UK and the U.S.
−Removed: are negotiating an adequacy agreement.
+Added: In addition, the EU GDPR prohibits the international transfer of personal information from the EEA to the United States and other jurisdictions that the European Commission does not recognize as having “adequate” data protection laws unless a data transfer mechanism has been put in place or a derogation under the EU GDPR can be relied upon.
+Added: In July 2020, the Court of Justice of the EU (“CJEU”) in its Schrems II judgement limited how organizations could lawfully transfer personal data from the EEA to the US by invalidating the EU-US Privacy Shield for purposes of international transfers and imposing further restrictions on the use of standard contractual clauses (“EU SCCs”), including a requirement for companies to carry out a transfer privacy impact assessment (“TIAs”).
+Added: A TIA, among other things, assesses laws governing access to personal data in the recipient country and considers whether supplementary measures that provide privacy protections additional to those provided under EU SCCs will need to be implemented to ensure an “essentially equivalent” level of data protection to that afforded in the EEA.
+Added: On October 7, 2022, US President Biden introduced an Executive Order to facilitate a new Trans-Atlantic Data Privacy Framework (“DPF”) and on 10 July 2023, the European Commission adopted its Final Implementing Decision granting the U.S.
+Added: adequacy (“Adequacy Decision”) for EU-US transfers of personal data for entities self-certified to the DPF.
+Added: Entities relying on EU SCCs for transfers to the U.S.
+Added: are also able to rely on the analysis in the Adequacy Decision as support for their TIA regarding the equivalence of U.S.
+Added: national security safeguards and redress.
+Added: This may have implications for our cross-border data flows and has and may in the future result in increased compliance costs.
+Added: The UK GDPR also imposes similar restrictions on transfers of personal data from the UK to jurisdictions that the UK Government does not consider adequate, including the United States.
+Added: The UK Government has published its own form of the EU SCCs, known as the International Data Transfer Agreement and an International Data Transfer Addendum to the new EU SCCs.
+Added: The UK Information Commissioner’s Office has also published its version of the TIA and guidance on international transfers, although entities may choose to adopt either the EU or UK style TIA.
+Added: Further, on September 21, 2023, the UK Secretary of State for Science, Innovation and Technology established a UK-U.S.
+Added: data bridge (i.e., a UK adequacy decision) and adopted UK regulations to implement the UK-U.S.
+Added: data bridge (“UK Adequacy Regulations”).
+Added: The UK Adequacy Regulations have now been passed in the UK Parliament, and personal data may be transferred from the UK under the UK-U.S.
+Added: data bridge through the UK extension to the DPF, from October 12, 2023, to organizations self-certified under the DPF.
+Added: The GDPR imposes fines for serious breaches of up to the higher of 4% of the organization’s annual worldwide turnover or €20m (under the EU GDPR) or £17.5m (under the UK GDPR).
+Added: The GDPR identifies a list of points to consider when determining the level of fines for data supervisory authorities to impose (including the nature, gravity and duration of the
+Added: infringement).
+Added: Data subjects also have a right to compensation, as a result of an organization’s breach of the GDPR which has affected them, for financial or non-financial losses (e.g., distress).
+Added: In the EU a number of new laws related to digital data and AI have recently entered into force, or are expected to enter into force in the foreseeable future.
+Added: We are still assessing the scope of application, impact, and risk of these recent EU laws on our business, and will continue to assess this moving forward, including for example:
+Added: (i) the EU’s Data Act, which was adopted on November 27, 2023 and seeks to, among other things regulate the use of, and access to, data generated through connected (or Internet-of-Things) devices and introduces a new means for public sector bodies to access, use and re-use private sector data;
+Added: and (ii) the proposed European Health Data Space Regulation which is expected to be agreed in Q3 2024 and seeks to, among other things, provide individuals with more control over their electronic health data (“EHD”), enable cross-border sharing of EHD between national EU healthcare systems and facilitate the sharing of EHD for secondary research purposes.
In addition to government regulation, privacy advocates and industry groups may propose new and different self-regulatory standards that may legally or contractually apply to us, and other regulatory protections may lose their applicability to our business as regulations and legal proceedings continue to evolve globally.
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Compliance with privacy, data protection, and information security laws, regulations, and other obligations is costly, and we may encounter difficulties, delays, or significant expenses in connection with our compliance, or because of our customers’ need to comply or our customers’ interpretation of their own legal requirements.
−Removed: For example, as previously disclosed in the Current Report on Form 8-K we filed with the SEC on August 4, 2022, in connection with the cybersecurity event we experienced on May 4, 2022, we provided breach notification to fewer than 350 individuals as required by applicable law.
−Removed: Additionally, as discussed further in the section entitled “ Legal Proceedings ” in Note 14, Commitments and Contingencies , of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K, we are currently and have in the past been subject to certain class action lawsuits asserting, among other allegations, claims of violation of the Illinois Biometric Information Privacy Act.
+Added: For example, as previously disclosed in connection with the cybersecurity event we experienced on May 4, 2022, we provided breach notification to fewer than 350 individuals as required by applicable law.
+Added: Additionally, we have in the past been subject to certain class action lawsuits asserting, among other allegations, claims of violation of the Illinois Biometric Information Privacy Act.
In addition, any future event that results in the failure or perceived failure by us to comply with laws, regulations, policies, legal or contractual obligations, industry standards, or regulatory guidance relating to privacy or data security could result in governmental investigations and enforcement actions, litigation, fines and penalties, exposure to indemnification obligations or other liabilities, and adverse publicity, all of which could have an adverse effect on our reputation, as well as our business, financial condition, and operating results.
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We also utilize third-party cloud services in connection with our operations, which also may need to be expanded or updated as our business needs change.
−Removed: Our IT systems and third-party cloud services are potentially vulnerable to disruption due to breakdown, malicious intrusion and computer viruses, public health crises such as the ongoing COVID-19 pandemic, other catastrophic events or environmental impact, as well as due to system upgrades and/or new system implementations.
+Added: Our IT systems and third-party cloud services are potentially vulnerable to disruption due to breakdown, malicious intrusion and computer viruses, public health crises such as the COVID-19 pandemic, other catastrophic events or environmental impact, as well as due to system upgrades and/or new system implementations.
Our systems may also experience vulnerabilities from third-party or open source software code that may be incorporated into our own or our vendors’ systems.
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We do not believe the security event will have a material adverse effect on its business, operating results, cash flow or financial condition.
+Added: We may also be subject to various cybersecurity laws in the EU and the UK, including the UK Network and Information Systems Regulation 2018 (“NIS Regulations”), and the EU Network and Information Systems Security 1 Directive (“NISD1”) as implemented into EU Member State law (and as updated by the EU Network and Information Systems Security 2 Directive (“NISD2”)) which apply to certain operators of “essential services” and digital service providers, such as cloud providers, and medical device manufacturers.
+Added: In addition, the EU Critical Entities Resilience Directive entered into force on January 17, 2023 which applies to, among other things, “essential services” including manufacturers of medical devices, imposes stringent cybersecurity and resilience requirements in particular in relation to incidents significantly impacting the continuation of the critical infrastructure service offering in the EU .
Future d ata security incidents could lead to the loss of trade secrets or other intellectual property, or to the public exposure of sensitive and confidential information of our employees, customers, suppliers, and others, any of which could have a material adverse effect on our business, operating results, cash flow, or financial condition.
−Removed: Moreover, the current and/or a future security breach or privacy violation that leads to disclosure or modification of, or prevents access to, patient information, including personally identifiable information or protected health information, could harm our reputation, result in litigation,
−Removed: compel us to comply with federal and/or state breach notification laws, subject us to mandatory corrective action, require us to verify the correctness of database contents, and otherwise subject us to liability under laws and regulations that protect personal information, resulting in increased costs or loss of revenues.
+Added: Moreover, the current and/or a future security breach or privacy violation that leads to disclosure or modification of, or prevents access to, patient information, including personally identifiable information or protected health information, could harm our reputation, result in litigation, compel us to comply with federal and/or state breach notification laws, subject us to mandatory corrective action, require us to verify the correctness of database contents, and otherwise subject us to liability under laws and regulations that protect personal information, resulting in increased costs or loss of revenues.
For additional information, see the risk factor captioned “ We are subject to laws, regulations, and other legal obligations related to privacy, data protection, and information security, and the costs of compliance with, and potential liability associated with, our actual or perceived failure to comply with such obligations could harm our business ” above for additional information.
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We have in the past acquired businesses, and expect to continue to seek to acquire businesses, technologies, or products in the future.
−Removed: For example, we acquired FDS Amplicare in September 2021, ReCept and MarkeTouch Media, each in December 2021, respectively, and Hub and Spoke Innovations in January 2022.
−Removed: We cannot provide assurance that any acquisition or future transaction we complete will result in long-term benefits to us or our stockholders, or that we will be able to effectively integrate or manage the acquired businesses, including FDS Amplicare, ReCept, MarkeTouch Media, or Hub and Spoke Innovations.
+Added: For example, we acquired FDS Amplicare in September 2021, Omnicell Specialty Pharmacy Services (formerly, ReCept) and MarkeTouch Media, each in December 2021, respectively, and Hub and Spoke Innovations in January 2022.
+Added: We cannot provide assurance that any acquisition or future transaction we complete will result in long-term benefits to us or our stockholders, or that we will be able to effectively integrate or manage the acquired businesses, including FDS Amplicare, Omnicell Specialty Pharmacy Services, MarkeTouch Media, or Hub and Spoke Innovations.
These transactions may involve significant challenges, uncertainties, and risks, including:
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If goodwill or other intangible assets that we recorded in connection with our prior acquisitions become impaired, we could be required to take significant charges against earnings.
−Removed: In connection with the accounting for the 340B Link Business acquisition in October 2020, the FDS Amplicare acquisition in September 2021, and the ReCept and MarkeTouch Media acquisitions, each in December 2021, respectively, we recorded a significant amount of goodwill and other intangible assets.
−Removed: In addition, for our prior acquisitions of Aesynt and MTS Medication Technologies, Inc.
−Removed: (“MTS”), we continue to maintain a significant amount of goodwill and intangible assets, and for Avantec Healthcare Limited, Mach4 Automatisierungstechnik GmbH, and ateb, we continue to maintain a significant amount of goodwill.
−Removed: As of December 31, 2022, we had recorded approximately $976.1 million net of accumulated amortization, in goodwill and intangible assets, in connection with past acquisitions.
+Added: In connection with the accounting for prior acquisitions, we recorded a significant amount of goodwill and other intangible assets.
Under GAAP, we must assess, at least annually and potentially more frequently, whether the value of goodwill and other indefinite-lived intangible assets has been impaired.
Intangible assets subject to amortization will be assessed for impairment in the event of an impairment indicator.
−Removed: Any reduction or impairment of the value of goodwill or other intangible assets will result in a charge against earnings, which could materially adversely affect our operating results and shareholders’ equity in future periods.
+Added: As of December 31, 2023, we had recorded approximately $946.0 million net of accumulated amortization, in goodwill and intangible assets, in connection with past acquisitions.
+Added: Any future reduction or impairment of the value of goodwill or other intangible assets will result in a charge against earnings, which could materially adversely affect our operating results and shareholders’ equity in future periods.
The healthcare industry is subject to legislative and regulatory changes, as well as financial constraints and consolidation, which could adversely affect the demand for our products and services.
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government legislation and program rulemaking may cause customers to postpone purchases of our products due to reductions in federal healthcare program reimbursement rates and/or needed changes to their operations in order to meet the requirements of legislation or in anticipation of future rulemaking.
−Removed: For example, the Budget Control Act of 2011, among other things, resulted in reductions in payments to Medicare providers of 2% per fiscal year, which went into effect on April 1, 2013 and, following a temporary suspension during the COVID-19 pandemic that expired on July 1, 2022, will remain in effect into 2031 unless additional Congressional action is taken.
+Added: For example, the Budget Control Act of 2011, among other things, resulted in reductions in payments to Medicare providers of 2% per fiscal year, which went into effect on April 1, 2013 and, following a temporary suspension during the COVID-19 pandemic that expired on July 1, 2022, will remain in effect through the first six months of the fiscal year 2023 sequestration order unless additional Congressional action is taken.
Additionally, the American Taxpayer Relief Act of 2012, among other things, reduced Centers for Medicare & Medicaid Services (“CMS”) payments to several types of providers, including hospitals, and increased the statute of limitations period for the government to recover Medicare overpayments to providers from three to five years.
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Furthermore, many existing healthcare laws and regulations, when enacted, did not anticipate the services we may provide.
−Removed: Any future actions or developments could adversely impact the healthcare industry, including with respect to the cost of prescription drugs, regulation of pharmacy services, the administration of the federal 340B Drug Pricing Program, changes to pharmacy reimbursement rates, or could challenge or change the way we do business, which could have an adverse impact on our business.
+Added: Any future actions or developments could adversely impact the healthcare industry, including with respect to the cost of prescription drugs, regulation of pharmacy services, the administration of the federal 340B Program, changes to pharmacy reimbursement rates, or could challenge or change the way we do business, which could have an adverse impact on our business.
Healthcare providers have consolidated to create larger healthcare delivery organizations in order to achieve economies of scale and/or greater market power.
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Government regulation of the healthcare industry could reduce demand for our products or services, or substantially increase the cost to produce our products or deliver our services.
−Removed: The manufacture and sale of most of our current medication management solutions products and services are not directly regulated by the FDA or the DEA, although such products and services are used by other persons (our customers) whose pharmacy, dispensing, and compounding activities may be subject to regulation by those agencies and by state boards of pharmacy.
+Added: The manufacture and sale of most of our current medication management solutions are not directly regulated by the FDA or the DEA, although such products and services are used by other persons (our customers) whose pharmacy, dispensing, and compounding activities may be subject to regulation by those agencies and by state boards of pharmacy.
However, we manufacture and develop specifications for products classified as Class I and Class II medical devices, which are subject to FDA regulation and require compliance with the FDA Quality System Regulation as well as medical device reporting, including a sterile disposable product that required FDA 510(k) review and clearance prior to marketing and distribution.
−Removed: Medical devices are also subject to various other regulatory requirements, including as applicable, premarket clearance or approval, clinical trial requirements, establishment registration and device listing, complaint handling, notification and repair, replace, refund, mandatory recalls, unique device identifier (“UDI”) requirements, reports of removals and corrections, post-marketing surveillance, and device tracking.
+Added: Medical devices are also subject to various other regulatory requirements, including as applicable, premarket clearance or approval, establishment registration and device listing, complaint handling, notification and repair, replace, refund, mandatory recalls, unique device identifier (“UDI”) requirements, reports of removals and corrections, cybersecurity requirements and post-marketing surveillance.
Additional products and services may require us to observe HHS regulations for credentialing of providers (pharmacists) or be subject to DEA regulations concerning the management, storing, dispensing, and disposal of, and accounting for, controlled substances, and may be regulated in the future by the FDA, DEA, or other federal agencies due to future legislative and regulatory initiatives or reforms.
−Removed: In addition, certain provisions of the Federal Food, Drug and Cosmetic Act (“FDCA”) related to the handling, distribution and compounding of pharmaceuticals, govern all parts of the drug distribution chain, which our customers may be required to comply with and which may influence customer demand for our products.
−Removed: Direct regulation of our business and products by the FDA, DEA, or other federal agencies could substantially increase the cost to produce our products or deliver our services and increase the time required to bring those products and services to market, reduce the demand for our products and services, and reduce our revenues.
+Added: In addition, certain provisions of the Federal Food, Drug and Cosmetic Act (“FDCA”) related to the handling, distribution and compounding of pharmaceuticals, govern all parts of the drug
+Added: distribution chain, which our customers may be required to comply with and which may influence customer demand for our products.
+Added: Direct regulation of our business and products by the FDA, DEA, CMS, or other federal agencies could substantially increase the cost to produce our products or deliver our services and increase the time required to bring those products and services to market, reduce the demand for our products and services, and reduce our revenues.
In addition, our customers include healthcare providers and facilities subject to regulation by the DEA, pharmacies subject to regulation by the FDA and individual state boards of pharmacy and hospitals subject to accreditation by accrediting organizations approved by the CMS, such as the Joint Commission, and the rules, regulations, and standards of such regulators and accrediting organizations.
Any failure of our customers to comply with the applicable rules, regulations, and standards could reduce demand for our products or services and harm our business, competitive position, operating results, cash flow, or financial condition.
−Removed: Given our customers, products, services, and industry relationships, we may also be subject to rules, regulations, standards, and enforcement imposed by HHS, the U.S.
−Removed: Department of Justice, the HHS Office of Inspector General, CMS, the Health Resources and Services Administration, and state attorneys general, among others.
+Added: Given our customers, products, services, and industry relationships, we may also be subject to rules, regulations, standards, and civil or criminal enforcement imposed by HHS, the U.S.
+Added: Department of Justice, the HHS Office of Inspector General, CMS, the Health Resources and Services Administration, and state attorneys general, including with respect to state and federal False Claims Act statutes, federal Anti-Kickback Statute, and federal Physician Payments Sunshine Act, among others.
As such, from time to time, we may be subject to various state or federal governmental inspections, reviews, audits and investigations to verify our compliance with governmental rules and regulations to the extent governing our products and services.
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These consequences may include, but are not limited to:
−Removed: (1) refunding or retroactively adjusting amounts
−Removed: that have been paid under the relevant government program or from other payers;
+Added: (1) refunding or retroactively adjusting amounts that have been paid under the relevant government program or from other payers;
(2) state or federal agencies imposing significant fines, penalties and other sanctions on us;
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We must comply with anti-kickback, fraud and abuse, false claims, transparency, and other healthcare laws and regulations.
−Removed: Our current and future operations are subject to various federal and state healthcare laws and regulations that affect our sales, marketing, and other promotional activities by limiting the kinds of financial arrangements we can enter into with respect to our products and services.
+Added: Our current and future operations are subject to various federal and state healthcare laws and regulations that affect our sales, marketing, and other promotional activities by limiting the kinds of financial arrangements we can enter into with respect to our products and services and/or requiring disclosure of certain of our financial arrangements to government agencies.
They also impose additional administrative and compliance burdens on us.
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Ensuring that our business arrangements with third parties comply with applicable healthcare laws, as well as responding to investigations by government authorities (which have increased in recent years as the healthcare industry has come under greater scrutiny) can be time and resource consuming and can divert management’s attention from the business.
−Removed: If our operations are found to be in violation of any of the laws described above or any other government regulations that apply to us, we may be subject to significant financial penalties and possible exclusion from participation in federal and state funded healthcare programs, and the curtailment or restricting of our operations, as well as additional reporting obligations
−Removed: and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws.
+Added: If our operations are found to be in violation of any of the laws described above or any other government regulations that apply to us, we may be subject to significant financial penalties and possible exclusion from participation in federal and state funded healthcare programs, and the curtailment or restricting of our operations, as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws.
This could harm our ability to operate our business and our financial results.
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• our reliance on distributors for the sale of our medication management solutions outside the United States, Canada, the UK, France, and Germany;
−Removed: • remaining uncertainty regarding the consequences of Brexit and the impact on markets, as well as the potential impact on:
−Removed: (i) our operations, (ii) our customers’ operations and capital planning, and (iii) the healthcare industry overall;
• the difficulty of managing an organization operating in various countries;
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• additional investment, coordination, and lead-time necessary to successfully interface our automation solutions with the existing information systems of our customers or potential customers outside of the United States;
−Removed: • political unrest, terrorism, and other potential hostilities in areas in which we have facilities or operations;
−Removed: • epidemics, pandemics, or other major public health crises, such as the ongoing COVID-19 pandemic.
+Added: • political unrest, terrorism, and other potential hostilities (such as the ongoing conflicts between Russia and Ukraine or Israel and Hamas), including in areas in which we have facilities or operations;
+Added: • epidemics, pandemics, or other major public health crises, such as the COVID-19 pandemic.
If we are unable to anticipate and address these risks properly our business, operating results, cash flow, or financial condition could be harmed.
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The adoption and expansion of trade restrictions, the occurrence of a trade war, other governmental action related to tariffs or trade agreements or policies, or the related uncertainties, has the potential to adversely impact our ability to do business outside of the United States as well as our supply chain and costs, which could, in turn, adversely affect our business, operating results, cash flow, or financial condition.
−Removed: Covenants in our A&R Credit Agreement restrict our business and operations in many ways, and if we do not effectively manage our compliance with these covenants, our financial conditions and operating results could be adversely affected.
−Removed: The A&R Credit Agreement contains various customary covenants that require us to provide financial and other information reporting as well as notice upon certain events and limit or restrict our ability and/or our subsidiaries’ ability to, among other things, incur or assume liens or additional debt or provide guarantees in respect of obligations of other persons;
+Added: Covenants in our Second A&R Credit Agreement restrict our business and operations in many ways, and if we do not effectively manage our compliance with these covenants, our financial conditions and operating results could be adversely affected.
+Added: The Second A&R Credit Agreement contains various customary covenants that require us to provide financial and other information reporting as well as notice upon certain events and limit or restrict our ability and/or our subsidiaries’ ability to, among other things, incur or assume liens or additional debt or provide guarantees in respect of obligations of other persons;
issue redeemable preferred stock;
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and consolidate or merge with or into, or sell substantially all of our assets to, another person.
−Removed: The A&R Credit Agreement also includes financial covenants requiring us (i) not to exceed a maximum consolidated secured net leverage ratio of 3.00:1 and (ii) to maintain a minimum interest coverage ratio of 3.00:1.
+Added: The Second A&R Credit Agreement also includes financial covenants requiring us (i) not to exceed a maximum consolidated secured net leverage ratio of 3.00:1 and (ii) to maintain a minimum consolidated interest coverage ratio of 3.00:1.
Our ability to comply with these financial covenants may be affected by events beyond our control.
−Removed: Our failure to comply with any of the covenants under the A&R Credit Agreement could result in a default under the terms of the A&R Credit Agreement, which could permit the administrative agent or the lenders to declare all or part of any outstanding borrowings to be immediately due and payable or foreclose on our assets, or to refuse to permit additional borrowings under the revolving credit facility, which could restrict our operations, particularly our ability to respond to changes in our business or to take specified actions to take advantage of certain
−Removed: business opportunities that may be presented to us.
−Removed: In addition, if we are unable to repay those amounts, the administrative agent and the lenders under the A&R Credit Agreement could proceed against the collateral granted to them to secure that debt and foreclose on our assets, which would seriously harm our business.
+Added: Our failure to comply with any of the covenants under the Second A&R Credit Agreement could result in a default under the terms of the Second A&R Credit Agreement, which could permit the administrative agent or the lenders to declare all or part of any outstanding borrowings to be immediately due and payable or foreclose on our assets, or to refuse to permit additional borrowings under the revolving credit facility, which could restrict our operations, particularly our ability to respond to changes in our business or to take specified actions to take advantage of certain business opportunities that may be presented to us.
+Added: In addition, if we are unable to repay those amounts, the administrative agent and the lenders under the Second A&R Credit Agreement could proceed against the collateral granted to them to secure that debt and foreclose on our assets, which would seriously harm our business.
Climate change, legal, regulatory or market measures to address climate change and related emphasis on environmental, social and corporate governance (“ESG”) matters by various stakeholders may negatively affect our business and operating results.
9 unchanged sentences
We rely on our network infrastructure, data centers, enterprise applications, and technology systems for the development, marketing, support, and sales of our products, and for the internal operation of our business.
−Removed: These systems are susceptible to disruption or failure in the event of an extreme weather condition, including earthquake, fire, flood, ice and snowstorms or other natural disasters, as well as cyber-attack, terrorist attack, telecommunications failure, epidemic or pandemic (such as the ongoing COVID-19 pandemic), or other catastrophic event.
−Removed: Many of these systems are housed or supported in or around our corporate headquarters located in Northern California, near major earthquake faults and which may be vulnerable to climate change effects, and where a significant portion of our research and development activities and other critical business operations take place.
+Added: These systems are susceptible to disruption or failure in the event of an extreme weather condition, including earthquake, fire, flood, ice and snowstorms or other natural disasters, as well as cyber-attack, terrorist attack, telecommunications failure, health emergencies, including epidemics or pandemics (such as the COVID-19 pandemic), or other catastrophic event.
+Added: Many of these systems are housed or supported in or around our corporate facility located in Northern California, near major earthquake faults and which may be vulnerable to climate change effects, and where a significant portion of our research and development activities and other critical business operations take place.
Other critical systems are housed in communities that have been subject to significant tropical storms such St.
−Removed: Petersburg, Florida, which is the location of our manufacturing facilities for our consumable medication packages, and Raleigh, North Carolina.
+Added: Petersburg, Florida, which is the location of our manufacturing facilities for our consumable medication packages.
In the future, tropical storms may be intensified or occur with increasing frequency as a result of climate change.
−Removed: Disruptions to, or the failure of any of these systems, and the resulting loss of critical data, which is not quickly recoverable by the effective execution of disaster recovery plans designed to reduce such disruption, could cause delays in our product development, prevent us from fulfilling our customers’ orders, and could severely affect our ability to conduct normal business operations, the result of which would adversely affect our operating results.
+Added: Disruptions to, or the failure of any of these systems, and the resulting loss of critical data, which is not quickly
+Added: recoverable by the effective execution of disaster recovery plans designed to reduce such disruption, could cause delays in our product development, prevent us from fulfilling our customers’ orders, and could severely affect our ability to conduct normal business operations, the result of which would adversely affect our operating results.
Our success is dependent on our ability to recruit and retain skilled and motivated personnel.
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If we lose the services of one or more of our key personnel, we may not be able to find a suitable replacement and our business could be materially adversely affected.
−Removed: Furthermore, external and internal factors (such as our continued growth) and events related to the COVID-19 pandemic (including new variants of the virus) may result in greater workloads for our employees compared to those at companies with which we compete for personnel, which may lead to higher levels of employee burnout and turnover.
+Added: Furthermore, external (such as the COVID-19 pandemic) and internal (such as our continued growth or internal restructuring initiatives) factors may result in greater workloads for our employees compared to those at companies with which we compete for personnel, which may lead to higher levels of employee burnout and turnover.
Competitors have in the past attempted, and may in the future attempt, to recruit our employees.
−Removed: In addition, since equity compensation is a key component of our employee compensation program, any failure to receive stockholder approval for future proposed increases to the number of shares reserved for issuance under our equity incentive plans could prevent us from granting equity compensation at competitive levels and make it more difficult to attract, retain, and motivate employees, including key employees of acquired businesses.
+Added: In addition, since equity compensation is a key component of our employee compensation program, any further decrease in our stock price or failure to receive stockholder approval for future proposed increases to the number of shares reserved for issuance under our equity incentive plans could prevent us from granting equity compensation at competitive levels and make it more difficult to attract, retain, and motivate employees, including key employees of acquired businesses.
Failure to attract and retain key personnel could harm our competitive position, operating results, and financial condition.
12 unchanged sentences
Factors that are largely beyond our control, such as the cost, quality, and availability of the raw materials and components utilized in the manufacture of our products, may affect the cost of such products, and we may not be able to pass those costs on to our customers.
−Removed: Our products use raw materials and components that may be subject to price fluctuations, shortages, or other disruptions of supply for many reasons outside of our control, including as a result of the COVID-19 pandemic.
+Added: Our products use raw materials and components that may be subject to price fluctuations, shortages, or other disruptions of supply for many reasons outside of our control.
In addition, we may be dependent upon a limited number of suppliers for certain components which may be unduly affected by supply chain disruptions.
2 unchanged sentences
We have developed and implemented strategies in an effort to mitigate the impact of price fluctuations, shortages, or other disruptions of supply, but these strategies, particularly in a prolonged inflationary environment, may only offset a portion of the adverse impact.
−Removed: We carry some inventory of critical components and are otherwise working to secure supplies necessary to ensure fulfillment of customer demand, but global shortages could result in our need to secure supplies at higher costs as well as manufacturing delays.
−Removed: We have recently experienced increased delays in shipments of various components used in the manufacture of our products, particularly with regard to semiconductor chips.
−Removed: As a result, we have sought alternate sources of certain components, which may be at a higher cost or lower quality.
−Removed: Because semiconductor chips continue to be subject to an ongoing and significant shortage, our ability to source components that use semiconductor chips has been adversely affected.
−Removed: These supply interruptions have resulted in increased component delivery lead times and increased costs to obtain components with available semiconductor chips.
−Removed: As the semiconductor chip shortage continues, or other shortages may continue, the production of our products may be impacted.
+Added: We carry some inventory of critical components and are otherwise working to secure supplies necessary
+Added: to ensure fulfillment of customer demand, but global shortages could result in our need to secure supplies at higher costs as well as manufacturing delays.
+Added: Supply interruptions may result in increased component delivery lead times and increased costs to obtain components and as a result the production of our products may be impacted.
If we or our suppliers are unable to obtain components from third parties in the quantities and of the quality that we require, on a timely basis and at acceptable prices, we may not be able to deliver our products on a timely or cost-effective basis to our customers, or it may lead to us delivering products that are of a lower quality that may result in increased repair and replacement costs, which could harm our business and reputation, operating results, cash flow, and financial condition.
We have also seen a period of sustained price increases for commodities used in the manufacture of our products that may continue as demand increases and supply remains constrained, which has resulted in, and may continue to result in, increased costs for Omnicell and thereby potentially lower profit margins.
−Removed: If the costs of these commodities increase or remain elevated, it could adversely affect Omnicell’s business, operating results, cash flow, or financial condition.
+Added: If the costs of these commodities increase or remain elevated, it could adversely affect our business, operating results, cash flow, or financial condition.
We depend on a limited number of suppliers for our products, and our business may suffer if we were required to change suppliers to obtain an adequate supply of components, equipment, and raw materials on a timely basis.
15 unchanged sentences
government customer leases will decline over time and cease in the future.
−Removed: The failure of any of our U.S.
+Added: In addition, under the terms of the Federal Supply Schedule contract, certain of our U.S.
+Added: government customer contracts are terminable at the convenience of the applicable U.S.
+Added: government customer.
+Added: If any of our government-owned or government-run hospital customers decide to terminate their agreements early for any reason, we would not derive the expected financial benefits from any such customer which could result in lower than expected revenue and adversely affect our business, operating results, cash flow, or financial condition.
+Added: In addition, the failure of any of our U.S.
government customers to receive their annual funding, or the government mandating changes to the Federal Supply Services contract, could impair our ability to sell equipment to these customers or to sell our U.S.
6 unchanged sentences
Managing our inventory of components and finished products is a complex task.
−Removed: A number of factors, including, but not limited to, the need to maintain a significant inventory of certain components that are in short supply, especially in response to the current semiconductor chip shortage, or that must be purchased in bulk to obtain favorable pricing, the general unpredictability of demand for specific products and customer requests for quick delivery schedules, may result in us maintaining large amounts of inventory.
+Added: A number of factors, including, but not limited to, the need to maintain a significant inventory of certain components that are in short supply or that must be purchased in bulk to obtain favorable pricing, the general unpredictability of demand for specific products and customer requests for quick delivery schedules, may result in us maintaining large amounts of inventory.
Other factors, including changes in market demand, customer requirements, and technology, may cause our inventory to become obsolete.
10 unchanged sentences
Despite the presence of healthcare and pharmacy professionals as intermediaries between our products and patients, if our products fail to provide accurate and timely information or operate as designed, customers, patients, or their family members could assert claims against us for product liability.
−Removed: Moreover, failure of health care facility and pharmacy
−Removed: employees to use our products for their intended purposes could result in product liability claims against us.
+Added: Moreover, failure of health care facility and pharmacy employees to use our products properly or for their intended purposes could result in product liability claims against us.
Litigation with respect to product liability claims, regardless of any outcome, could result in substantial cost to us, divert management’s attention from operations, and decrease market acceptance of our products.
9 unchanged sentences
These factors could negatively and materially affect our ability to market, sell, or distribute our products.
−Removed: Investment in new business strategies and initiatives could disrupt ongoing business and present risks not originally contemplated.
−Removed: We have invested, and in the future may invest, in new business strategies or initiatives, including with respect to our software as a service or solution as a service subscription products and services or other subscription and cloud-based offerings.
−Removed: Such endeavors may involve significant risks and uncertainties, including distraction of management from current operations, lack of expertise to effectively execute such strategies or initiatives, insufficient revenue to offset liabilities assumed and expenses associated with a strategy or initiative, inadequate return of capital, and unidentified issues not discovered in our due diligence.
+Added: Investment in new business strategies, initiatives, products or solutions could disrupt ongoing business and present risks not originally contemplated.
+Added: We have invested, and in the future may invest, in new business strategies, initiatives, products or solutions, including with respect to our software as a service or solution as a service subscription products and services or other subscription and cloud-based offerings.
+Added: Such endeavors may involve significant risks and uncertainties, including distraction of management from current operations, lack of expertise to effectively execute such strategies or initiatives or to develop such products or solutions, delays, technical problems (including software defects or errors) or unexpected expenses related to the entry into new business strategies or initiatives or development of new products or solutions, insufficient revenue to offset liabilities assumed and expenses associated with a strategy, initiative, product or solution, inadequate return of capital or return on investment, and unidentified issues not discovered in our due diligence.
These new ventures may be inherently risky and may not be successful.
−Removed: Even if successful, they may not have the projected or actual impact that we initially expected or that recoups our initial investment.
+Added: Even if successful, they may not have the projected or actual impact that we initially expected or that recoups our initial
+Added: investment and we may make a determination to exit a particular business strategy, initiative, product line or solution.
As a result, such initiatives may materially adversely affect our business, operating results, cash flow, or financial condition.
5 unchanged sentences
• changes in the ratings of our common stock by securities analysts or changes in their earnings estimates;
−Removed: • changes in our business model and initiatives, such as our ongoing transition to focus on a subscription-based business model and our ongoing restructuring initiative to contain costs;
+Added: • changes in our business model and initiatives, such as our ongoing transition to focus on a subscription-based business model o r a decision to exit a particular business or product line, and our ongoing restructuring initiatives to contain costs;
• developments in our customer relationships;
7 unchanged sentences
• cyber events, such as the ransomware incident we experienced in May 2022;
−Removed: • epidemics, pandemics, or other major public health crises, such as the ongoing COVID-19 pandemic;
+Added: • epidemics, pandemics, or other major public health crises, such as the COVID-19 pandemic;
• general economic, regulatory, political and market conditions.
10 unchanged sentences
• our ability to successfully install our products on a timely basis and meet other contractual obligations necessary to recognize revenue;
−Removed: • fluctuations in customer demand for our products, including due to changes in our customers’ budgets, and whether customer demand was properly estimated;
+Added: • fluctuations in customer demand for our products, including due to changes in our customers’ budgets, healthcare worker turnover rates and labor shortages and whether customer demand was properly estimated;
• our ability to control costs, including operating expenses, and continue cost reduction efforts, such as our restructuring initiative;
9 unchanged sentences
We are transitioning to focus on a subscription-based business model, which industry or financial analysts that publish reports about our business, may not have historically reflected, or may not accurately reflect in the future.
−Removed: As a result, analysts’ ability to accurately forecast our results may be negatively impacted and it may be more likely that we fail to meet their
+Added: As a result, analysts’ ability to accurately forecast our results may be negatively impacted and it may be more likely that we fail to meet their estimates.
As a result, if our financial results fail to meet (or significantly exceed) our publicly announced financial guidance or the expectations of analysts or investors, analysts could downgrade our common stock or publish unfavorable research that could cause our stock price or trading volume to decline, potentially significantly.
1 unchanged sentence
We may seek additional capital through a variety of means, including through private and public equity offerings and debt financings.
−Removed: To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest will be diluted, and the terms may include liquidation or other preferences that adversely affect the rights of our stockholders.
+Added: To the extent that we raise additional capital through the sale of equity or convertible debt securities, or the refinancing of our existing convertible notes, the ownership interest will be diluted, and the terms may include liquidation or other preferences that adversely affect the rights of our stockholders.
Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take certain actions, such as incurring additional debt, making capital expenditures, entering into licensing arrangements, or declaring dividends.
6 unchanged sentences
Delaware law also prohibits corporations from engaging in a business combination with any holders of 15% or more of their capital stock until the holder has held the stock for three years unless, among other possibilities, our Board of Directors approves the transaction.
−Removed: Our Board of Directors may use these provisions to prevent changes in the management and control of our Company.
+Added: of Directors may use these provisions to prevent changes in the management and control of our Company.
Also, under applicable Delaware law, our Board of Directors may adopt additional anti-takeover measures in the future including, without limitation, a stockholder rights plan.
11 unchanged sentences
Prior to May 15, 2025, if a circumstance that permits early conversion occurs, holders of the Notes will be entitled to convert their Notes at any time during specified periods at their option.
−Removed: During the three months ended December 31, 2022, none of the conditional conversion features of the Notes were triggered, and therefore, the Notes are not convertible during the first quarter of 2023, commencing on January 1, 2023, but the notes may be convertible in the future.
If one or more holders elect to convert their Notes, we will be required to settle at least the principal amount of our conversion obligation through the payment of cash (up to $1,000 in cash per $1,000 principal amount of Notes), which could adversely affect our liquidity.
10 unchanged sentences
If an option counterparty becomes subject to insolvency proceedings, we will become an unsecured creditor in those proceedings with a claim equal to our exposure at that time under the convertible note hedge transactions with such option counterparty.
−Removed: Our exposure will depend on many factors but, generally, an increase in our exposure will be correlated to an increase in the market price and in the volatility of our common stock.
+Added: Our exposure will depend on many factors but, generally, an increase in our exposure will be correlated to an increase in the market price and in the volatility
+Added: of our common stock.
In addition, upon a default by an option counterparty, we may suffer adverse tax consequences and more dilution than we currently anticipate with respect to our common stock.
8 unchanged sentences
There can be no assurance that the outcomes from these examinations will not materially adversely affect our business, operating results, cash flow, or financial condition.
−Removed: Forecasting our estimated annual effective tax rate is complex and subject to uncertainty, and there may be a material difference between the forecasted and the accrued effective tax rates, especially due to the volatility and uncertainty of global economic conditions resulting from the COVID-19 pandemic.
+Added: Forecasting our estimated annual effective tax rate is complex and subject to uncertainty, and there may be a material difference between the forecasted and the accrued effective tax rates.
Any increase in our effective tax rate would reduce our profitability.
2 unchanged sentences
If we fail to maintain effective internal control over financial reporting, as such standards are modified, supplemented, or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal control over financial reporting.
−Removed: Should that occur, we may not be able to accurately report our financial results,
−Removed: prevent fraud, or file our periodic reports in a timely manner, which may cause investors to lose confidence in our reported financial information and may lead to a decline in our stock price.
+Added: Should that occur, we may not be able to accurately report our financial results, prevent fraud, or file our periodic reports in a timely manner, which may cause investors to lose confidence in our reported financial information and may lead to a decline in our stock price.
In addition, our failure to timely file our periodic reports could eventually result in the delisting of our common stock, regulatory sanctions from the SEC, and/or the breach of the terms contained in our credit facility, or any preferred equity or debt securities we may issue in the future, any of which could have a material adverse impact on our operations and your investment in our common stock.
−Removed: UNRESOLVED STAFF COMMENTS
−Removed: There are currently no unresolved issues with respect to any SEC staff’s written comments.
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.