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ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 53.00 548.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 541.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 135 540.9833984375 m 297.7294921875 540.9833984375 l s q 0 0 1 rg BT 135.00 542.32 Td (December 31, 2016 and October 1, 2016) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 529.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 529.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 135.00 529.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 529.32 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 53.00 522.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 515.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 514.9833984375 m 323.376953125 514.9833984375 l s q 0 0 1 rg BT 117.00 516.32 Td (Condensed Consolidated Statements of Cash 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d 1 J 1 j 3 M 117 475.9833984375 m 338.9140625 475.9833984375 l s q 0 0 1 rg BT 117.00 477.32 Td (Notes to Condensed Consolidated Financial Statements) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 464.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 464.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 464.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 464.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 449.9833984375 m 81.3251953125 449.9833984375 l s q 0 0 1 rg BT 53.00 451.32 Td (Item 2.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 450.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 449.9833984375 m 474.314453125 449.9833984375 l s q 0 0 1 rg BT 117.00 451.32 Td (Management's Discussion and ) Tj ET Q q 0 0 1 rg BT 240.17 451.32 Td (Analysis of Financial Condition and Results of Operations) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 438.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 438.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 438.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 438.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 423.9833984375 m 81.3251953125 423.9833984375 l s q 0 0 1 rg BT 53.00 425.32 Td (Item 3.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 424.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 423.9833984375 m 358.62109375 423.9833984375 l s q 0 0 1 rg BT 117.00 425.32 Td (Quantitative and Qualitative Disclosures ) Tj ET Q q 0 0 1 rg BT 281.40 425.32 Td (About Market Risk) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 412.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 412.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 412.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 412.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 397.9833984375 m 81.3251953125 397.9833984375 l s q 0 0 1 rg BT 53.00 399.32 Td (Item 4.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 398.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 397.9833984375 m 215.3154296875 397.9833984375 l s q 0 0 1 rg BT 117.00 399.32 Td (Controls and Procedures) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 386.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 386.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 386.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 386.32 Td () Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 53 371.91259765625 m 84.66015625 371.91259765625 l s q 0 0 1 rg BT 53.00 373.48 Td (PartII.) Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 1.00 Tf ET q 0 0 0 rg BT 97.00 372.47 Td () Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 117 371.91259765625 m 197.087890625 371.91259765625 l s q 0 0 1 rg BT 117.00 373.48 Td (Other) Tj ET Q q 0 0 1 rg BT 142.37 373.48 Td ( Information) Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 1.00 Tf ET q 0 0 0 rg BT 559.00 372.47 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 360.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 360.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 360.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 360.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 345.9833984375 m 81.3251953125 345.9833984375 l s q 0 0 1 rg BT 53.00 347.32 Td (Item 1.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 346.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 345.9833984375 m 191.140625 345.9833984375 l s q 0 0 1 rg BT 117.00 347.32 Td (Legal Proceedings) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 334.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 334.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 334.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 334.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 319.9833984375 m 88.546875 319.9833984375 l s q 0 0 1 rg BT 53.00 321.32 Td (Item 1A.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 320.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 319.9833984375 m 167.2783203125 319.9833984375 l s q 0 0 1 rg BT 117.00 321.32 Td (Risk Factors) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 308.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 308.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 308.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 308.32 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 53 293.9833984375 m 81.3251953125 293.9833984375 l s q 0 0 1 rg BT 53.00 295.32 Td (Item 6.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 1.00 Tf ET q 0 0 0 rg BT 97.00 294.51 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 117 293.9833984375 m 150.3349609375 293.9833984375 l s q 0 0 1 rg BT 117.00 295.32 Td (Exhibits) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 282.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.00 282.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 282.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.00 282.32 Td () Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 53 267.91259765625 m 98.380859375 267.91259765625 l s q 0 0 1 rg BT 53.00 269.48 Td (Signatur) Tj ET Q q 0 0 1 rg BT 90.05 269.48 Td (es) Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 554 618.9833984375 m 559 618.9833984375 l s q 0 0 1 rg BT 554.00 620.32 Td (4) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 554 579.9833984375 m 559 579.9833984375 l s q 0 0 1 rg BT 554.00 581.32 Td (5) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 554 540.9833984375 m 559 540.9833984375 l s q 0 0 1 rg BT 554.00 542.32 Td (6) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 554 501.9833984375 m 559 501.9833984375 l s q 0 0 1 rg BT 554.00 503.32 Td (7) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 554 475.9833984375 m 559 475.9833984375 l s q 0 0 1 rg BT 554.00 477.32 Td (8) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 449.9833984375 m 559 449.9833984375 l s q 0 0 1 rg BT 549.00 451.32 Td (29) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 423.9833984375 m 559 423.9833984375 l s q 0 0 1 rg BT 549.00 425.32 Td (44) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 397.9833984375 m 559 397.9833984375 l s q 0 0 1 rg BT 549.00 399.32 Td (46) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 345.9833984375 m 559 345.9833984375 l s q 0 0 1 rg BT 549.00 347.32 Td (47) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 319.9833984375 m 559 319.9833984375 l s q 0 0 1 rg BT 549.00 321.32 Td (47) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 293.9833984375 m 559 293.9833984375 l s q 0 0 1 rg BT 549.00 295.32 Td (65) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 549 267.9833984375 m 559 267.9833984375 l s q 0 0 1 rg BT 549.00 269.32 Td (67) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL endstream endobj 7 0 obj <>] /Rotate 0 /Contents 8 0 R>> endobj 8 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (3) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 50 740.68505859375 m 363.76953125 740.68505859375 l s q 0 0 0 rg BT 50.00 742.25 Td (SPECIAL) Tj ET Q q 0 0 0 rg BT 92.79 742.25 Td ( NOTE REGARDING FOR) Tj ET Q q 0 0 0 rg BT 211.62 742.25 Td (W) Tj ET Q q 0 0 0 rg BT 220.51 742.25 Td (ARD-LOOKING ST) Tj ET Q q 0 0 0 rg BT 308.39 742.25 Td (A) Tj ET Q q 0 0 0 rg BT 314.87 742.25 Td (TEMENTS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.25 Td (This quarterly report contains certain forward-looking statements within the meaning of Section27A) Tj ET Q q 0 0 0 rg BT 453.23 718.25 Td ( of the Securities ) Tj ET Q q 0 0 0 rg BT 522.66 718.25 Td (Act of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.25 Td (1933 and Section21E of the Securities Exchange ) Tj ET Q q 0 0 0 rg BT 249.39 706.25 Td (Act of 1934. ) Tj ET Q q 0 0 0 rg BT 301.61 706.25 Td (All statements included in or incorporated by reference in this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (quarterly report, other than statements of historical fact, are forward-looking statements. ) Tj ET Q q 0 0 0 rg BT 405.25 694.25 Td (These statements are generally ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td (accompanied by words such as trend, may) Tj ET Q q 0 0 0 rg BT 231.78 682.25 Td (, will, could, would, should, expect, plan, anticipate, rely) Tj ET Q q 0 0 0 rg BT 529.32 682.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.25 Td (believe, estimate, predict, intend, potential, continue, "outlook," forecast or the negative of such terms, or other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.25 Td (comparable terminology) Tj ET Q q 0 0 0 rg BT 147.37 658.25 Td (, including without limitation statements made under Our Strategy) Tj ET Q q 0 0 0 rg BT 416.39 658.25 Td (, discussions regarding our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.25 Td (bookings and in Management) Tj ET Q q 0 0 0 rg BT 175.81 646.25 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 244.98 646.25 Td (Analysis of Financial Condition and Results of Operations. Forward-looking ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.25 Td (statements also include the assumptions underlying or relating to any of the foregoing statements. ) Tj ET Q q 0 0 0 rg BT 442.42 634.25 Td (Actual results of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.25 Td (Coherent,Inc. \(referred to herein as the Company) Tj ET Q q 0 0 0 rg BT 248.44 622.25 Td (, we, our or Coherent\) may dif) Tj ET Q q 0 0 0 rg BT 369.89 622.25 Td (fer significantly from those anticipated in these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.25 Td (forward-looking statements as a result of various factors, including those discussed in the sections captioned Our Strategy) Tj ET Q q 0 0 0 rg BT 541.17 610.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.25 Td (Risk Factors, Key Performance Indicators, as well as any other cautionary language in this quarterly report. ) Tj ET Q q 0 0 0 rg BT 499.57 598.25 Td (All forward-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.25 Td (looking statements included in the document are based on information available to us on the date hereof. ) Tj ET Q q 0 0 0 rg BT 470.81 586.25 Td (W) Tj ET Q q 0 0 0 rg BT 479.44 586.25 Td (e undertake no ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.25 Td (obligation to update these forward-looking statements as a result of events or circumstances or to reflect the occurrence of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.25 Td (unanticipated events or non-occurrence of anticipated events. ) Tj ET Q endstream endobj 9 0 obj <>] /Rotate 0 /Contents 10 0 R>> endobj 10 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 742.25 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 742.25 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 742.25 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 742.25 Td (I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 145.96 742.25 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 196.60 742.25 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 718.25 Td (ITEM 1. 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0.8 0.9333333333333333 1 rg /GS0 gs 305.50 613.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 613.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 613.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 613.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 583.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 583.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 583.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 583.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 583.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 554.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 554.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 554.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 554.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 554.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 524.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 524.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 524.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 524.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 524.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 494.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 494.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 494.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 494.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 494.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 464.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 464.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 464.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 464.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 464.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 435.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 435.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 435.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 435.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 435.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 405.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 405.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 405.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 405.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 405.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 375.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 375.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 375.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 375.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 375.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 346.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 346.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 346.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 346.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 346.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 318.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 318.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 318.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 318.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 318.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 290.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 290.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 290.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 290.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 290.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 251.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 251.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 251.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 251.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 251.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 223.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 223.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 223.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 223.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 223.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 194.75 250.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 194.75 60.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 194.75 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 194.75 60.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 194.75 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 154.75 250.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 154.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 154.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 154.75 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 154.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 55.50 126.75 250.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 305.50 126.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 126.75 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 369.50 126.75 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 126.75 4.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 634.75 m 365.5 634.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 634.75 m 369.5 634.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 634.75 m 429.5 634.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 634.75 m 365.5 634.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 613.75 m 365.5 613.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 634.75 m 429.5 634.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 613.75 m 429.5 613.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 613.75 m 365.5 613.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 583.75 m 365.5 583.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 583.75 m 429.5 583.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 583.75 m 429.5 583.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 494.75 m 365.5 494.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 494.75 m 429.5 494.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 494.75 m 365.5 494.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 479.75 m 365.5 479.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 494.75 m 429.5 494.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 479.75 m 429.5 479.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 479.75 m 365.5 479.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 405.75 m 365.5 405.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 405.75 m 429.5 405.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 390.75 m 365.5 390.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 405.75 m 429.5 405.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 390.75 m 429.5 390.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 360.75 m 365.5 360.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 360.75 m 429.5 360.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 332.75 m 365.5 332.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 332.75 m 429.5 332.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 332.75 m 365.5 332.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 319.75 m 365.5 319.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305.5 317.75 m 365.5 317.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 332.75 m 429.5 332.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 319.75 m 429.5 319.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 369.5 317.75 m 429.5 317.75 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 58.00 637.47 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 330.60 638.98 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 311.75 625.98 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 327.00 617.98 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 380.75 625.98 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 391.00 617.98 Td (2016) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 603.43 Td (Net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 603.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 329.15 603.43 Td (346,073) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.00 603.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.15 603.42 Td (190,275) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 588.43 Td (Cost of sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 329.15 588.43 Td (204,559) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.15 588.42 Td (106,377) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 573.43 Td (Gross profit) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 329.15 573.43 Td (141,514) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 573.42 Td (83,898) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 559.43 Td (Operating expenses:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 362.00 557.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 426.00 557.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 544.42 Td (Research and development) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 544.43 Td (27,084) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 544.42 Td (19,140) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 529.42 Td (Selling, general and administrative) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 529.43 Td (73,768) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 529.42 Td (36,774) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 514.42 Td (Gain from business combination) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 335.80 514.48 Td (\(5,416) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.65 514.43 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.65 514.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 499.42 Td (Amortization of intangible assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 339.15 499.43 Td (3,878) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.65 499.42 Td (701) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 484.42 Td (Total operating expenses) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 484.43 Td (99,314) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 484.42 Td (56,615) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 469.43 Td (Income from operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 469.43 Td (42,200) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 469.42 Td (27,283) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 455.43 Td (Other income \(expense\):) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 362.00 453.47 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 440.42 Td (Interest income) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 346.65 440.43 Td (143) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.65 440.42 Td (240) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 425.42 Td (Interest expense) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 335.80 425.48 Td (\(7,964) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.65 425.43 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.30 425.47 Td (\(15) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.65 425.42 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.00 410.42 Td (Othernet) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 410.43 Td (12,993) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.30 410.47 Td (\(447) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.65 410.42 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 395.42 Td (Total other income \(expense\), net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 339.15 395.43 Td (5,172) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.30 395.47 Td (\(222) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.65 395.42 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 380.43 Td (Income from continuing operations before income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 380.43 Td (47,372) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 380.42 Td (27,061) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 365.42 Td (Provision for income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 365.43 Td (16,674) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.15 365.42 Td (6,775) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 351.43 Td (Net income from continuing operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 351.43 Td (30,698) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 351.32 Td (20,286) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 337.32 Td (Loss from discontinued operations, net of income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 343.30 337.48 Td (\(290) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.65 337.43 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 415.65 337.43 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 323.43 Td (Net income) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 323.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.15 323.43 Td (30,408) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.00 323.32 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.15 323.32 Td (20,286) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 295.43 Td (Basic net income per share:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 281.32 Td (Income per share from continuing operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 281.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 344.15 281.43 Td (1.26) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 372.00 281.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 408.15 281.43 Td (0.85) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 266.42 Td (Loss per share from discontinued operations, net of income) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 256.42 Td (taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 256.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 340.80 256.48 Td (\(0.01) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.65 256.43 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.00 256.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.65 256.42 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 242.43 Td (Net income per share) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 242.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 344.15 242.43 Td (1.25) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 372.00 242.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 408.15 242.43 Td (0.85) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 214.43 Td (Diluted net income per share:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 362.00 212.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 426.00 212.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 199.42 Td (Income per share from continuing operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 199.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 344.15 199.43 Td (1.25) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 372.00 199.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 408.15 199.43 Td (0.84) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 184.42 Td (Loss per share from discontinued operations, net of income) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 174.42 Td (taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 174.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 340.80 174.48 Td (\(0.01) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.65 174.43 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.00 174.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.65 174.42 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.00 159.43 Td (Net income per share) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.00 159.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 344.15 159.43 Td (1.23) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 372.00 159.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 408.15 159.43 Td (0.84) Tj ET Q BT /F2 10.00 Tf ET q 0 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698.98 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 444.00 690.98 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.05 698.98 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 518.00 690.98 Td (2016) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 214.35 677.43 Td (ASSETS) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 675.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 675.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 662.42 Td (Current assets:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 660.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 660.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 647.42 Td (Cash and cash equivalents) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 420.00 647.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 647.43 Td (360,217) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 647.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 647.42 Td (354,347) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 632.42 Td (Restricted cash) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 461.15 632.43 Td (2,232) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 632.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 617.42 Td (Short-term investments) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 468.65 617.43 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 617.42 Td (45,606) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 602.42 Td (Accounts receivablenet of allowances of $6,932 and $2,420, respectively) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 602.43 Td (241,112) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 602.42 Td (165,715) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 587.42 Td (Inventories) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 587.43 Td (386,013) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 587.42 Td (212,898) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 572.42 Td (Prepaid expenses and other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 456.15 572.43 Td (66,981) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 572.42 Td (37,073) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 557.42 Td (Assets held-for-sale) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 456.15 557.43 Td (65,484) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 557.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 542.42 Td (Total current assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 443.65 542.43 Td (1,122,164) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 542.42 Td (815,639) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 527.42 Td (Property and equipment, net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 527.43 Td (251,090) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 527.42 Td (127,443) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 512.42 Td (Goodwill) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 512.43 Td (351,311) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 512.42 Td (101,458) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 497.42 Td (Intangible assets, net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 497.43 Td (233,634) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 497.42 Td (13,874) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 482.42 Td (Non-current restricted cash) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 456.15 482.43 Td (11,543) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 482.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 467.42 Td (Other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 467.43 Td (119,829) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 467.42 Td (102,734) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 452.42 Td (Total assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 420.00 452.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 443.65 452.43 Td (2,089,571) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 452.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 517.65 452.42 Td (1,161,148) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 125.10 423.43 Td (LIABILITIES AND STOCKHOLDERS EQUITY) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 421.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 421.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 408.42 Td (Current liabilities:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 406.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 406.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 393.42 Td (Short-term borrowings and current-portion of long-term obligations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 420.00 393.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 461.15 393.43 Td (7,183) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 393.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 393.42 Td (20,000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 378.42 Td (Accounts payable) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 456.15 378.43 Td (66,439) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 378.42 Td (45,182) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 363.42 Td (Income taxes payable) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 456.15 363.43 Td (41,191) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 363.42 Td (19,870) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 348.42 Td (Other current liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 348.43 Td (198,281) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 348.42 Td (116,442) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 333.42 Td (Total current liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 333.43 Td (313,094) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 333.42 Td (201,494) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 318.42 Td (Long-term obligations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 318.43 Td (677,323) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 318.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 303.42 Td (Other long-term liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 303.43 Td (172,173) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 303.42 Td (48,826) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 288.42 Td (Commitments and contingencies \(Note 11\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 273.42 Td (Stockholders equity:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 271.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 271.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 258.42 Td (Common stock, Authorized500,000 shares, par value $.01 per share:) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 484.00 256.47 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 256.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 243.42 Td (Outstanding24,553 shares and 24,324 shares, respectively) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 468.65 243.43 Td (244) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 243.42 Td (242) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 228.42 Td (Additional paid-in capital) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 228.43 Td (145,494) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 228.42 Td (151,298) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 213.42 Td (Accumulated other comprehensive loss) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 452.80 213.48 Td (\(13,753) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 483.65 213.43 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.80 213.47 Td (\(5,300) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 557.65 213.42 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.00 198.42 Td (Retained earnings) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 198.43 Td (794,996) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 198.42 Td (764,588) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 183.42 Td (Total stockholders equity) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 451.15 183.43 Td (926,981) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 183.42 Td (910,828) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 168.42 Td (Total liabilities and stockholders equity) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 420.00 168.43 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 443.65 168.43 Td (2,089,571) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 168.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 517.65 168.42 Td (1,161,148) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 154.15 140.25 Td (See ) Tj ET Q q 0 0 0 rg BT 170.35 140.25 Td (Accompanying Notes to Condensed Consolidated Financial Statements.) 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0 rg BT 256.53 718.25 Td (Unaudited; in thousands\)) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 49.50 673.75 368.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 673.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 673.75 4.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 673.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 49.50 653.75 368.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 653.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 653.75 4.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 653.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 49.50 633.75 368.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 633.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 633.75 4.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 633.75 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg 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253.75 m 491.5 253.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 253.75 m 561.5 253.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 233.75 m 487.5 233.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 224.75 m 487.5 224.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 222.75 m 487.5 222.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 233.75 m 561.5 233.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 224.75 m 561.5 224.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 222.75 m 561.5 222.75 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 52.00 697.47 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 452.60 698.98 Td (Thr) Tj ET Q q 0 0 0 rg BT 465.79 698.98 Td (ee Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 52.00 676.47 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 428.75 685.98 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 444.00 677.98 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.75 685.98 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 518.00 677.98 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 665.88 Td (Cash flows from operating activities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.00 655.75 Td (Net income) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.00 655.88 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 655.88 Td (30,408) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 494.00 655.75 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.65 655.75 Td (20,286) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.00 645.75 Td (Adjustments to reconcile net income to net cash provided by operating activities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 635.75 Td (Depreciation and amortization) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 635.88 Td (8,995) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 635.75 Td (6,385) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 625.75 Td (Amortization of intangible assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 625.88 Td (12,088) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 625.75 Td (2,092) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 615.75 Td (Gain on business combination) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 615.88 Td (\(5,416) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 615.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 615.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 605.75 Td (Deferred income taxes) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 605.88 Td (1,291) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 605.75 Td (\(3,492) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 605.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 595.75 Td (Amortization of debt issuance cost) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 472.30 595.88 Td (600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 594.37 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 585.75 Td (Stock-based compensation) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 585.88 Td (5,503) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 585.75 Td (3,745) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 575.75 Td (Non-cash restructuring charges) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 575.88 Td (4,359) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 575.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 565.75 Td (Other non-cash expenses) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 472.30 565.88 Td (456) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.65 565.75 Td (165) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 555.75 Td (Changes in assets and liabilities, net of effect of acquisitions:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 545.75 Td (Accounts receivable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 545.88 Td (4,417) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 545.75 Td (\(3,646) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 545.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 535.75 Td (Inventories) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 535.88 Td (6,613) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 535.75 Td (\(3,713) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 535.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 525.75 Td (Prepaid expenses and other assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 525.88 Td (\(3,559) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 525.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 525.75 Td (\(3,551) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 525.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 515.75 Td (Other long-term assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 515.88 Td (\(1,083) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 515.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 515.75 Td (\(1,047) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 515.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 505.75 Td (Accounts payable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 505.88 Td (1,439) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 505.75 Td (\(4,252) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 505.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 495.75 Td (Income taxes payable/receivable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 495.88 Td (\(1,428) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 495.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 495.75 Td (4,575) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 485.75 Td (Other current liabilities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 485.88 Td (17,911) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 485.75 Td (\(5,128) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 485.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 475.75 Td (Other long-term liabilities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 475.88 Td (1,330) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 475.75 Td (1,843) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 465.75 Td (Cash flows from discontinued operations) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 465.88 Td (\(1,283) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 465.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 465.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 455.75 Td (Net cash provided by operating activities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 455.88 Td (82,641) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.65 455.75 Td (14,262) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 435.88 Td (Cash flows from investing activities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 425.75 Td (Purchases of property and equipment) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.60 425.88 Td (\(15,390) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 425.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 425.75 Td (\(4,765) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 425.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 415.75 Td (Proceeds from dispositions of property and equipment) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 472.30 415.88 Td (123) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 415.75 Td (50) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 405.75 Td (Purchases of available-for-sale securities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 476.30 405.88 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.95 405.75 Td (\(50,151) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 405.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 395.75 Td (Proceeds from sales and maturities of available-for-sale securities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 395.88 Td (25,108) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.65 395.75 Td (51,254) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 385.75 Td (Acquisition of businesses, net of cash acquired) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.60 385.88 Td (\(740,481) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 385.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 385.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 375.75 Td (Cash flows from discontinued operations) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 469.60 375.88 Td (\(153) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 375.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 375.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 365.75 Td (Net cash used in investing activities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.60 365.88 Td (\(730,793) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 365.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 365.75 Td (\(3,612) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 365.75 Td (\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 345.88 Td (Cash flows from financing activities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 335.75 Td (Short-term borrowings) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 335.88 Td (3,920) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.65 335.75 Td (17,160) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 325.75 Td (Repayments of short-term borrowings) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.60 325.88 Td (\(23,920) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 325.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.95 325.75 Td (\(12,160) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 325.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 315.75 Td (Proceeds from long-term borrowings) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 458.30 315.88 Td (740,685) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 315.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 305.75 Td (Repayments of long-term borrowings) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.60 305.88 Td (\(2,171) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 305.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 305.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 295.75 Td (Issuance of common stock under employee stock option and purchase plans) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 295.88 Td (3,866) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 295.75 Td (3,521) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 285.75 Td (Net settlement of restricted common stock) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.60 285.88 Td (\(15,255) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 285.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 285.75 Td (\(5,317) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 285.75 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 275.75 Td (Debt issuance costs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.60 275.88 Td (\(25,824) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 275.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 275.75 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.00 265.75 Td (Net cash provided by financing activities) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 458.30 265.88 Td (681,301) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 265.75 Td (3,204) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 255.88 Td (Effect of exchange rate changes on cash, cash equivalents and restricted cash) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.60 255.88 Td (\(13,504) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.30 255.88 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.95 255.75 Td (\(2,118) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 557.65 255.75 Td (\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 245.88 Td (Net increase in cash, cash equivalents and restricted cash) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 245.88 Td (19,645) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.65 245.75 Td (11,736) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 235.88 Td (Cash, cash equivalents and restricted cash, beginning of period) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 458.30 235.88 Td (354,347) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 531.65 235.75 Td (130,607) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 225.88 Td (Cash, cash equivalents and restricted cash, end of period) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.00 225.88 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 458.30 225.88 Td (373,992) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 494.00 225.75 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 531.65 225.75 Td (142,343) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.00 205.88 Td (Noncash investing and financing activities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.00 195.75 Td ( Unpaid property and equipment purchases) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.00 195.88 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 466.30 195.88 Td (4,084) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 494.00 195.75 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.65 195.75 Td (1,499) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.00 185.75 Td ( Use of previously owned equity shares in acquisition) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.00 185.88 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.30 185.88 Td (20,685) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 494.00 185.75 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.65 185.75 Td () Tj ET Q BT /F1 10.00 Tf ET BT /F1 9.00 Tf ET q 0 0 0 rg BT 50.00 161.45 Td (The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance ) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 50.00 150.65 Td (sheets that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows.) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 106.15 366.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 416.50 106.15 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 106.15 4.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 86.15 366.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 416.50 86.15 70.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 86.15 4.00 -10.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 490.50 86.15 70.00 -10.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 127.14999999999998 m 486.5 127.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 127.14999999999998 m 490.5 127.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 490.5 127.14999999999998 m 560.5 127.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 106.14999999999998 m 486.5 106.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 490.5 106.14999999999998 m 560.5 106.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 76.14999999999998 m 486.5 76.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 67.14999999999998 m 486.5 67.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 65.14999999999998 m 486.5 65.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 490.5 76.14999999999998 m 560.5 76.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 490.5 67.14999999999998 m 560.5 67.14999999999998 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 490.5 65.14999999999998 m 560.5 65.14999999999998 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 129.87 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 451.60 131.38 Td (Thr) Tj ET Q q 0 0 0 rg BT 464.79 131.38 Td (ee Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 108.87 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 427.75 118.38 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 443.00 110.38 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 506.75 118.38 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 517.00 110.38 Td (2016) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 98.15 Td (Cash and cash equivalents) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 419.00 98.28 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 457.30 98.28 Td (360,217) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 493.00 98.15 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 530.65 98.15 Td (142,343) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 88.15 Td (Restricted cash, current) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 465.30 88.28 Td (2,232) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.65 86.77 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 78.15 Td (Restricted cash, non-current) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 461.30 78.28 Td (11,543) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.65 76.77 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 68.15 Td (Total Cash, Cash equivalents, and restricted cash shown in the condensed consolidated statement of cash flows) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 419.00 68.28 Td ($) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 457.30 68.28 Td (373,992) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 493.00 68.15 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 530.65 68.15 Td (142,343) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 154.15 54.65 Td (See ) Tj ET Q q 0 0 0 rg BT 170.35 54.65 Td (Accompanying Notes to Condensed Consolidated Financial Statements.) Tj ET Q endstream endobj 17 0 obj <>] /Rotate 0 /Contents 18 0 R>> endobj 18 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 216.45 742.25 Td (COHERENT) Tj ET Q q 0 0 0 rg BT 272.94 742.25 Td (,INC. ) Tj ET Q q 0 0 0 rg BT 300.72 742.25 Td (AND SUBSIDIARIES) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 142.65 730.25 Td (NOTES ) Tj ET Q q 0 0 0 rg BT 178.87 730.25 Td (T) Tj ET Q q 0 0 0 rg BT 185.36 730.25 Td (O CONDENSED CONSOLIDA) Tj ET Q q 0 0 0 rg BT 320.75 730.25 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 399.93 730.25 Td ( ST) Tj ET Q q 0 0 0 rg BT 413.92 730.25 Td (A) Tj ET Q q 0 0 0 rg BT 420.40 730.25 Td (TEMENTS) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 281.55 718.25 Td (\(Unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 706.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (1. BASIS OF) Tj ET Q q 0 0 0 rg BT 112.42 694.25 Td ( PRESENT) Tj ET Q q 0 0 0 rg BT 160.30 694.25 Td (A) Tj ET Q q 0 0 0 rg BT 166.78 694.25 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.25 Td (The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rulesand ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 658.25 Td (regulations of the Securities and Exchange Commission \(SEC\). Certain information and footnote disclosures normally ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 646.25 Td (included in financial statements prepared in accordance with accounting principles generally accepted in the United States ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 634.25 Td (of ) Tj ET Q q 0 0 0 rg BT 78.28 634.25 Td (America \(GAAP\) have been condensed or omitted pursuant to such rulesand regulations. ) Tj ET Q q 0 0 0 rg BT 447.99 634.25 Td (These interim condensed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 622.25 Td (consolidated financial statements and notes thereto should be read in conjunction with the Coherent,Inc. \(referred to herein ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.25 Td (as the Company) Tj ET Q q 0 0 0 rg BT 136.22 610.25 Td (, we, our) Tj ET Q q 0 0 0 rg BT 188.57 610.25 Td (, us or Coherent\) condensed consolidated financial statements and notes thereto filed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 598.25 Td (on Form10-K for the fiscal year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 226.84 598.25 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 291.54 598.25 Td (. In the opinion of management, all adjustments necessary for a fair ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 586.25 Td (presentation of financial condition and results of operation as of and for the periods presented have been made and include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 574.25 Td (only normal recurring adjustments. Interim results of operations are not necessarily indicative of results to be expected for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 562.25 Td (the year or any other interim periods. Our fiscal year ends on the Saturday closest to September30 and our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 497.59 562.25 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.70 562.25 Td ( fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 550.25 Td (quarters include 13 weeks of operations in each fiscal year presented. Fiscal year ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.98 550.25 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.98 550.25 Td ( and 2016 both include 52 weeks.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 526.25 Td (The consolidated financial statements include the accounts of Coherent,Inc. and its majority-owned subsidiaries ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.25 Td (\(collectively) Tj ET Q q 0 0 0 rg BT 117.33 514.25 Td (, the "Company", "we", "our", or "Coherent"\). Intercompany balances and transactions have been eliminated.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 490.25 Td (On November 7, 2016, we acquired Rofin-Sinar ) Tj ET Q q 0 0 0 rg BT 263.05 490.25 Td (T) Tj ET Q q 0 0 0 rg BT 268.46 490.25 Td (echnologies, Inc. \("Rofin"\). ) Tj ET Q q 0 0 0 rg BT 381.41 490.25 Td (The significant accounting policies of Rofin ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 478.25 Td (have been aligned to conform to those of Coherent, and the consolidated financial statements include the results of Rofin ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 466.25 Td (as of the acquisition date.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 442.25 Td (The preparation of consolidated financial statements in conformity with Generally ) Tj ET Q q 0 0 0 rg BT 399.01 442.25 Td (Accepted ) Tj ET Q q 0 0 0 rg BT 438.71 442.25 Td (Accounting Principles ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 430.25 Td (\("GAAP"\) requires management to make estimates and assumptions that af) Tj ET Q q 0 0 0 rg BT 368.96 430.25 Td (fect the reported amounts of assets and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 418.25 Td (liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 406.25 Td (reported amounts of revenues and expenses during the reporting period. ) Tj ET Q q 0 0 0 rg BT 357.08 406.25 Td (Actual results could dif) Tj ET Q q 0 0 0 rg BT 450.49 406.25 Td (fer from those estimates.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 382.25 Td (As a result of the acquisition of Rofin in the first quarter of fiscal 2017, we reor) Tj ET Q q 0 0 0 rg BT 385.79 382.25 Td (ganized our prior two reporting segments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 370.25 Td (\(Specialty Laser Systems and Commercial Lasers and Components\) into two new reporting segments for the combined ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 358.25 Td (company based upon the or) Tj ET Q q 0 0 0 rg BT 177.79 358.25 Td (ganizational structure of the combined company and how the chief operating decision maker ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 346.25 Td (\("CODM"\) receives and utilizes information provided to allocate resources and make decisions: OEM Laser Sources ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 334.25 Td (\(OLS\) and Industrial Lasers & Systems \(ILS\). ) Tj ET Q q 0 0 0 rg BT 272.39 334.25 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 321.73 334.25 Td (, our segment information was restated retroactively in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 322.25 Td (first quarter of fiscal 2017. Rofin has primarily been included in our Industrial Lasers & Systems segment.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 54.00 298.25 Td (2. RECENT) Tj ET Q q 0 0 0 rg BT 112.99 298.25 Td ( ) Tj ET Q q 0 0 0 rg BT 114.94 298.25 Td (ACCOUNTING ST) Tj ET Q q 0 0 0 rg BT 198.38 298.25 Td (ANDARDS) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 72.00 274.25 Td (Adoption of New ) Tj ET Q q 0 0 0 rg BT 146.17 274.25 Td (Accounting Pr) Tj ET Q q 0 0 0 rg BT 207.93 274.25 Td (onouncement) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 250.25 Td (In November 2016, the F) Tj ET Q q 0 0 0 rg BT 172.07 250.25 Td (ASB issued amended guidance that require a statement of cash flows to explain the change ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 238.25 Td (during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 226.25 Td (cash equivalents. ) Tj ET Q q 0 0 0 rg BT 142.63 226.25 Td (Therefore, amounts generally described as restricted cash and restricted cash equivalents should be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 214.25 Td (included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 202.25 Td (on the statement of cash flows. ) Tj ET Q q 0 0 0 rg BT 198.18 202.25 Td (The new standard will become ef) Tj ET Q q 0 0 0 rg BT 331.00 202.25 Td (fective for our fiscal year beginning September 30, 2018. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 190.25 Td (W) Tj ET Q q 0 0 0 rg BT 80.64 190.25 Td (e elected to early adopt the standard in the first quarter of fiscal 2017 on a retrospective basis with no impact on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 178.25 Td (condensed consolidated financial statements and disclosures.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 154.25 Td (In ) Tj ET Q q 0 0 0 rg BT 82.28 154.25 Td (April 2015, the F) Tj ET Q q 0 0 0 rg BT 150.42 154.25 Td (ASB issued amended guidance that simplifies the presentation of debt issuance costs by requiring that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 142.25 Td (debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 130.25 Td (carrying amount of that debt liability) Tj ET Q q 0 0 0 rg BT 218.81 130.25 Td (, consistent with debt discounts. ) Tj ET Q q 0 0 0 rg BT 348.90 130.25 Td (The recognition and measurement guidance for debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 118.25 Td (issuance costs are not af) Tj ET Q q 0 0 0 rg BT 168.45 118.25 Td (fected by the amended guidance. ) Tj ET Q q 0 0 0 rg BT 302.10 118.25 Td (The new standard will become ef) Tj ET Q q 0 0 0 rg BT 434.92 118.25 Td (fective for our fiscal year ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 106.25 Td (beginning October 2, 2016. ) Tj ET Q q 0 0 0 rg BT 184.02 106.25 Td (W) Tj ET Q q 0 0 0 rg BT 192.66 106.25 Td (e elected to early adopt the standard in the second quarter of fiscal 2016 and had recorded ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 94.25 Td (debt issuance costs of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.42 94.25 Td ($5.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 210.32 94.25 Td ( in other assets for the debt commitment we entered into in the second quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 82.25 Td (2016 because the debt was not outstanding as of October 1, 2016. ) Tj ET Q q 0 0 0 rg BT 336.76 82.25 Td (The debt issuance costs related to the term loan facility ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 70.25 Td (were reclassified to debt in the first quarter of fiscal 2017 when we drew down the debt.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 72.00 46.25 Td (Recently Issued ) Tj ET Q q 0 0 0 rg BT 140.89 46.25 Td (Accounting Pr) Tj ET Q q 0 0 0 rg BT 202.65 46.25 Td (onouncements) Tj ET Q endstream endobj 19 0 obj <>] /Rotate 0 /Contents 20 0 R>> endobj 20 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 725.25 Td (In October 2016, the F) Tj ET Q q 0 0 0 rg BT 162.07 725.25 Td (ASB issued amended guidance that improves the accounting for the income tax consequences of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 713.25 Td (intra-entity transfers of assets other than inventory) Tj ET Q q 0 0 0 rg BT 272.96 713.25 Td (. Under the new guidance, an entity should recognize the income tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 701.25 Td (consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. ) Tj ET Q q 0 0 0 rg BT 463.34 701.25 Td (The new standard will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 689.25 Td (become ef) Tj ET Q q 0 0 0 rg BT 113.18 689.25 Td (fective for our fiscal year beginning September 30, 2018. ) Tj ET Q q 0 0 0 rg BT 344.31 689.25 Td (W) Tj ET Q q 0 0 0 rg BT 352.95 689.25 Td (e are currently assessing the impact of this amended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 677.25 Td (guidance and the timing of adoption.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 648.25 Td (In March 2016, the F) Tj ET Q q 0 0 0 rg BT 155.96 648.25 Td (ASB issued amended guidance that simplifies several aspects of the accounting for employee share-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 636.25 Td (based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 624.25 Td (requirements, as well as classification in the statement of cash flows. Under the new guidance, an entity recognizes all ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 612.25 Td (excess tax benefits and tax deficiencies as income tax expense or benefit in the income statement. ) Tj ET Q q 0 0 0 rg BT 464.72 612.25 Td (This change eliminates ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 600.25 Td (the notion of the ) Tj ET Q q 0 0 0 rg BT 139.77 600.25 Td (APIC pool and significantly reduces the complexity and cost of accounting for excess tax benefits and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 588.25 Td (tax deficiencies. ) Tj ET Q q 0 0 0 rg BT 139.29 588.25 Td (The new standard will become ef) Tj ET Q q 0 0 0 rg BT 272.11 588.25 Td (fective for our fiscal year beginning October 1, 2017. ) Tj ET Q q 0 0 0 rg BT 487.68 588.25 Td (W) Tj ET Q q 0 0 0 rg BT 496.32 588.25 Td (e are currently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 576.25 Td (assessing the impact of this amended guidance.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 552.25 Td (In May 2014, the F) Tj ET Q q 0 0 0 rg BT 148.20 552.25 Td (ASB amended the ) Tj ET Q q 0 0 0 rg BT 222.91 552.25 Td (Accounting Standards Codification and created a new ) Tj ET Q q 0 0 0 rg BT 440.71 552.25 Td (T) Tj ET Q q 0 0 0 rg BT 446.12 552.25 Td (opic 606, "Revenue from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 540.25 Td (Contracts with Customers". In May 2016, accounting guidance was issued to clarify the not yet ef) Tj ET Q q 0 0 0 rg BT 463.31 540.25 Td (fective revenue ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 528.25 Td (recognition guidance issued in May 2014. ) Tj ET Q q 0 0 0 rg BT 242.06 528.25 Td (This additional guidance does not change the core principle of the revenue ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 516.25 Td (recognition guidance issued in May 2014, rather) Tj ET Q q 0 0 0 rg BT 265.16 516.25 Td (, it provides clarification of accounting for collections of sales taxes as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 504.25 Td (well as recognition of revenue \(i\) associated with contract modifications, \(ii\) for noncash consideration, and \(iii\) based on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 492.25 Td (the collectability of the consideration from the customer) Tj ET Q q 0 0 0 rg BT 296.10 492.25 Td (. ) Tj ET Q q 0 0 0 rg BT 300.92 492.25 Td (The guidance also specifies when a contract should be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 480.25 Td (considered completed for purposes of applying the transition guidance. ) Tj ET Q q 0 0 0 rg BT 367.28 480.25 Td (The ef) Tj ET Q q 0 0 0 rg BT 392.92 480.25 Td (fective date and transition requirements ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 468.25 Td (for this guidance are the same as the ef) Tj ET Q q 0 0 0 rg BT 227.31 468.25 Td (fective date and transition requirements for the guidance previously issued in 2014, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 456.25 Td (which is ef) Tj ET Q q 0 0 0 rg BT 115.70 456.25 Td (fective for our fiscal year beginning September 30, 2018. ) Tj ET Q q 0 0 0 rg BT 346.83 456.25 Td (W) Tj ET Q q 0 0 0 rg BT 355.47 456.25 Td (e are currently evaluating the new guidance and do ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 444.25 Td (not expect the guidance to have a material impact on our financial statements. ) Tj ET Q q 0 0 0 rg BT 385.59 444.25 Td (W) Tj ET Q q 0 0 0 rg BT 394.23 444.25 Td (e have not decided upon the method of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 432.25 Td (adoption.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 408.25 Td (3. ) Tj ET Q q 0 0 0 rg BT 68.00 408.25 Td (BUSINESS COMBINA) Tj ET Q q 0 0 0 rg BT 167.56 408.25 Td (TIONS) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 388.25 Td (Fiscal 2017 ) Tj ET Q q 0 0 0 rg BT 117.44 388.25 Td (Acquisitions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 368.25 Td (Rofin-Sinar) Tj ET Q q 0 0 0 rg BT 118.38 368.25 Td ( ) Tj ET Q q 0 0 0 rg BT 120.70 368.25 Td (T) Tj ET Q q 0 0 0 rg BT 126.45 368.25 Td (echnologies, Inc. \("Rofin"\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 348.25 Td (On November 7, 2016, we completed our previously announced acquisition of Rofin pursuant to the Mer) Tj ET Q q 0 0 0 rg BT 488.00 348.25 Td (ger ) Tj ET Q q 0 0 0 rg BT 502.72 348.25 Td (Agreement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 336.25 Td (dated March 16, 2016. Rofin is one of the world's leading developers and manufacturers of high-performance industrial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 324.25 Td (laser sources and laser) Tj ET Q q 0 0 0 rg BT 157.48 324.25 Td (-based solutions and components. Rofin has primarily been included in our Industrial Lasers & ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 312.25 Td (Systems segment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 292.25 Td (As a condition of the acquisition, we are required to divest ourselves of Rofin) Tj ET Q q 0 0 0 rg BT 381.26 292.25 Td (s low power CO2 laser business based in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 280.25 Td (Hull, United Kingdom, and will report this business separately as a discontinued operation until it is divested \(See Note ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 268.25 Td (18\). ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 248.25 Td (Due to the timing of the acquisition, the total purchase consideration has been allocated to the tangible and identifiable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 236.25 Td (intangible assets acquired and liabilities assumed based on a preliminary valuation analysis. ) Tj ET Q q 0 0 0 rg BT 437.44 236.25 Td (These preliminary values may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 224.25 Td (change in future reporting periods upon finalization of the valuation, which will occur no later than the third quarter of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 212.25 Td (fiscal 2017.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 192.25 Td (The total preliminary purchase consideration allocated to net assets acquired was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 454.53 192.25 Td ($936.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.42 192.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 180.25 Td (consisted of the following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 161.75 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 161.75 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 131.75 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 131.75 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 101.75 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 101.75 100.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 131.75 m 507.5 131.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 131.75 m 507.5 131.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 86.75 m 507.5 86.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 86.75 m 507.5 86.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 72.75 m 507.5 72.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 70.75 m 507.5 70.75 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 151.42 Td (Cash consideration to Rofin's shareholders) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.00 151.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 151.42 Td (904,491) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 136.42 Td (Cash settlement paid for Rofin employee stock options) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 136.42 Td (15,290) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 121.42 Td (Total cash payments to Rofin shareholders and option holders) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 121.42 Td (919,781) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 106.42 Td (Add: fair value of previously owned Rofin shares) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 106.42 Td (20,685) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 91.42 Td (Less: post-merger stock compensation expense) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.80 91.47 Td (\(4,152) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 91.42 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 76.42 Td (Total purchase price to allocate) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.00 76.42 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 76.42 Td (936,314) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 21 0 obj <>] /Rotate 0 /Contents 22 0 R>> endobj 22 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (The acquisition was an all-cash transaction at a price of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 292.36 742.10 Td ($32.50) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 319.86 742.10 Td ( per share of Rofin common stock. ) Tj ET Q q 0 0 0 rg BT 460.75 742.10 Td (W) Tj ET Q q 0 0 0 rg BT 469.39 742.10 Td (e funded the payment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (of the aggregate consideration with a combination of our available cash on hand and the proceeds from the Euro ) Tj ET Q q 0 0 0 rg BT 519.05 730.10 Td (T) Tj ET Q q 0 0 0 rg BT 524.46 730.10 Td (erm ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (Loan described in Note 9. ) Tj ET Q q 0 0 0 rg BT 173.90 718.10 Td (The total payment of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.98 718.10 Td ($15.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 313.87 718.10 Td ( due to the cancellation of options held by employees of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 706.10 Td (Rofin was allocated between total estimated mer) Tj ET Q q 0 0 0 rg BT 262.19 706.10 Td (ger consideration of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 344.67 706.10 Td ($1) Tj ET Q q 0 0 0 rg BT 354.29 706.10 Td (1.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.19 706.10 Td ( and post-mer) Tj ET Q q 0 0 0 rg BT 452.99 706.10 Td (ger stock-based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (compensation expense of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 171.58 694.10 Td ($4.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 220.47 694.10 Td ( based on the portion of the total service period of the underlying options that have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 682.10 Td (not been completed by the mer) Tj ET Q q 0 0 0 rg BT 191.39 682.10 Td (ger date. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 662.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 662.10 Td (e recognized a gain of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 167.42 662.10 Td ($5.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.32 662.10 Td ( in the first quarter of fiscal 2017 on the increase in fair value from the date of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 650.10 Td (purchase for the shares we already owned.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 630.10 Td (Under the acquisition method of accounting, the total estimated acquisition consideration is allocated to the acquired ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 618.10 Td (tangible and intangible assets and assumed liabilities of Rofin based on their fair values as of the acquisition date. ) Tj ET Q q 0 0 0 rg BT 524.55 618.10 Td (Any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 606.10 Td (excess of the acquisition consideration over the fair value of assets acquired and liabilities assumed is allocated to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 594.10 Td (goodwill. ) Tj ET Q q 0 0 0 rg BT 108.38 594.10 Td (W) Tj ET Q q 0 0 0 rg BT 117.01 594.10 Td (e expect that all such goodwill will not be deductible for tax purposes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 574.10 Td (Our preliminary allocation of the purchase price is as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 555.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 555.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 525.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 525.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 495.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 495.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 465.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 465.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 435.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 435.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 405.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 405.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 375.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 375.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 345.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 345.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 315.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 315.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 285.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 285.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 121.50 255.60 286.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 407.50 255.60 100.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 240.60000000000002 m 507.5 240.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 240.60000000000002 m 507.5 240.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 226.60000000000002 m 507.5 226.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 407.5 224.60000000000002 m 507.5 224.60000000000002 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 545.27 Td (Cash, cash equivalents and short-term investments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.00 545.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 545.27 Td (163,425) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 530.27 Td (Accounts receivable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 530.27 Td (90,877) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 515.27 Td (Inventory) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 515.27 Td (197,442) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 500.27 Td (Prepaid expenses and other assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 500.27 Td (10,367) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 485.27 Td (Assets held-for-sale, current) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 485.27 Td (63,666) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 470.27 Td (Property and equipment) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 470.27 Td (126,507) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 455.27 Td (Other assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 455.27 Td (27,760) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 440.27 Td (Intangible assets:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 425.27 Td ( Existing technology) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 425.27 Td (169,029) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 410.27 Td ( In-process research and development) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 410.27 Td (12,800) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 395.27 Td ( Backlog) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.15 395.27 Td (5,600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 380.27 Td ( Customer relationships) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.15 380.27 Td (39,209) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 365.27 Td ( Trademarks) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.15 365.27 Td (5,699) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 350.27 Td ( Patents) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.65 350.27 Td (300) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 335.27 Td (Goodwill) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 335.27 Td (254,042) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 320.27 Td (Current portion of long-term obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.80 320.32 Td (\(3,633) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 320.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 305.27 Td (Current liabilities held for sale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.80 305.32 Td (\(7,186) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 305.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 290.27 Td (Accounts payable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.80 290.32 Td (\(21,603) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 290.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 275.27 Td (Other current liabilities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.80 275.32 Td (\(59,245) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 275.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 260.27 Td (Long-term debt) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.80 260.32 Td (\(11,641) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 260.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 245.27 Td (Other long-term liabilities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.80 245.32 Td (\(127,101) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.65 245.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.00 230.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.00 230.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.15 230.27 Td (936,314) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 206.10 Td (The fair value write-up of acquired finished goods and work-in-process inventory was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.11 206.10 Td ($26.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.01 206.10 Td (, which will be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 194.10 Td (amortized over the expected period during which the acquired inventory is sold, or 6 months. ) Tj ET Q q 0 0 0 rg BT 442.62 194.10 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 491.96 194.10 Td (, for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.84 194.10 Td (three ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 182.10 Td (months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.83 182.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 126.33 182.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.91 182.10 Td (, we recorded an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 273.48 182.10 Td ($8.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.38 182.10 Td ( incremental cost of sales char) Tj ET Q q 0 0 0 rg BT 442.98 182.10 Td (ge associated with the fair ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 170.10 Td (value write-up of inventory acquired in the mer) Tj ET Q q 0 0 0 rg BT 257.47 170.10 Td (ger with Rofin.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 150.10 Td (The fair value write-up of acquired property) Tj ET Q q 0 0 0 rg BT 243.94 150.10 Td (, plant and equipment of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.91 150.10 Td ($36.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.80 150.10 Td ( will be amortized over the useful lives ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 138.10 Td (of the assets. Property) Tj ET Q q 0 0 0 rg BT 155.67 138.10 Td (, plant and equipment is valued at its value-in-use, unless there was a known plan to dispose of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 126.10 Td (asset.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 106.10 Td (The acquired existing technology) Tj ET Q q 0 0 0 rg BT 200.92 106.10 Td (, backlog, trademarks and patents are being amortized on a straight-line basis, which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 94.10 Td (approximates the economic use of the asset, over their estimated useful lives of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.35 94.10 Td (3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.35 94.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.12 94.10 Td (5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.12 94.10 Td ( years, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 438.72 94.10 Td (6) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.72 94.10 Td ( months, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.67 94.10 Td (3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.67 94.10 Td ( years, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.21 94.10 Td (5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.21 94.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 82.10 Td (years, respectively) Tj ET Q q 0 0 0 rg BT 141.76 82.10 Td (. Customer relationships are being amortized on an accelerated basis utilizing free cash flows over ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 70.10 Td (periods ranging from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 154.92 70.10 Td (5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.92 70.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 172.70 70.10 Td (10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 182.70 70.10 Td ( years. ) Tj ET Q q 0 0 0 rg BT 211.12 70.10 Td (The useful lives of in-process research and development will be defined in the future ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 58.10 Td (upon further evaluation of the status of these applications. ) Tj ET Q q 0 0 0 rg BT 302.20 58.10 Td (The fair value of the acquired intangibles was determined using ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 46.10 Td (the income approach. In performing these valuations, the key underlying probability-adjusted assumptions of the ) Tj ET Q endstream endobj 23 0 obj <>] /Rotate 0 /Contents 24 0 R>> endobj 24 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.15 31.60 Td (1) Tj ET Q q 0 0 0 rg BT 305.78 31.60 Td (1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (discounted cash flows were projected revenues, gross mar) Tj ET Q q 0 0 0 rg BT 299.96 742.10 Td (gin expectations and operating cost estimates. ) Tj ET Q q 0 0 0 rg BT 485.56 742.10 Td (The valuations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (were based on the information that was available as of the acquisition date and the expectations and assumptions that have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (been deemed reasonable by our management. ) Tj ET Q q 0 0 0 rg BT 252.46 718.10 Td (There are inherent uncertainties and management judgment required in these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 706.10 Td (determinations. ) Tj ET Q q 0 0 0 rg BT 132.25 706.10 Td (This acquisition resulted in a purchase price that exceeded the estimated fair value of tangible and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (intangible assets, which was allocated to goodwill.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 674.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 674.10 Td (e ) Tj ET Q q 0 0 0 rg BT 83.59 674.10 Td (believe ) Tj ET Q q 0 0 0 rg BT 114.98 674.10 Td (the ) Tj ET Q q 0 0 0 rg BT 129.71 674.10 Td (amount ) Tj ET Q q 0 0 0 rg BT 162.22 674.10 Td (of ) Tj ET Q q 0 0 0 rg BT 173.06 674.10 Td (goodwill ) Tj ET Q q 0 0 0 rg BT 211.13 674.10 Td (relative ) Tj ET Q q 0 0 0 rg BT 243.63 674.10 Td (to ) Tj ET Q q 0 0 0 rg BT 253.92 674.10 Td (identifiable ) Tj ET Q q 0 0 0 rg BT 301.97 674.10 Td (intangible ) Tj ET Q q 0 0 0 rg BT 344.48 674.10 Td (assets ) Tj ET Q q 0 0 0 rg BT 370.32 674.10 Td (relates ) Tj ET Q q 0 0 0 rg BT 398.93 674.10 Td (to ) Tj ET Q q 0 0 0 rg BT 409.23 674.10 Td (several ) Tj ET Q q 0 0 0 rg BT 440.06 674.10 Td (factors ) Tj ET Q q 0 0 0 rg BT 469.78 674.10 Td (including: ) Tj ET Q q 0 0 0 rg BT 512.84 674.10 Td (\(1\) ) Tj ET Q q 0 0 0 rg BT 527.02 674.10 Td (potential ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 662.10 Td (buyer) Tj ET Q q 0 0 0 rg BT 90.57 662.10 Td (-specific ) Tj ET Q q 0 0 0 rg BT 127.93 662.10 Td (syner) Tj ET Q q 0 0 0 rg BT 149.41 662.10 Td (gies ) Tj ET Q q 0 0 0 rg BT 168.45 662.10 Td (related ) Tj ET Q q 0 0 0 rg BT 198.59 662.10 Td (to ) Tj ET Q q 0 0 0 rg BT 209.30 662.10 Td (market ) Tj ET Q q 0 0 0 rg BT 240.00 662.10 Td (opportunities ) Tj ET Q q 0 0 0 rg BT 295.71 662.10 Td (for ) Tj ET Q q 0 0 0 rg BT 310.31 662.10 Td (a ) Tj ET Q q 0 0 0 rg BT 317.68 662.10 Td (combined ) Tj ET Q q 0 0 0 rg BT 360.05 662.10 Td (product ) Tj ET Q q 0 0 0 rg BT 393.54 662.10 Td (of) Tj ET Q q 0 0 0 rg BT 401.69 662.10 Td (fering; ) Tj ET Q q 0 0 0 rg BT 431.28 662.10 Td (and ) Tj ET Q q 0 0 0 rg BT 448.65 662.10 Td (\(2\) ) Tj ET Q q 0 0 0 rg BT 463.25 662.10 Td (potential ) Tj ET Q q 0 0 0 rg BT 501.17 662.10 Td (to ) Tj ET Q q 0 0 0 rg BT 511.89 662.10 Td (leverage ) Tj ET Q q 0 0 0 rg BT 548.69 662.10 Td (our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 650.10 Td (sales ) Tj ET Q q 0 0 0 rg BT 89.94 650.10 Td (force ) Tj ET Q q 0 0 0 rg BT 112.98 650.10 Td (to ) Tj ET Q q 0 0 0 rg BT 123.25 650.10 Td (attract ) Tj ET Q q 0 0 0 rg BT 150.73 650.10 Td (new ) Tj ET Q q 0 0 0 rg BT 169.89 650.10 Td (customers ) Tj ET Q q 0 0 0 rg BT 212.94 650.10 Td (and ) Tj ET Q q 0 0 0 rg BT 229.88 650.10 Td (revenue ) Tj ET Q q 0 0 0 rg BT 264.03 650.10 Td (and ) Tj ET Q q 0 0 0 rg BT 280.96 650.10 Td (cross ) Tj ET Q q 0 0 0 rg BT 304.02 650.10 Td (sell ) Tj ET Q q 0 0 0 rg BT 320.40 650.10 Td (to ) Tj ET Q q 0 0 0 rg BT 330.68 650.10 Td (existing ) Tj ET Q q 0 0 0 rg BT 364.85 650.10 Td (customers.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 630.10 Td (In-process research and development \(IPR&D\) consists of three projects that have not yet reached technological ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 618.10 Td (feasibility) Tj ET Q q 0 0 0 rg BT 107.34 618.10 Td (. ) Tj ET Q q 0 0 0 rg BT 111.79 618.10 Td (Acquired IPR&D assets are initially recognized at fair value and are classified as indefinite-lived assets until the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 606.10 Td (successful completion or abandonment of the associated research and development ef) Tj ET Q q 0 0 0 rg BT 409.91 606.10 Td (forts. ) Tj ET Q q 0 0 0 rg BT 433.06 606.10 Td (The value assigned to IPR&D ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 594.10 Td (was determined by considering the value of the products under development to the overall development plan, estimating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 582.10 Td (the resulting net cash flows from the projects when completed and discounting the net cash flows to their present value. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 570.10 Td (During the development period, these assets will not be amortized as char) Tj ET Q q 0 0 0 rg BT 362.73 570.10 Td (ges to earnings; instead these assets will be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 558.10 Td (subject to periodic impairment testing. Upon successful completion of the development process for the acquired IPR&D ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 546.10 Td (projects, the assets would then be considered finite-lived intangible assets and amortization of the assets will commence. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 534.10 Td (The projects have not been completed as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 244.04 534.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.63 534.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 514.10 Td (e expensed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.28 514.10 Td ($14.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.17 514.10 Td ( of acquisition-related costs as selling, general and administrative expenses in our consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 502.10 Td (statements of operations in the first quarter of fiscal 2017.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 482.10 Td (The results of this acquisition were included in our consolidated operations beginning on November 7, 2016. ) Tj ET Q q 0 0 0 rg BT 505.50 482.10 Td (The amount ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 470.10 Td (of continuing Rofin net sales and net loss from continuing operations included in our condensed consolidated statements of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 458.10 Td (operations for the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.84 458.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 300.43 458.10 Td ( was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 381.24 458.10 Td ($74.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 435.13 458.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 454.57 458.10 Td ($12.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 508.46 458.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 446.10 Td (respectively) Tj ET Q q 0 0 0 rg BT 115.66 446.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 68 424.7669921875 m 207.4189453125 424.7669921875 l s q 0 0 0 rg BT 68.00 426.10 Td (Unaudited Pro Forma Information ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 406.10 Td (The following unaudited pro forma financial information presents our combined results of operations as if the acquisition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 394.10 Td (of Rofin and the related issuance of our Euro ) Tj ET Q q 0 0 0 rg BT 250.26 394.10 Td (T) Tj ET Q q 0 0 0 rg BT 255.67 394.10 Td (erm Loan had occurred on October 4, 2015. ) Tj ET Q q 0 0 0 rg BT 433.21 394.10 Td (The unaudited pro forma ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 382.10 Td (financial information is not necessarily indicative of what our condensed consolidated results of operations actually would ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 370.10 Td (have been had the acquisition been completed on October 4, 2015. In addition, the unaudited pro forma financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 358.10 Td (information does not attempt to project the future results of operations of the combined company) Tj ET Q q 0 0 0 rg BT 455.03 358.10 Td (. ) Tj ET Q q 0 0 0 rg BT 459.85 358.10 Td (The actual results may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 346.10 Td (dif) Tj ET Q q 0 0 0 rg BT 78.93 346.10 Td (fer significantly from the pro forma results presented here due to many factors.) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 112.50 306.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 312.50 306.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 412.50 306.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 416.50 306.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 112.50 276.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 312.50 276.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 412.50 276.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 416.50 276.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 112.50 246.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 312.50 246.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 412.50 246.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 416.50 246.60 100.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 312.5 306.6 m 412.5 306.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 412.5 306.6 m 416.5 306.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 416.5 306.6 m 516.5 306.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 115.00 310.83 Td () Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.20 318.85 Td (Three Months Ended) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 330.55 310.85 Td (December 31, 2016) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 432.20 318.85 Td (Three Months Ended) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 440.55 310.85 Td (January 2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.00 296.27 Td (Total net sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.00 296.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.15 296.27 Td (389,816) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.00 296.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.15 296.27 Td (300,439) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.00 281.27 Td (Net income \(loss\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.00 281.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 381.15 281.27 Td (39,183) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.00 281.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.80 281.32 Td (\(32,047) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.65 281.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.00 266.27 Td (Net income \(loss\) per share:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.00 251.27 Td (Basic) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.50 251.27 Td ($1.61) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.00 251.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.80 251.32 Td (\(1.34) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.65 251.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.00 236.27 Td (Diluted) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.50 236.27 Td ($1.59) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.00 236.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.80 236.32 Td (\(1.32) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.65 236.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 215.10 Td (The unaudited pro forma financial information above includes the net income of Rofin) Tj ET Q q 0 0 0 rg BT 417.34 215.10 Td (s low power CO2 laser business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 203.10 Td (based in Hull, United Kingdom, which is recorded as a discontinued operation in the first quarter of fiscal 2017.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 186.10 Td (The unaudited pro forma financial information above reflects the following material adjustments:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 169.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 169.10 Td (Incremental amortization and depreciation expense related to the estimated fair value of identifiable intangible assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 157.10 Td (and property) Tj ET Q q 0 0 0 rg BT 136.17 157.10 Td (, plant and equipment from the purchase price allocation.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 145.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 145.10 Td (The exclusion of amortization of inventory step-up to its estimated fair value from the three months ended December ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 133.10 Td (31, 2016 and the addition of the amortization to the three months ended January 2, 2016.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 121.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 121.10 Td (The exclusion of revenue adjustments as a result of the reduction in customer deposits and deferred revenue related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 109.10 Td (its estimated fair value from the three months ended December 31, 2016 and the addition of these adjustments to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 97.10 Td (three months ended January 2, 2016.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 85.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 85.10 Td (Incremental interest expense and amortization of debt issuance costs related to our Euro ) Tj ET Q q 0 0 0 rg BT 439.86 85.10 Td (T) Tj ET Q q 0 0 0 rg BT 445.27 85.10 Td (erm Loan and Revolving ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 73.10 Td (Credit ) Tj ET Q q 0 0 0 rg BT 112.94 73.10 Td (Agreement.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 61.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 61.10 Td (The exclusion of acquisition costs incurred by both Coherent and Rofin from the three months ended December 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 49.10 Td (2016 and the addition of these costs to the three months ended January 2, 2016.) Tj ET Q endstream endobj 25 0 obj <>] /Rotate 0 /Contents 26 0 R>> endobj 26 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (12) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 742.10 Td (The exclusion of a stock-based compensation char) Tj ET Q q 0 0 0 rg BT 287.42 742.10 Td (ge related to the acceleration of Rofin options from the three months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 730.10 Td (ended December 31, 2016 and the addition of this char) Tj ET Q q 0 0 0 rg BT 305.19 730.10 Td (ge to the three months ended January 2, 2016.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 718.10 Td (The exclusion of a gain on business combination for our previously owned shares of Rofin from the three months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 706.10 Td (ended December 31, 2016 and the addition of this gain to the three months ended January 2, 2016.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 694.10 Td (The exclusion of a foreign exchange gain on forward contracts related to our debt commitment and debt issuance from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 682.10 Td (the three months ended December 31, 2016 and the addition of this gain to the three months ended January 2, 2016.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 670.10 Td (The estimated tax impact of the above adjustments.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 650.10 Td (Fiscal 2015 ) Tj ET Q q 0 0 0 rg BT 117.44 650.10 Td (Acquisitions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 630.10 Td (Raydiance, Inc.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.10 Td (On July 24, 2015, we acquired certain assets of Raydiance, Inc. \("Raydiance"\) for approximately $) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.25 610.10 Td (5.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 507.15 610.10 Td (, excluding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 598.10 Td (transaction costs. Raydiance manufactured complete tools and lasers for ultrafast processing systems and subsystems in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 586.10 Td (precision micromachining processing market. ) Tj ET Q q 0 0 0 rg BT 253.04 586.10 Td (The Raydiance assets have been included in our OEM Laser Sources ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 574.10 Td (segment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 554.10 Td (Our allocation of the purchase price is as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 543.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 543.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 513.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 513.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 483.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 483.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 468.6 m 488.5 468.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 468.6 m 488.5 468.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 454.6 m 488.5 454.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 452.6 m 488.5 452.6 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 533.27 Td (Tangible assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 533.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 533.27 Td (1,048) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 518.27 Td (Goodwill) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 518.27 Td (1,552) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 503.27 Td (Intangible assets:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 488.27 Td ( Existing technology) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.65 488.27 Td (800) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 473.27 Td ( Customer lists) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 473.27 Td (1,600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 458.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 458.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 458.27 Td (5,000) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 434.10 Td (The purchase price allocated to goodwill was finalized in the first quarter of fiscal 2016 with an increase of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 499.23 434.10 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.12 434.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 422.10 Td (and has been updated from the preliminary allocation in the fourth quarter of fiscal 2015.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 402.10 Td (Results of operations for the business have been included in our consolidated financial statements subsequent to the date of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 390.10 Td (acquisition and pro forma results of operations in accordance with authoritative guidance for prior periods have not been ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 378.10 Td (presented because the ef) Tj ET Q q 0 0 0 rg BT 165.27 378.10 Td (fect of the acquisition was not material to our prior period consolidated financial results.) Tj ET Q BT /F1 10.00 Tf ET 1 1 1 rg /GS0 gs 68.00 365.03 353.76 -9.09 re f /GS0 gs q 0 0 0 rg BT 68.00 358.10 Td (The identifiable intangible assets are being amortized over their respective useful lives o) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.76 358.10 Td (f ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 427.59 358.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 447.58 358.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.35 358.10 Td (five) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 475.90 358.10 Td ( years.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 338.10 Td (None of the goodwill from this purchase is deductible for tax purposes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 318.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 318.10 Td (e expensed $) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.28 318.10 Td (0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 172.17 318.10 Td ( of acquisition-related costs as selling, general and administrative expenses in our consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 306.10 Td (statements of operations for our fiscal year 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 286.10 Td (T) Tj ET Q q 0 0 0 rg BT 74.49 286.10 Td (insley Optics) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 266.10 Td (On July 27, 2015, we acquired the assets and certain liabilities of the ) Tj ET Q q 0 0 0 rg BT 345.25 266.10 Td (T) Tj ET Q q 0 0 0 rg BT 351.00 266.10 Td (insley Optics \("T) Tj ET Q q 0 0 0 rg BT 419.17 266.10 Td (insley"\) business from L-3 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 254.10 Td (Communications Corporation for approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 264.07 254.10 Td ($4.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 312.97 254.10 Td (, excluding transaction costs. ) Tj ET Q q 0 0 0 rg BT 431.09 254.10 Td (T) Tj ET Q q 0 0 0 rg BT 436.85 254.10 Td (insley is a specialized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 242.10 Td (manufacturer of high precision optical components and subsystems sold primarily in the aerospace and defense industry) Tj ET Q q 0 0 0 rg BT 547.50 242.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 230.10 Td (T) Tj ET Q q 0 0 0 rg BT 73.76 230.10 Td (insley manufactures the lar) Tj ET Q q 0 0 0 rg BT 181.59 230.10 Td (ge form factor optics for our excimer laser annealing systems. ) Tj ET Q q 0 0 0 rg BT 431.60 230.10 Td (T) Tj ET Q q 0 0 0 rg BT 437.36 230.10 Td (insley has been included in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 218.10 Td (OEM Laser Sources segment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 198.10 Td (Our allocation of the purchase price is as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 187.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 187.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 157.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 157.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 127.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 127.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 97.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 97.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 67.60 350.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 67.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 67.60000000000002 m 488.5 67.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 67.60000000000002 m 488.5 67.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 53.60000000000002 m 488.5 53.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 51.60000000000002 m 488.5 51.60000000000002 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 177.27 Td (Tangible assets:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 162.27 Td ( Inventories) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 162.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 162.27 Td (2,263) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 147.27 Td ( Accounts receivable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 147.27 Td (2,240) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 132.27 Td ( Prepaid expenses and other assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 132.27 Td (1,132) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 117.27 Td ( Property and equipment) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 117.27 Td (2,451) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 102.27 Td (Liabilities assumed) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.80 102.32 Td (\(1,702) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.65 102.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 87.27 Td (Deferred tax liabilities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 466.30 87.32 Td (\(768) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.65 87.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 72.27 Td (Gain on business combination) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.80 72.32 Td (\(1,316) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.65 72.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 57.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 57.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 57.27 Td (4,300) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 27 0 obj <>] /Rotate 0 /Contents 28 0 R>> endobj 28 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (13) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (The purchase price was lower than the fair value of net assets purchased, resulting in a gain of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 447.03 742.10 Td ($1.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.92 742.10 Td ( recorded as a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (separate line item in our consolidated statements of operations for our fiscal year 2015. ) Tj ET Q q 0 0 0 rg BT 418.54 730.10 Td (The Company reassessed the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (recognition and measurement of identifiable assets acquired and liabilities assumed and concluded that all acquired assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 706.10 Td (and assumed liabilities were recognized and that the valuation procedures and resulting measures were appropriate.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 686.10 Td (Results of operations for the business have been included in our consolidated financial statements subsequent to the date of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 674.10 Td (acquisition and pro forma results of operations in accordance with authoritative guidance for prior periods have not been ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 662.10 Td (presented because the ef) Tj ET Q q 0 0 0 rg BT 165.27 662.10 Td (fect of the acquisition was not material to our prior period consolidated financial results.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 642.10 Td (The gain from the bar) Tj ET Q q 0 0 0 rg BT 155.01 642.10 Td (gain purchase is not subject to income taxation.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 622.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 622.10 Td (e expensed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.28 622.10 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 172.17 622.10 Td ( of acquisition-related costs as selling, general and administrative expenses in our consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.10 Td (statements of operations for our fiscal year 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 578.10 Td (4.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 57.50 578.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.00 578.10 Td (F) Tj ET Q q 0 0 0 rg BT 75.37 578.10 Td (AIR ) Tj ET Q q 0 0 0 rg BT 96.02 578.10 Td (V) Tj ET Q q 0 0 0 rg BT 101.95 578.10 Td (ALUES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 566.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 554.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 554.10 Td (e have not changed our valuation techniques in measuring the fair value of any financial assets and liabilities during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 542.10 Td (period. ) Tj ET Q q 0 0 0 rg BT 98.37 542.10 Td (W) Tj ET Q q 0 0 0 rg BT 107.00 542.10 Td (e recognize transfers between levels within the fair value hierarchy) Tj ET Q q 0 0 0 rg BT 374.28 542.10 Td (, if any) Tj ET Q q 0 0 0 rg BT 401.68 542.10 Td (, at the end of each quarter) Tj ET Q q 0 0 0 rg BT 507.46 542.10 Td (. ) Tj ET Q q 0 0 0 rg BT 512.28 542.10 Td (There were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 530.10 Td (no transfers between levels during the periods presented. ) Tj ET Q q 0 0 0 rg BT 297.10 530.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.54 530.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.12 530.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.56 530.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.27 530.10 Td (, we did not have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 518.10 Td (any assets or liabilities valued based on Level 3 valuations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 494.10 Td (Financial assets and liabilities measured at fair value as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.92 494.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 381.51 494.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.94 494.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 465.65 494.10 Td ( are summarized below ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 482.10 Td (\(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 383.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 383.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 383.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 383.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 383.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 383.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 383.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 383.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 353.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 353.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 353.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 353.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 353.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 353.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 353.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 353.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 314.60 158.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 314.60 47.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 314.60 60.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 314.60 49.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 314.60 47.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 314.60 60.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 314.60 4.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 314.60 49.00 -26.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 273.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 273.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 273.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 273.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 273.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 273.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 273.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 273.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 243.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 243.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 243.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 243.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 243.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 243.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 243.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 243.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 199.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 199.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 199.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 199.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 199.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 199.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 199.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 199.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 67.50 169.60 158.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 225.50 169.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 229.50 169.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 276.50 169.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 169.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 169.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 169.60 49.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.50 169.60 4.00 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gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 139.60 47.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 139.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 139.60 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.50 139.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 512.50 139.60 49.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 225.5 409.6 m 229.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 409.6 m 276.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 276.5 409.6 m 280.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 409.6 m 340.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 409.6 m 344.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 409.6 m 393.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 409.6 m 444.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 444.5 409.6 m 448.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 409.6 m 508.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508.5 409.6 m 512.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 409.6 m 561.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 225.5 396.6 m 229.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 396.6 m 276.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 276.5 396.6 m 280.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 396.6 m 340.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 396.6 m 344.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 396.6 m 393.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 409.6 m 444.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 396.6 m 444.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 444.5 409.6 m 448.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 444.5 396.6 m 448.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 409.6 m 508.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 396.6 m 508.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508.5 409.6 m 512.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508.5 396.6 m 512.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 409.6 m 561.5 409.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 396.6 m 561.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 396.6 m 444.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 444.5 396.6 m 448.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 396.6 m 508.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 396.6 m 561.5 396.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 199.60000000000002 m 276.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 185.60000000000002 m 276.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 183.60000000000002 m 276.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 199.60000000000002 m 340.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 185.60000000000002 m 340.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 183.60000000000002 m 340.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 199.60000000000002 m 393.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 185.60000000000002 m 393.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 183.60000000000002 m 393.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 199.60000000000002 m 444.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 185.60000000000002 m 444.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 183.60000000000002 m 444.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 199.60000000000002 m 508.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 185.60000000000002 m 508.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 183.60000000000002 m 508.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 199.60000000000002 m 561.5 199.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 185.60000000000002 m 561.5 185.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 183.60000000000002 m 561.5 183.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 124.60000000000002 m 276.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 110.60000000000002 m 276.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 229.5 108.60000000000002 m 276.5 108.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 124.60000000000002 m 340.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 110.60000000000002 m 340.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 108.60000000000002 m 340.5 108.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 124.60000000000002 m 393.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 110.60000000000002 m 393.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 108.60000000000002 m 393.5 108.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 124.60000000000002 m 444.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 110.60000000000002 m 444.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397.5 108.60000000000002 m 444.5 108.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 124.60000000000002 m 508.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 110.60000000000002 m 508.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 108.60000000000002 m 508.5 108.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 124.60000000000002 m 561.5 124.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 110.60000000000002 m 561.5 110.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512.5 108.60000000000002 m 561.5 108.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 70.00 412.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 235.00 421.83 Td (Aggregate) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 234.65 413.83 Td (Fair Value) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 285.85 445.83 Td (QuotedPrices) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 306.65 437.83 Td (in) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 283.65 429.83 Td (ActiveMarkets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 288.85 421.83 Td (for) Tj ET Q q 0 0 0 rg BT 298.92 421.83 Td (Identical) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 299.30 413.83 Td (Assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.05 437.83 Td (Significant) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 358.35 429.83 Td (Other) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 348.90 421.83 Td (Observable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 357.35 413.83 Td (Inputs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 403.00 421.83 Td (Aggregate) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 402.65 413.83 Td (Fair Value) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 453.85 445.83 Td (QuotedPrices) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 474.65 437.83 Td (in) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 451.65 429.83 Td (ActiveMarkets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 456.85 421.83 Td (forIdentical) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 467.30 413.83 Td (Assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 518.05 437.83 Td (Significant) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 526.35 429.83 Td (Other) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 516.90 421.83 Td (Observable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 525.35 413.83 Td (Inputs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 278.75 400.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 452.05 400.83 Td (October 1, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 146.00 386.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 295.00 387.83 Td (\(Level1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 353.50 387.83 Td (\(Level2\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.00 387.83 Td (\(Level1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 521.50 387.83 Td (\(Level2\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 373.27 Td (Assets:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 358.27 Td (Cash equivalents:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 343.27 Td (Money market fund deposits) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 232.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.10 343.27 Td (68,213) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 283.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.15 343.27 Td (68,213) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.65 343.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.10 343.27 Td (237,142) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.15 343.27 Td (237,142) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 343.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 319.27 Td (Short-term investments:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 303.27 Td (U.S. ) Tj ET Q q 0 0 0 rg BT 102.10 303.27 Td (T) Tj ET Q q 0 0 0 rg BT 107.86 303.27 Td (reasury and agency ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 293.27 Td (obligations ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 128.94 297.80 Td (\(2\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.65 293.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.65 293.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 374.65 293.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.65 293.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 293.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 293.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 278.27 Td (Commercial paper ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 158.64 282.80 Td (\(2\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 262.65 278.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.65 278.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.65 278.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.10 278.27 Td (24,999) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 278.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 278.27 Td (24,999) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 263.27 Td (Equity securities ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 151.43 267.80 Td (\(1\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 262.65 263.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.65 263.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.65 263.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.10 263.27 Td (20,482) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.15 263.27 Td (20,482) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 263.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 248.27 Td (Prepaid and other assets:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 233.27 Td (Foreign currency contracts ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 191.68 237.80 Td (\(3\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 250.15 233.27 Td (1,693) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.65 233.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.15 233.27 Td (1,693) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.65 233.27 Td (889) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 233.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 233.27 Td (889) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 214.27 Td (Mutual funds Deferred comp ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 204.27 Td (and supplemental plan ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 174.48 208.80 Td (\(4\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.10 204.27 Td (16,143) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.15 204.27 Td (16,143) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.65 204.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.10 204.27 Td (14,399) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.15 204.27 Td (14,399) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 204.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 189.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 232.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.10 189.27 Td (86,174) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 283.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.15 189.27 Td (84,356) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.15 189.27 Td (1,818) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.10 189.27 Td (298,036) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.15 189.27 Td (272,023) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.00 189.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 189.27 Td (26,013) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 159.27 Td (Liabilities:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 144.27 Td (Other current liabilities:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 129.27 Td (Foreign currency contracts ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 191.68 133.80 Td (\(3\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 246.80 129.27 Td (\(3,099) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.65 129.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.65 129.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.80 129.32 Td (\(3,099) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.65 129.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.80 129.32 Td (\(3,100) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 440.65 129.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 129.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.80 129.32 Td (\(3,100) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 557.65 129.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 114.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 232.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.10 114.27 Td (83,075) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 283.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.15 114.27 Td (84,356) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.80 114.32 Td (\(1,281) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.65 114.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.10 114.27 Td (294,936) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.15 114.27 Td (272,023) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.00 114.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 114.27 Td (22,913) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 86.10 Td (___________________________________________________) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 74.10 Td (\(1\) ) Tj ET Q q 0 0 0 rg BT 72.50 74.10 Td (V) Tj ET Q q 0 0 0 rg BT 78.61 74.10 Td (aluations are based upon quoted market prices.) Tj ET Q endstream endobj 29 0 obj <>] /Rotate 0 /Contents 30 0 R>> endobj 30 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (14) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (\(2\) ) Tj ET Q q 0 0 0 rg BT 72.50 742.10 Td (V) Tj ET Q q 0 0 0 rg BT 78.61 742.10 Td (aluations are based upon quoted market prices in active markets involving similar assets. ) Tj ET Q q 0 0 0 rg BT 436.11 742.10 Td (The market inputs used to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 730.10 Td (value these instruments generally consist of market yields, reported trades, broker/dealer quotes or alternative pricing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 718.10 Td (sources with reasonable levels of price transparency) Tj ET Q q 0 0 0 rg BT 280.10 718.10 Td (. Pricing sources include industry standard data providers, security ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 706.10 Td (master files from lar) Tj ET Q q 0 0 0 rg BT 153.68 706.10 Td (ge financial institutions, and other third party sources which are input into a distribution-curve-based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 694.10 Td (algorithm to determine a daily market value. ) Tj ET Q q 0 0 0 rg BT 252.81 694.10 Td (This creates a consensus price or a weighted average price for each ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 682.10 Td (security) Tj ET Q q 0 0 0 rg BT 103.51 682.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (\(3\) ) Tj ET Q q 0 0 0 rg BT 72.50 658.10 Td (The principal market in which we execute our foreign currency contracts is the institutional market in an over) Tj ET Q q 0 0 0 rg BT 510.75 658.10 Td (-the-counter ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 646.10 Td (environment with a relatively high level of price transparency) Tj ET Q q 0 0 0 rg BT 318.98 646.10 Td (. ) Tj ET Q q 0 0 0 rg BT 323.80 646.10 Td (The market participants usually are lar) Tj ET Q q 0 0 0 rg BT 477.72 646.10 Td (ge commercial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 634.10 Td (banks. Our foreign currency contracts) Tj ET Q q 0 0 0 rg BT 226.42 634.10 Td ( valuation inputs are based on quoted prices and quoted pricing intervals from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 622.10 Td (public data sources and do not involve management judgment. ) Tj ET Q q 0 0 0 rg BT 324.66 622.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.16 622.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.75 622.10 Td (, prepaid expenses and other assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 610.10 Td (include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.43 610.10 Td ($1,693) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 131.93 610.10 Td ( non-designated forward contracts; other current liabilities include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.06 610.10 Td ($3,099) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 426.56 610.10 Td ( non-designated forward ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 598.10 Td (contracts. ) Tj ET Q q 0 0 0 rg BT 113.04 598.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 125.54 598.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 190.25 598.10 Td (, prepaid expenses and other assets include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.08 598.10 Td ($889) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 384.08 598.10 Td ( non-designated forward contracts; other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 586.10 Td (current liabilities include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 174.97 586.10 Td ($3,100) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 202.47 586.10 Td ( non-designated forward contracts. See Note 6, "Derivative Instruments and Hedging ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 574.10 Td (Activities". ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (\(4\) ) Tj ET Q q 0 0 0 rg BT 72.50 550.10 Td (The fair value of mutual funds is determined based on quoted market prices. Securities traded on a national exchange are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 538.10 Td (stated at the last reported sales price on the day of valuation; other securities traded in over) Tj ET Q q 0 0 0 rg BT 435.50 538.10 Td (-the-counter markets and listed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 526.10 Td (securities for which no sale was reported on that date are stated as the last quoted bid price. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 51.00 502.10 Td (5.) Tj ET Q BT /F2 3.00 Tf ET q 0 0 0 rg BT 58.50 502.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.25 502.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.75 502.10 Td (SHOR) Tj ET Q q 0 0 0 rg BT 98.74 502.10 Td (T) Tj ET Q q 0 0 0 rg BT 104.49 502.10 Td (-TERM) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 137.82 502.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 140.32 502.10 Td (INVESTMENTS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 51.00 490.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 478.10 Td (W) Tj ET Q q 0 0 0 rg BT 77.64 478.10 Td (e consider all highly liquid investments with maturities of three months or less at the time of purchase to be cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 466.10 Td (equivalents. Investments classified as available-for) Tj ET Q q 0 0 0 rg BT 272.34 466.10 Td (-sale are reported at fair value with unrealized gains and losses, net of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 454.10 Td (related income taxes, recorded as a separate component of other comprehensive income \(OCI\) in stockholders) Tj ET Q q 0 0 0 rg BT 521.13 454.10 Td ( equity ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 442.10 Td (until realized. Interest and amortization of premiums and discounts for debt securities are included in interest income. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 430.10 Td (Gains and losses on securities sold are determined based on the specific identification method and are included in other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 418.10 Td (income \(expense\).) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 394.10 Td (Cash, cash equivalents and short-term investments consist of the following \(in thousands\):) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 382.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 337.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 337.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 337.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 337.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 337.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 337.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 337.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 337.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 307.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 307.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 307.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 307.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 307.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 307.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 307.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 307.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 277.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 277.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 277.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 277.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 277.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 277.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 277.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 277.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 358.6 m 339.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339.5 358.6 m 343.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 358.6 m 413.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413.5 358.6 m 417.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 358.6 m 487.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487.5 358.6 m 491.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 358.6 m 561.5 358.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 337.6 m 339.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 337.6 m 413.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 337.6 m 487.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 337.6 m 561.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 337.6 m 339.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 323.6 m 339.5 323.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 321.6 m 339.5 321.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 337.6 m 413.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 323.6 m 413.5 323.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 321.6 m 413.5 321.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 337.6 m 487.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 323.6 m 487.5 323.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 321.6 m 487.5 321.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 337.6 m 561.5 337.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 323.6 m 561.5 323.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 321.6 m 561.5 321.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 262.6 m 339.5 262.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 248.60000000000002 m 339.5 248.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 246.60000000000002 m 339.5 246.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 262.6 m 413.5 262.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 248.60000000000002 m 413.5 248.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 246.60000000000002 m 413.5 246.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 262.6 m 487.5 262.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 248.60000000000002 m 487.5 248.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 246.60000000000002 m 487.5 246.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 262.6 m 561.5 262.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 248.60000000000002 m 561.5 248.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 246.60000000000002 m 561.5 246.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 72.00 361.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 382.75 362.83 Td (December 31, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 72.00 340.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 286.30 341.83 Td (CostBasis) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 359.40 349.83 Td (Unr) Tj ET Q q 0 0 0 rg BT 373.03 349.83 Td (ealized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 367.95 341.83 Td (Gains) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.40 349.83 Td (Unr) Tj ET Q q 0 0 0 rg BT 447.03 349.83 Td (ealized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 440.85 341.83 Td (Losses) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.15 341.83 Td (FairValue) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 328.17 Td (Cash and cash equivalents) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 327.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.15 327.27 Td (360,217) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 327.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 327.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 327.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 327.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 327.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 327.27 Td (360,217) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 72.00 310.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 310.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 310.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 297.27 Td (Short-term investments:) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 336.00 295.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 295.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 295.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 295.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.00 282.27 Td (Available-for-sale securities:) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 336.00 280.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 280.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 280.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 280.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 268.17 Td (U.S. Treasury and agency obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 267.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 320.65 267.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 267.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 267.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 267.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 267.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 267.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 267.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 102.00 252.27 Td (Total short-term investments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 252.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 320.65 252.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 252.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 252.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 252.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 252.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 252.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 252.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.50 236.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 191.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 191.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 191.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 191.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 191.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 191.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 191.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 191.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 161.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 161.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 161.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 161.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 161.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 161.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 161.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 161.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 131.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 131.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 131.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 131.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 131.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 131.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 131.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 131.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 69.50 101.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 269.50 101.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.50 101.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.50 101.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 101.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 101.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 101.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 491.50 101.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 212.60000000000002 m 339.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339.5 212.60000000000002 m 343.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 212.60000000000002 m 413.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413.5 212.60000000000002 m 417.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 212.60000000000002 m 487.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487.5 212.60000000000002 m 491.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 212.60000000000002 m 561.5 212.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 191.60000000000002 m 339.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 191.60000000000002 m 413.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 191.60000000000002 m 487.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 191.60000000000002 m 561.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 191.60000000000002 m 339.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 177.60000000000002 m 339.5 177.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 175.60000000000002 m 339.5 175.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 191.60000000000002 m 413.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 177.60000000000002 m 413.5 177.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 175.60000000000002 m 413.5 175.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 191.60000000000002 m 487.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 177.60000000000002 m 487.5 177.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 175.60000000000002 m 487.5 175.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 191.60000000000002 m 561.5 191.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 177.60000000000002 m 561.5 177.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 175.60000000000002 m 561.5 175.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 86.60000000000002 m 339.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 86.60000000000002 m 413.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 86.60000000000002 m 487.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 86.60000000000002 m 561.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 86.60000000000002 m 339.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 72.60000000000002 m 339.5 72.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 269.5 70.60000000000002 m 339.5 70.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 86.60000000000002 m 413.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 72.60000000000002 m 413.5 72.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343.5 70.60000000000002 m 413.5 70.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 86.60000000000002 m 487.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 72.60000000000002 m 487.5 72.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 70.60000000000002 m 487.5 70.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 86.60000000000002 m 561.5 86.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 72.60000000000002 m 561.5 72.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 491.5 70.60000000000002 m 561.5 70.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 72.00 215.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 388.05 216.83 Td (October 1, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 72.00 194.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 286.30 195.83 Td (CostBasis) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 359.40 203.83 Td (Unr) Tj ET Q q 0 0 0 rg BT 373.03 203.83 Td (ealized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 367.95 195.83 Td (Gains) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.40 203.83 Td (Unr) Tj ET Q q 0 0 0 rg BT 447.03 203.83 Td (ealized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 440.85 195.83 Td (Losses) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.15 195.83 Td (FairValue) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 182.17 Td (Cash and cash equivalents) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 181.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.15 181.27 Td (354,347) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 181.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 181.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 181.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 181.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 181.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.15 181.27 Td (354,347) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 72.00 164.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 164.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 164.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 151.27 Td (Short-term investments:) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 336.00 149.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 149.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 149.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 149.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.00 136.27 Td (Available-for-sale securities:) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 336.00 134.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 410.00 134.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 484.00 134.36 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 558.00 134.36 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 122.17 Td (Commercial paper) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 121.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 308.15 121.27 Td (24,999) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 121.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 121.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 121.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 121.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 121.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 121.27 Td (24,999) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 106.27 Td ( U.S. Treasury and agency obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 320.65 106.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 106.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 106.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 542.65 106.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 92.17 Td (Equity Securities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 308.15 91.27 Td (15,269) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.15 91.27 Td (5,213) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 91.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 91.27 Td (20,482) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 102.00 76.27 Td (Total short-term investments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.00 76.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 308.15 76.27 Td (40,393) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.00 76.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.15 76.27 Td (5,213) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 76.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.65 76.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.00 76.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.15 76.27 Td (45,606) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 31 0 obj <>] /Rotate 0 /Contents 32 0 R>> endobj 32 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (15) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 742.10 Td (None of the unrealized losses as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 210.90 742.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 289.48 742.10 Td ( or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.81 742.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.52 742.10 Td ( were considered to be other) Tj ET Q q 0 0 0 rg BT 480.33 742.10 Td (-than-temporary ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 730.10 Td (impairments.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 706.10 Td (The amortized cost and estimated fair value of available-for) Tj ET Q q 0 0 0 rg BT 308.14 706.10 Td (-sale investments in debt securities as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.71 706.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.29 706.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 694.10 Td (and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.94 694.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.65 694.10 Td ( classified as short-term investments on our condensed consolidated balance sheet were as follows \(in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 682.10 Td (thousands\):) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 621.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 72.00 645.60 160.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 232.00 645.60 75.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 307.00 645.60 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 311.00 645.60 80.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 391.00 645.60 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 395.00 645.60 75.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 470.00 645.60 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 474.00 645.60 80.00 -25.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 658.6 m 307 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 307 658.6 m 311 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 311 658.6 m 391 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 658.6 m 470 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 470 658.6 m 474 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 474 658.6 m 554 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 311 658.6 m 391 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 474 658.6 m 554 658.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 645.6 m 307 645.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 621.6 m 307 621.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 619.6 m 307 619.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 311 645.6 m 391 645.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 311 621.6 m 391 621.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 311 619.6 m 391 619.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 645.6 m 470 645.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 621.6 m 470 621.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 619.6 m 470 619.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 474 645.6 m 554 645.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 474 621.6 m 554 621.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 474 619.6 m 554 619.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 74.50 661.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 278.75 662.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 447.05 662.83 Td (October 1, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 74.50 648.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 242.00 649.83 Td (AmortizedCost) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 314.30 649.83 Td (EstimatedFairValue) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 405.00 649.83 Td (AmortizedCost) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 477.30 649.83 Td (EstimatedFairValue) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 74.50 636.17 Td (Investments in available-for-sale debt) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 74.50 626.17 Td (securities due in less than one year) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 234.50 625.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 288.15 625.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 313.50 625.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.15 625.27 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.50 625.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 438.65 625.27 Td (25,124) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.50 625.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.65 625.27 Td (25,124) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 609.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 597.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 114.55 597.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.86 597.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 195.36 597.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 273.94 597.10 Td (, we received proceeds totaling ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.55 597.10 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.44 597.10 Td ( from the sale of available-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 585.10 Td (for) Tj ET Q q 0 0 0 rg BT 80.46 585.10 Td (-sale securities and realized no gross gains or losses. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 338.17 585.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 416.48 585.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.98 585.10 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.58 585.10 Td (, we received ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 573.10 Td (proceeds totaling ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 140.09 573.10 Td ($15.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.98 573.10 Td ( from the sale of available-for) Tj ET Q q 0 0 0 rg BT 312.89 573.10 Td (-sale securities and realized gross gains of less than ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.88 573.10 Td ($0.1 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 561.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.89 561.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.00 549.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 58.50 537.10 Td (6.DERIV) Tj ET Q q 0 0 0 rg BT 106.94 537.10 Td (A) Tj ET Q q 0 0 0 rg BT 113.42 537.10 Td (TIVE INSTRUMENTS ) Tj ET Q q 0 0 0 rg BT 215.67 537.10 Td (AND HEDGING ) Tj ET Q q 0 0 0 rg BT 290.12 537.10 Td (ACTIVITIES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.50 525.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 513.10 Td (W) Tj ET Q q 0 0 0 rg BT 85.14 513.10 Td (e maintain operations in various countries outside of the United States and have foreign subsidiaries that manufacture ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 501.10 Td (and sell our products in various global markets. ) Tj ET Q q 0 0 0 rg BT 268.78 501.10 Td (The majority of our sales are transacted in U.S. dollars. However) Tj ET Q q 0 0 0 rg BT 528.58 501.10 Td (, we do ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 489.10 Td (generate revenues in other currencies, primarily the Euro, Japanese ) Tj ET Q q 0 0 0 rg BT 346.84 489.10 Td (Y) Tj ET Q q 0 0 0 rg BT 353.06 489.10 Td (en, South Korean ) Tj ET Q q 0 0 0 rg BT 425.09 489.10 Td (W) Tj ET Q q 0 0 0 rg BT 433.73 489.10 Td (on and Chinese Renminbi ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 477.10 Td (\(RMB\). ) Tj ET Q q 0 0 0 rg BT 109.84 477.10 Td (As a result, our earnings, cash flows and cash balances are exposed to fluctuations in foreign currency exchange ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 465.10 Td (rates. ) Tj ET Q q 0 0 0 rg BT 100.20 465.10 Td (W) Tj ET Q q 0 0 0 rg BT 108.83 465.10 Td (e attempt to limit these exposures through financial market instruments. ) Tj ET Q q 0 0 0 rg BT 398.31 465.10 Td (W) Tj ET Q q 0 0 0 rg BT 406.94 465.10 Td (e utilize derivative instruments, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 453.10 Td (primarily forward contracts with maturities of four months or less, to manage our exposure associated with anticipated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 441.10 Td (cash flows and net asset and liability positions denominated in foreign currencies. Gains and losses on the forward ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 429.10 Td (contracts are mitigated by gains and losses on the underlying instruments. ) Tj ET Q q 0 0 0 rg BT 374.03 429.10 Td (W) Tj ET Q q 0 0 0 rg BT 382.67 429.10 Td (e do not use derivative financial instruments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 417.10 Td (for speculative or trading purposes. ) Tj ET Q q 0 0 0 rg BT 220.17 417.10 Td (The credit risk amounts represent the Company) Tj ET Q q 0 0 0 rg BT 412.89 417.10 Td (s gross exposure to potential ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 405.10 Td (accounting loss on derivative instruments that are outstanding or unsettled if all counterparties failed to perform ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 393.10 Td (according to the terms of the contract, based on then-current currency rates at each respective date.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 58.50 381.10 Td () Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 76.50 369.10 Td (Non-Designated Derivatives) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 345.10 Td (The outstanding notional contract and fair value asset \(liability\) amounts of non-designated hedge contracts, with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 333.10 Td (maximum maturity of four months, are as follows \(in thousands\):) Tj ET Q endstream endobj 33 0 obj <>] /Rotate 0 /Contents 34 0 R>> endobj 34 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (16) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 448.00 Td () Tj ET Q 0.8 0.9333333333333333 1 rg 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686.50 68.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.50 686.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 686.50 68.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 79.50 657.50 193.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.50 657.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 657.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 657.50 67.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 657.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 415.50 657.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.50 657.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 657.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 79.50 627.50 193.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.50 627.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 627.50 4.00 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0.9333333333333333 1 rg /GS0 gs 415.50 537.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.50 537.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 537.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 79.50 507.50 193.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.50 507.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 507.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 507.50 67.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 507.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 415.50 507.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.50 507.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 507.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 79.50 477.50 193.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.50 477.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 477.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 477.50 67.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 477.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 415.50 477.50 68.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.50 477.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.50 477.50 68.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272.5 735.5 m 340.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 735.5 m 344.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 735.5 m 411.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 415.5 735.5 m 483.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 483.5 735.5 m 487.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487.5 735.5 m 555.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272.5 716.5 m 340.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 735.5 m 411.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 716.5 m 411.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 415.5 716.5 m 483.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487.5 735.5 m 555.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487.5 716.5 m 555.5 716.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 82.00 738.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 291.80 739.73 Td (U.S.NotionalContractValue) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.05 739.73 Td (U.S. FairValue) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 82.00 719.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 282.75 727.58 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 298.00 719.58 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.55 720.73 Td (October 1, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 425.75 727.58 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 441.00 719.58 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 494.05 720.73 Td (October 1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 707.07 Td (Euro currency hedge contracts) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 337.00 704.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 408.00 704.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 480.00 704.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 552.00 704.26 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 692.07 Td (Purchase) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 691.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 691.18 Td (96,092) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 691.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 380.15 691.17 Td (91,108) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 691.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 453.80 691.23 Td (\(1,546) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 479.65 691.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 691.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 691.17 Td (162) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 677.07 Td (Sell) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 677.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.80 677.23 Td (\(13,155) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 677.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 677.07 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.80 677.12 Td (\(750,454) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.65 677.07 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 677.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 464.65 677.18 Td (365) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 677.07 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.80 677.12 Td (\(2,234) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 677.07 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 648.07 Td (Japanese Yen currency hedge contracts) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 633.07 Td (Purchase) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 632.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 321.65 632.18 Td (623) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 632.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.65 632.17 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 632.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 466.30 632.23 Td (\(18) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 479.65 632.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 632.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 632.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 618.07 Td (Sell) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 617.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.80 617.23 Td (\(18,700) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 617.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 617.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.80 617.22 Td (\(36,450) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.65 617.17 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 617.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 464.65 617.18 Td (751) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 617.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 533.30 617.22 Td (\(343) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 617.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 588.07 Td (South Korean Won currency hedge contracts) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 573.07 Td (Purchase) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 572.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 572.18 Td (15,744) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 572.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 380.15 572.17 Td (31,248) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 572.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 453.80 572.23 Td (\(1,437) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 479.65 572.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 572.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 572.17 Td (413) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 558.07 Td ( Sell) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 557.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.80 557.23 Td (\(19,612) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 557.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 557.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.80 557.22 Td (\(37,929) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.65 557.17 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 557.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 464.65 557.18 Td (493) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 557.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 533.30 557.22 Td (\(152) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 557.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 528.07 Td (Chinese RMB currency hedge contracts) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 513.07 Td (Sell) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 512.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 310.80 512.23 Td (\(8,141) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 512.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 512.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.80 512.22 Td (\(25,237) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.65 512.17 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 512.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 469.65 512.18 Td (35) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 512.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 538.30 512.22 Td (\(91) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 512.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 483.07 Td (Other foreign currency hedge contracts) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 337.00 480.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 408.00 480.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 480.00 480.26 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 552.00 480.26 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 468.07 Td (Purchase) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 467.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 314.15 467.18 Td (4,306) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 467.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.15 467.17 Td (6,033) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 467.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 466.30 467.23 Td (\(53) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 479.65 467.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 467.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 543.30 467.22 Td (\(4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 467.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 453.07 Td (Sell) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 275.00 452.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 310.80 452.23 Td (\(3,031) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 452.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 452.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 381.80 452.22 Td (\(1,775) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.65 452.17 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 418.00 452.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 474.65 452.18 Td (4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 452.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 452.17 Td (38) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 424.00 Td (The fair value of our derivative instruments is included in prepaid expenses and other assets and in other current ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 412.00 Td (liabilities in our Condensed Consolidated Balance Sheets \(See Note 4\).) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 388.00 Td (During the three months ended December 31, 2016 and the three months ended January 2, 2016 we recognized a gain of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 376.00 Td ($9.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 125.39 376.00 Td ( and a loss of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.66 376.00 Td ($2.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 229.55 376.00 Td (, respectively) Tj ET Q q 0 0 0 rg BT 282.21 376.00 Td (, in other income \(expense\) for derivative instruments not designated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 364.00 Td (as hedging instruments. ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 76.50 335.00 Td (Designated Derivatives) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 318.00 Td (Cash flow hedges related to anticipated transactions are designated and documented at the inception of the hedge when ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 306.00 Td (we enter into contracts for specific future transactions. Cash flow hedges are evaluated for ef) Tj ET Q q 0 0 0 rg BT 447.55 306.00 Td (fectiveness quarterly) Tj ET Q q 0 0 0 rg BT 529.92 306.00 Td (. ) Tj ET Q q 0 0 0 rg BT 534.74 306.00 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 294.00 Td (ef) Tj ET Q q 0 0 0 rg BT 84.09 294.00 Td (fective portion of the gain or loss on these hedges is reported as a component of OCI in stockholder's equity and is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 282.00 Td (reclassified into earnings when the underlying transaction af) Tj ET Q q 0 0 0 rg BT 317.63 282.00 Td (fects earnings. ) Tj ET Q q 0 0 0 rg BT 377.70 282.00 Td (W) Tj ET Q q 0 0 0 rg BT 386.34 282.00 Td (e had no cash flow hedges outstanding at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 270.00 Td (December 31, 2016 or October 1, 2016. Changes in the fair value of currency forward contracts due to changes in time ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 258.00 Td (value are excluded from the assessment of ef) Tj ET Q q 0 0 0 rg BT 255.97 258.00 Td (fectiveness and recognized in other income \(expense\) as incurred. ) Tj ET Q q 0 0 0 rg BT 521.78 258.00 Td (W) Tj ET Q q 0 0 0 rg BT 530.42 258.00 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 246.00 Td (classify the cash flows from the foreign exchange forward contracts that are accounted for as cash flow hedges in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 234.00 Td (same section as the underlying item, primarily within cash flows from operating activities since we do not designate our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 222.00 Td (cash flow hedges as investing or financing activities. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 198.00 Td (During the three months ended January 2, 2016, we recorded losses in OCI and in other income \(expense\) related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 186.00 Td (accounting for derivatives designated as cash flow hedges. ) Tj ET Q q 0 0 0 rg BT 313.18 186.00 Td (These losses were not material. During the three months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 174.00 Td (ended December 31, 2016, we did not have any activity related to designated cash flow hedges.) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 76.50 150.00 Td (Master Netting ) Tj ET Q q 0 0 0 rg BT 139.09 150.00 Td (Arrangements) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 126.00 Td (T) Tj ET Q q 0 0 0 rg BT 81.91 126.00 Td (o mitigate credit risk in derivative transactions, we enter into master netting arrangements that allow each counterparty ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 114.00 Td (in the arrangements to net settle amounts of multiple and separate derivative transactions under certain conditions. ) Tj ET Q q 0 0 0 rg BT 535.89 114.00 Td (W) Tj ET Q q 0 0 0 rg BT 544.53 114.00 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 102.00 Td (present the fair value of derivative assets and liabilities within our condensed consolidated balance sheet on a gross basis ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 90.00 Td (even when derivative transactions are subject to master netting arrangements and may otherwise qualify for net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 78.00 Td (presentation. ) Tj ET Q q 0 0 0 rg BT 130.19 78.00 Td (The impact of netting derivative assets and liabilities is not material to our financial position for any of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 66.00 Td (periods presented. Our derivative contracts do not contain any credit risk related contingent features and do not require ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.50 54.00 Td (collateral or other security to be furnished by us or the counterparties.) Tj ET Q endstream endobj 35 0 obj <>] /Rotate 0 /Contents 36 0 R>> endobj 36 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (17) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (7. GOODWILL) Tj ET Q q 0 0 0 rg BT 124.74 718.10 Td ( ) Tj ET Q q 0 0 0 rg BT 126.68 718.10 Td (AND INT) Tj ET Q q 0 0 0 rg BT 167.89 718.10 Td (ANGIBLE) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 214.01 718.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 216.51 718.10 Td (ASSETS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 253.76 718.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.55 694.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.86 694.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 194.36 694.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.94 694.10 Td (, we noted no indications of impairment or triggering events to cause us ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 682.10 Td (to review goodwill for potential impairment. ) Tj ET Q q 0 0 0 rg BT 248.61 682.10 Td (W) Tj ET Q q 0 0 0 rg BT 257.25 682.10 Td (e will conduct our annual goodwill testing during the fourth fiscal quarter) Tj ET Q q 0 0 0 rg BT 550.79 682.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 658.10 Td (The changes in the carrying amount of goodwill by segment for the period from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 390.13 658.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 454.84 658.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.62 658.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.20 658.10 Td ( are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 646.10 Td (as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 606.60 280.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 606.60 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 606.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 606.60 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 482.50 606.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 606.60 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 576.60 280.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 576.60 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.50 576.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 576.60 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 482.50 576.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 576.60 65.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 606.6 m 413.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 606.6 m 482.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 606.6 m 551.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 606.6 m 413.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 606.6 m 482.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 606.6 m 551.5 606.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 561.6 m 413.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 561.6 m 482.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 561.6 m 551.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 561.6 m 413.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 547.6 m 413.5 547.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 545.6 m 413.5 545.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 561.6 m 482.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 547.6 m 482.5 547.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 545.6 m 482.5 545.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 561.6 m 551.5 561.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 547.6 m 551.5 547.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 545.6 m 551.5 545.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 609.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 360.20 618.83 Td (OEM Laser) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 367.20 610.83 Td (Sources) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.05 618.83 Td (Industrial Lasers) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 431.35 610.83 Td (& Systems) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 509.75 610.83 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 596.27 Td (Balance as of October 1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.00 596.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.15 596.27 Td (97,015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 596.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.15 596.27 Td (4,443) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.00 596.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.15 596.27 Td (101,458) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 581.27 Td (Additions \(see Note 3\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 581.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 446.15 581.27 Td (254,042) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.15 581.27 Td (254,042) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 566.27 Td (Translation adjustments and other) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 383.80 566.32 Td (\(4,726) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 409.65 566.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.65 566.27 Td (537) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.80 566.32 Td (\(4,189) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.65 566.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 551.27 Td (Balance as of December 31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.00 551.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.15 551.27 Td (92,289) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 551.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 446.15 551.27 Td (259,022) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.00 551.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.15 551.27 Td (351,311) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 535.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 523.10 Td (Components of our amortizable intangible assets are as follows \(in thousands\):) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 511.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 458.60 150.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 218.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 274.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 382.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 438.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 442.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 494.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 458.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 428.60 150.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 218.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 274.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 382.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 438.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 442.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 494.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 428.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 398.60 150.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 218.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 274.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 382.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 438.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 442.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 494.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 398.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 368.60 150.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 218.50 368.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 274.50 368.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.50 368.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 382.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.50 368.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 438.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 442.50 368.60 52.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 494.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 368.60 52.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 487.6 m 270.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 487.6 m 274.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 487.6 m 326.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 487.6 m 330.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 487.6 m 382.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 487.6 m 438.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 438.5 487.6 m 442.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 487.6 m 494.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 494.5 487.6 m 498.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 487.6 m 550.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 458.6 m 270.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 487.6 m 326.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 458.6 m 326.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 458.6 m 382.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 458.6 m 438.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 487.6 m 494.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 458.6 m 494.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 487.6 m 550.5 487.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 458.6 m 550.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 458.6 m 270.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 458.6 m 326.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 458.6 m 382.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 458.6 m 438.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 458.6 m 494.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 458.6 m 550.5 458.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 368.6 m 270.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 368.6 m 326.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 368.6 m 382.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 368.6 m 438.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 368.6 m 494.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 368.6 m 550.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 368.6 m 270.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 354.6 m 270.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 218.5 352.6 m 270.5 352.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 368.6 m 326.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 354.6 m 326.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274.5 352.6 m 326.5 352.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 368.6 m 382.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 354.6 m 382.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330.5 352.6 m 382.5 352.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 368.6 m 438.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 354.6 m 438.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386.5 352.6 m 438.5 352.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 368.6 m 494.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 354.6 m 494.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 442.5 352.6 m 494.5 352.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 368.6 m 550.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 354.6 m 550.5 354.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498.5 352.6 m 550.5 352.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 490.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 267.75 491.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 441.05 491.83 Td (October 1, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 461.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 234.05 478.83 Td (Gr) Tj ET Q q 0 0 0 rg BT 243.68 478.83 Td (oss) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 228.20 470.83 Td (Carrying) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 229.95 462.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 277.30 470.83 Td (Accumulated) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 277.10 462.83 Td (Amortization) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.00 462.83 Td (Net) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 402.05 478.83 Td (Gr) Tj ET Q q 0 0 0 rg BT 411.68 478.83 Td (oss) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 396.20 470.83 Td (Carrying) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 397.95 462.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 445.30 470.83 Td (Accumulated) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 445.10 462.83 Td (Amortization) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 518.00 462.83 Td (Net) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 449.17 Td (Existing technology) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 234.10 448.27 Td (195,710) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 291.80 448.27 Td (\(25,935) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 448.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 333.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.10 448.27 Td (169,775) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.15 448.27 Td (70,664) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 459.80 448.32 Td (\(61,133) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.65 448.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 501.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 448.27 Td (9,531) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 434.17 Td (Patents) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 251.65 433.27 Td (302) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.30 433.27 Td (\(10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 433.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.65 433.27 Td (292) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.65 433.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.65 433.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 433.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 419.17 Td (Customer relationships) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.15 418.27 Td (48,157) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 296.80 418.27 Td (\(6,533) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 418.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.15 418.27 Td (41,624) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.15 418.27 Td (15,968) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 459.80 418.32 Td (\(11,658) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.65 418.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 418.27 Td (4,310) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 404.17 Td (Trade Name) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 244.15 403.27 Td (5,768) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 304.30 403.27 Td (\(358) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 403.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.15 403.27 Td (5,410) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.65 403.27 Td (384) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.30 403.32 Td (\(351) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.65 403.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 403.27 Td (33) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 389.17 Td (Order backlog) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 244.15 388.27 Td (5,600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 296.80 388.27 Td (\(1,867) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 388.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.15 388.27 Td (3,733) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.65 388.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.65 388.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 388.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 373.27 Td (In-process research& development) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.15 373.27 Td (12,800) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 312.65 373.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.15 373.27 Td (12,800) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.65 373.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 373.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 358.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 234.10 358.27 Td (268,337) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 291.80 358.27 Td (\(34,703) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.65 358.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 333.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.10 358.27 Td (233,634) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.15 358.27 Td (87,016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 459.80 358.32 Td (\(73,142) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.65 358.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 501.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 358.27 Td (13,874) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 330.10 Td (For accounting purposes, when an intangible asset is fully amortized, it is removed from the disclosure schedule. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 306.10 Td (Amortization expense for intangible assets for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 269.88 306.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.20 306.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 350.70 306.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.28 306.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.72 306.10 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.32 306.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.87 306.10 Td ($12.1 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 294.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 96.89 294.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 116.33 294.10 Td ($2.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 165.22 294.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 217.88 294.10 Td (. ) Tj ET Q q 0 0 0 rg BT 222.70 294.10 Td (The change in the accumulated amortization also includes ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.06 294.10 Td ($2.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.95 294.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.39 294.10 Td ($0.7 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 282.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 96.89 282.10 Td ( of foreign exchange impact for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.44 282.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 318.75 282.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.25 282.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.84 282.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.27 282.10 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.87 282.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 535.53 282.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 258.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 80.50 258.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.08 258.10 Td (, estimated amortization expense for the remainder of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.54 258.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.54 258.10 Td (, the next five succeeding fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 246.10 Td (years and all fiscal years thereafter are as follows \(in thousands\): ) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 206.60 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 468.50 206.60 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 176.60 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 468.50 176.60 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 146.60 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 468.50 146.60 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 116.60 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 468.50 116.60 82.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 206.60000000000002 m 550.5 206.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 206.60000000000002 m 550.5 206.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 101.60000000000002 m 550.5 101.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 101.60000000000002 m 550.5 101.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 87.60000000000002 m 550.5 87.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 468.5 85.60000000000002 m 550.5 85.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 209.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 491.65 226.83 Td (Estimated) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 486.10 218.83 Td (Amortization) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 494.75 210.83 Td (Expense) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 196.27 Td (2017 \(remainder\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.00 196.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 196.27 Td (46,905) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 181.27 Td (2018) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 181.27 Td (53,714) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 166.27 Td (2019) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 166.27 Td (50,654) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 151.27 Td (2020) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 151.27 Td (43,989) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 136.27 Td (2021) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 136.27 Td (13,066) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 121.27 Td (2022) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 121.27 Td (3,241) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 106.27 Td (Thereafter) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 106.27 Td (22,065) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 91.27 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.00 91.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.15 91.27 Td (233,634) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 63.10 Td (8. BALANCE SHEET) Tj ET Q q 0 0 0 rg BT 154.57 63.10 Td ( DET) Tj ET Q q 0 0 0 rg BT 176.88 63.10 Td (AILS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 51.10 Td () Tj ET Q endstream endobj 37 0 obj <>] /Rotate 0 /Contents 38 0 R>> endobj 38 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (18) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (Inventories consist of the following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 710.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 710.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 710.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 710.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 680.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 680.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 680.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 680.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 710.6 m 476.5 710.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 710.6 m 550.5 710.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 710.6 m 476.5 710.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 710.6 m 550.5 710.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 665.6 m 476.5 665.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 665.6 m 550.5 665.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 665.6 m 476.5 665.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 651.6 m 476.5 651.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 649.6 m 476.5 649.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 665.6 m 550.5 665.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 651.6 m 550.5 651.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 649.6 m 550.5 649.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 713.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 722.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 714.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 497.05 722.83 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 714.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 700.27 Td (Purchased parts and assemblies) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 700.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 700.28 Td (116,405) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 700.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 700.27 Td (56,824) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 685.27 Td (Work-in-process) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 685.28 Td (119,031) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 685.27 Td (88,391) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 670.27 Td (Finished goods) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 670.28 Td (150,577) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 670.27 Td (67,683) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 655.27 Td (Total inventories) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 655.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 655.28 Td (386,013) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 655.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.15 655.27 Td (212,898) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 639.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 627.10 Td (Prepaid expenses and other assets consist of the following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 595.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 595.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 595.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 595.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 565.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 565.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 565.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 565.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 595.6 m 476.5 595.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 595.6 m 550.5 595.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 595.6 m 476.5 595.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 595.6 m 550.5 595.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 550.6 m 476.5 550.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 550.6 m 550.5 550.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 550.6 m 476.5 550.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 536.6 m 476.5 536.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 534.6 m 476.5 534.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 550.6 m 550.5 550.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 536.6 m 550.5 536.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 534.6 m 550.5 534.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 598.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 607.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 599.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 497.05 607.83 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 599.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 585.27 Td (Prepaid and refundable income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 585.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 585.28 Td (27,851) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 585.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 585.27 Td (12,415) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 570.27 Td (Other taxes receivable) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 570.28 Td (10,691) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 570.27 Td (10,538) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 555.27 Td (Prepaid expenses and other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 555.28 Td (28,439) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 555.27 Td (14,120) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 540.27 Td (Total prepaid expenses and other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 540.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 540.28 Td (66,981) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 540.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 540.27 Td (37,073) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 524.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 512.10 Td (Other assets consist of the following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 480.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 480.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 480.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 480.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 450.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 450.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 450.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 450.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 480.6 m 476.5 480.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 480.6 m 550.5 480.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 480.6 m 476.5 480.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 480.6 m 550.5 480.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 435.6 m 476.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 435.6 m 550.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 435.6 m 476.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 421.6 m 476.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 419.6 m 476.5 419.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 435.6 m 550.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 421.6 m 550.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 419.6 m 550.5 419.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 483.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 492.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 484.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 497.05 492.83 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 484.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 470.27 Td (Assets related to deferred compensation arrangements) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 470.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 470.28 Td (27,528) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 470.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 470.27 Td (26,356) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 455.27 Td (Deferred tax assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 455.28 Td (79,262) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 455.27 Td (67,157) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 440.27 Td (Other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 440.28 Td (13,039) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 440.27 Td (9,221) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 425.27 Td (Total other assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 425.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 425.28 Td (119,829) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 425.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.15 425.27 Td (102,734) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 397.10 Td (Other current liabilities consist of the following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 365.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 365.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 365.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 365.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 335.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 335.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 335.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 335.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 305.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 305.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 305.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 305.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 275.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 275.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 275.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 275.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 365.6 m 476.5 365.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 365.6 m 550.5 365.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 365.6 m 476.5 365.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 365.6 m 550.5 365.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 275.6 m 476.5 275.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 275.6 m 550.5 275.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 275.6 m 476.5 275.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 261.6 m 476.5 261.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 259.6 m 476.5 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 275.6 m 550.5 275.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 261.6 m 550.5 261.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 259.6 m 550.5 259.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 368.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 377.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 369.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 497.05 377.83 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 369.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 355.27 Td (Accrued payroll and benefits) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 355.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 355.28 Td (46,931) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 355.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 355.27 Td (47,506) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 340.27 Td (Deferred revenue) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 340.28 Td (62,772) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 340.27 Td (33,034) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 325.27 Td (Warranty reserve) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 325.28 Td (28,600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 325.27 Td (15,949) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 310.27 Td (Accrued expenses and other) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 310.28 Td (36,952) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 310.27 Td (18,356) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 295.27 Td (Current liabilities held for sale) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 295.28 Td (7,386) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 295.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 280.27 Td (Customer deposits) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 280.28 Td (15,640) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 280.27 Td (1,597) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 265.27 Td (Total other current liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 265.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 265.28 Td (198,281) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 265.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.15 265.27 Td (116,442) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 249.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 237.10 Td (Components of the reserve for warranty costs during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 295.99 237.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.54 237.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.02 237.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.02 237.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.46 237.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.46 237.10 Td ( were as follows \(in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 225.10 Td (thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 180.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 180.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 180.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 180.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 150.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 150.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 150.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 150.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 120.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 120.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 120.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 120.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 201.60000000000002 m 476.5 201.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476.5 201.60000000000002 m 480.5 201.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 201.60000000000002 m 550.5 201.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 180.60000000000002 m 476.5 180.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 180.60000000000002 m 550.5 180.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 180.60000000000002 m 476.5 180.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476.5 180.60000000000002 m 480.5 180.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 180.60000000000002 m 550.5 180.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 105.60000000000002 m 476.5 105.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 105.60000000000002 m 550.5 105.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 105.60000000000002 m 476.5 105.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 91.60000000000002 m 476.5 91.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 89.60000000000002 m 476.5 89.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 105.60000000000002 m 550.5 105.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 91.60000000000002 m 550.5 91.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 89.60000000000002 m 550.5 89.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 204.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 441.60 205.83 Td (Thr) Tj ET Q q 0 0 0 rg BT 454.79 205.83 Td (ee Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 183.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 192.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 184.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 496.75 192.83 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 184.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 170.27 Td (Beginning balance) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 170.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 170.28 Td (15,949) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 170.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 170.27 Td (15,308) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 155.27 Td (Additions related to current period sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 155.28 Td (8,814) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 155.27 Td (4,954) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 140.27 Td (Warranty costs incurred in the current period) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 446.80 140.33 Td (\(6,399) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 472.65 140.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.80 140.32 Td (\(5,390) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.65 140.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 125.27 Td (Accruals resulting from acquisitions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 125.28 Td (12,593) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 125.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 110.27 Td (Adjustments to accruals related to foreign exchange and other) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 446.80 110.33 Td (\(2,357) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 472.65 110.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 528.30 110.32 Td (\(227) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.65 110.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 95.27 Td (Ending balance) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 95.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 95.28 Td (28,600) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 95.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 95.27 Td (14,645) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 79.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 67.10 Td (Other long-term liabilities consist of the following \(in thousands\):) Tj ET Q endstream endobj 39 0 obj <>] /Rotate 0 /Contents 40 0 R>> endobj 40 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (19) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 727.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 727.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 727.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 727.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 697.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 697.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 697.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 697.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 667.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 667.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 667.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 667.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 637.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 406.50 637.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.50 637.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 480.50 637.50 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 727.5 m 476.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 727.5 m 550.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 727.5 m 476.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 727.5 m 550.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 622.5 m 476.5 622.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 622.5 m 550.5 622.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 622.5 m 476.5 622.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 608.5 m 476.5 608.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406.5 606.5 m 476.5 606.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 622.5 m 550.5 622.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 608.5 m 550.5 608.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 480.5 606.5 m 550.5 606.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 730.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.75 739.73 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.00 731.73 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 497.05 739.73 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.00 731.73 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 717.17 Td (Long-term taxes payable) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 717.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 717.18 Td (25,041) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 717.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 717.17 Td (2,951) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 702.17 Td (Deferred compensation) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 702.18 Td (29,500) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 702.17 Td (28,313) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 687.17 Td (Deferred tax liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 687.18 Td (67,603) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 687.17 Td (1,468) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 672.17 Td (Deferred revenue) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 672.18 Td (3,717) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 672.17 Td (4,069) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 657.17 Td (Asset retirement obligations liability) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 657.18 Td (4,761) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 657.17 Td (2,796) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 642.17 Td (Defined benefit plan liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 642.18 Td (38,621) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 642.17 Td (8,123) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 627.17 Td (Other long-term liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 627.18 Td (2,930) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 627.17 Td (1,106) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 612.17 Td (Total other long-term liabilities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 409.00 612.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.15 612.18 Td (172,173) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.00 612.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 612.17 Td (48,826) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 596.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 584.00 Td (9. BORROWINGS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 572.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 560.00 Td (On November 4, 2016, we repaid the outstanding balance, plus accrued interest, on our former domestic line of credit and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 548.00 Td (terminated the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 127.98 548.00 Td ($50.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 181.87 548.00 Td ( credit facility with Union Bank of California. ) Tj ET Q q 0 0 0 rg BT 368.03 548.00 Td (W) Tj ET Q q 0 0 0 rg BT 376.67 548.00 Td (e assumed two term loans having an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 536.00 Td (aggregated principal amount of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 195.73 536.00 Td ($15.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 249.62 536.00 Td ( as of November 7, 2016 and several lines of credit totaling approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 524.00 Td ($18.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.89 524.00 Td ( with the completion of the Rofin acquisition. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 500.00 Td (On November 7, 2016, we entered into the Credit ) Tj ET Q q 0 0 0 rg BT 268.23 500.00 Td (Agreement by and among us, Coherent Holding GmbH, as borrower \(the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 488.00 Td (Borrower\), and certain of our direct and indirect subsidiaries from time to time party thereto, as guarantors, the lenders ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 476.00 Td (from time to time party thereto, Barclays Bank PLC, as administrative agent and an L/C Issuer) Tj ET Q q 0 0 0 rg BT 446.12 476.00 Td (, Bank of ) Tj ET Q q 0 0 0 rg BT 485.00 476.00 Td (America, N.A., as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 464.00 Td (an L/C Issuer) Tj ET Q q 0 0 0 rg BT 121.48 464.00 Td (, and MUFG Union Bank, N.A., as an L/C Issuer) Tj ET Q q 0 0 0 rg BT 317.02 464.00 Td (. ) Tj ET Q q 0 0 0 rg BT 321.84 464.00 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 366.83 464.00 Td (Agreement provides for a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.79 464.00 Td (670.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.68 464.00 Td ( Euro ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 452.00 Td (senior secured term loan facility \(the "Euro ) Tj ET Q q 0 0 0 rg BT 243.22 452.00 Td (T) Tj ET Q q 0 0 0 rg BT 248.63 452.00 Td (erm Loan"\) and a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.02 452.00 Td ($100.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.91 452.00 Td ( senior secured revolving credit facility ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 440.00 Td (\("Revolving Credit Facility"\) with a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 214.75 440.00 Td ($30.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.64 440.00 Td ( letter of credit sublimit and a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.44 440.00 Td ($10.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.33 440.00 Td ( swing line sublimit. ) Tj ET Q q 0 0 0 rg BT 527.32 440.00 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 428.00 Td (Borrower may increase the aggregate revolving commitments or borrow incremental term loans in an aggregate principal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 416.00 Td (amount not to exceed the sum of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 201.02 416.00 Td ($150.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.91 416.00 Td ( and an amount that would not cause the senior secured net leverage ratio ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 404.00 Td (to be greater than 2.75 to 1.00, subject to certain conditions, including obtaining additional commitments from the lenders ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 392.00 Td (then party to the Credit ) Tj ET Q q 0 0 0 rg BT 162.70 392.00 Td (Agreement or new lenders. On November 7, 2016, the Borrower borrowed the full ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.38 392.00 Td (670.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 549.27 392.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 380.00 Td (Euros under the Euro ) Tj ET Q q 0 0 0 rg BT 155.57 380.00 Td (T) Tj ET Q q 0 0 0 rg BT 160.98 380.00 Td (erm Loan and its proceeds were used to finance the acquisition of Rofin and pay related fees and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 368.00 Td (expenses. On November 7, 2016, we also used ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.13 368.00 Td (10.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.02 368.00 Td ( Euro of the capacity under the Revolving Credit Facility for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 356.00 Td (the issuance of a letter of credit.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.9333333333333333 0.15294117647058825 0.1411764705882353 rg BT 196.00 356.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 68.00 332.00 Td (The terms of the Credit ) Tj ET Q q 0 0 0 rg BT 163.25 332.00 Td (Agreement require Borrower to prepay the term loans in certain circumstances, including from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 320.00 Td (excess cash flow beyond a threshold amount, from the receipt of proceeds from certain dispositions or from the incurrence ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 308.00 Td (of certain indebtedness, and from extraordinary receipts resulting in net cash proceeds in excess of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 464.52 308.00 Td ($10.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.42 308.00 Td ( in any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 296.00 Td (fiscal year) Tj ET Q q 0 0 0 rg BT 108.81 296.00 Td (. ) Tj ET Q q 0 0 0 rg BT 113.63 296.00 Td (The Borrower has the right to prepay loans under the Credit ) Tj ET Q q 0 0 0 rg BT 354.95 296.00 Td (Agreement in whole or in part at any time without ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 284.00 Td (premium or penalty) Tj ET Q q 0 0 0 rg BT 146.22 284.00 Td (, subject to customary breakage costs. Revolving loans may be borrowed, repaid and reborrowed until ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 272.00 Td (the fifth anniversary of the Closing Date, at which time all outstanding revolving loans must be repaid. ) Tj ET Q q 0 0 0 rg BT 481.33 272.00 Td (The Euro ) Tj ET Q q 0 0 0 rg BT 521.14 272.00 Td (T) Tj ET Q q 0 0 0 rg BT 526.55 272.00 Td (erm ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 260.00 Td (Loan matures on the seventh anniversary of the Closing Date, at which time all outstanding principal and accrued and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 248.00 Td (unpaid interest on the Euro ) Tj ET Q q 0 0 0 rg BT 178.63 248.00 Td (T) Tj ET Q q 0 0 0 rg BT 184.04 248.00 Td (erm Loan must be repaid. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 224.00 Td (Loans under the Credit ) Tj ET Q q 0 0 0 rg BT 161.87 224.00 Td (Agreement bear interest, at the Borrower) Tj ET Q q 0 0 0 rg BT 326.06 224.00 Td () Tj ET Q q 0 0 0 rg BT 328.83 224.00 Td (s option, at a rate equal to either \(i\)\(x\) in the case of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 212.00 Td (calculations with respect to U.S. Dollars or certain other alternative currencies, the London interbank of) Tj ET Q q 0 0 0 rg BT 482.95 212.00 Td (fered rate \(the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 200.00 Td (LIBOR\) or \(y\) in the case of calculations with respect to the Euro, the euro interbank of) Tj ET Q q 0 0 0 rg BT 427.41 200.00 Td (fered rate \("EURIBOR" and, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 188.00 Td (together with LIBOR, the "Eurocurrency Rate"\) or \(ii\) a base rate \(the Base Rate\) equal to the highest of \(x\) the federal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 176.00 Td (funds rate, plus 0.50%, \(y\) the prime rate then in ef) Tj ET Q q 0 0 0 rg BT 272.48 176.00 Td (fect and \(z\) the Eurocurrency Rate for loans denominated in U.S. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 164.00 Td (dollars applicable to a one-month interest period, plus 1.0%, in each case, plus an applicable mar) Tj ET Q q 0 0 0 rg BT 455.19 164.00 Td (gin. ) Tj ET Q q 0 0 0 rg BT 472.79 164.00 Td (The applicable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 152.00 Td (mar) Tj ET Q q 0 0 0 rg BT 83.37 152.00 Td (gin for Euro ) Tj ET Q q 0 0 0 rg BT 134.56 152.00 Td (T) Tj ET Q q 0 0 0 rg BT 139.97 152.00 Td (erm Loan borrowed as Eurocurrency Rate loans, is 3.50% initially) Tj ET Q q 0 0 0 rg BT 404.52 152.00 Td (, and following the first anniversary of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 140.00 Td (the Closing Date ranges from 3.00% to 3.50% depending on the consolidated total gross leverage ratio at the time of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 128.00 Td (determination. For Euro ) Tj ET Q q 0 0 0 rg BT 166.69 128.00 Td (T) Tj ET Q q 0 0 0 rg BT 172.10 128.00 Td (erm Loan borrowed as Base Rate Loans, the applicable mar) Tj ET Q q 0 0 0 rg BT 410.71 128.00 Td (gin initially is 2.50%, and following ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 116.00 Td (the first anniversary of the Closing Date ranges from 2.00% to 2.50% depending upon the consolidated total gross leverage ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 104.00 Td (ratio at the time of determination. ) Tj ET Q q 0 0 0 rg BT 204.72 104.00 Td (The applicable mar) Tj ET Q q 0 0 0 rg BT 281.72 104.00 Td (gin for revolving loans borrowed as Eurocurrency Rate Loans, ranges ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 92.00 Td (from 3.75% to 4.25%, and for revolving loans borrowed as Base Rate Loans, ranges from 2.75% to 3.25%, in each case, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 80.00 Td (based on the consolidated total gross leverage ratio at the time of determination. Interest on Base Rate Loans is payable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 68.00 Td (quarterly in arrears. Interest on Eurocurrency Rate Loans is payable at the end of the applicable interest period \(or at three ) Tj ET Q endstream endobj 41 0 obj <>] /Rotate 0 /Contents 42 0 R>> endobj 42 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (20) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (month intervals if the interest period exceeds three months\). Interest periods for Eurocurrency Rate loans may be, at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (Borrower) Tj ET Q q 0 0 0 rg BT 106.69 730.10 Td () Tj ET Q q 0 0 0 rg BT 109.47 730.10 Td (s option, one, two, three or six months. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 706.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 112.99 706.10 Td (Agreement requires the Borrower to make scheduled quarterly payments on the Euro ) Tj ET Q q 0 0 0 rg BT 455.47 706.10 Td (T) Tj ET Q q 0 0 0 rg BT 460.88 706.10 Td (erm Loan of 0.25% of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (the original principal amount of the Euro ) Tj ET Q q 0 0 0 rg BT 234.16 694.10 Td (T) Tj ET Q q 0 0 0 rg BT 239.57 694.10 Td (erm Loan, with any remaining principal payable at maturity) Tj ET Q q 0 0 0 rg BT 478.01 694.10 Td (. ) Tj ET Q q 0 0 0 rg BT 482.46 694.10 Td (A) Tj ET Q q 0 0 0 rg BT 489.13 694.10 Td ( commitment fee ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 682.10 Td (accrues on any unused portion of the revolving loan commitments under the Credit ) Tj ET Q q 0 0 0 rg BT 402.09 682.10 Td (Agreement at a rate of 0.375% or 0.5% ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.10 Td (depending on the consolidated total gross leverage ratio at any time of determination. ) Tj ET Q q 0 0 0 rg BT 411.60 670.10 Td (The Borrower is also obligated to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 658.10 Td (pay other customary fees for a credit facility of this size and type. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 634.10 Td (On the Closing Date, we and certain of our direct and indirect subsidiaries, as guarantors, provided an unconditional ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 622.10 Td (guaranty of all obligations of the Borrower and the other loan parties arising under the Credit ) Tj ET Q q 0 0 0 rg BT 442.34 622.10 Td (Agreement, the other loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.10 Td (documents and under swap contracts and treasury management agreements with the lenders or their af) Tj ET Q q 0 0 0 rg BT 476.56 610.10 Td (filiates \(with certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 598.10 Td (limited exceptions\). ) Tj ET Q q 0 0 0 rg BT 149.74 598.10 Td (The Borrower and the guarantors have also granted security interests in substantially all of their assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 586.10 Td (to secure such obligations. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 562.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 112.99 562.10 Td (Agreement contains customary af) Tj ET Q q 0 0 0 rg BT 247.48 562.10 Td (firmative covenants, including covenants regarding the payment of taxes and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 550.10 Td (other obligations, maintenance of insurance, reporting requirements and compliance with applicable laws and regulations, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 538.10 Td (and negative covenants, including covenants limiting the ability of us and our subsidiaries to, among other things, incur ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 526.10 Td (debt, grant liens, make investments, make certain restricted payments, transact with af) Tj ET Q q 0 0 0 rg BT 412.42 526.10 Td (filiates, and sell assets. ) Tj ET Q q 0 0 0 rg BT 506.11 526.10 Td (The Credit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.10 Td (Agreement also requires us and our subsidiaries to maintain a senior secured net leverage ratio as of the last day of each ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 502.10 Td (fiscal quarter of less of than or equal to 3.50 to 1.00. ) Tj ET Q q 0 0 0 rg BT 279.71 502.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 324.70 502.10 Td (Agreement contains customary events of default that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 490.10 Td (include, among other things, payment defaults, cross defaults with certain other indebtedness, violation of covenants, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 478.10 Td (inaccuracy of representations and warranties in any material respect, change in control of us and the Borrower) Tj ET Q q 0 0 0 rg BT 508.25 478.10 Td (, judgment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 466.10 Td (defaults, and bankruptcy and insolvency events. If an event of default exists, the lenders may require the immediate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 454.10 Td (payment of all Obligations, as defined in the Credit ) Tj ET Q q 0 0 0 rg BT 275.18 454.10 Td (Agreement, and may exercise certain other rights and remedies ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 442.10 Td (provided for under the Credit ) Tj ET Q q 0 0 0 rg BT 187.14 442.10 Td (Agreement, the other loan documents and applicable law) Tj ET Q q 0 0 0 rg BT 414.18 442.10 Td (. ) Tj ET Q q 0 0 0 rg BT 419.00 442.10 Td (The acceleration of such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 430.10 Td (obligations is automatic upon the occurrence of a bankruptcy and insolvency event of default. ) Tj ET Q q 0 0 0 rg BT 445.20 430.10 Td (W) Tj ET Q q 0 0 0 rg BT 453.83 430.10 Td (e were in compliance with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 418.10 Td (all covenants at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.70 418.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.28 418.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 394.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 394.10 Td (e incurred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.39 394.10 Td ($27.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 173.28 394.10 Td ( of debt issuance costs related to the Euro ) Tj ET Q q 0 0 0 rg BT 341.66 394.10 Td (T) Tj ET Q q 0 0 0 rg BT 347.07 394.10 Td (erm Loan, which are included in short-term ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 382.10 Td (borrowings and current portion of long-term obligations and long-term obligations in the condensed consolidated balance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 370.10 Td (sheets and will be amortized to interest expense over the seven year life of the Euro ) Tj ET Q q 0 0 0 rg BT 404.36 370.10 Td (T) Tj ET Q q 0 0 0 rg BT 409.77 370.10 Td (erm Loan using the ef) Tj ET Q q 0 0 0 rg BT 497.34 370.10 Td (fective interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 358.10 Td (method. ) Tj ET Q q 0 0 0 rg BT 102.81 358.10 Td (W) Tj ET Q q 0 0 0 rg BT 111.45 358.10 Td (e incurred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 154.21 358.10 Td ($2.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 203.10 358.10 Td ( of debt issuance costs in connection with the Revolving Credit Facility which were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 346.10 Td (capitalized and included in prepaid expenses and other assets and other assets in the condensed consolidated balance sheets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 334.10 Td (and will be amortized to interest expense using the straight-line method over the contractual term of five years of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 322.10 Td (Revolving Credit Facility) Tj ET Q q 0 0 0 rg BT 169.56 322.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 298.10 Td (For the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.92 298.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 258.50 298.10 Td (, we recognized interest expense of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 401.50 298.10 Td ($4.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 450.39 298.10 Td ( in relation to the Euro ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 286.10 Td (T) Tj ET Q q 0 0 0 rg BT 73.41 286.10 Td (erm Loan and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 131.44 286.10 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.33 286.10 Td ( amortization of debt issuance costs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 262.10 Td (Additional sources of cash available to us were international currency lines of credit and bank credit facilities totaling ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 250.10 Td ($29.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.89 250.10 Td ( as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 146.05 250.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 224.64 250.10 Td (, of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 267.40 250.10 Td ($21.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.30 250.10 Td ( was unused and available. ) Tj ET Q q 0 0 0 rg BT 430.52 250.10 Td (These unsecured international ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 238.10 Td (credit facilities were used in Europe and Japan during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 300.14 238.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 370.68 238.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.17 238.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 428.17 238.10 Td (. ) Tj ET Q q 0 0 0 rg BT 432.61 238.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.06 238.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 535.64 238.10 Td (, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 226.10 Td (had utilized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.43 226.10 Td ($5.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 166.32 226.10 Td ( of the international credit facilities as guarantees in Europe and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.27 226.10 Td ($1.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.17 226.10 Td ( as short-term ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 214.10 Td (borrowings in Japan. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 190.10 Td (Short-term ) Tj ET Q q 0 0 0 rg BT 113.83 190.10 Td (borrowings ) Tj ET Q q 0 0 0 rg BT 161.88 190.10 Td (and ) Tj ET Q q 0 0 0 rg BT 178.82 190.10 Td (current ) Tj ET Q q 0 0 0 rg BT 209.63 190.10 Td (portion ) Tj ET Q q 0 0 0 rg BT 241.02 190.10 Td (of ) Tj ET Q q 0 0 0 rg BT 251.85 190.10 Td (long-term ) Tj ET Q q 0 0 0 rg BT 293.78 190.10 Td (obligations ) Tj ET Q q 0 0 0 rg BT 340.72 190.10 Td (consist ) Tj ET Q q 0 0 0 rg BT 371.00 190.10 Td (of ) Tj ET Q q 0 0 0 rg BT 381.83 190.10 Td (the ) Tj ET Q q 0 0 0 rg BT 396.55 190.10 Td (following ) Tj ET Q q 0 0 0 rg BT 437.94 190.10 Td (\(in ) Tj ET Q q 0 0 0 rg BT 451.54 190.10 Td (thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 158.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 158.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.50 158.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.50 158.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 128.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 128.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.50 128.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.50 128.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 98.60 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 98.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.50 98.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.50 98.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 158.60000000000002 m 481.5 158.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 158.60000000000002 m 555.5 158.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 98.60000000000002 m 481.5 98.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 84.60000000000002 m 481.5 84.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 82.60000000000002 m 481.5 82.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 98.60000000000002 m 555.5 98.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 84.60000000000002 m 555.5 84.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 82.60000000000002 m 555.5 82.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 76.00 161.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 422.75 170.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 438.00 162.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 502.05 170.83 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 512.00 162.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 148.27 Td (Current portion of Euro Term Loan \(1\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.00 148.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.15 148.27 Td (3,806) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.00 148.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 148.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 133.27 Td (1.3% Term loan due 2024) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.15 133.27 Td (1,305) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 133.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 118.27 Td (1.0% State of Connecticut term loan due 2023) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.65 118.27 Td (368) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 118.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 103.27 Td (Line of credit borrowings) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.15 103.27 Td (1,704) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 103.27 Td (20,000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 88.27 Td (Total short-term borrowings and current portion of long-term obligations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 414.00 88.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 455.15 88.28 Td (7,183) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.00 88.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.15 88.27 Td (20,000) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 72.10 Td (\(1\) ) Tj ET Q q 0 0 0 rg BT 82.16 72.10 Td (Net ) Tj ET Q q 0 0 0 rg BT 99.10 72.10 Td (of ) Tj ET Q q 0 0 0 rg BT 109.93 72.10 Td (debt ) Tj ET Q q 0 0 0 rg BT 129.65 72.10 Td (issuance ) Tj ET Q q 0 0 0 rg BT 166.02 72.10 Td (costs ) Tj ET Q q 0 0 0 rg BT 188.52 72.10 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.35 72.10 Td ($3.2 ) Tj ET Q q 0 0 0 rg BT 219.35 72.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 248.24 72.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 48.10 Td (Long-term ) Tj ET Q q 0 0 0 rg BT 113.26 48.10 Td (obligations ) Tj ET Q q 0 0 0 rg BT 160.21 48.10 Td (consist ) Tj ET Q q 0 0 0 rg BT 190.49 48.10 Td (of ) Tj ET Q q 0 0 0 rg BT 201.32 48.10 Td (the ) Tj ET Q q 0 0 0 rg BT 216.03 48.10 Td (following ) Tj ET Q q 0 0 0 rg BT 257.42 48.10 Td (\(in ) Tj ET Q q 0 0 0 rg BT 271.03 48.10 Td (thousands\):) Tj ET Q endstream endobj 43 0 obj <>] /Rotate 0 /Contents 44 0 R>> endobj 44 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (21) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 727.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 727.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.50 727.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.50 727.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 697.50 338.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.50 697.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.50 697.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.50 697.50 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 727.5 m 481.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 727.5 m 555.5 727.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 682.5 m 481.5 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 682.5 m 481.5 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 668.5 m 481.5 668.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411.5 666.5 m 481.5 666.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 682.5 m 555.5 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 668.5 m 555.5 668.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485.5 666.5 m 555.5 666.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 76.00 730.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 422.75 739.73 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 438.00 731.73 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 502.05 739.73 Td (October 1,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 512.00 731.73 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 717.17 Td (Euro Term Loan due 2024 \(1\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.00 717.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.15 717.17 Td (666,488) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.00 717.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 717.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 702.17 Td (1.3% Term loan due 2024) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.15 702.17 Td (8,808) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 702.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 687.17 Td (1.0% State of Connecticut term loan due 2023) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.15 687.17 Td (2,027) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 687.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 672.17 Td (Total long-term obligations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 414.00 672.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 445.15 672.18 Td (677,323) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.00 672.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 672.17 Td () Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 656.00 Td (\(1\) ) Tj ET Q q 0 0 0 rg BT 82.16 656.00 Td (Net ) Tj ET Q q 0 0 0 rg BT 99.10 656.00 Td (of ) Tj ET Q q 0 0 0 rg BT 109.93 656.00 Td (debt ) Tj ET Q q 0 0 0 rg BT 129.65 656.00 Td (issuance ) Tj ET Q q 0 0 0 rg BT 166.02 656.00 Td (costs ) Tj ET Q q 0 0 0 rg BT 188.52 656.00 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.35 656.00 Td ($24.2 ) Tj ET Q q 0 0 0 rg BT 224.35 656.00 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 253.24 656.00 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 632.00 Td (Contractual maturities of our debt obligations as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.62 632.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.21 632.00 Td ( are as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 606.50 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 473.50 606.50 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 576.50 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 473.50 576.50 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 546.50 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 473.50 546.50 82.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 516.50 400.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 473.50 516.50 82.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 606.5 m 555.5 606.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 606.5 m 555.5 606.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 501.5 m 555.5 501.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 501.5 m 555.5 501.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 487.5 m 555.5 487.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473.5 485.5 m 555.5 485.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 76.00 609.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 499.95 610.73 Td (Amount) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 596.17 Td (2017 \(remainder\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.00 596.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 596.17 Td (6,499) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 581.17 Td (2018) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 581.17 Td (8,670) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 566.17 Td (2019) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 566.17 Td (8,674) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 551.17 Td (2020) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 551.17 Td (8,677) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 536.17 Td (2021) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 536.17 Td (8,681) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 521.17 Td (2022) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 521.17 Td (8,685) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 506.17 Td (Thereafter) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 506.17 Td (660,287) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 491.17 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.00 491.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.15 491.17 Td (710,173) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 52.00 463.00 Td (10.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.00 463.00 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 69.50 463.00 Td (ST) Tj ET Q q 0 0 0 rg BT 81.55 463.00 Td (OCK-BASED COMPENSA) Tj ET Q q 0 0 0 rg BT 199.98 463.00 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 451.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.00 439.00 Td (Fair) Tj ET Q q 0 0 0 rg BT 88.14 439.00 Td ( ) Tj ET Q q 0 0 0 rg BT 90.46 439.00 Td (V) Tj ET Q q 0 0 0 rg BT 96.77 439.00 Td (alue of Stock Compensation) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 427.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 415.00 Td (W) Tj ET Q q 0 0 0 rg BT 78.64 415.00 Td (e recognize compensation expense for all share based payment awards based on the fair value of such awards. ) Tj ET Q q 0 0 0 rg BT 520.78 415.00 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 403.00 Td (expense is recognized on a straight-line basis over the respective requisite service period of the awards.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 391.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.00 379.00 Td (Determining Fair) Tj ET Q q 0 0 0 rg BT 144.52 379.00 Td ( ) Tj ET Q q 0 0 0 rg BT 146.84 379.00 Td (V) Tj ET Q q 0 0 0 rg BT 153.14 379.00 Td (alue) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 367.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 355.00 Td (The fair values of shares purchased under the Employee Stock Purchase Plan \(ESPP\) for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 450.72 355.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.03 355.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 343.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 148.58 343.00 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 168.02 343.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 231.62 343.00 Td (, respectively) Tj ET Q q 0 0 0 rg BT 284.28 343.00 Td (,were estimated using the following weighted-average ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 331.00 Td (assumptions:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 271.50 210.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 271.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 284.50 271.50 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 271.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 271.50 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 241.50 210.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 241.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 284.50 241.50 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 241.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 241.50 60.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 211.50 210.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 211.50 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 284.50 211.50 60.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 211.50 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 211.50 60.00 -25.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 305.5 m 344.5 305.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 305.5 m 348.5 305.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 305.5 m 408.5 305.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 292.5 m 344.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 292.5 m 348.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 292.5 m 408.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 292.5 m 344.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 271.5 m 344.5 271.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 292.5 m 348.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 292.5 m 408.5 292.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 271.5 m 408.5 271.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 271.5 m 344.5 271.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 271.5 m 408.5 271.5 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 293.05 309.73 Td (EmployeeStockPurchasePlan) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 309.60 296.73 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.75 283.73 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 306.00 275.73 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 359.75 283.73 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 370.00 275.73 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 261.17 Td (Expected life in years) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 328.50 261.18 Td (0.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.50 261.17 Td (0.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 246.17 Td (Expected volatility) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 316.50 246.18 Td (31.6) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.00 246.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.15 246.17 Td (28.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 246.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 231.17 Td (Risk-free interest rate) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 316.50 231.18 Td (0.47) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.00 231.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.15 231.17 Td (0.19) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 231.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 216.17 Td (Expected dividend yield) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 324.00 216.18 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.00 216.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.65 216.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 216.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 191.17 Td (Weighted average fair value per share) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 287.00 191.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 311.50 191.18 Td (23.37) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.00 191.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 377.15 191.17 Td (13.27) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 163.00 Td (There were no stock options granted during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 261.61 163.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.92 163.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 342.42 163.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.01 163.00 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 440.44 163.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.04 163.00 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 139.00 Td (W) Tj ET Q q 0 0 0 rg BT 78.64 139.00 Td (e grant performance restricted stock units to of) Tj ET Q q 0 0 0 rg BT 265.33 139.00 Td (ficers and certain employees. ) Tj ET Q q 0 0 0 rg BT 386.76 139.00 Td (The performance restricted stock unit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 127.00 Td (agreements provide for the award of performance restricted stock units with each unit representing the right to receive ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 115.00 Td (one share of our common stock to be issued after the applicable award vesting period. ) Tj ET Q q 0 0 0 rg BT 415.82 115.00 Td (The final number of units ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 103.00 Td (awarded, if any) Tj ET Q q 0 0 0 rg BT 131.26 103.00 Td (, for these performance grants will be determined as of the vesting dates, based upon our total ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 91.00 Td (shareholder return over the performance period compared to the Russell 2000 Index and could range from no units to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 79.00 Td (a maximum of twice the initial award units. ) Tj ET Q q 0 0 0 rg BT 246.72 79.00 Td (The weighted average fair value for these performance units was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 67.00 Td (determined using a Monte Carlo simulation model incorporating the following weighted average assumptions:) Tj ET Q endstream endobj 45 0 obj <>] /Rotate 0 /Contents 46 0 R>> endobj 46 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (22) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 718.50 210.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 718.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 284.50 718.50 100.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 384.50 718.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 388.50 718.50 100.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 690.50 210.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 690.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 284.50 690.50 100.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 384.50 690.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 388.50 690.50 100.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 733.5 m 284.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 733.5 m 384.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 388.5 733.5 m 488.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 733.5 m 284.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 718.5 m 284.5 718.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 733.5 m 384.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 718.5 m 384.5 718.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 388.5 733.5 m 488.5 733.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 388.5 718.5 m 488.5 718.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 718.5 m 284.5 718.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284.5 718.5 m 384.5 718.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 388.5 718.5 m 488.5 718.5 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 349.60 737.73 Td (Thr) Tj ET Q q 0 0 0 rg BT 362.79 737.73 Td (ee Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 301.75 722.73 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 410.75 722.73 Td (January 2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 709.07 Td (Risk-free interest rate) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 361.50 709.18 Td (1.3) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 374.00 709.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.15 709.07 Td (1.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 709.07 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 695.07 Td (Volatility) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 356.50 695.18 Td (31.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 374.00 695.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.15 695.07 Td (27.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 695.07 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 681.07 Td (Weighted average fair value) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 348.50 681.18 Td ($163.17) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.50 681.07 Td ($74.48) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 653.00 Td (W) Tj ET Q q 0 0 0 rg BT 78.64 653.00 Td (e recognize the estimated cost of these awards, as determined under the simulation model, over the related service ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 641.00 Td (period of approximately 3 years, with no adjustment in future periods based upon the actual shareholder return over ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 629.00 Td (the performance period.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 617.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.00 605.00 Td (Stock Compensation Expense) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 593.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 581.00 Td (The following table shows total stock-based compensation expense and related tax benefits included in the condensed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 569.00 Td (consolidated statements of operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 251.62 569.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 329.93 569.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 332.43 569.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 411.01 569.00 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 430.45 569.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.05 569.00 Td ( \(in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 557.00 Td (thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 515.50 210.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 515.50 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 515.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 515.50 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 487.50 210.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 487.50 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 487.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 487.50 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 459.50 210.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 280.50 459.50 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 459.50 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 459.50 60.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 534.5 m 340.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 534.5 m 344.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 534.5 m 404.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 534.5 m 340.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 515.5 m 340.5 515.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 534.5 m 344.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 534.5 m 404.5 534.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 515.5 m 404.5 515.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 515.5 m 340.5 515.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 515.5 m 404.5 515.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 459.5 m 340.5 459.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 459.5 m 404.5 459.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 459.5 m 340.5 459.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 446.5 m 340.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 280.5 444.5 m 340.5 444.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 459.5 m 404.5 459.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 446.5 m 404.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 444.5 m 404.5 444.5 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 305.60 538.58 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 286.75 526.58 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 302.00 518.58 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 355.75 526.58 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 366.00 518.58 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 506.07 Td (Cost of sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 283.00 506.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 321.65 506.18 Td (960) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 506.07 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.65 506.07 Td (605) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 492.07 Td (Research and development) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 314.15 492.18 Td (1,053) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.65 492.07 Td (426) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 478.07 Td (Selling, general and administrative) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 314.15 478.18 Td (7,642) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.15 478.07 Td (2,714) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 464.07 Td (Income tax benefit) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 310.80 464.23 Td (\(1,489) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 336.65 464.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.30 464.12 Td (\(351) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.65 464.07 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 283.00 450.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 314.15 450.18 Td (8,166) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 450.07 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.15 450.07 Td (3,394) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 422.00 Td (As a result of our acquisition of Rofin on November 7, 2016, we made a payment of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 409.64 422.00 Td ($15.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.54 422.00 Td ( due to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 410.00 Td (cancellation of options held by employees of Rofin. ) Tj ET Q q 0 0 0 rg BT 279.49 410.00 Td (The payment was allocated between total estimated mer) Tj ET Q q 0 0 0 rg BT 503.39 410.00 Td (ger ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 398.00 Td (consideration of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 137.20 398.00 Td ($1) Tj ET Q q 0 0 0 rg BT 146.83 398.00 Td (1.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 190.72 398.00 Td ( and post-mer) Tj ET Q q 0 0 0 rg BT 245.53 398.00 Td (ger stock-based compensation expense of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.08 398.00 Td ($4.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.97 398.00 Td (, recorded in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 386.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 148.31 386.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.81 386.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 229.39 386.00 Td (, based on the portion of the total service period of the underlying options that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 374.00 Td (have not been completed by the mer) Tj ET Q q 0 0 0 rg BT 214.77 374.00 Td (ger date. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 350.00 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.55 350.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.86 350.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 196.36 350.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.94 350.00 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 279.94 350.00 Td ($0.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 328.83 350.00 Td ( was capitalized into inventory for all stock plans, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 338.00 Td ($0.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 118.89 338.00 Td ( was amortized to cost of sales and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 260.52 338.00 Td ($1.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.41 338.00 Td ( remained in inventory at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.43 338.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.02 338.00 Td (.During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 326.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 148.31 326.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.81 326.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 214.41 326.00 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 219.41 326.00 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.30 326.00 Td ( was capitalized into inventory for all stock plans, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.91 326.00 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.80 326.00 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 314.00 Td (amortized to cost of sales and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.07 314.00 Td ($0.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.97 314.00 Td ( remained in inventory at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 342.99 314.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.59 314.00 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 302.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 290.00 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.50 290.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.08 290.00 Td (, the total compensation cost related to unvested stock-based awards granted to employees ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 278.00 Td (under our stock plans but not yet recognized was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 328.26 278.00 Td ($47.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.15 278.00 Td (, net of estimated forfeitures of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 508.50 278.00 Td ($1.5 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 266.00 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.89 266.00 Td (. ) Tj ET Q q 0 0 0 rg BT 103.71 266.00 Td (This cost will be amortized on a straight-line basis over a weighted-average period of approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 507.74 266.00 Td (2.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.24 266.00 Td ( years ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 254.00 Td (and will be adjusted for subsequent changes in estimated forfeitures.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 230.00 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.50 230.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.08 230.00 Td (, total compensation cost related to options to purchase common shares under the ESPP) Tj ET Q q 0 0 0 rg BT 510.64 230.00 Td ( but not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 218.00 Td (yet vested was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.07 218.00 Td ($0.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.97 218.00 Td (, which will be recognized over the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 383.25 218.00 Td (six) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 394.92 218.00 Td ( month of) Tj ET Q q 0 0 0 rg BT 433.62 218.00 Td (fering period.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.00 194.00 Td (Stock ) Tj ET Q q 0 0 0 rg BT 95.84 194.00 Td (A) Tj ET Q q 0 0 0 rg BT 102.32 194.00 Td (wards ) Tj ET Q q 0 0 0 rg BT 130.38 194.00 Td (Activity) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 170.00 Td (The following table summarizes the activity of our time-based and performance restricted stock units for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.97 170.00 Td (first ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 158.00 Td (three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.93 158.00 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.42 158.00 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.42 158.00 Td ( \(in thousands, except per share amounts\):) Tj ET Q endstream endobj 47 0 obj <>] /Rotate 0 /Contents 48 0 R>> endobj 48 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (23) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 689.50 270.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 689.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.50 689.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 394.50 689.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 689.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 689.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 689.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.50 689.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 659.50 270.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 659.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.50 659.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 394.50 659.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 659.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 659.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 659.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.50 659.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 629.50 270.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 629.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.50 629.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 394.50 629.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.50 629.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.50 629.50 50.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.50 629.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.50 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3 M 340.5 613.5 m 390.5 613.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 629.5 m 498.5 629.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 615.5 m 498.5 615.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448.5 613.5 m 498.5 613.5 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 353.40 740.58 Td (Time Based Restricted) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 372.30 732.58 Td (Stock Units) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.20 740.58 Td (Performance Restricted) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 480.30 732.58 Td (Stock Units) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 346.50 701.73 Td (Number) Tj ET Q q 0 0 0 rg BT 374.80 701.73 Td ( of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 353.50 693.73 Td (Shar) Tj ET Q q 0 0 0 rg BT 369.80 693.73 Td (es) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 402.75 717.73 Td (W) Tj ET Q q 0 0 0 rg BT 410.31 717.73 Td (eighted) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 405.05 709.73 Td (A) Tj ET Q q 0 0 0 rg BT 410.23 709.73 Td (verage) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 399.55 701.73 Td (Grant Date) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 401.15 693.73 Td (Fair) Tj ET Q q 0 0 0 rg BT 415.67 693.73 Td ( ) Tj ET Q q 0 0 0 rg BT 417.52 693.73 Td (V) Tj ET Q q 0 0 0 rg BT 422.56 693.73 Td (alue) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 454.50 701.73 Td (Number) Tj ET Q q 0 0 0 rg BT 482.80 701.73 Td ( of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 461.50 693.73 Td (Shar) Tj ET Q q 0 0 0 rg BT 477.80 693.73 Td (es) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 510.75 717.73 Td (Weighted) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 513.05 709.73 Td (Average) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 507.55 701.73 Td (Grant Date) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 509.15 693.73 Td (Fair Value) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 679.17 Td (Nonvested stock at October 1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.65 679.17 Td (459) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.00 679.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.15 679.17 Td (66.47) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 679.17 Td (169) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.00 679.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.15 679.17 Td (74.10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 664.17 Td (Granted) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.65 664.17 Td (175) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.15 664.17 Td (127.76) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.65 664.17 Td (69) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.15 664.17 Td (163.17) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 649.17 Td (V) Tj ET Q q 0 0 0 rg BT 79.11 649.17 Td (ested ) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 102.16 653.70 Td (\(1\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.30 649.22 Td (\(202) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.65 649.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.15 649.17 Td (63.65) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 649.22 Td (\(104) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 649.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.15 649.17 Td (77.10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 634.17 Td (Forfeited) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.30 634.22 Td (\(6) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.65 634.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.15 634.17 Td (63.43) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 486.30 634.22 Td (\(4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.65 634.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.15 634.17 Td (70.57) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.00 619.17 Td (Nonvested stock at December 31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.65 619.17 Td (426) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.00 619.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.15 619.17 Td (114.07) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 619.17 Td (130) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.00 619.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.15 619.17 Td (84.90) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.00 591.00 Td (__________________________________________) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 572.40 Td (\(1\) ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 88.00 572.40 Td (Service-based restricted stock units vested during each fiscal year) Tj ET Q q 0 0 0 rg BT 297.70 572.40 Td (. Performance-based awards and units included at ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 458.53 572.40 Td (100%) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 477.20 572.40 Td ( of tar) Tj ET Q q 0 0 0 rg BT 496.15 572.40 Td (get goal; ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.00 562.80 Td (under the terms of the awards, the recipient may earn between ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 270.80 562.80 Td (0%) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 281.47 562.80 Td ( and ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 297.02 562.80 Td (200%) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 315.68 562.80 Td ( of the award.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 531.60 Td (1) Tj ET Q q 0 0 0 rg BT 54.45 531.60 Td (1.) Tj ET Q BT /F2 3.00 Tf ET q 0 0 0 rg BT 61.95 531.60 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 65.70 531.60 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.20 531.60 Td (COMMITMENTS ) Tj ET Q q 0 0 0 rg BT 150.15 531.60 Td (AND CONTINGENCIES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 507.60 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 507.60 Td (e are subject to legal claims and litigation arising in the ordinary course of business, such as product liability) Tj ET Q q 0 0 0 rg BT 510.05 507.60 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 495.60 Td (employment or intellectual property claims, including, but not limited to, the matters described below) Tj ET Q q 0 0 0 rg BT 473.92 495.60 Td (. On May 14, 2013, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 483.60 Td (IMRA) Tj ET Q q 0 0 0 rg BT 93.56 483.60 Td ( ) Tj ET Q q 0 0 0 rg BT 95.51 483.60 Td (America \(Imra\) filed a complaint for patent infringement against two of our subsidiaries in the Regional Court of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 471.60 Td (Dsseldorf, Germany) Tj ET Q q 0 0 0 rg BT 153.44 471.60 Td (, captioned In re IMRA) Tj ET Q q 0 0 0 rg BT 246.47 471.60 Td ( ) Tj ET Q q 0 0 0 rg BT 248.42 471.60 Td (America Inc. versus Coherent Kaiserslautern GmbH et. al. 4b O 38/13. ) Tj ET Q q 0 0 0 rg BT 534.55 471.60 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 459.60 Td (complaint alleges that the use of certain of the Company) Tj ET Q q 0 0 0 rg BT 296.54 459.60 Td (s lasers infringes upon EP) Tj ET Q q 0 0 0 rg BT 400.05 459.60 Td ( Patent No. 754,103, entitled Method ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 447.60 Td (For Controlling Configuration of Laser Induced Breakdown and ) Tj ET Q q 0 0 0 rg BT 326.84 447.60 Td (Ablation, issued November 5, 1997. ) Tj ET Q q 0 0 0 rg BT 478.30 447.60 Td (The patent, now ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 435.60 Td (expired in all jurisdictions, is owned by the University of Michigan and licensed to Imra. ) Tj ET Q q 0 0 0 rg BT 425.80 435.60 Td (The complaint seeks unspecified ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 423.60 Td (compensatory damages, the cost of court proceedings and seeks to permanently enjoin the Company from infringing the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 411.60 Td (patent in the future. Following the filing of the infringement suit, our subsidiaries filed a separate nullity action with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 399.60 Td (Federal Patent Court in Munich, Germany requesting that the court hold that the Patent was invalid based on prior art. On ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 387.60 Td (October 1, 2015, the Federal Patent Court ruled that the German portion of the Patent was invalid. Imra has appealed this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 375.60 Td (decision to the Federal Court of Justice, the highest civil jurisdiction court in Germany) Tj ET Q q 0 0 0 rg BT 413.94 375.60 Td (. ) Tj ET Q q 0 0 0 rg BT 418.76 375.60 Td (The infringement action is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 363.60 Td (currently stayed pending the outcome of such appeal. Management has made an accrual with respect to this matter and has ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 351.60 Td (determined, based on its current knowledge, that the amount or range of reasonably possible losses in excess of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 339.60 Td (amounts already accrued is not reasonably estimable. ) Tj ET Q q 0 0 0 rg BT 282.93 339.60 Td (Although we do not expect that such legal claims and litigation will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 327.60 Td (ultimately have a material adverse ef) Tj ET Q q 0 0 0 rg BT 215.25 327.60 Td (fect on our consolidated financial position, results of operations or cash flows, an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 315.60 Td (adverse result in one or more matters could negatively af) Tj ET Q q 0 0 0 rg BT 295.24 315.60 Td (fect our results in the period in which they occur) Tj ET Q q 0 0 0 rg BT 488.79 315.60 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 291.60 Td (The United States and many foreign governments impose tarif) Tj ET Q q 0 0 0 rg BT 317.20 291.60 Td (fs and duties on the import and export of certain products we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 279.60 Td (sell. From time to time our duty calculations and payments are audited by government agencies. During the second quarter ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 267.60 Td (of fiscal 2016, we concluded an audit in South Korea for customs duties and value added tax for the period March 2009 to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 255.60 Td (March 2014. ) Tj ET Q q 0 0 0 rg BT 121.42 255.60 Td (W) Tj ET Q q 0 0 0 rg BT 130.06 255.60 Td (e paid ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 156.71 255.60 Td ($1.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 205.60 255.60 Td ( related to this matter in the second quarter of fiscal 2016 and have no remaining accrual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 243.60 Td (at October 1, 2016. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 219.60 Td (On November 7, 2016, we entered into a Credit ) Tj ET Q q 0 0 0 rg BT 260.45 219.60 Td (Agreement with Barclays, BAML) Tj ET Q q 0 0 0 rg BT 396.16 219.60 Td ( and MUFG. See Note 9 "Borrowings" ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 207.60 Td (for further discussion of the issuance of the financing. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 171.60 Td (12. EARNINGS PER SHARE) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 159.60 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 147.60 Td (Basic earnings per share is computed based on the weighted average number of shares outstanding during the period, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 135.60 Td (excluding unvested restricted stock. Diluted earnings per share is computed based on the weighted average number of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 123.60 Td (shares outstanding during the period increased by the ef) Tj ET Q q 0 0 0 rg BT 290.59 123.60 Td (fect of dilutive employee stock awards, including stock options, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 111.60 Td (restricted stock awards and stock purchase plan contracts, using the treasury stock method.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 99.60 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 87.60 Td (The following table presents information necessary to calculate basic and diluted earnings per share \(in thousands, except ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 75.60 Td (per share data\):) Tj ET Q endstream endobj 49 0 obj <>] /Rotate 0 /Contents 50 0 R>> endobj 50 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (24) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.00 714.50 190.00 -17.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 258.00 714.50 66.00 -17.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 324.00 714.50 4.00 -17.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 328.00 714.50 65.00 -17.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 714.50 4.00 -17.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.00 682.50 190.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 258.00 682.50 66.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 324.00 682.50 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 328.00 682.50 65.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 682.50 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.00 643.50 190.00 -27.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 258.00 643.50 66.00 -27.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 324.00 643.50 4.00 -27.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 328.00 643.50 65.00 -27.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 643.50 4.00 -27.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.00 589.50 190.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 258.00 589.50 66.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 324.00 589.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 328.00 589.50 65.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 589.50 4.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 735.5 m 324 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 324 735.5 m 328 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 735.5 m 393 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 735.5 m 324 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 714.5 m 324 714.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 735.5 m 393 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 714.5 m 393 714.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 714.5 m 324 714.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 714.5 m 393 714.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 682.5 m 324 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 682.5 m 393 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 682.5 m 324 682.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 659.5 m 324 659.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 657.5 m 324 657.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 659.5 m 393 659.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 657.5 m 393 657.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 589.5 m 324 589.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 575.5 m 324 575.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 258 573.5 m 324 573.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 589.5 m 393 589.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 575.5 m 393 575.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 573.5 m 393 573.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 70.50 738.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 288.60 739.73 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 70.50 717.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 267.25 726.73 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 282.50 718.73 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 341.75 726.73 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 352.00 718.73 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 702.17 Td (Weighted average shares outstanding basic) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 292.65 702.18 Td (24,347) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.65 702.17 Td (23,996) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 687.17 Td (Dilutive effect of employee stock awards) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.15 687.18 Td (297) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 374.15 687.17 Td (240) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 673.07 Td (Weighted average shares outstanding) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 663.07 Td (diluted) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 292.65 663.18 Td (24,644) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.65 663.17 Td (24,236) Tj ET Q BT /F2 10.00 Tf ET 0.8 0.9333333333333333 1 rg /GS0 gs 70.50 627.95 167.03 -8.93 re f /GS0 gs q 0 0 0 rg BT 70.50 621.18 Td (Net income fr) Tj ET Q q 0 0 0 rg BT 128.63 621.18 Td (om continuing operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 260.50 621.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 292.65 621.18 Td (30,698) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.50 621.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.65 621.17 Td (20,286) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 607.07 Td (Loss from discontinued operations, net of) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 597.07 Td (income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 301.80 594.18 Td (\(290) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 320.15 594.18 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 379.15 594.18 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 70.50 579.18 Td (Net income) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 260.50 579.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 292.65 579.18 Td (30,408) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.50 579.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.65 579.17 Td (20,286) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 563.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 551.00 Td (A) Tj ET Q q 0 0 0 rg BT 74.17 551.00 Td ( total of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 107.77 551.00 Td (1) Tj ET Q q 0 0 0 rg BT 112.40 551.00 Td (10,737) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.90 551.00 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.34 551.00 Td (32,213) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 186.84 551.00 Td ( potentially dilutive securities have been excluded from the diluted share calculation for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 539.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 145.81 539.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 148.31 539.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 226.89 539.00 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 246.33 539.00 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.93 539.00 Td (, respectively as their ef) Tj ET Q q 0 0 0 rg BT 404.99 539.00 Td (fect was anti-dilutive. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 527.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 515.00 Td (13.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 62.50 515.00 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 515.00 Td (OTHER INCOME \(EXPENSE\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 503.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 491.00 Td (Other income \(expense\) is as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 446.50 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.50 446.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 338.50 446.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 342.50 446.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 412.50 446.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 68.50 406.50 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.50 406.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 338.50 406.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 342.50 406.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 412.50 406.50 4.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 467.5 m 338.5 467.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 338.5 467.5 m 342.5 467.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 467.5 m 412.5 467.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 446.5 m 338.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 446.5 m 412.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 446.5 m 338.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 446.5 m 412.5 446.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 391.5 m 338.5 391.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 391.5 m 412.5 391.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 377.5 m 338.5 377.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268.5 375.5 m 338.5 375.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 377.5 m 412.5 377.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 342.5 375.5 m 412.5 375.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 470.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 303.60 471.73 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 71.00 449.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 279.75 458.73 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 295.00 450.73 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 358.75 458.73 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 369.00 450.73 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 436.17 Td (Foreign exchange gain \(loss\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 271.00 436.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 307.15 436.18 Td (13,099) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 345.00 436.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.80 436.22 Td (\(1,322) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.65 436.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 421.17 Td (Gain \(loss\) on deferred compensation) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 411.17 Td (investments, net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 321.30 411.23 Td (\(52) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.65 411.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.65 411.17 Td (875) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 396.17 Td (Other) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 321.30 396.23 Td (\(54) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 334.65 396.18 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.65 396.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.00 381.17 Td (Other - net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 271.00 381.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 307.15 381.18 Td (12,993) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 345.00 381.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 390.30 381.22 Td (\(447) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 408.65 381.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 353.00 Td (14.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 65.00 353.00 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 353.00 Td (INCOME) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 109.72 353.00 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 112.22 353.00 Td (T) Tj ET Q q 0 0 0 rg BT 118.15 353.00 Td (AXES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 341.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 329.00 Td (Income tax expense includes a provision for federal, state and foreign taxes based on the annual estimated ef) Tj ET Q q 0 0 0 rg BT 502.10 329.00 Td (fective tax rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 317.00 Td (applicable to us and our subsidiaries, adjusted for items which are considered discrete to the period. Our ef) Tj ET Q q 0 0 0 rg BT 494.63 317.00 Td (fective tax rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 305.00 Td (for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 96.88 305.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 175.19 305.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.69 305.00 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 256.27 305.00 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 276.82 305.00 Td (35.2%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.65 305.00 Td (.Our ef) Tj ET Q q 0 0 0 rg BT 333.29 305.00 Td (fective tax rate for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.07 305.00 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 502.38 305.00 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.88 305.00 Td (December31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 293.00 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 293.00 Td ( was higher than the statutory rate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 236.84 293.00 Td (35%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 255.17 293.00 Td ( primarily due to Rofin transaction costs not deductible for tax purposes, tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 281.00 Td (costs of Rofin restructuring, ) Tj ET Q q 0 0 0 rg BT 182.15 281.00 Td (ASC 740-10 \(formerly FIN48\) tax liabilities for transfer pricing, stock-based compensation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 269.00 Td (not deductible for tax purposes and limitations on the deductibility of compensation under IRC Section 162\(m\). ) Tj ET Q q 0 0 0 rg BT 516.90 269.00 Td (These ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 257.00 Td (amounts are partially of) Tj ET Q q 0 0 0 rg BT 163.06 257.00 Td (fset by dif) Tj ET Q q 0 0 0 rg BT 203.43 257.00 Td (ferences related to the benefit of income subject to foreign tax rates that are lower than ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 245.00 Td (U.S. tax rates including the Singapore tax exemption and the benefit of federal research and development tax credits. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 221.00 Td (The ef) Tj ET Q q 0 0 0 rg BT 93.63 221.00 Td (fective tax rate on income before income taxes for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 311.87 221.00 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 327.98 221.00 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 396.28 221.00 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 416.28 221.00 Td ( of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.61 221.00 Td (25.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.44 221.00 Td ( was lower than the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 209.00 Td (statutory rate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.81 209.00 Td (35.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.64 209.00 Td ( primarily due to dif) Tj ET Q q 0 0 0 rg BT 240.00 209.00 Td (ferences related to the benefit of income subject to foreign tax rates that are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 197.00 Td (lower than U.S. tax rates including the Singapore tax exemption, the benefit of foreign tax credits and the benefit of federal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 185.00 Td (research and development tax credits including renewal of the federal research and development tax credits for fiscal 2015. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 173.00 Td (These amounts are partially of) Tj ET Q q 0 0 0 rg BT 189.44 173.00 Td (fset by deemed dividend inclusions under the Subpart F tax rules, stock-based compensation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 161.00 Td (not deductible for tax purposes and limitations on the deductibility of compensation under IRC Section 162\(m\). ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 137.00 Td (Determining the consolidated provision for income taxes, income tax liabilities and deferred tax assets and liabilities ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 125.00 Td (involves judgment. ) Tj ET Q q 0 0 0 rg BT 146.98 125.00 Td (W) Tj ET Q q 0 0 0 rg BT 155.62 125.00 Td (e calculate and provide for income taxes in each of the tax jurisdictions in which we operate, which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 113.00 Td (involves estimating current tax exposures as well as making judgments regarding the recoverability of deferred tax assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 101.00 Td (in each jurisdiction. ) Tj ET Q q 0 0 0 rg BT 149.46 101.00 Td (The estimates used could dif) Tj ET Q q 0 0 0 rg BT 263.70 101.00 Td (fer from actual results, which may have a significant impact on operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 89.00 Td (results in future periods. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 65.00 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 65.00 Td (e had U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 53.00 Td (attributes that can be used to of) Tj ET Q q 0 0 0 rg BT 192.78 53.00 Td (fset federal taxable income in future periods. ) Tj ET Q q 0 0 0 rg BT 374.19 53.00 Td (These credit carryforwards will expire if they ) Tj ET Q endstream endobj 51 0 obj <>] /Rotate 0 /Contents 52 0 R>> endobj 52 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (25) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (are not used within certain time periods. ) Tj ET Q q 0 0 0 rg BT 230.73 742.10 Td (As of December 31, 2016, management determined that there is suf) Tj ET Q q 0 0 0 rg BT 501.02 742.10 Td (ficient positive ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (evidence to conclude that it is more likely than not suf) Tj ET Q q 0 0 0 rg BT 284.98 730.10 Td (ficient taxable income will exist in the future allowing us to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (recognize these deferred tax assets. It is possible that some or all these attributes could ultimately expire unused. If facts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 706.10 Td (and circumstances change in the future, management may determine at that time a valuation allowance is necessary) Tj ET Q q 0 0 0 rg BT 529.11 706.10 Td (. ) Tj ET Q q 0 0 0 rg BT 533.56 706.10 Td (A) Tj ET Q q 0 0 0 rg BT 540.23 706.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (valuation allowance would materially increase our tax expense in the period applied and would adversely af) Tj ET Q q 0 0 0 rg BT 499.61 694.10 Td (fect our results ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 682.10 Td (of operations and statement of financial condition. Changes in our underlying facts or circumstances, such as the impact of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.10 Td (the Rofin acquisition, will be continually assessed and we will re-evaluate its position accordingly) Tj ET Q q 0 0 0 rg BT 460.04 670.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 646.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 646.10 Td (e are subject to taxation and file income tax returns in the U.S. federal jurisdiction and in many state and foreign ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 634.10 Td (jurisdictions. For U.S. federal income tax purposes, all years prior to 201) Tj ET Q q 0 0 0 rg BT 359.51 634.10 Td (1 are closed. ) Tj ET Q q 0 0 0 rg BT 412.09 634.10 Td (W) Tj ET Q q 0 0 0 rg BT 420.72 634.10 Td (e agreed to extend the statutes of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 622.10 Td (limitations for its fiscal 201) Tj ET Q q 0 0 0 rg BT 178.17 622.10 Td (1 and 2012 U.S. federal tax returns to June 30, 2018 due to an ongoing ) Tj ET Q q 0 0 0 rg BT 463.12 622.10 Td (Advanced Pricing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.10 Td (Agreement \(AP) Tj ET Q q 0 0 0 rg BT 134.56 610.10 Td (A\) between the U.S. and Korea. In March 2016, the Internal Revenue Service \(IRS\) issued an audit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 598.10 Td (notice and Information Documentation Requests \(IDRs\) for fiscal 2013. ) Tj ET Q q 0 0 0 rg BT 358.30 598.10 Td (The audit is currently in progress and the statute of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 586.10 Td (limitation was extended to December 31, 2017. In our major foreign jurisdictions and our major state jurisdictions, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 574.10 Td (years prior to 201) Tj ET Q q 0 0 0 rg BT 138.44 574.10 Td (1 and 2012, respectively) Tj ET Q q 0 0 0 rg BT 235.54 574.10 Td (, are closed to examination. Earlier years in our various jurisdictions may remain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 562.10 Td (open for adjustment to the extent that we have tax attribute carryforwards from those years. In July 2015 and March 2016, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 550.10 Td (Coherent Kaiserslautern GmbH \(formerly Lumera Laser GmbH\) received tax audit notices for the fiscal years 2010 to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 538.10 Td (2014. ) Tj ET Q q 0 0 0 rg BT 92.82 538.10 Td (The audit began in ) Tj ET Q q 0 0 0 rg BT 169.46 538.10 Td (August 2015. ) Tj ET Q q 0 0 0 rg BT 225.68 538.10 Td (W) Tj ET Q q 0 0 0 rg BT 234.31 538.10 Td (e acquired the shares of Lumera Laser GmbH in December 2012 and, pursuant to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 526.10 Td (the terms of the acquisition agreement, we should not have responsibility for any assessments related to the pre-acquisition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.10 Td (period. In June, 2016, Coherent Holding GmbH and Coherent Deutschland GmbH each received a tax audit notice for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 502.10 Td (fiscal years 201) Tj ET Q q 0 0 0 rg BT 130.38 502.10 Td (1 to 2014. ) Tj ET Q q 0 0 0 rg BT 172.98 502.10 Td (The audit began in the fourth quarter of fiscal 2016. Coherent GmbH, Coherent LaserSystems ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 490.10 Td (GmbH & Co. KG and Coherent Germany GmbH received audit notices for the period that they were in existence during ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 478.10 Td (the fiscal years 201) Tj ET Q q 0 0 0 rg BT 145.10 478.10 Td (1 through 2014 and the audit work is scheduled to commence in January 2017.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 454.10 Td (W) Tj ET Q q 0 0 0 rg BT 76.64 454.10 Td (e regularly engage in discussions and negotiations with tax authorities regarding tax matters in various jurisdictions and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 442.10 Td (management believes that it has adequately provided reserves for any adjustments that may result from tax examinations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 418.10 Td (The following table summarizes the activity related to the Company's gross unrecognized tax benefits for the three months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 406.10 Td (ended December 31, 2016 \(amounts in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 368.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 368.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 338.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 338.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 308.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 308.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 278.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 278.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 248.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 248.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 218.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 218.60 80.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 174.50 188.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 374.50 188.60 80.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 368.6 m 454.5 368.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 353.6 m 454.5 353.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 353.6 m 454.5 353.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 188.60000000000002 m 454.5 188.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 188.60000000000002 m 454.5 188.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 174.60000000000002 m 454.5 174.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374.5 172.60000000000002 m 454.5 172.60000000000002 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 377.60 372.83 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 381.75 357.83 Td (December 31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 343.27 Td (Balance as of the beginning of the year) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.00 343.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 423.15 343.28 Td (20,442) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 328.27 Td (Increase related to acquisitions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 423.15 328.28 Td (21,659) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 313.27 Td (Tax positions related to current year:) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.00 313.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 298.27 Td ( Additions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 435.65 298.28 Td (815) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 283.27 Td ( Reductions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.65 283.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 268.27 Td (Tax positions related to prior year:) Tj ET Q BT /F2 10.00 Tf ET 0.8 0.9333333333333333 1 rg /GS0 gs 377.00 275.05 2.50 -8.93 re f /GS0 gs q 0 0 0 rg BT 377.00 268.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 253.27 Td ( Additions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 428.15 253.28 Td (3,018) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 238.27 Td ( Reductions) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.65 238.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 223.27 Td (Settlements) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.65 223.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 208.27 Td (Lapses in statutes of limitations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 440.65 208.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 193.27 Td (Foreign currency revaluation adjustment) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 424.80 193.33 Td (\(1,002) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.65 193.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.00 178.27 Td (Balance as of end of period) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.00 178.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 423.15 178.28 Td (44,932) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 150.10 Td (As of December 31, 2016, the total amount of gross interest and penalties accrued was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.76 150.10 Td ($1.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.66 150.10 Td (, mostly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 138.10 Td (due to the Rofin acquisition, and it is classified as long-term taxes payable in the consolidated balance sheet.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 102.10 Td (15. DEFINED BENEFIT) Tj ET Q q 0 0 0 rg BT 158.73 102.10 Td ( PLANS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 90.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 78.10 Td (As a result of the Rofin acquisition, we have assumed all assets and liabilities of Rofin) Tj ET Q q 0 0 0 rg BT 416.82 78.10 Td (s defined benefit plans for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 66.10 Td (Rofin-Sinar Laser) Tj ET Q q 0 0 0 rg BT 139.52 66.10 Td (, GmbH \("RSL"\) and Rofin-Sinar Inc. \("RS Inc."\) employees.) Tj ET Q q 0 0 0 rg BT 389.24 66.10 Td (The U.S. plan began in fiscal year 1995 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 54.10 Td (and is funded. ) Tj ET Q q 0 0 0 rg BT 126.33 54.10 Td (Any new employees hired after January 1, 2007, are not eligible for the RS Inc. pension plan. ) Tj ET Q q 0 0 0 rg BT 502.06 54.10 Td (As is the ) Tj ET Q endstream endobj 53 0 obj <>] /Rotate 0 /Contents 54 0 R>> endobj 54 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (26) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (customary practice with German companies, the German pension plan is unfunded.) Tj ET Q q 0 0 0 rg BT 403.18 742.10 Td (Any new employees hired after the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (acquisition of Rofin-Baasel Lasertechnik in 2000 are not eligible for the RSL) Tj ET Q q 0 0 0 rg BT 376.72 730.10 Td ( pension plan. ) Tj ET Q q 0 0 0 rg BT 434.86 730.10 Td (The measurement date of these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (pension plans is September 30.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 694.10 Td (Ef) Tj ET Q q 0 0 0 rg BT 77.26 694.10 Td (fective January 1, 2012, the RS Inc. defined benefit plan was amended to exclude highly compensated employees, as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 682.10 Td (defined by the Internal Revenue Service, from receiving future years of service under the RS Inc. defined benefit plan. ) Tj ET Q q 0 0 0 rg BT 543.93 682.10 Td (A) Tj ET Q q 0 0 0 rg BT 550.60 682.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 670.10 Td (non-qualified defined benefit plan was created to replace the benefits lost by the employees that were otherwise excluded ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 658.10 Td (from the qualified defined benefit plan. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 634.10 Td (In addition, we have defined benefit plans in Coherent Korea, Coherent Japan, and Coherent Italy) Tj ET Q q 0 0 0 rg BT 458.05 634.10 Td (, covering all full-time ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 622.10 Td (employees with at least one year of service, and a defined benefit plan in Coherent Germany covering two individuals. ) Tj ET Q q 0 0 0 rg BT 544.24 622.10 Td (As ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 610.10 Td (is the customary practice with European and ) Tj ET Q q 0 0 0 rg BT 247.66 610.10 Td (Asian companies, the plans are unfunded. ) Tj ET Q q 0 0 0 rg BT 416.88 610.10 Td (W) Tj ET Q q 0 0 0 rg BT 425.51 610.10 Td (e have elected to recognize all ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 598.10 Td (actuarial gains and losses on these plans immediately) Tj ET Q q 0 0 0 rg BT 280.35 598.10 Td (, as incurred. ) Tj ET Q q 0 0 0 rg BT 334.31 598.10 Td (The measurement date of these defined benefit plans is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 586.10 Td (September 30.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 562.10 Td (For financial reporting purposes, the calculation of net periodic pension costs is based upon a number of actuarial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 550.10 Td (assumptions including a discount rate for plan obligations, an assumed rate of return on pension assets and an assumed rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 538.10 Td (of compensation increase for employees covered by the plan. ) Tj ET Q q 0 0 0 rg BT 314.58 538.10 Td (All of these assumptions were based upon management's ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 526.10 Td (judgment, considering all known trends and uncertainties. ) Tj ET Q q 0 0 0 rg BT 301.56 526.10 Td (Actual results that dif) Tj ET Q q 0 0 0 rg BT 387.75 526.10 Td (fer from these assumptions would impact ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.10 Td (future expense recognition and the cash funding requirements of our defined benefit plans.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 490.10 Td (Components of net periodic cost were as follows for the three month periods ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.47 490.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.05 490.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 501.49 490.10 Td (January2, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 478.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.00 478.10 Td (:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 140.50 421.60 186.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 421.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 396.50 421.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 400.50 421.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 140.50 391.60 186.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 391.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 396.50 391.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 400.50 391.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 140.50 361.60 186.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 361.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 396.50 361.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 400.50 361.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 140.50 331.60 186.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.50 331.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 396.50 331.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 400.50 331.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 442.6 m 396.5 442.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 396.5 442.6 m 400.5 442.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 442.6 m 470.5 442.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 421.6 m 396.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 421.6 m 470.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 421.6 m 396.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 421.6 m 470.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 331.6 m 396.5 331.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 317.6 m 396.5 317.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326.5 315.6 m 396.5 315.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 331.6 m 470.5 331.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 317.6 m 470.5 317.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 400.5 315.6 m 470.5 315.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 143.00 445.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 361.60 446.83 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 143.00 424.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 337.75 433.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 353.00 425.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 416.75 433.83 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 427.00 425.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 411.72 Td (Service cost) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 329.00 411.83 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 411.83 Td (385) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.00 411.72 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 411.72 Td (142) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 396.72 Td (Interest cost) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 396.83 Td (189) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.65 396.72 Td (15) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 381.72 Td (Expected return on plan assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 374.30 381.83 Td (\(123) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 392.65 381.83 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.65 381.72 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 366.72 Td (Amortization of prior net \(gain\) loss) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 382.65 366.83 Td (93) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.65 366.72 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 351.72 Td (Amortization of prior service cost) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 382.65 351.83 Td (13) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.65 351.72 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 336.72 Td (Recognized net actuarial loss) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 336.83 Td (230) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 336.72 Td (122) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.00 321.72 Td (Net periodic pension cost) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 329.00 321.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 321.28 Td (787) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.00 321.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 321.27 Td (279) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 281.10 Td (16. SEGMENT) Tj ET Q q 0 0 0 rg BT 134.83 281.10 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 185.47 281.10 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 257.10 Td (As a result of the acquisition of Rofin in the first quarter of fiscal 2017, we reor) Tj ET Q q 0 0 0 rg BT 403.29 257.10 Td (ganized our prior two reporting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 245.10 Td (segments \(Specialty Laser Systems and Commercial Lasers and Components\) into two new reporting segments for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 233.10 Td (combined company based upon the or) Tj ET Q q 0 0 0 rg BT 237.22 233.10 Td (ganizational structure of the combined company and how the chief operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 221.10 Td (decision maker \("CODM"\) receives and utilizes information provided to allocate resources and make decisions: OEM ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 209.10 Td (Laser Sources \(OLS\) and Industrial Lasers & Systems \(ILS\). ) Tj ET Q q 0 0 0 rg BT 348.76 209.10 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 398.10 209.10 Td (, our segment information was restated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 197.10 Td (retroactively in the first quarter of fiscal 2017. ) Tj ET Q q 0 0 0 rg BT 272.75 197.10 Td (This segmentation reflects the go-to-market strategies and syner) Tj ET Q q 0 0 0 rg BT 528.87 197.10 Td (gies for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 185.10 Td (our broad portfolio of laser technologies and products. ) Tj ET Q q 0 0 0 rg BT 305.54 185.10 Td (While both segments deliver cost-ef) Tj ET Q q 0 0 0 rg BT 449.76 185.10 Td (fective, highly reliable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 173.10 Td (photonics solutions, the OLS business segment is focused on high performance laser sources and complex optical sub-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 161.10 Td (systems, typically used in microelectronics manufacturing, medical diagnostics and therapeutic medical applications, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 149.10 Td (as well as in scientific research. Our ILS business segment delivers high performance laser sources, sub-systems and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 137.10 Td (tools primarily used for industrial laser materials processing, serving important end markets like automotive, machine ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 125.10 Td (tool, consumer goods and medical device manufacturing. Rofin has primarily been included in our Industrial Lasers & ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 113.10 Td (Systems segment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 101.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 89.10 Td (W) Tj ET Q q 0 0 0 rg BT 94.14 89.10 Td (e have identified OLS and ILS as operating segments for which discrete financial information is available. Both ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 77.10 Td (units have dedicated engineering, manufacturing, product business management and product line management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 65.10 Td (functions. ) Tj ET Q q 0 0 0 rg BT 127.17 65.10 Td (A) Tj ET Q q 0 0 0 rg BT 133.83 65.10 Td ( small portion of our outside revenue is attributable to projects and recently developed products for which ) Tj ET Q endstream endobj 55 0 obj <>] /Rotate 0 /Contents 56 0 R>> endobj 56 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (27) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 742.10 Td (a segment has not yet been determined. ) Tj ET Q q 0 0 0 rg BT 245.27 742.10 Td (The associated direct and indirect costs are presented in the category of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 730.10 Td (Corporate and other) Tj ET Q q 0 0 0 rg BT 165.07 730.10 Td (, along with other corporate costs as described below) Tj ET Q q 0 0 0 rg BT 376.30 730.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 706.10 Td (Our Chief Executive Of) Tj ET Q q 0 0 0 rg BT 181.12 706.10 Td (ficer has been identified as the CODM as he assesses the performance of the segments and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 694.10 Td (decides how to allocate resources to the segments. Income from operations is the measure of profit and loss that our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td (CODM uses to assess performance and make decisions. ) Tj ET Q q 0 0 0 rg BT 310.73 682.10 Td (As assets are not a measure used to assess the performance of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 670.10 Td (the company by the CODM, asset information is not tracked or compiled by segment and is not available to be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 658.10 Td (reported in our disclosures. Income from operations represents the net sales less the cost of sales and direct operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 646.10 Td (expenses incurred within the operating segments as well as allocated expenses such as shared sales and manufacturing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 634.10 Td (costs. ) Tj ET Q q 0 0 0 rg BT 110.32 634.10 Td (W) Tj ET Q q 0 0 0 rg BT 118.96 634.10 Td (e do not allocate to our operating segments certain operating expenses which we manage separately at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 622.10 Td (corporate level. ) Tj ET Q q 0 0 0 rg BT 150.01 622.10 Td (These unallocated costs include stock-based compensation and corporate functions \(certain research ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 610.10 Td (and development, management, finance, legal and human resources\) and are included in the results below under ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 598.10 Td (Corporate and other in the reconciliation of operating results. Management does not consider unallocated Corporate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 586.10 Td (and other costs in its measurement of segment performance.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 562.10 Td (The following table provides net sales and income from continuing operations for our operating segments and a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 550.10 Td (reconciliation of our total income from continuing operations to income from continuing operations before income ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 538.10 Td (taxes \(in thousands\):) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 87.50 526.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 86.00 481.60 170.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 256.00 481.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 481.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 481.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 410.00 481.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 86.00 451.60 170.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 256.00 451.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 451.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 451.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 410.00 451.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 86.00 393.60 170.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 256.00 393.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 393.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 393.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 410.00 393.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 86.00 363.60 170.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 256.00 363.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 363.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 363.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 410.00 363.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 86.00 323.60 170.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 256.00 323.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 323.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 323.60 75.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 410.00 323.60 4.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 502.6 m 331 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 502.6 m 335 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 502.6 m 410 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 502.6 m 331 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 481.6 m 331 481.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 502.6 m 335 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 502.6 m 410 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 481.6 m 410 481.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 436.6 m 331 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 436.6 m 410 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 422.6 m 331 422.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 420.6 m 331 420.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 422.6 m 410 422.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 420.6 m 410 420.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 348.6 m 410 348.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 348.6 m 331 348.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 308.6 m 331 308.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 283.6 m 331 283.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 256 281.6 m 331 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 308.6 m 410 308.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 283.6 m 410 283.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 281.6 m 410 281.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 88.50 505.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 296.10 506.83 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 88.50 485.83 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 269.75 493.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 285.00 485.83 Td (2016) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 355.55 493.85 Td (January 2,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 364.00 485.85 Td (2016) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 88.5 469.93339843750005 m 127.6552734375 469.93339843750005 l s q 0 0 0 rg BT 88.50 471.27 Td (Net sales:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.50 456.27 Td (OEM Laser Sources) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 258.50 456.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 294.65 456.28 Td (238,736) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.50 456.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.65 456.27 Td (158,830) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.50 441.27 Td (Industrial Lasers & Systems) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 294.65 441.28 Td (107,337) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.65 441.27 Td (31,445) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 426.27 Td (Total net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 258.50 426.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 294.65 426.28 Td (346,073) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.50 426.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.65 426.27 Td (190,275) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 88.5 396.93339843750005 m 232.630859375 396.93339843750005 l s q 0 0 0 rg BT 88.50 398.27 Td (Income from continuing operations:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.50 383.27 Td (OEM Laser Sources) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 258.50 383.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 299.65 383.28 Td (83,590) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.50 383.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.65 383.27 Td (40,920) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.50 368.27 Td (Industrial Lasers & Systems) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.30 368.28 Td (\(16,508) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 327.15 368.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 380.30 368.32 Td (\(3,310) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.15 368.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.50 353.27 Td (Corporate and other) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.30 353.28 Td (\(24,882) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 327.15 353.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 375.30 353.32 Td (\(10,327) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.15 353.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 338.27 Td (Total income from continuing) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 328.27 Td (operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 299.65 328.28 Td (42,200) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.65 328.27 Td (27,283) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 313.27 Td ( Total other income \(expense\), net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.65 313.28 Td (5,172) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.80 313.32 Td (\(222) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.15 313.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 297.27 Td (Income from continuing operations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.50 287.27 Td (before income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 258.50 287.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 299.65 287.28 Td (47,372) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.50 287.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.65 287.27 Td (27,061) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 271.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 259.10 Td ( Major) Tj ET Q q 0 0 0 rg BT 112.03 259.10 Td ( Customers) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 235.10 Td (W) Tj ET Q q 0 0 0 rg BT 94.14 235.10 Td (e had ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 118.01 235.10 Td (one) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.45 235.10 Td ( major customer during the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 324.07 235.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 402.65 235.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 422.09 235.10 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.69 235.10 Td ( who accounted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 223.10 Td (for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 99.66 223.10 Td (23.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 125.49 223.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 144.93 223.10 Td (10.6%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 170.76 223.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 223.42 223.10 Td (, of net sales. ) Tj ET Q q 0 0 0 rg BT 278.22 223.10 Td (W) Tj ET Q q 0 0 0 rg BT 286.86 223.10 Td (e had another major customer who accounted for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.12 223.10 Td (17.6%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.95 223.10 Td ( of net sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 211.10 Td (for the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 195.19 211.10 Td (January2, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 258.79 211.10 Td (. ) Tj ET Q q 0 0 0 rg BT 263.61 211.10 Td (The customers purchased primarily from our OLS segment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 187.10 Td (W) Tj ET Q q 0 0 0 rg BT 94.14 187.10 Td (e had ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 118.01 187.10 Td (one) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.45 187.10 Td ( major customer who accounted for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 276.85 187.10 Td (17.6%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.68 187.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 322.12 187.10 Td (18.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.95 187.10 Td ( of accounts receivable at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.06 187.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.64 187.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 175.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.21 175.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 202.87 175.10 Td (. ) Tj ET Q q 0 0 0 rg BT 207.69 175.10 Td (W) Tj ET Q q 0 0 0 rg BT 216.33 175.10 Td (e had another major customer who accounted for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.58 175.10 Td (18.7%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 440.41 175.10 Td ( of accounts receivable at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 163.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.21 163.10 Td (. ) Tj ET Q q 0 0 0 rg BT 155.03 163.10 Td (The customers purchased primarily from our OLS segment. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 127.10 Td (17. RESTRUCTURING CHARGES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 103.10 Td (In the first quarter of fiscal 2017, we began the implementation of planned restructuring activities in connection with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 91.10 Td (acquisition of Rofin. ) Tj ET Q q 0 0 0 rg BT 152.81 91.10 Td (These activities primarily relate to the exit from our high power fiber laser product line, change of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 79.10 Td (control payments to Rofin of) Tj ET Q q 0 0 0 rg BT 183.36 79.10 Td (ficers and re-grouping of our production lines due to segment reor) Tj ET Q q 0 0 0 rg BT 447.54 79.10 Td (ganization, resulting in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 67.10 Td (char) Tj ET Q q 0 0 0 rg BT 85.03 67.10 Td (ges primarily for employee termination and other exit related costs associated with the write-of) Tj ET Q q 0 0 0 rg BT 465.00 67.10 Td (f of property and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 55.10 Td (equipment and inventory) Tj ET Q q 0 0 0 rg BT 167.33 55.10 Td (.) Tj ET Q endstream endobj 57 0 obj <>] /Rotate 0 /Contents 58 0 R>> endobj 58 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (28) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td (The following table presents our current liability as accrued on our balance sheets for restructuring char) Tj ET Q q 0 0 0 rg BT 482.38 742.10 Td (ges. ) Tj ET Q q 0 0 0 rg BT 500.53 742.10 Td (The table sets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 730.10 Td (forth an analysis of the components of the restructuring char) Tj ET Q q 0 0 0 rg BT 309.13 730.10 Td (ges and payments and other deductions made against the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 718.10 Td (accrual for the first quarter of fiscal 2017 \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 662.60 275.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 662.60 69.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 662.60 69.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 662.60 69.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 73.50 632.60 275.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 348.50 632.60 69.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 417.50 632.60 69.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 486.50 632.60 69.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 677.6 m 417.5 677.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 677.6 m 486.5 677.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 677.6 m 555.5 677.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 632.6 m 417.5 632.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 618.6 m 417.5 618.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 348.5 616.6 m 417.5 616.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 632.6 m 486.5 632.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 618.6 m 486.5 618.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 417.5 616.6 m 486.5 616.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 632.6 m 555.5 632.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 618.6 m 555.5 618.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486.5 616.6 m 555.5 616.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 351.05 681.83 Td (Severance Related) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 423.20 681.83 Td (Asset Write Offs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 511.75 681.83 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 667.27 Td (Balances, Oct 1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.00 667.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.65 667.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 667.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.65 667.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.00 667.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 667.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 652.27 Td (Provision) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 391.15 652.27 Td (2,703) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.15 652.27 Td (4,359) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 652.27 Td (7,062) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 637.27 Td (Payments and other) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 395.30 637.32 Td (\(344) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.65 637.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.80 637.32 Td (\(4,359) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.65 637.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.80 637.32 Td (\(4,703) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 551.65 637.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.00 622.27 Td (Balances, December 31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.00 622.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 391.15 622.27 Td (2,359) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.00 622.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.65 622.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.00 622.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.15 622.27 Td (2,359) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 601.10 Td (The current year severance related costs are primarily comprised of severance pay for employees being terminated due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 589.10 Td (the transition of activities out of Rofin. ) Tj ET Q q 0 0 0 rg BT 225.75 589.10 Td (At December 31, 2016, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.84 589.10 Td ($2.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 370.73 589.10 Td ( of accrued restructuring costs were included in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 577.10 Td (other current liabilities. By segment, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.57 577.10 Td ($6.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 265.47 577.10 Td ( of restructuring costs were incurred in the ILS segment and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 507.89 577.10 Td ($0.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 556.78 577.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 565.10 Td (were incurred in the OLS segment. Restructuring char) Tj ET Q q 0 0 0 rg BT 284.42 565.10 Td (ges are recorded in cost of sales, research and development and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 553.10 Td (selling, general and administrative expenses in our condensed consolidated statements of operations.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 524.10 Td (18. DISCONTINUED OPERA) Tj ET Q q 0 0 0 rg BT 182.05 524.10 Td (TIONS) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 68.00 500.10 Td (Discontinued ) Tj ET Q q 0 0 0 rg BT 126.62 500.10 Td (Operations ) Tj ET Q q 0 0 0 rg BT 176.90 500.10 Td (and ) Tj ET Q q 0 0 0 rg BT 194.97 500.10 Td (Assets ) Tj ET Q q 0 0 0 rg BT 224.14 500.10 Td (Held ) Tj ET Q q 0 0 0 rg BT 247.19 500.10 Td (for) Tj ET Q q 0 0 0 rg BT 259.78 500.10 Td ( ) Tj ET Q q 0 0 0 rg BT 262.28 500.10 Td (Sale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 476.10 Td (Discontinued operations are comprised of Rofin) Tj ET Q q 0 0 0 rg BT 263.23 476.10 Td (s low power CO2 laser business based in Hull, United Kingdom, that we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 464.10 Td (acquired as part of our acquisition of Rofin. ) Tj ET Q q 0 0 0 rg BT 244.90 464.10 Td (As a condition of the acquisition, we are required to divest ourselves of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 452.10 Td (Rofin) Tj ET Q q 0 0 0 rg BT 93.56 452.10 Td (s low power CO2 laser business and will report this business separately as a discontinued operation until it is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 440.10 Td (divested. Management is actively marketing this business for sale. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 416.10 Td (For ) Tj ET Q q 0 0 0 rg BT 84.24 416.10 Td (financial ) Tj ET Q q 0 0 0 rg BT 121.57 416.10 Td (statement ) Tj ET Q q 0 0 0 rg BT 162.25 416.10 Td (purposes, ) Tj ET Q q 0 0 0 rg BT 202.65 416.10 Td (the ) Tj ET Q q 0 0 0 rg BT 217.22 416.10 Td (results ) Tj ET Q q 0 0 0 rg BT 245.68 416.10 Td (of ) Tj ET Q q 0 0 0 rg BT 256.36 416.10 Td (operations ) Tj ET Q q 0 0 0 rg BT 300.36 416.10 Td (for ) Tj ET Q q 0 0 0 rg BT 314.37 416.10 Td (this ) Tj ET Q q 0 0 0 rg BT 331.17 416.10 Td (discontinued ) Tj ET Q q 0 0 0 rg BT 384.63 416.10 Td (business ) Tj ET Q q 0 0 0 rg BT 420.87 416.10 Td (have ) Tj ET Q q 0 0 0 rg BT 442.10 416.10 Td (been ) Tj ET Q q 0 0 0 rg BT 463.33 416.10 Td (segregated ) Tj ET Q q 0 0 0 rg BT 508.43 416.10 Td (from ) Tj ET Q q 0 0 0 rg BT 530.22 416.10 Td (those ) Tj ET Q q 0 0 0 rg BT 553.68 416.10 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 404.10 Td (the ) Tj ET Q q 0 0 0 rg BT 83.09 404.10 Td (continuing ) Tj ET Q q 0 0 0 rg BT 128.74 404.10 Td (operations ) Tj ET Q q 0 0 0 rg BT 173.27 404.10 Td (and ) Tj ET Q q 0 0 0 rg BT 190.59 404.10 Td (are ) Tj ET Q q 0 0 0 rg BT 205.67 404.10 Td (presented ) Tj ET Q q 0 0 0 rg BT 246.86 404.10 Td (in ) Tj ET Q q 0 0 0 rg BT 257.52 404.10 Td (our ) Tj ET Q q 0 0 0 rg BT 273.72 404.10 Td (condensed ) Tj ET Q q 0 0 0 rg BT 318.81 404.10 Td (consolidated ) Tj ET Q q 0 0 0 rg BT 372.22 404.10 Td (financial ) Tj ET Q q 0 0 0 rg BT 410.08 404.10 Td (statements ) Tj ET Q q 0 0 0 rg BT 455.17 404.10 Td (as ) Tj ET Q q 0 0 0 rg BT 466.37 404.10 Td (discontinued ) Tj ET Q q 0 0 0 rg BT 520.35 404.10 Td (operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 392.10 Td (and ) Tj ET Q q 0 0 0 rg BT 84.59 392.10 Td (the ) Tj ET Q q 0 0 0 rg BT 98.95 392.10 Td (net ) Tj ET Q q 0 0 0 rg BT 113.32 392.10 Td (assets ) Tj ET Q q 0 0 0 rg BT 138.80 392.10 Td (of ) Tj ET Q q 0 0 0 rg BT 149.27 392.10 Td (the ) Tj ET Q q 0 0 0 rg BT 163.64 392.10 Td (remaining ) Tj ET Q q 0 0 0 rg BT 206.33 392.10 Td (discontinued ) Tj ET Q q 0 0 0 rg BT 259.58 392.10 Td (business ) Tj ET Q q 0 0 0 rg BT 295.62 392.10 Td (have ) Tj ET Q q 0 0 0 rg BT 316.65 392.10 Td (been ) Tj ET Q q 0 0 0 rg BT 337.67 392.10 Td (presented ) Tj ET Q q 0 0 0 rg BT 378.14 392.10 Td (as ) Tj ET Q q 0 0 0 rg BT 388.62 392.10 Td (current ) Tj ET Q q 0 0 0 rg BT 419.08 392.10 Td (assets ) Tj ET Q q 0 0 0 rg BT 444.56 392.10 Td (and ) Tj ET Q q 0 0 0 rg BT 461.14 392.10 Td (current ) Tj ET Q q 0 0 0 rg BT 491.61 392.10 Td (liabilities ) Tj ET Q q 0 0 0 rg BT 530.97 392.10 Td (held ) Tj ET Q q 0 0 0 rg BT 550.34 392.10 Td (for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 380.10 Td (sale.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 356.10 Td (The ) Tj ET Q q 0 0 0 rg BT 86.05 356.10 Td (results ) Tj ET Q q 0 0 0 rg BT 114.66 356.10 Td (of ) Tj ET Q q 0 0 0 rg BT 125.49 356.10 Td (discontinued ) Tj ET Q q 0 0 0 rg BT 179.09 356.10 Td (operations ) Tj ET Q q 0 0 0 rg BT 223.24 356.10 Td (for ) Tj ET Q q 0 0 0 rg BT 237.40 356.10 Td (the ) Tj ET Q q 0 0 0 rg BT 252.12 356.10 Td (fiscal ) Tj ET Q q 0 0 0 rg BT 276.28 356.10 Td (quarter ) Tj ET Q q 0 0 0 rg BT 307.09 356.10 Td (ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 333.47 356.10 Td (December31, ) Tj ET Q q 0 0 0 rg BT 392.05 356.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.05 356.10 Td ( ) Tj ET Q q 0 0 0 rg BT 414.55 356.10 Td (are ) Tj ET Q q 0 0 0 rg BT 429.26 356.10 Td (as ) Tj ET Q q 0 0 0 rg BT 440.09 356.10 Td (follows ) Tj ET Q q 0 0 0 rg BT 472.59 356.10 Td (\(in ) Tj ET Q q 0 0 0 rg BT 486.20 356.10 Td (thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 333.60 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 333.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 303.60 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 303.60 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 273.60 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 273.60 100.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 258.6 m 514.5 258.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 258.6 m 514.5 258.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 244.60000000000002 m 514.5 244.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 242.60000000000002 m 514.5 242.60000000000002 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 323.27 Td (Net sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 323.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 323.27 Td (4,511) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 308.27 Td (Cost of sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 308.27 Td (3,109) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 293.27 Td (Operating expenses) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 293.27 Td (1,546) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 278.27 Td (Other expense) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.65 278.27 Td (218) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 263.27 Td (Income tax benefit) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 497.30 263.32 Td (\(72) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.65 263.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 248.27 Td (Net loss from discontinued operations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 248.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 492.30 248.32 Td (\(290) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.65 248.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 220.10 Td (Current assets and current liabilities classified as held for sale as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.03 220.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.61 220.10 Td ( related to discontinued operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 208.10 Td (are as follows \(in thousands\):) Tj ET Q endstream endobj 59 0 obj <>] /Rotate 0 /Contents 60 0 R>> endobj 60 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (29) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 748.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 748.50 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 718.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 718.50 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 688.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 688.50 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 658.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 658.50 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 628.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 628.50 100.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 114.50 598.50 300.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 598.50 100.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 658.5 m 514.5 658.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 658.5 m 514.5 658.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 644.5 m 514.5 644.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 642.5 m 514.5 642.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 583.5 m 514.5 583.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 583.5 m 514.5 583.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 569.5 m 514.5 569.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 567.5 m 514.5 567.5 l s BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 738.17 Td (Accounts receivable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 738.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 738.17 Td (5,054) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 723.17 Td (Inventories) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 723.17 Td (5,844) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 708.17 Td (Prepaid expenses and other assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.65 708.17 Td (462) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 693.17 Td (Property and equipment) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 693.17 Td (9,740) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 678.17 Td (Goodwill) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.15 678.17 Td (33,121) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 663.17 Td (Intangible assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.15 663.17 Td (11,263) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 648.17 Td (Total current assets held for sale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 648.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.15 648.17 Td (65,484) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 618.17 Td (Accounts payable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 618.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 618.17 Td (1,729) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 603.17 Td (Income taxes payable) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.65 603.17 Td (380) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 588.17 Td (Other current liabilities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 588.17 Td (5,277) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.00 573.17 Td (Total current liabilities held for sale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.00 573.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.15 573.17 Td (7,386) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 533.00 Td (ITEM 2. MANAGEMENT'S DISCUSSION ) Tj ET Q q 0 0 0 rg BT 238.64 533.00 Td (AND ) Tj ET Q q 0 0 0 rg BT 262.26 533.00 Td (ANAL) Tj ET Q q 0 0 0 rg BT 289.67 533.00 Td (YSIS OF) Tj ET Q q 0 0 0 rg BT 327.92 533.00 Td ( FINANCIAL) Tj ET Q q 0 0 0 rg BT 386.54 533.00 Td ( CONDITION ) Tj ET Q q 0 0 0 rg BT 449.89 533.00 Td (AND RESUL) Tj ET Q q 0 0 0 rg BT 506.48 533.00 Td (TS OF) Tj ET Q q 0 0 0 rg BT 534.73 533.00 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 521.00 Td (OPERA) Tj ET Q q 0 0 0 rg BT 84.26 521.00 Td (TIONS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 509.00 Td () Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 50 495.43505859375 m 159.83154296875 495.43505859375 l s q 0 0 0 rg BT 50.00 497.00 Td (COMP) Tj ET Q q 0 0 0 rg BT 79.80 497.00 Td (ANY) Tj ET Q q 0 0 0 rg BT 101.10 497.00 Td ( OVER) Tj ET Q q 0 0 0 rg BT 132.14 497.00 Td (VIEW) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 485.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 473.00 Td (BUSINESS BACKGROUND) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 461.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 449.00 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 449.00 Td (e are one of the world) Tj ET Q q 0 0 0 rg BT 148.88 449.00 Td (s leading providers of lasers, laser) Tj ET Q q 0 0 0 rg BT 284.75 449.00 Td (-based technologies and laser) Tj ET Q q 0 0 0 rg BT 402.00 449.00 Td (-based system solutions in a broad ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 437.00 Td (range of commercial, industrial and scientific applications. ) Tj ET Q q 0 0 0 rg BT 287.24 437.00 Td (W) Tj ET Q q 0 0 0 rg BT 295.87 437.00 Td (e design, manufacture, service and market lasers and related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 425.00 Td (accessories for a diverse group of customers. Since inception in 1966, we have grown through internal expansion and through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 413.00 Td (strategic acquisitions of complementary businesses, technologies, intellectual property) Tj ET Q q 0 0 0 rg BT 395.09 413.00 Td (, manufacturing processes and product ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 401.00 Td (of) Tj ET Q q 0 0 0 rg BT 58.15 401.00 Td (ferings.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 389.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 377.00 Td (As a result of the acquisition of Rofin in the first quarter of fiscal 2017, we reor) Tj ET Q q 0 0 0 rg BT 367.79 377.00 Td (ganized our prior two reporting segments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 365.00 Td (\(Specialty Laser Systems and Commercial Lasers and Components\) into two new reporting segments for the combined ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 353.00 Td (company: OEM Laser Sources \(OLS\) and Industrial Lasers & Systems \(ILS\). ) Tj ET Q q 0 0 0 rg BT 380.29 353.00 Td (This segmentation reflects the go-to-market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 341.00 Td (strategies and syner) Tj ET Q q 0 0 0 rg BT 128.68 341.00 Td (gies for our broad portfolio of laser technologies and products. ) Tj ET Q q 0 0 0 rg BT 381.49 341.00 Td (While both segments deliver cost-ef) Tj ET Q q 0 0 0 rg BT 525.71 341.00 Td (fective, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 329.00 Td (highly reliable photonics solutions, the OLS business segment is focused on high performance laser sources and complex ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 317.00 Td (optical sub-systems typically used in microelectronics manufacturing, medical diagnostics and therapeutic medical ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 305.00 Td (applications, as well as in scientific research. Our ILS business segment delivers high performance laser sources, sub-systems ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 293.00 Td (and tools primarily used for industrial laser materials processing, serving important end markets like automotive, machine tool, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 281.00 Td (consumer goods and medical device manufacturing. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 257.00 Td (Income from operations is the measure of profit and loss that our chief operating decision maker \(CODM\) uses to assess ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 245.00 Td (performance and make decisions. Income from operations represents the sales less the cost of sales and direct operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 233.00 Td (expenses incurred within the operating segments as well as allocated expenses such as shared sales and manufacturing costs. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 221.00 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 221.00 Td (e do not allocate to our operating segments certain operating expenses, which we manage separately at the corporate level. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 209.00 Td (These unallocated costs include stock-based compensation and corporate functions \(certain advanced research and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 197.00 Td (development, management, finance, legal and human resources\) and are included in Corporate and other) Tj ET Q q 0 0 0 rg BT 467.62 197.00 Td (. Management does not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 185.00 Td (consider unallocated Corporate and other costs in its measurement of segment performance.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 161.00 Td (MARKET) Tj ET Q q 0 0 0 rg BT 94.82 161.00 Td ( ) Tj ET Q q 0 0 0 rg BT 96.77 161.00 Td (APPLICA) Tj ET Q q 0 0 0 rg BT 140.47 161.00 Td (TIONS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 149.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 137.00 Td (Our products address a broad range of applications that we group into the following markets: Microelectronics, Materials ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 125.00 Td (Processing, OEM Components and Instrumentation and Scientific Research in academia and government.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 113.00 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 101.00 Td (OUR STRA) Tj ET Q q 0 0 0 rg BT 100.65 101.00 Td (TEGY) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 89.00 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 89.00 Td (e strive to develop innovative and proprietary products and solutions that meet the needs of our customers and that are based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 77.00 Td (on our core expertise in lasers and optical technologies. In pursuit of our strategy) Tj ET Q q 0 0 0 rg BT 373.14 77.00 Td (, we intend to:) Tj ET Q endstream endobj 61 0 obj <>] /Rotate 0 /Contents 62 0 R>> endobj 62 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (30) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 742.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 742.10 Td (Leverage our) Tj ET Q q 0 0 0 rg BT 142.74 742.10 Td ( technology portfolio and application engineering to lead the pr) Tj ET Q q 0 0 0 rg BT 411.73 742.10 Td (oliferation of photonics into ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 730.10 Td (br) Tj ET Q q 0 0 0 rg BT 95.82 730.10 Td (oader) Tj ET Q q 0 0 0 rg BT 120.08 730.10 Td ( markets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 157.57 730.10 Td (W) Tj ET Q q 0 0 0 rg BT 176.21 730.10 Td (e will continue to identify opportunities in which our technology portfolio and application ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 718.10 Td (engineering can be used to of) Tj ET Q q 0 0 0 rg BT 203.28 718.10 Td (fer innovative solutions and gain access to new markets. ) Tj ET Q q 0 0 0 rg BT 430.81 718.10 Td (W) Tj ET Q q 0 0 0 rg BT 439.45 718.10 Td (e plan to utilize our expertise ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 706.10 Td (to increase our market share in the mid to high power material processing applications.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 685.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 685.10 Td (Str) Tj ET Q q 0 0 0 rg BT 99.15 685.10 Td (eamline our) Tj ET Q q 0 0 0 rg BT 149.79 685.10 Td ( manufacturing structur) Tj ET Q q 0 0 0 rg BT 253.50 685.10 Td (e and impr) Tj ET Q q 0 0 0 rg BT 299.98 685.10 Td (ove our) Tj ET Q q 0 0 0 rg BT 331.74 685.10 Td ( cost structur) Tj ET Q q 0 0 0 rg BT 388.21 685.10 Td (e) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.65 685.10 Td (W) Tj ET Q q 0 0 0 rg BT 411.29 685.10 Td (e will focus on optimizing the mix of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 673.10 Td (products that we manufacture internally and externally) Tj ET Q q 0 0 0 rg BT 304.15 673.10 Td (. ) Tj ET Q q 0 0 0 rg BT 308.97 673.10 Td (W) Tj ET Q q 0 0 0 rg BT 317.61 673.10 Td (e will utilize vertical integration where our internal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 661.10 Td (manufacturing process is considered proprietary and seek to leverage external sources when the capabilities and cost ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 649.10 Td (structure are well developed and on a path towards commoditization.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 628.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 628.10 Td (Focus on long-term impr) Tj ET Q q 0 0 0 rg BT 192.20 628.10 Td (ovement of adjusted EBITDA, in dollars and as a per) Tj ET Q q 0 0 0 rg BT 418.71 628.10 Td (centage of net sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.07 628.10 Td (W) Tj ET Q q 0 0 0 rg BT 518.71 628.10 Td (e define ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 616.10 Td (adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 157.93 616.10 Td ( as operating income adjusted for depreciation, amortization, stock compensation expenses, major ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 604.10 Td (restructuring costs and certain other non-operating income and expense items. Key initiatives to reach our goals for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 592.10 Td (EBITDA) Tj ET Q q 0 0 0 rg BT 122.11 592.10 Td ( improvements include utilization of our ) Tj ET Q q 0 0 0 rg BT 285.41 592.10 Td (Asian manufacturing locations, rationalizing our supply chain and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 580.10 Td (continued leveraging of our infrastructure.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 559.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 559.10 Td (Optimize our) Tj ET Q q 0 0 0 rg BT 142.75 559.10 Td ( leadership position in existing markets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.71 559.10 Td (There are a number of markets where we have historically ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 547.10 Td (been at the forefront of technological development and product deployment and from which we have derived a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 535.10 Td (substantial portion of our revenues. ) Tj ET Q q 0 0 0 rg BT 229.68 535.10 Td (W) Tj ET Q q 0 0 0 rg BT 238.31 535.10 Td (e plan to optimize our financial returns from these markets.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 514.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 514.10 Td (Maintain and develop additional str) Tj ET Q q 0 0 0 rg BT 239.18 514.10 Td (ong collaborative customer) Tj ET Q q 0 0 0 rg BT 354.53 514.10 Td ( and industry r) Tj ET Q q 0 0 0 rg BT 418.53 514.10 Td (elationships) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.11 514.10 Td (W) Tj ET Q q 0 0 0 rg BT 487.74 514.10 Td (e believe that the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 502.10 Td (Coherent brand name and reputation for product quality) Tj ET Q q 0 0 0 rg BT 308.89 502.10 Td (, technical performance and customer satisfaction will help us ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 490.10 Td (to further develop our loyal customer base. ) Tj ET Q q 0 0 0 rg BT 260.21 490.10 Td (W) Tj ET Q q 0 0 0 rg BT 268.85 490.10 Td (e plan to maintain our current customer relationships and develop new ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 478.10 Td (ones with customers who are industry leaders and work together with these customers to design and develop ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 466.10 Td (innovative product systems and solutions as they develop new technologies.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 445.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 86.00 445.10 Td (Develop and acquir) Tj ET Q q 0 0 0 rg BT 169.16 445.10 Td (e new technologies and market shar) Tj ET Q q 0 0 0 rg BT 321.47 445.10 Td (e) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.91 445.10 Td (W) Tj ET Q q 0 0 0 rg BT 344.54 445.10 Td (e will continue to enhance our market position ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 433.10 Td (through our existing technologies and develop new technologies through our internal research and development ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 421.10 Td (ef) Tj ET Q q 0 0 0 rg BT 93.59 421.10 Td (forts, as well as through the acquisition of additional complementary technologies, intellectual property) Tj ET Q q 0 0 0 rg BT 506.71 421.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.00 409.10 Td (manufacturing processes and product of) Tj ET Q q 0 0 0 rg BT 245.77 409.10 Td (ferings.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 373.10 Td (APPLICA) Tj ET Q q 0 0 0 rg BT 93.70 373.10 Td (TION OF) Tj ET Q q 0 0 0 rg BT 135.28 373.10 Td ( CRITICAL) Tj ET Q q 0 0 0 rg BT 187.24 373.10 Td ( ) Tj ET Q q 0 0 0 rg BT 189.18 373.10 Td (ACCOUNTING POLICIES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 361.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 349.10 Td (Our discussion and analysis of financial condition and results of operations are based upon our condensed consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 337.10 Td (financial statements, which have been prepared in accordance with accounting principles generally accepted in the United ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 325.10 Td (States of ) Tj ET Q q 0 0 0 rg BT 86.67 325.10 Td (America and pursuant to the rulesand regulations of the SEC. ) Tj ET Q q 0 0 0 rg BT 336.98 325.10 Td (The preparation of these condensed consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 313.10 Td (financial statements requires management to make estimates and assumptions that af) Tj ET Q q 0 0 0 rg BT 388.60 313.10 Td (fect the reported amounts of assets and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 301.10 Td (liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 289.10 Td (the reported amounts of revenues and expenses during the reporting period. ) Tj ET Q q 0 0 0 rg BT 354.17 289.10 Td (W) Tj ET Q q 0 0 0 rg BT 362.81 289.10 Td (e have identified the following as the items that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 277.10 Td (require the most significant judgment and often involve complex estimation: revenue recognition, business combinations, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 265.10 Td (accounting for long-lived assets \(including goodwill and intangible assets\), inventory valuation, warranty reserves, stock-based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 253.10 Td (compensation and accounting for income taxes. See Item 7. "Management's Discussion and ) Tj ET Q q 0 0 0 rg BT 418.01 253.10 Td (Analysis of Financial Condition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 241.10 Td (and Results of Operations" in our ) Tj ET Q q 0 0 0 rg BT 185.73 241.10 Td (Annual Report on Form 10-K for our fiscal year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.34 241.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.05 241.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 229.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 217.10 Td (Starting in the three months ended December 31, 2016, we assessed business combinations to be one of our critical accounting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 205.10 Td (policies. ) Tj ET Q q 0 0 0 rg BT 85.92 205.10 Td (W) Tj ET Q q 0 0 0 rg BT 94.56 205.10 Td (e include the results of operations of the businesses that we acquire as of the respective dates of acquisition. ) Tj ET Q q 0 0 0 rg BT 527.58 205.10 Td (W) Tj ET Q q 0 0 0 rg BT 536.22 205.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 193.10 Td (allocate the fair value of the purchase price of our business acquisitions to the tangible assets acquired, liabilities assumed, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 181.10 Td (intangible assets acquired, based on their estimated fair values. ) Tj ET Q q 0 0 0 rg BT 303.90 181.10 Td (The excess of the purchase price over the fair values of these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 169.10 Td (identifiable assets and liabilities is recorded as goodwill. ) Tj ET Q q 0 0 0 rg BT 278.00 169.10 Td (Additional information existing as of the acquisition date, but ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 157.10 Td (unknown to us at that time, may become known during the remainder of the measurement period, not to exceed 12 months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 145.10 Td (from the acquisition date, which may result in changes to the amounts and allocations recorded.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 121.10 Td (KEY) Tj ET Q q 0 0 0 rg BT 71.30 121.10 Td ( PERFORMANCE INDICA) Tj ET Q q 0 0 0 rg BT 191.11 121.10 Td (T) Tj ET Q q 0 0 0 rg BT 197.60 121.10 Td (ORS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 109.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 97.10 Td (Below is a summary of some of the quantitative performance indicators \(as defined below\) that are evaluated by management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 85.10 Td (to assess our financial performance. Some of the indicators are non-GAAP) Tj ET Q q 0 0 0 rg BT 348.71 85.10 Td ( measures and should not be considered as an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 73.10 Td (alternative to any other measure for determining operating performance or liquidity that is calculated in accordance with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 61.10 Td (generally accepted accounting principles.) Tj ET Q endstream endobj 63 0 obj <>] /Rotate 0 /Contents 64 0 R>> endobj 64 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (31) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 690.50 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 690.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 690.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 690.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 690.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 690.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 690.50 4.00 -15.00 re f /GS0 gs 0.8 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0.9333333333333333 1 rg /GS0 gs 488.50 500.50 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 500.50 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 470.50 220.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 470.50 70.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 470.50 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 470.50 70.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 470.50 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 470.50 70.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 470.50 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 470.50 70.00 -25.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 735.5 m 340.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 735.5 m 344.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 735.5 m 414.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 735.5 m 340.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 716.5 m 340.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 735.5 m 344.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 735.5 m 414.5 735.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 716.5 m 414.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 716.5 m 488.5 716.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 716.5 m 562.5 716.5 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 738.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 305.60 739.73 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 453.00 738.22 Td () Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 527.00 738.22 Td () Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 719.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 281.75 727.58 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 297.00 719.58 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 351.75 720.73 Td (January 2, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 439.85 720.73 Td (Change) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.85 720.73 Td (%Change) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 706.22 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 378.20 708.58 Td (\(Dollarsinthousands\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 680.17 Td (Bookings) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 680.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 297.50 680.18 Td (551,606) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 680.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.15 680.17 Td (273,004) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 680.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.75 680.17 Td (278,602) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.80 680.17 Td (102.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 680.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 665.17 Td (Book-to-bill ratio) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 665.18 Td (1.59) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 665.17 Td (1.43) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.80 665.17 Td (0.16) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.80 665.17 Td (11.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 665.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 650.17 Td (Net salesOEM Laser Sources) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 650.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 297.50 650.18 Td (238,736) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 650.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.15 650.17 Td (158,830) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 650.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.80 650.17 Td (79,906) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.80 650.17 Td (50.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 650.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 635.17 Td (Net salesIndustrial Lasers & Systems) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 635.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 297.50 635.18 Td (107,337) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 635.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.15 635.17 Td (31,445) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 635.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.80 635.17 Td (75,892) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.80 635.17 Td (241.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 635.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 620.17 Td (Gross profit as a percentage of net sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 610.17 Td (OEM Laser Sources) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 610.18 Td (52.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 610.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 610.17 Td (47.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 610.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.80 610.17 Td (4.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 610.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 537.80 610.17 Td (8.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 610.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 595.17 Td (Gross profit as a percentage of net salesIndustrial) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 585.17 Td (Lasers & Systems) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 585.18 Td (17.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 585.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 585.17 Td (27.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 585.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.45 585.17 Td (\(10.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 585.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.45 585.17 Td (\(37.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.30 585.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 570.17 Td (Research and development as a percentage of net) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 560.17 Td (sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 317.50 560.18 Td (7.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 560.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 560.17 Td (10.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 560.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.45 560.17 Td (\(2.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 560.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.45 560.17 Td (\(22.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.30 560.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 545.17 Td (Income from continuing operations before income) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 535.17 Td (taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 535.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 302.50 535.18 Td (47,372) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 535.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.15 535.17 Td (27,061) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 535.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.80 535.17 Td (20,311) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.80 535.17 Td (75.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 535.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 520.17 Td (Net cash provided by operating activities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 520.18 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 302.50 520.18 Td (82,641) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.00 520.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.15 520.17 Td (14,262) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 520.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.80 520.17 Td (68,379) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.80 520.17 Td (479.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 520.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 505.17 Td (Days sales outstanding in receivables) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 505.18 Td (62.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 505.17 Td (68.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.45 505.17 Td (\(5.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 505.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 534.45 505.17 Td (\(8.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.30 505.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 490.17 Td (Annualized first quarter inventory turns) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 317.50 490.18 Td (2.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.15 490.17 Td (2.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.45 490.17 Td (\(0.6) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 490.17 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.45 490.17 Td (\(22.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.30 490.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 475.17 Td (Capital spending as a percentage of net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 317.50 475.18 Td (4.4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 475.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.15 475.17 Td (2.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 475.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.80 475.17 Td (1.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 475.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.80 475.17 Td (76.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 475.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 460.17 Td (Net income from continuing operations as a) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 450.17 Td (percentage of net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 317.50 450.18 Td (8.9) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 450.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 450.17 Td (10.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 450.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.45 450.17 Td (\(1.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 450.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 529.45 450.17 Td (\(16.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 550.30 450.17 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 435.17 Td (Adjusted EBITDA as a percentage of net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 435.18 Td (28.4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 330.00 435.18 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 435.17 Td (21.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.65 435.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.80 435.17 Td (7.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.65 435.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.80 435.17 Td (33.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 435.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 419.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 407.00 Td (Definitions and analysis of these performance indicators are as follows:) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 383.00 Td (Bookings and Book-to-Bill Ratio) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 371.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 359.00 Td (Bookings represent orders received during the current period for products and services. ) Tj ET Q q 0 0 0 rg BT 401.09 359.00 Td (While we generally have not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 347.00 Td (experienced a significant rate of cancellation, bookings are generally cancelable, depending on the notice period, by our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 335.00 Td (customers without substantial penalty and, therefore, we cannot assure all bookings will be converted to net sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 323.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 311.00 Td (The book-to-bill ratio is calculated as quarterly bookings divided by quarterly net sales.) Tj ET Q q 0 0 0 rg BT 402.50 311.00 Td (This is an indication of the strength of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 299.00 Td (our business but can sometimes be impacted by a single lar) Tj ET Q q 0 0 0 rg BT 286.43 299.00 Td (ge order or a single lar) Tj ET Q q 0 0 0 rg BT 376.49 299.00 Td (ge shipment. ) Tj ET Q q 0 0 0 rg BT 429.54 299.00 Td (A) Tj ET Q q 0 0 0 rg BT 436.21 299.00 Td ( ratio of greater than 1.0 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 287.00 Td (indicates that demand for our products is greater than what we supply in the quarter whereas a ratio of less than 1.0 indicates ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 275.00 Td (that demand for our products is less than what we supply in the quarter) Tj ET Q q 0 0 0 rg BT 332.99 275.00 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 263.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 251.00 Td (Bookings in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.83 251.00 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 131.94 251.00 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 200.24 251.00 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 220.24 251.00 Td ( included $78.8 million of Rofin bookings since the acquisition on November 7, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 239.00 Td (2016, primarily in the materials processing market. Bookings increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 337.98 239.00 Td (102.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.81 239.00 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 396.31 239.00 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.42 239.00 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.72 239.00 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.72 239.00 Td ( compared to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 227.00 Td (the same quarter one year ago, primarily due to significant increases in the microelectronics and materials processing markets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 215.00 Td (as well as increases in the OEM components and instrumentation market. Compared to the fourth quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 507.92 215.00 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.92 215.00 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 203.00 Td (bookings increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 129.42 203.00 Td (1) Tj ET Q q 0 0 0 rg BT 134.05 203.00 Td (19.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 159.88 203.00 Td ( with significant increases in the microelectronics and materials processing markets. ) Tj ET Q q 0 0 0 rg BT 498.48 203.00 Td (The book-to-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 191.00 Td (bill ratio was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.71 191.00 Td (1.59) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 122.21 191.00 Td ( in the first quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 234.12 191.00 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 254.12 191.00 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 167.00 Td (Backlog represents orders which we expect to be shipped within 12 months and the current portion of service contracts. For a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 155.00 Td (discussion of backlog, see RESUL) Tj ET Q q 0 0 0 rg BT 192.11 155.00 Td (TS OF OPERA) Tj ET Q q 0 0 0 rg BT 253.24 155.00 Td (TIONS - BACKLOG.) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 129.6669921875 m 117.7490234375 129.6669921875 l s q 0 0 0 rg BT 50.00 131.00 Td (Microelectronics) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 119.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 107.00 Td (Microelectronics bookings increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.67 107.00 Td (98%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 218.00 107.00 Td ( compared to the same quarter one year ago and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 411.81 107.00 Td (155%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 435.14 107.00 Td ( from bookings in the fourth ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 95.00 Td (quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.80 95.00 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 135.80 95.00 Td (. ) Tj ET Q q 0 0 0 rg BT 140.62 95.00 Td (The microelectronics book-to-bill ratio for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 327.78 95.00 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.89 95.00 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.19 95.00 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.19 95.00 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.74 95.00 Td (2.13) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 470.24 95.00 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 83.00 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 71.00 Td (Flat panel display orders in the first quarter of fiscal 2017 increased 1) Tj ET Q q 0 0 0 rg BT 327.88 71.00 Td (13% from orders in the first quarter of fiscal 2016 and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 59.00 Td (200% from orders in the fourth quarter of fiscal 2016, primarily due to the timing and mix of order placement by customers ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 47.00 Td (with higher orders received from multiple customers in multiple countries for lar) Tj ET Q q 0 0 0 rg BT 372.78 47.00 Td (ge format Linebeam 1000 systems to be used ) Tj ET Q endstream endobj 65 0 obj <>] /Rotate 0 /Contents 66 0 R>> endobj 66 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (32) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (in or) Tj ET Q q 0 0 0 rg BT 68.43 742.10 Td (ganic light-emitting diode \(OLED\) production as well as higher service bookings. ) Tj ET Q q 0 0 0 rg BT 398.17 742.10 Td (W) Tj ET Q q 0 0 0 rg BT 406.81 742.10 Td (e expect continued fluctuations in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (order volumes on a quarterly basis. In addition to the front-end excimer laser annealing process, there are an increasing number ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (of laser) Tj ET Q q 0 0 0 rg BT 79.51 718.10 Td (-based, back-end flat panel display packaging applications in the mobile handset market. ) Tj ET Q q 0 0 0 rg BT 436.43 718.10 Td (These applications are linked ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (to specific models or bubble orders and require rapid fulfillment. ) Tj ET Q q 0 0 0 rg BT 311.68 706.10 Td (These higher than expected orders are reflected in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td (microelectronics market data and we are increasing production in several dif) Tj ET Q q 0 0 0 rg BT 355.80 694.10 Td (ferent product families and locations to meet ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (delivery requirements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (Orders in the advanced packaging \(API\) market increased 82% from orders in the first quarter of fiscal 2016 and increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (85% from orders in the fourth quarter of fiscal 2016. ) Tj ET Q q 0 0 0 rg BT 262.81 646.10 Td (The microvia business increased from fan-out wafer level packaging, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (which provides more input/output connections from a die. Orders from laser direct imaging \(LDI\) applications also improved; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (historically via drilling and LDI have trailed the semiconductor capital equipment market by approximately six months.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (Orders from semiconductor capital equipment OEMs increased 21% from the first quarter of fiscal 2016 and increased 19% ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (from the fourth quarter of fiscal 2016 due to increases in wafer inspection and processing \(investments for mobile logic chips\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td (applications. Service orders and shipments remain strong due to high utilization rates in most fabs. ) Tj ET Q q 0 0 0 rg BT 446.68 574.10 Td (The growth is consistent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (with overall trends in the market as expressed by industry reports and capacity expansion for 3D NAND memory is the primary ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (driver) Tj ET Q q 0 0 0 rg BT 73.48 550.10 Td (, followed by logic capacity expansion. ) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 524.7669921875 m 133.59375 524.7669921875 l s q 0 0 0 rg BT 50.00 526.10 Td (Materials Processing) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.10 Td (Materials processing orders in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 188.02 502.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.13 502.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.43 502.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 292.43 502.10 Td ( included $69.6 million of Rofin orders since the acquisition on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 490.10 Td (November 7, 2016. Materials processing orders increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.98 490.10 Td (374%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.31 490.10 Td ( compared to the same quarter one year ago and increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 478.10 Td (242%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.33 478.10 Td ( from the fourth quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 205.22 478.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 225.22 478.10 Td (. ) Tj ET Q q 0 0 0 rg BT 230.04 478.10 Td (The materials processing book-to-bill ratio for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.49 478.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 448.59 478.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 516.89 478.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.89 478.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.10 Td (1.02) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 466.10 Td (. ) Tj ET Q q 0 0 0 rg BT 72.32 466.10 Td (The materials processing vertical is the end market that has increased the most for us as a result of the Rofin acquisition. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.10 Td (The traditional marking and engraving business performed well with contributions from metal work using ultra-violet lasers to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.10 Td (textile marking with CO) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 147.49 440.67 Td (2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.73 442.10 Td ( products. Cutting and converting application orders were also strong due to volume orders from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.10 Td (package and label industry) Tj ET Q q 0 0 0 rg BT 156.25 430.10 Td (. ) Tj ET Q q 0 0 0 rg BT 160.70 430.10 Td (Automotive applications were very active and drove orders for ultrafast lasers used in fuel injector ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.10 Td (nozzle drilling and high-power lasers used in powertrain welding. ) Tj ET Q q 0 0 0 rg BT 315.30 418.10 Td (W) Tj ET Q q 0 0 0 rg BT 323.94 418.10 Td (e also had record orders for medical device manufacturing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 406.10 Td (workstations, where we see opportunities to expand our business. ) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 380.7669921875 m 208.037109375 380.7669921875 l s q 0 0 0 rg BT 50.00 382.10 Td (OEM Components and Instrumentation) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.10 Td (OEM Components and Instrumentation orders increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 278.28 358.10 Td (56%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 296.61 358.10 Td ( compared to the same quarter one year ago and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.42 358.10 Td (10%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 508.75 358.10 Td ( from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.10 Td (fourth quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 142.74 346.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 162.74 346.10 Td (. ) Tj ET Q q 0 0 0 rg BT 167.56 346.10 Td (The book-to-bill ratio for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 285.58 346.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.69 346.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 369.99 346.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.99 346.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.54 346.10 Td (1.01) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 428.04 346.10 Td (. ) Tj ET Q q 0 0 0 rg BT 432.86 346.10 Td (The increases arose from an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 334.10 Td (improved outlook from medical OEMs, sustained growth in bioinstrumentation and higher demand for medical consumables.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 310.10 Td (Orders for medical OEM products increased 191% compared to the same quarter one year ago and 1) Tj ET Q q 0 0 0 rg BT 451.70 310.10 Td (15% compared to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 298.10 Td (fourth quarter of fiscal 2016. Instrumentation orders increased 26% compared to the same quarter one year ago but decreased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 286.10 Td (21% compared to the fourth quarter of fiscal 2016 due to timing of orders coming of) Tj ET Q q 0 0 0 rg BT 387.78 286.10 Td (f the high orders in the fourth quarter of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 274.10 Td (fiscal 2016. ) Tj ET Q q 0 0 0 rg BT 101.47 274.10 Td (The medical OEM market remains strong including success with an excimer) Tj ET Q q 0 0 0 rg BT 407.29 274.10 Td (-based technique in refractive sur) Tj ET Q q 0 0 0 rg BT 540.39 274.10 Td (gery ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 262.10 Td (by a major vendor) Tj ET Q q 0 0 0 rg BT 122.48 262.10 Td (. Bioinstrumentation customers are reporting solid growth in reagent sales, which drives demand for laser) Tj ET Q q 0 0 0 rg BT 544.39 262.10 Td (-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 250.10 Td (based instruments across all territories. ) Tj ET Q q 0 0 0 rg BT 208.11 250.10 Td (W) Tj ET Q q 0 0 0 rg BT 216.75 250.10 Td (e are exploring new laser architectures that can accelerate instrument deployment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 238.10 Td (through lower pricing. Our work in medical consumables, primarily fiber assemblies for lithotripsy \(ultrasonic removal of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 226.10 Td (kidney stones\), has resulted in a steady increase in business and there are more opportunities in this area.) Tj ET Q BT /F1 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 200.76699218750002 m 127.4658203125 200.76699218750002 l s q 0 0 0 rg BT 50.00 202.10 Td (Scientific Research) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 190.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.10 Td (Scientific and government programs orders increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 266.04 178.10 Td (3%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 279.37 178.10 Td ( compared to the same quarter one year ago and decreased slightly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 166.10 Td (from the fourth quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.39 166.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.39 166.10 Td (. ) Tj ET Q q 0 0 0 rg BT 204.21 166.10 Td (The book-to-bill for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.41 166.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 317.52 166.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.82 166.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.82 166.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 426.37 166.10 Td (1.19) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.87 166.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 50.00 154.10 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.00 142.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 142.10 Td (e had record orders for ) Tj ET Q q 0 0 0 rg BT 151.65 142.10 Td (Astrella in the first quarter of fiscal 2017, which is a workhorse tool in applications ranging from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 130.10 Td (applied physics to physical chemistry) Tj ET Q q 0 0 0 rg BT 199.32 130.10 Td (, led by two factors. Chinese research investments in the physical sciences continue to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 118.10 Td (grow and are nearly equal to those in the U.S. ) Tj ET Q q 0 0 0 rg BT 235.32 118.10 Td (W) Tj ET Q q 0 0 0 rg BT 243.96 118.10 Td (e also believe we have captured market share for ultrafast amplifiers across ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 106.10 Td (multiple geographies. ) Tj ET Q q 0 0 0 rg BT 138.96 106.10 Td (The multiphoton microscopy market is a consistent overall performer) Tj ET Q q 0 0 0 rg BT 416.11 106.10 Td (. ) Tj ET Q q 0 0 0 rg BT 420.93 106.10 Td (The mix is shifting towards our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 94.10 Td (newer platforms including the Discovery) Tj ET Q q 0 0 0 rg BT 213.19 94.10 Td (, Monaco and Fidelity due to their applicability in optogenetics. Orders for CW) Tj ET Q q 0 0 0 rg BT 530.16 94.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 82.10 Td (pulse lasers used in life sciences and chemistry also increased slightly reflecting research trends in Europe and ) Tj ET Q q 0 0 0 rg BT 493.46 82.10 Td (Asia. ) Tj ET Q q 0 0 0 rg BT 516.61 82.10 Td (The only ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 70.10 Td (product area with decreased orders was for certain gas lasers due to shifting technology) Tj ET Q q 0 0 0 rg BT 398.95 70.10 Td (.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 46.10 Td (Net Sales) Tj ET Q endstream endobj 67 0 obj <>] /Rotate 0 /Contents 68 0 R>> endobj 68 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (33) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (Net sales include sales of lasers, laser tools, related accessories and service. Net sales for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 422.36 730.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 438.47 730.10 Td ( fiscal quarter of 2017 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.25 718.10 Td (50.3%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 116.08 718.10 Td ( in our OLS segment and increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.10 718.10 Td (241.3%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 289.93 718.10 Td ( in our ILS segment from the same quarter one year ago, with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (majority of the increase in the ILS segment due to Rofin shipments since the acquisition on November 7, 2016. For a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td (description of the reasons for changes in net sales refer to the Results of Operations section of this quarterly report.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (Gr) Tj ET Q q 0 0 0 rg BT 62.04 670.10 Td (oss Pr) Tj ET Q q 0 0 0 rg BT 87.69 670.10 Td (ofit as a Per) Tj ET Q q 0 0 0 rg BT 138.32 670.10 Td (centage of Net Sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (Gross profit as a percentage of net sales \(gross profit percentage\) is calculated as gross profit for the period divided by net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (sales for the period. Gross profit percentage in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 255.21 634.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 271.32 634.10 Td ( quarter increased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.83 634.10 Td (47.9%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.66 634.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.43 634.10 Td (52.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 431.26 634.10 Td ( in our OLS segment and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.85 622.10 Td (27.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.68 622.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.46 622.10 Td (17.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 178.29 622.10 Td ( in our ILS segment from the same quarter one year ago. For a description of the reasons for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (changes in gross profit refer to the Results of Operations section of this quarterly report.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (Resear) Tj ET Q q 0 0 0 rg BT 79.25 586.10 Td (ch and Development as a Per) Tj ET Q q 0 0 0 rg BT 202.67 586.10 Td (centage of Net Sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (Research and development as a percentage of net sales \(R&D percentage\) is calculated as research and development expense ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (for the period divided by net sales for the period. Management considers R&D percentage to be an important indicator in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (managing our business as investing in new technologies is a key to future growth. R&D percentage decreased to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.33 538.10 Td (7.8%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.16 538.10 Td ( from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (10.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 75.83 526.10 Td ( in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.44 526.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 120.55 526.10 Td ( fiscal quarter compared to the same period one year ago.For a description of the reasons for changes in R&D ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.10 Td (spending refer to the Results of Operations section of this quarterly report.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 490.10 Td (Net Cash Pr) Tj ET Q q 0 0 0 rg BT 102.03 490.10 Td (ovided by Operating ) Tj ET Q q 0 0 0 rg BT 191.77 490.10 Td (Activities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 478.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.10 Td (Net cash provided by operating activities as reflected on our Condensed Consolidated Statements of Cash Flows primarily ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.10 Td (represents the excess of cash collected from billings to our customers and other receipts over cash paid to our vendors for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.10 Td (expenses and inventory purchases to run our business.) Tj ET Q q 0 0 0 rg BT 268.94 442.10 Td (W) Tj ET Q q 0 0 0 rg BT 277.58 442.10 Td (e believe that cash flows from operations is an important performance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.10 Td (indicator because cash generation over the long term is essential to maintaining a healthy business and providing funds to help ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.10 Td (fuel growth. For a description of the reasons for changes in Net Cash Provided by Operating ) Tj ET Q q 0 0 0 rg BT 423.80 418.10 Td (Activities refer to the Liquidity ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 406.10 Td (and Capital Resources section of this quarterly report.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 394.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 382.10 Td (Days Sales Outstanding in Receivables) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 358.10 Td (e calculate days sales outstanding \(DSO\) in receivables as net receivables at the end of the period divided by net sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.10 Td (during the period and then multiplied by the number of days in the period, using 90 days for quarters.DSO in receivables ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 334.10 Td (indicates how well we are managing our collection of receivables, with lower DSO in receivables resulting in higher working ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 322.10 Td (capital availability) Tj ET Q q 0 0 0 rg BT 123.49 322.10 Td (.) Tj ET Q q 0 0 0 rg BT 128.31 322.10 Td (The more money we have tied up in receivables, the less money we have available for research and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 310.10 Td (development, acquisitions, expansion, marketing and other activities to grow our business.Our DSO in receivables for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.83 310.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 557.94 310.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 298.10 Td (quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.80 298.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 135.80 298.10 Td ( decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 202.15 298.10 Td (68.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 219.65 298.10 Td ( days to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 253.26 298.10 Td (62.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 270.76 298.10 Td ( days compared to the same quarter one year ago primarily due to higher ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 286.10 Td (sales of flat panel display system in ) Tj ET Q q 0 0 0 rg BT 194.14 286.10 Td (Asia and the timing of collections of those receivables, lower sales and receivables in Japan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 274.10 Td (which typically has a higher DSO and improved collections of older receivables in the U.S. and Europe partially of) Tj ET Q q 0 0 0 rg BT 510.24 274.10 Td (fset by the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 262.10 Td (impact of the acquisition of Rofin, who have historically had higher DSOs than those previously reported by us.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 250.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 238.10 Td (Annualized First Quarter) Tj ET Q q 0 0 0 rg BT 159.25 238.10 Td ( Inventory ) Tj ET Q q 0 0 0 rg BT 206.29 238.10 Td (T) Tj ET Q q 0 0 0 rg BT 212.05 238.10 Td (urns) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 226.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 214.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 214.10 Td (e calculate annualized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 149.41 214.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 165.52 214.10 Td ( quarter inventory turns as the cost of sales during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.41 214.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.52 214.10 Td ( quarter annualized and divided by net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 202.10 Td (inventories at the end of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 163.85 202.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.96 202.10 Td ( quarter) Tj ET Q q 0 0 0 rg BT 210.22 202.10 Td (. ) Tj ET Q q 0 0 0 rg BT 215.04 202.10 Td (This indicates how well we are managing our inventory levels, with higher inventory ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 190.10 Td (turns resulting in more working capital availability and a higher return on our investments in inventory) Tj ET Q q 0 0 0 rg BT 460.64 190.10 Td (. ) Tj ET Q q 0 0 0 rg BT 465.46 190.10 Td (The more money we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.10 Td (have tied up in inventory) Tj ET Q q 0 0 0 rg BT 149.33 178.10 Td (, the less money we have available for research and development, acquisitions, expansion, marketing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 166.10 Td (and other activities to grow our business. Our annualized inventory turns for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.70 166.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.81 166.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.11 166.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.11 166.10 Td ( decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 543.46 166.10 Td (2.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 555.96 166.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 154.10 Td (to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.28 154.10 Td (2.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.78 154.10 Td ( turns compared to the same quarter one year ago primarily due to the impact of the acquisition of Rofin in the first ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 142.10 Td (quarter of fiscal 2017, including both the impact of including Rofin's cost of sales only after the November 7, 2016 acquisition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 130.10 Td (date and Rofin's historically lower inventory turns rate.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 106.10 Td (Capital Spending as a Per) Tj ET Q q 0 0 0 rg BT 160.39 106.10 Td (centage of Net Sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 94.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 82.10 Td (Capital spending as a percentage of net sales \(capital spending percentage\) is calculated as capital expenditures for the period ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 70.10 Td (divided by net sales for the period.Capital spending percentage indicates the extent to which we are expanding or improving ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 58.10 Td (our operations, including investments in technology and equipment.Management monitors capital spending levels as this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 46.10 Td (assists us in measuring our cash flows, net of capital expenditures. Our capital spending percentage increased to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.14 46.10 Td (4.4%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.97 46.10 Td ( from ) Tj ET Q endstream endobj 69 0 obj <>] /Rotate 0 /Contents 70 0 R>> endobj 70 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (34) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (2.5%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.83 742.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 102.21 742.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 118.32 742.10 Td ( quarter compared to the same period one year ago primarily due to) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 387.66 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 390.16 742.10 Td (investments to expand our manufacturing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (capacity in Gttingen, Germany) Tj ET Q q 0 0 0 rg BT 177.64 730.10 Td (, the acquisition of Rofin in the first quarter of fiscal 2017, the upgrade certain of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (production facilities in California and New Jersey and higher purchases of production-related assets, partially of) Tj ET Q q 0 0 0 rg BT 498.29 718.10 Td (fset by the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (impact of higher revenues in the first quarter of fiscal 2017. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (Adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 129.19 682.10 Td ( as a Per) Tj ET Q q 0 0 0 rg BT 165.39 682.10 Td (centage of Net Sales) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 658.10 Td (e define adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 165.00 658.10 Td ( as operating income adjusted for depreciation, amortization, stock compensation expenses, major ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (restructuring costs and certain other non-operating income and expense items, such as costs related to the acquisition of Rofin. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (Key initiatives to reach our goals for EBITDA) Tj ET Q q 0 0 0 rg BT 235.23 634.10 Td ( improvements include utilization of our ) Tj ET Q q 0 0 0 rg BT 398.53 634.10 Td (Asian manufacturing locations, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (rationalizing our supply chain and continued leveraging of our infrastructure. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 598.10 Td (e utilize a number of dif) Tj ET Q q 0 0 0 rg BT 154.81 598.10 Td (ferent financial measures, both GAAP) Tj ET Q q 0 0 0 rg BT 307.45 598.10 Td ( and non-GAAP) Tj ET Q q 0 0 0 rg BT 371.33 598.10 Td (, such as adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 479.93 598.10 Td ( as a percentage of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (net sales, in analyzing and assessing our overall business performance, for making operating decisions and for forecasting and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td (planning future periods. ) Tj ET Q q 0 0 0 rg BT 148.13 574.10 Td (W) Tj ET Q q 0 0 0 rg BT 156.77 574.10 Td (e consider the use of non-GAAP) Tj ET Q q 0 0 0 rg BT 286.65 574.10 Td ( financial measures helpful in assessing our current financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (performance and ongoing operations. ) Tj ET Q q 0 0 0 rg BT 201.71 562.10 Td (While we use non-GAAP) Tj ET Q q 0 0 0 rg BT 303.82 562.10 Td ( financial measures as a tool to enhance our understanding of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (certain aspects of our financial performance, we do not consider these measures to be a substitute for) Tj ET Q q 0 0 0 rg BT 453.06 550.10 Td (, or superior to, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (information provided by GAAP) Tj ET Q q 0 0 0 rg BT 177.11 538.10 Td ( financial measures. ) Tj ET Q q 0 0 0 rg BT 259.12 538.10 Td (W) Tj ET Q q 0 0 0 rg BT 267.76 538.10 Td (e provide adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 379.68 538.10 Td ( in order to enhance investors' understanding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (of our ongoing operations. ) Tj ET Q q 0 0 0 rg BT 158.41 526.10 Td (This measure is used by some investors when assessing our performance.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 504.10 Td (Below is the reconciliation of our net income from continuing operations as a percentage of net sales to our adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 553.75 504.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 492.10 Td (as a percentage of net sales:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 435.60 207.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 257.50 435.60 62.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 319.50 435.60 4.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.50 435.60 62.00 -25.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 395.60 207.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 257.50 395.60 62.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 319.50 395.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.50 395.60 62.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 366.60 207.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 257.50 366.60 62.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 319.50 366.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.50 366.60 62.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 337.60 207.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 257.50 337.60 62.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 319.50 337.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.50 337.60 62.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 307.60 207.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 257.50 307.60 62.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 319.50 307.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.50 307.60 62.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 257.5 456.6 m 319.5 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319.5 456.6 m 323.5 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 323.5 456.6 m 385.5 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 257.5 435.6 m 319.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 323.5 435.6 m 385.5 435.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 257.5 292.6 m 319.5 292.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 257.5 271.6 m 319.5 271.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 257.5 269.6 m 319.5 269.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 323.5 292.6 m 385.5 292.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 323.5 271.6 m 385.5 271.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 323.5 269.6 m 385.5 269.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 153.50 459.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 284.60 460.83 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 53.00 438.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 264.75 447.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 280.00 439.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 335.75 447.83 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 346.00 439.83 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 425.27 Td (Net income from continuing operations as a) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 415.27 Td (percentage of net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 415.28 Td (8.9) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 415.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 359.15 415.27 Td (10.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 415.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 400.27 Td (Income tax expense) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 400.28 Td (4.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 400.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.15 400.27 Td (3.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 400.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 385.27 Td (Interest and other income \(expense\), net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 289.80 385.28 Td (\(1.5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.65 385.28 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.15 385.27 Td (0.6) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 385.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 371.17 Td (Depreciation and amortization) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 371.28 Td (6.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 371.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.15 371.17 Td (4.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 371.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 357.17 Td (Restructuring charges) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 357.28 Td (2.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 357.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.65 357.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 357.17 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 342.27 Td (Purchase accounting step up) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 342.28 Td (2.7) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 342.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.65 342.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 342.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 327.27 Td (Gain on business combination) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 289.80 327.28 Td (\(1.6) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.65 327.28 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.65 327.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 327.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 312.27 Td (Costs related to acquisition of Rofin) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 312.28 Td (4.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 312.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.65 312.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 312.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 297.27 Td (Stock-based compensation) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.15 297.28 Td (2.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 297.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.15 297.27 Td (2.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 297.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 275.27 Td (Adjusted EBITDA as a percentage of net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 288.15 275.28 Td (28.4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.00 275.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 359.15 275.27 Td (21.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 275.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 50 233.53505859375002 m 159.013671875 233.53505859375002 l s q 0 0 0 rg BT 50.00 235.10 Td (SIGNIFICANT) Tj ET Q q 0 0 0 rg BT 116.50 235.10 Td ( EVENTS) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 218.10 Td (Acquisition and r) Tj ET Q q 0 0 0 rg BT 124.28 218.10 Td (elated financing) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 201.10 Td (On November7, 2016, we completed our previously announced acquisition of Rofin pursuant to the Mer) Tj ET Q q 0 0 0 rg BT 470.00 201.10 Td (ger ) Tj ET Q q 0 0 0 rg BT 484.72 201.10 Td (Agreement dated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 189.10 Td (March 16, 2016. Rofin is one of the world's leading developers and manufacturers of high-performance industrial laser sources ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 177.10 Td (and laser) Tj ET Q q 0 0 0 rg BT 85.62 177.10 Td (-based solutions and components. ) Tj ET Q q 0 0 0 rg BT 222.54 177.10 Td (As a condition of the acquisition, we are required to divest ourselves of Rofin) Tj ET Q q 0 0 0 rg BT 535.80 177.10 Td (s low ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 165.10 Td (power CO2 laser business based in Hull, United Kingdom, and will report this business separately as a discontinued operation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 153.10 Td (until it is divested. ) Tj ET Q q 0 0 0 rg BT 126.21 153.10 Td (The acquisition was an all-cash transaction at a price of $32.50 per share of Rofin common stock. ) Tj ET Q q 0 0 0 rg BT 518.96 153.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 141.10 Td (aggregate consideration paid by us to the former Rofin stockholders was approximately $904.5 million, excluding related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 129.10 Td (transaction fees and expenses. ) Tj ET Q q 0 0 0 rg BT 172.83 129.10 Td (W) Tj ET Q q 0 0 0 rg BT 181.46 129.10 Td (e also paid $15.3 million due to the cancellation of options held by employees of Rofin. ) Tj ET Q q 0 0 0 rg BT 534.55 129.10 Td (W) Tj ET Q q 0 0 0 rg BT 543.18 129.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 117.10 Td (funded the payment of the aggregate consideration with a combination of our available cash on hand and the proceeds from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 105.10 Td (Euro ) Tj ET Q q 0 0 0 rg BT 71.76 105.10 Td (T) Tj ET Q q 0 0 0 rg BT 77.17 105.10 Td (erm Loan described below) Tj ET Q q 0 0 0 rg BT 182.87 105.10 Td (. See Note 3. Business Combinations in the Notes to Condensed Consolidated Financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 93.10 Td (Statements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 69.10 Td (On November7, 2016, we entered into a Credit ) Tj ET Q q 0 0 0 rg BT 242.45 69.10 Td (Agreement \(the Credit ) Tj ET Q q 0 0 0 rg BT 338.80 69.10 Td (Agreement\) with Barclays Bank PLC \("Barclays"\), ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 57.10 Td (Bank of ) Tj ET Q q 0 0 0 rg BT 83.89 57.10 Td (America, N.A. \("BAML"\) and MUFG Union Bank, N.A. \("MUFG"\). ) Tj ET Q q 0 0 0 rg BT 363.90 57.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 408.89 57.10 Td (Agreement provided for a 670.0 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 45.10 Td (million Euro senior secured term loan facility \(the Euro ) Tj ET Q q 0 0 0 rg BT 278.91 45.10 Td (T) Tj ET Q q 0 0 0 rg BT 284.32 45.10 Td (erm Loan\) and a $100.0 million senior secured revolving credit ) Tj ET Q endstream endobj 71 0 obj <>] /Rotate 0 /Contents 72 0 R>> endobj 72 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (35) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (facility) Tj ET Q q 0 0 0 rg BT 77.67 742.10 Td (. On November7, 2016, the Euro ) Tj ET Q q 0 0 0 rg BT 213.57 742.10 Td (T) Tj ET Q q 0 0 0 rg BT 218.98 742.10 Td (erm Loan was drawn in full and its proceeds were used to finance the acquisition of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (Rofin and pay related fees and expenses. ) Tj ET Q q 0 0 0 rg BT 214.94 730.10 Td (Also, on November7, 2016, we used 10.0 million Euro of the capacity under the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (revolving credit facility for the issuance of a letter of credit. See Note 9. Borrowings in the Notes to Condensed Consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (Financial Statements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (In relation to the acquisition of Rofin, we paid Barclays, our financial advisor) Tj ET Q q 0 0 0 rg BT 360.07 682.10 Td (, a fee of approximately $9.5 million, $1.0 million ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (of which was paid upon delivery of the fairness opinion in the second quarter of fiscal 2016, and the remaining portion of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (which was paid upon consummation of the acquisition in the first quarter of fiscal 2017; these fees were recorded in the selling, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (general and administrative line of the consolidated statements of operations. ) Tj ET Q q 0 0 0 rg BT 356.67 646.10 Td (W) Tj ET Q q 0 0 0 rg BT 365.31 646.10 Td (e also paid Barclays, BAML) Tj ET Q q 0 0 0 rg BT 479.08 646.10 Td ( and MUFG ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (together approximately $17.0 million and $5.6 million for underwriting and upfront fees, respectively) Tj ET Q q 0 0 0 rg BT 456.20 634.10 Td (, upon the close of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (financing on November 7, 2016; these fees are recorded as debt issuance costs on our consolidated balance sheets. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (As a result of the acquisition of Rofin in the first quarter of fiscal 2017, we reor) Tj ET Q q 0 0 0 rg BT 367.79 598.10 Td (ganized into two new reporting segments for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (combined company based upon our or) Tj ET Q q 0 0 0 rg BT 202.84 586.10 Td (ganizational structure and how our Chief Operating Decision Maker receives and utilizes ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td (information provided to allocate resources and make decisions: OEM Laser Sources \("OLS"\) and Industrial Lasers & Systems ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (\("ILS"\). ) Tj ET Q q 0 0 0 rg BT 84.64 562.10 Td (This segmentation reflects the go-to-market strategies and syner) Tj ET Q q 0 0 0 rg BT 340.77 562.10 Td (gies for our broad portfolio of laser technologies and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (products. ) Tj ET Q q 0 0 0 rg BT 89.26 550.10 Td (While both segments deliver cost-ef) Tj ET Q q 0 0 0 rg BT 233.48 550.10 Td (fective, highly reliable photonics solutions, the OLS business segment, is focused ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (on high performance laser sources and complex optical sub-systems, typically used in microelectronics manufacturing, medical ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (diagnostics and therapeutic medical applications, as well as in scientific research. Our ILS business segment delivers high ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.10 Td (performance laser sources, sub-systems and tools primarily used for industrial laser materials processing, serving important end ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.10 Td (markets like automotive, machine tool, consumer goods and medical device manufacturing.) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 50 476.53505859375 m 178.5546875 476.53505859375 l s q 0 0 0 rg BT 50.00 478.10 Td (RESUL) Tj ET Q q 0 0 0 rg BT 82.43 478.10 Td (TS OF) Tj ET Q q 0 0 0 rg BT 110.67 478.10 Td ( OPERA) Tj ET Q q 0 0 0 rg BT 147.43 478.10 Td (TIONS) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 454.10 Td (CONSOLIDA) Tj ET Q q 0 0 0 rg BT 109.82 454.10 Td (TED SUMMAR) Tj ET Q q 0 0 0 rg BT 178.64 454.10 Td (Y) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.10 Td (The following table sets forth, for the periods indicated, the percentage of total net sales represented by the line items reflected ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.10 Td (in our condensed consolidated statements of operations:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 155.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 373.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 373.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 373.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 373.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 343.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 343.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 343.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 343.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 314.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 314.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 314.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 314.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 284.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 284.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 284.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 284.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 254.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 254.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 254.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 254.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 224.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 224.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 224.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 224.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 184.60 200.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 253.00 184.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 323.00 184.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 184.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 394.6 m 323 394.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 394.6 m 397 394.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 394.6 m 323 394.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 373.6 m 323 373.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 394.6 m 397 394.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 373.6 m 397 373.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 373.6 m 323 373.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 373.6 m 397 373.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 343.6 m 323 343.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 343.6 m 397 343.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 254.60000000000002 m 323 254.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 254.60000000000002 m 397 254.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 239.60000000000002 m 323 239.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 239.60000000000002 m 397 239.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 209.60000000000002 m 323 209.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 209.60000000000002 m 397 209.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 169.60000000000002 m 323 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 169.60000000000002 m 397 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 155.60000000000002 m 323 155.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 253 153.60000000000002 m 323 153.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 155.60000000000002 m 397 155.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327 153.60000000000002 m 397 153.60000000000002 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 152.50 397.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 288.10 398.83 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 376.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 264.25 385.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 279.50 377.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 343.25 385.83 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 353.50 377.83 Td (2016) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 363.28 Td (Net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 286.65 363.28 Td (100.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 363.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 362.30 363.27 Td (100.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 363.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 348.28 Td (Cost of sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 348.28 Td (59.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 348.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 348.27 Td (55.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 348.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 333.28 Td (Gross profit) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 333.28 Td (40.9) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 333.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 333.27 Td (44.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 333.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 319.28 Td (Operating expenses:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 61.50 304.27 Td (Research and development) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.65 304.28 Td (7.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 304.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 304.27 Td (10.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 304.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 61.50 289.27 Td (Selling, general and administrative) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 289.28 Td (21.3) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 289.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 289.27 Td (19.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 289.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 61.50 274.27 Td (Gain on business combination) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 293.30 274.33 Td (\(1.5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 274.28 Td (\)%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 374.80 274.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 274.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 61.50 259.27 Td (Amortization of intangible assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.65 259.28 Td (1.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 259.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.30 259.27 Td (0.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 259.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 244.27 Td (Total operating expenses) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 244.28 Td (28.7) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 244.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 244.27 Td (29.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 244.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 229.28 Td (Income from operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 229.28 Td (12.2) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 229.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 229.27 Td (14.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 229.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 214.28 Td (Other income \(expense\), net) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.65 214.28 Td (1.5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 214.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.95 214.27 Td (\(0.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 384.80 214.27 Td (\)%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 199.28 Td (Income from continuing operations before) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 189.28 Td (income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 291.65 189.28 Td (13.7) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 189.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 189.27 Td (14.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 189.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 174.27 Td (Provision for income taxes) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.65 174.28 Td (4.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 174.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.30 174.27 Td (3.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 174.27 Td (%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 55.50 159.28 Td (Net income from continuing operations) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 296.65 159.28 Td (8.9) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 312.50 159.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.30 159.27 Td (10.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.15 159.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 131.10 Td (Net income from continuing operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.12 131.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 255.22 131.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 323.53 131.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.53 131.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.08 131.10 Td ($30.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.97 131.10 Td ( \() Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 423.80 131.10 Td ($1.25) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 446.30 131.10 Td ( per diluted share\)) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 518.77 131.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 521.27 131.10 Td (including ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 119.10 Td ($14.5 million of after tax costs related to our acquisition of Rofin, $8.2 million of after) Tj ET Q q 0 0 0 rg BT 396.39 119.10 Td (-tax stock-based compensation expense, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 107.10 Td ($7.7 million after) Tj ET Q q 0 0 0 rg BT 119.51 107.10 Td (-tax amortization of intangible assets, $6.5 million after) Tj ET Q q 0 0 0 rg BT 341.75 107.10 Td (-tax amortization of purchase accounting inventory ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 95.10 Td (step up, $4.6 million of after) Tj ET Q q 0 0 0 rg BT 163.95 95.10 Td (-tax restructuring costs, $1.8 million after) Tj ET Q q 0 0 0 rg BT 330.09 95.10 Td (-tax interest expense on the commitment of our term loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 83.10 Td (to finance the acquisition of Rofin, a $3.4 million after) Tj ET Q q 0 0 0 rg BT 268.35 83.10 Td (-tax gain on our sale of owned Rofin shares and $7.1 million after) Tj ET Q q 0 0 0 rg BT 531.70 83.10 Td (-tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 71.10 Td (foreign exchange gain on forward contracts associated with our foreign exchange risk related to the commitment of our Euro ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 59.10 Td (T) Tj ET Q q 0 0 0 rg BT 55.41 59.10 Td (erm Loan and the issuance of the Euro ) Tj ET Q q 0 0 0 rg BT 211.84 59.10 Td (T) Tj ET Q q 0 0 0 rg BT 217.25 59.10 Td (erm Loan to finance the acquisition of Rofin. Net income from continuing operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 47.10 Td (for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.88 47.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.99 47.10 Td ( quarter of fiscal 2016 was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 203.84 47.10 Td ($20.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.73 47.10 Td ( \() Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.56 47.10 Td ($0.84) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 286.06 47.10 Td ( per diluted share\) including $3.4 million of after) Tj ET Q q 0 0 0 rg BT 481.64 47.10 Td (-tax stock-based ) Tj ET Q endstream endobj 73 0 obj <>] /Rotate 0 /Contents 74 0 R>> endobj 74 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (36) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (compensation expense, $1.4 million after) Tj ET Q q 0 0 0 rg BT 214.76 742.10 Td (-tax amortization of intangible assets and a benefit of $1.2 million related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (renewal of the federal research and development tax credits for fiscal 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (BACKLOG) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (Backlog represents orders which we expect to be shipped within 12 months and the current portion of service contracts. Orders ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (used to compute backlog are generally cancelable and, depending on the notice period, are subject to rescheduling by our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (customers without substantial penalties. Historically) Tj ET Q q 0 0 0 rg BT 258.48 658.10 Td (, we have not experienced a significant rate of cancellation or rescheduling, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (though we cannot guarantee that the rate of cancellations or rescheduling will not increase in the future. ) Tj ET Q q 0 0 0 rg BT 466.88 646.10 Td (W) Tj ET Q q 0 0 0 rg BT 475.52 646.10 Td (e have a backlog of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (orders shippable within 12 months of $823.5 million at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.76 634.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.34 634.10 Td (, including a significant concentration in the flat ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (panel display market \(58%\) for customers which are primarily located in ) Tj ET Q q 0 0 0 rg BT 342.96 622.10 Td (Asia. ) Tj ET Q q 0 0 0 rg BT 365.74 622.10 Td (As a result of the acquisition of Rofin, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (acquired ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.92 610.10 Td ($1) Tj ET Q q 0 0 0 rg BT 96.55 610.10 Td (14.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 145.44 610.10 Td ( of backlog as of November 7, 2016.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (NET) Tj ET Q q 0 0 0 rg BT 70.38 586.10 Td ( SALES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (Market ) Tj ET Q q 0 0 0 rg BT 84.16 562.10 Td (Application) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (The following tables set forth, for the periods indicated, the amount of net sales and their relative percentages of total net sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (by market application \(dollars in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 446.60 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 446.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 446.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 446.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 446.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 446.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 446.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 446.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 416.60 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 416.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 416.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 416.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 416.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 416.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 416.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 416.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 386.60 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 386.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 386.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 386.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 386.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 386.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 386.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 386.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 502.6 m 340.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 502.6 m 344.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 502.6 m 414.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 502.6 m 418.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 502.6 m 488.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488.5 502.6 m 492.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 502.6 m 562.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 502.6 m 340.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 489.6 m 340.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 502.6 m 344.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 489.6 m 344.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 502.6 m 414.5 502.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 489.6 m 414.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 489.6 m 488.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488.5 489.6 m 492.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 489.6 m 562.5 489.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 460.6 m 340.5 460.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 460.6 m 414.5 460.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 460.6 m 488.5 460.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 460.6 m 562.5 460.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 386.6 m 340.5 386.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 386.6 m 414.5 386.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 386.6 m 488.5 386.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 386.6 m 562.5 386.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 386.6 m 340.5 386.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 372.6 m 340.5 372.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 370.6 m 340.5 370.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 372.6 m 414.5 372.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 370.6 m 414.5 370.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 372.6 m 488.5 372.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 370.6 m 488.5 370.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 372.6 m 562.5 372.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 370.6 m 562.5 370.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 379.60 506.83 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 309.75 493.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.75 493.83 Td (January 2, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.95 464.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 360.15 480.83 Td (Per) Tj ET Q q 0 0 0 rg BT 371.99 480.83 Td (centage ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 366.85 472.83 Td (of total) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 363.65 464.83 Td ( net sales) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 438.95 464.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.15 480.83 Td (Per) Tj ET Q q 0 0 0 rg BT 519.99 480.83 Td (centage) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 513.85 472.83 Td ( of total) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 511.65 464.83 Td ( net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 53.00 451.28 Td (Consolidated:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 436.27 Td (Microelectronics) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 436.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.15 436.28 Td (175,774) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 386.50 436.28 Td (50.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 436.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 436.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.15 436.27 Td (96,506) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 436.27 Td (50.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 436.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 421.27 Td (OEM components and instrumentation) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 421.28 Td (46,572) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 386.50 421.28 Td (13.5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 421.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.15 421.27 Td (39,333) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 421.27 Td (20.7) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 421.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 406.27 Td (Materials processing) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 406.28 Td (94,643) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 386.50 406.28 Td (27.3) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 406.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.15 406.27 Td (23,034) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 406.27 Td (12.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 406.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 391.27 Td (Scientific and government programs) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 309.15 391.28 Td (29,084) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 391.50 391.28 Td (8.4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 391.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.15 391.27 Td (31,402) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 391.27 Td (16.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 391.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 376.27 Td ( Total) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 376.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.15 376.28 Td (346,073) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 381.50 376.28 Td (100.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 376.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 376.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.15 376.27 Td (190,275) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.15 376.27 Td (100.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 376.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 348.10 Td (Net sales in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.87 348.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 129.98 348.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 198.28 348.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 218.28 348.10 Td ( included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.71 348.10 Td ($74.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 311.61 348.10 Td ( of Rofin net sales since the acquisition on November 7, 2016, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 336.10 Td (primarily in the materials processing market. Net sales for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 299.64 336.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.75 336.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 384.05 336.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.05 336.10 Td ( increased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 459.31 336.10 Td ($155.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.20 336.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 534.03 336.10 Td (82%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 552.36 336.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 324.10 Td (compared to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 116.92 324.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.03 324.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 201.33 324.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.33 324.10 Td (, with significant increases in the microelectronics and materials processing markets, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 312.10 Td (a smaller increase in the OEM components and instrumentation market and a decrease in the scientific and government ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 300.10 Td (programs market.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 276.10 Td (The increase in the microelectronics market of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 238.53 276.10 Td ($79.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 292.42 276.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 308.25 276.10 Td (82%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.58 276.10 Td (, was primarily due to higher shipments related to flat ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 264.10 Td (panel display annealing systems and higher shipments related to semiconductor and advanced packaging applications partially ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 252.10 Td (of) Tj ET Q q 0 0 0 rg BT 58.15 252.10 Td (fset by lower shipments for micro materials processing applications. Sales in the materials processing market increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 537.18 252.10 Td ($71.6 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 240.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 240.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 94.72 240.10 Td (31) Tj ET Q q 0 0 0 rg BT 104.35 240.10 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.68 240.10 Td (, primarily due to Rofin net sales since the acquisition on November 7, 2016 and higher shipments for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 228.10 Td (automotive and other materials processing applications. ) Tj ET Q q 0 0 0 rg BT 275.03 228.10 Td (The increase in the OEM components and instrumentation market of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 216.10 Td ($7.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.89 216.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 114.72 216.10 Td (18%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.05 216.10 Td (, was due primarily to higher shipments for medical, military and bio-instrumentation applications, with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 204.10 Td (much of the increase in military and medical applications due to the acquisition of Rofin. Sales in the scientific and government ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 192.10 Td (programs market decreased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 162.45 192.10 Td ($2.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.34 192.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 227.17 192.10 Td (7.4%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 248.00 192.10 Td (, due to lower demand for advanced research applications used by university ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 180.10 Td (and government research groups, particularly in the U.S. and Europe.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 156.10 Td (The timing for shipments of our higher average selling price excimer products in the flat panel display market have historically ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 144.10 Td (fluctuated and are in the future expected to fluctuate from quarter) Tj ET Q q 0 0 0 rg BT 311.34 144.10 Td (-to-quarter due to customer scheduling, our ability to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 132.10 Td (manufacture these products and/or availability of critical component parts and supplies.) Tj ET Q q 0 0 0 rg BT 402.11 132.10 Td (As a result, the timing to convert orders ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 120.10 Td (for these products to net sales will likely fluctuate from quarter) Tj ET Q q 0 0 0 rg BT 301.94 120.10 Td (-to-quarter) Tj ET Q q 0 0 0 rg BT 344.15 120.10 Td (.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 96.10 Td (Segments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 84.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 72.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 72.10 Td (e are or) Tj ET Q q 0 0 0 rg BT 88.43 72.10 Td (ganized into two reportable operating segments: OLS and ILS. ) Tj ET Q q 0 0 0 rg BT 341.52 72.10 Td (While both segments deliver cost-ef) Tj ET Q q 0 0 0 rg BT 485.74 72.10 Td (fective, highly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 60.10 Td (reliable photonics solutions, OLS is focused on high performance laser sources and complex optical sub-systems, typically ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 48.10 Td (used in microelectronics manufacturing, medical diagnostics and therapeutic medical applications, as well as in scientific ) Tj ET Q endstream endobj 75 0 obj <>] /Rotate 0 /Contents 76 0 R>> endobj 76 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (37) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (research. ILS delivers high performance laser sources, sub-systems and tools primarily used for industrial laser materials ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (processing, serving important end markets like automotive, machine tool, consumer goods and medical device manufacturing. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (The following tables set forth, for the periods indicated, the amount of net sales and their relative percentages of total net sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (by segment \(dollars in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 626.60 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 626.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 626.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 626.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 626.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 626.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 626.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 626.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 596.60 220.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 270.50 596.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 340.50 596.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 344.50 596.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 414.50 596.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 596.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 596.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 596.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 682.6 m 340.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 682.6 m 344.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 682.6 m 414.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 414.5 682.6 m 418.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 682.6 m 488.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488.5 682.6 m 492.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 682.6 m 562.5 682.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 669.6 m 340.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 340.5 669.6 m 344.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 669.6 m 414.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 669.6 m 488.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488.5 669.6 m 492.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 669.6 m 562.5 669.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 640.6 m 340.5 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 640.6 m 414.5 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 640.6 m 488.5 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 640.6 m 562.5 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 596.6 m 340.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 596.6 m 488.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 596.6 m 340.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 582.6 m 340.5 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 270.5 580.6 m 340.5 580.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 596.6 m 414.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 582.6 m 414.5 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 344.5 580.6 m 414.5 580.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 596.6 m 488.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 582.6 m 488.5 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 580.6 m 488.5 580.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 596.6 m 562.5 596.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 582.6 m 562.5 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 580.6 m 562.5 580.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 379.60 686.83 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 309.75 673.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.75 673.83 Td (January 2, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.95 644.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 360.15 660.83 Td (Per) Tj ET Q q 0 0 0 rg BT 371.99 660.83 Td (centage) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 366.85 652.83 Td (of total) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 364.65 644.83 Td (net sales) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 438.95 644.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 508.15 660.83 Td (Per) Tj ET Q q 0 0 0 rg BT 519.99 660.83 Td (centage ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 514.85 652.83 Td (of total ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 512.65 644.83 Td (net sales) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 53.00 631.28 Td (Consolidated:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 616.27 Td (OEM Laser Sources \(OLS\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 616.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.15 616.28 Td (238,736) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 386.50 616.28 Td (69.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 616.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 616.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.15 616.27 Td (158,830) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 616.27 Td (83.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 616.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 601.27 Td (Industrial Lasers & Systems \(ILS\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.15 601.28 Td (107,337) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 386.50 601.28 Td (31.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 601.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.15 601.27 Td (31,445) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.15 601.27 Td (16.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 601.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 586.27 Td ( Total) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.00 586.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 304.15 586.28 Td (346,073) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 381.50 586.28 Td (100.0) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 404.00 586.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 586.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.15 586.27 Td (190,275) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.15 586.27 Td (100.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.65 586.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 558.10 Td (Net sales for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.75 558.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.86 558.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 202.16 558.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 222.16 558.10 Td ( increased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.42 558.10 Td ($155.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 336.31 558.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 352.14 558.10 Td (82%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 370.47 558.10 Td (, compared to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 442.39 558.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.50 558.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.80 558.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 546.80 558.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 546.10 Td (with increases of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 120.25 546.10 Td ($79.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 174.15 546.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 189.98 546.10 Td (50%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 208.31 546.10 Td (, in our OLS segment and increases of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.54 546.10 Td ($75.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.44 546.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 433.27 546.10 Td (241%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.60 546.10 Td (, in our ILS segment.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 541.03 546.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 543.53 546.10 Td (Net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 534.10 Td (sales in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 96.93 534.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.04 534.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 181.34 534.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 201.34 534.10 Td ( included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.78 534.10 Td ($74.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 294.67 534.10 Td ( of Rofin net sales since the acquisition on November 7, 2016, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 522.10 Td (with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.28 522.10 Td ($73.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.17 522.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.61 522.10 Td ($0.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.50 522.10 Td ( in the ILS and OLS segments, respectively) Tj ET Q q 0 0 0 rg BT 365.70 522.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 50.00 510.10 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.00 498.10 Td (The increase in our OLS segment sales was primarily due to higher shipments of flat panel display annealing systems and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 486.10 Td (higher service revenue as well as higher shipments for semiconductor and materials processing applications partially of) Tj ET Q q 0 0 0 rg BT 527.17 486.10 Td (fset by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 474.10 Td (lower shipments for scientific and government programs. ) Tj ET Q q 0 0 0 rg BT 281.43 474.10 Td (The increase in our ILS segment sales was primarily due to higher ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 462.10 Td (shipments for materials processing and OEM components and instrumentation applications due to the acquisition of Rofin as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 450.10 Td (well as higher shipments to the flat panel display market.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 426.10 Td (GROSS PROFIT) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 414.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 402.10 Td (Consolidated) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 390.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 378.10 Td (Our gross profit rate decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 188.28 378.10 Td (3.2%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 209.11 378.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.89 378.10 Td (40.9%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 247.72 378.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 275.21 378.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 291.32 378.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 359.62 378.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.62 378.10 Td ( from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.06 378.10 Td (44.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.89 378.10 Td ( in the first quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 366.10 Td (2016. ) Tj ET Q q 0 0 0 rg BT 74.82 366.10 Td (The decrease in the gross profit rate was primarily due to the impact of purchase accounting adjustments \(5.0%\) for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 354.10 Td (amortization of inventory step up and amortization of intangibles related to the acquisition of Rofin in the first quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 342.10 Td (2017. ) Tj ET Q q 0 0 0 rg BT 74.45 342.10 Td (Also contributing to the increase was the impact of the acquisition of Rofin before considering purchase accounting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 330.10 Td (adjustments \(1.3%\) partially of) Tj ET Q q 0 0 0 rg BT 174.23 330.10 Td (fset by improvements in historical Coherent mar) Tj ET Q q 0 0 0 rg BT 367.90 330.10 Td (gins primarily due to the favorable leverage of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 318.10 Td (manufacturing costs on higher volumes and the favorable impact of the weaker Euro as well as lower warranty costs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 294.10 Td (Our gross profit rate has been and will continue to be af) Tj ET Q q 0 0 0 rg BT 272.81 294.10 Td (fected by a variety of factors including market and product mix, pricing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 282.10 Td (on volume orders, shipment volumes, our ability to manufacture advanced and more complex products, manufacturing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 270.10 Td (ef) Tj ET Q q 0 0 0 rg BT 57.59 270.10 Td (ficiencies, excess and obsolete inventory write-downs, warranty costs, amortization of intangibles, pricing by competitors or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 258.10 Td (suppliers, new product introductions, production volume, customization and reconfiguration of systems, commodity prices and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 246.10 Td (foreign currency fluctuations, particularly the recent weakening of the Euro and to a lesser extent, the Japanese ) Tj ET Q q 0 0 0 rg BT 495.83 246.10 Td (Y) Tj ET Q q 0 0 0 rg BT 502.06 246.10 Td (en and South ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 234.10 Td (Korean ) Tj ET Q q 0 0 0 rg BT 81.75 234.10 Td (W) Tj ET Q q 0 0 0 rg BT 90.39 234.10 Td (on.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 222.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 210.10 Td (OEM Laser) Tj ET Q q 0 0 0 rg BT 100.64 210.10 Td ( Sour) Tj ET Q q 0 0 0 rg BT 123.53 210.10 Td (ces) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 198.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 186.10 Td (The gross profit rate in our OLS segment increased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 269.94 186.10 Td (4.2%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 290.77 186.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.55 186.10 Td (52.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 329.38 186.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.88 186.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 372.98 186.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 441.28 186.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 461.28 186.10 Td ( from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.72 186.10 Td (47.9%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 511.55 186.10 Td ( in the first ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 174.10 Td (quarter of fiscal 2016. ) Tj ET Q q 0 0 0 rg BT 140.62 174.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 158.67 174.10 Td (4.2%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.50 174.10 Td ( first quarter increase in the gross profit rate was primarily due to favorable product mar) Tj ET Q q 0 0 0 rg BT 531.13 174.10 Td (gins ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 162.10 Td (\(3.0%\) as a result of favorable leverage of manufacturing costs on higher volumes and the favorable impact of the weaker Euro ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 150.10 Td (and lower other costs \(0.8%\) due to lower inventory provisions and duty costs in certain business units as well as the impact of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 138.10 Td (the weaker Euro. ) Tj ET Q q 0 0 0 rg BT 119.97 138.10 Td (Also contributing to the increase in gross profit rate were lower intangibles amortization \(0.3%\) and lower ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 126.10 Td (warranty and installation costs \(0.1%\) as a percentage of revenue due to the impact of higher revenues.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 102.10 Td (Industrial Lasers & Systems) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 78.10 Td (The gross profit rate in our ILS segment decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 267.71 78.10 Td (10.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 293.54 78.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.32 78.10 Td (17.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 332.15 78.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 359.64 78.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 375.75 78.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 444.05 78.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 464.05 78.10 Td ( from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.49 78.10 Td (27.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.32 78.10 Td ( in the first ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 66.10 Td (quarter of fiscal 2016. ) Tj ET Q q 0 0 0 rg BT 140.62 66.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 158.67 66.10 Td (10.1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 184.50 66.10 Td ( first quarter decrease in the gross profit rate was primarily due to the impact of purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 54.10 Td (accounting adjustments \(16.2%\) for amortization of inventory step up and amortization of intangibles related to the acquisition ) Tj ET Q endstream endobj 77 0 obj <>] /Rotate 0 /Contents 78 0 R>> endobj 78 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (38) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (of Rofin in the first quarter of fiscal 2017 and restructuring costs \(3.2%\) related to the implementation of planned restructuring ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (activities in connection with the acquisition of Rofin, which is primarily related to the exit from our preexisting high power ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (fiber laser product line. ) Tj ET Q q 0 0 0 rg BT 145.62 718.10 Td (The decreases in gross profit rate were partially of) Tj ET Q q 0 0 0 rg BT 346.46 718.10 Td (fset by the favorable impact of Rofin's mar) Tj ET Q q 0 0 0 rg BT 517.75 718.10 Td (gins ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (before considering purchase accounting adjustments.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (OPERA) Tj ET Q q 0 0 0 rg BT 84.26 670.10 Td (TING EXPENSES:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 519.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 593.60 212.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 265.00 593.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 593.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 593.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 593.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.00 593.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.00 593.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.00 593.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 563.60 212.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 265.00 563.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 563.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 563.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 563.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.00 563.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.00 563.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.00 563.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 533.60 212.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 265.00 533.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 335.00 533.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 533.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 533.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 413.00 533.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 483.00 533.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 487.00 533.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 646.6 m 335 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 646.6 m 339 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 646.6 m 409 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 646.6 m 413 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 646.6 m 483 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 483 646.6 m 487 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 646.6 m 557 646.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 633.6 m 335 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 633.6 m 339 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 633.6 m 409 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 633.6 m 483 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 483 633.6 m 487 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 633.6 m 557 633.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 608.6 m 335 608.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 608.6 m 409 608.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 608.6 m 483 608.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 608.6 m 557 608.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 533.6 m 335 533.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 533.6 m 409 533.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 533.6 m 483 533.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 533.6 m 557 533.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 519.6 m 335 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 265 517.6 m 335 517.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 519.6 m 409 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 517.6 m 409 517.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 519.6 m 483 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 413 517.6 m 483 517.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 519.6 m 557 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 487 517.6 m 557 517.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 374.10 650.83 Td (Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 304.25 637.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 457.25 637.83 Td (January 2, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 285.45 612.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.35 620.83 Td (Per) Tj ET Q q 0 0 0 rg BT 362.19 620.83 Td (centage of ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.35 612.83 Td (total net sales) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 433.45 612.83 Td (Amount) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 498.35 620.83 Td (Per) Tj ET Q q 0 0 0 rg BT 510.19 620.83 Td (centage of ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 498.35 612.83 Td (total net sales) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 372.70 597.83 Td (\(Dollars in thousands\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 583.27 Td (Research and development) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 267.50 583.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 303.65 583.28 Td (27,084) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 382.65 583.28 Td (7.8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 398.50 583.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.50 583.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 583.27 Td (19,140) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.65 583.27 Td (10.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.15 583.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 568.27 Td (Selling, general and administrative) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 303.65 568.28 Td (73,768) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 568.28 Td (21.3) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 398.50 568.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 568.27 Td (36,774) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.65 568.27 Td (19.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.15 568.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 553.27 Td (Gain on business combination) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 305.30 553.33 Td (\(5,416) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 331.15 553.28 Td (\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 379.30 553.33 Td (\(1.5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 395.15 553.28 Td (\)%) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 469.15 553.28 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 538.15 553.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.15 553.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 538.27 Td (Amortization of intangible assets) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 308.65 538.28 Td (3,878) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 382.65 538.28 Td (1.1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 398.50 538.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 464.15 538.27 Td (701) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 535.65 538.27 Td (0.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.15 538.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 523.27 Td (Total operating expenses) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 267.50 523.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 303.65 523.28 Td (99,314) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 377.65 523.28 Td (28.7) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 398.50 523.28 Td (%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.50 523.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.65 523.27 Td (56,615) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.65 523.27 Td (29.8) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.15 523.27 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 495.10 Td (Resear) Tj ET Q q 0 0 0 rg BT 79.25 495.10 Td (ch and development) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 471.10 Td (Research and development \(R&D\) expenses increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 278.79 471.10 Td ($7.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 327.69 471.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.52 471.10 Td (42%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.85 471.10 Td (, during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.17 471.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 426.28 471.10 Td ( fiscal quarter ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 459.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.58 459.10 Td ( compared to the same quarter one year ago.) Tj ET Q q 0 0 0 rg BT 307.77 459.10 Td (The increase was primarily due to Rofin R&D expenses \($5.1 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 447.10 Td (million\) since the acquisition on November 7, 2016, $1.1 million higher project spending including higher variable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 435.10 Td (compensation and higher spending on materials, $1.0 million of restructuring costs in the first quarter of fiscal 2017 related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 423.10 Td (the exit from our high power fiber laser product line and $0.7 million higher stock-based compensation expense including $0.5 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 411.10 Td (million related to a char) Tj ET Q q 0 0 0 rg BT 145.34 411.10 Td (ge recorded in the first quarter of fiscal 2017 due to the acceleration of Rofin options. On a segment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 399.10 Td (basis as compared to the prior year period, OLS research and development spending increased $1.6 million primarily due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 387.10 Td (higher net spending on projects. ILS spending increased $5.6 million primarily due to the acquisition of Rofin and restructuring ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 375.10 Td (costs partially of) Tj ET Q q 0 0 0 rg BT 116.47 375.10 Td (fset by lower project spending. Corporate and other spending increased $0.8 million due to higher stock-based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 363.10 Td (compensation expense. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 339.10 Td (Selling, general and administrative) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 315.10 Td (Selling, general and administrative \(SG&A\) expenses increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 316.58 315.10 Td ($37.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 370.47 315.10 Td (, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.30 315.10 Td (101%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 409.63 315.10 Td (, during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.95 315.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 474.06 315.10 Td ( fiscal quarter ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 303.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.58 303.10 Td ( compared to the same quarter one year ago.) Tj ET Q q 0 0 0 rg BT 307.77 303.10 Td (The increase was primarily due to $14.1 million higher ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 291.10 Td (financial advisory) Tj ET Q q 0 0 0 rg BT 121.27 291.10 Td (, consulting and legal costs related to the acquisition of Rofin, Rofin SG&A) Tj ET Q q 0 0 0 rg BT 424.00 291.10 Td ( expenses \($13.5 million\) since ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 279.10 Td (the acquisition on November 7, 2016 and $5.2 million higher stock-based compensation expense, including $3.4 million related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 267.10 Td (to a char) Tj ET Q q 0 0 0 rg BT 84.24 267.10 Td (ge recorded in the first quarter of fiscal 2017 due to the acceleration of Rofin options, as well as higher expense for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 255.10 Td (new grants. In addition, SG&A) Tj ET Q q 0 0 0 rg BT 174.43 255.10 Td ( expense increased $3.8 million due to higher payroll spending for variable compensation, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 243.10 Td (commissions and salaries and benefits and increased $0.4 million net due to higher other variable spending of) Tj ET Q q 0 0 0 rg BT 488.32 243.10 Td (fset by lower ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 231.10 Td (char) Tj ET Q q 0 0 0 rg BT 67.03 231.10 Td (ges for increases in deferred compensation plan liabilities. On a segment basis as compared to the prior year period, OLS ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 219.10 Td (segment expenses increased $4.1 million primarily due to higher payroll and other variable spending. ILS spending increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 207.10 Td ($14.1 million primarily due to the acquisition of Rofin and higher payroll spending. Corporate and other spending increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 195.10 Td ($18.8 million primarily due to higher financial advisory) Tj ET Q q 0 0 0 rg BT 272.64 195.10 Td (, consulting and legal costs related to the acquisition of Rofin, higher ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 183.10 Td (stock-based compensation expense and higher payroll spending net of lower char) Tj ET Q q 0 0 0 rg BT 374.72 183.10 Td (ges for increases in deferred compensation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 171.10 Td (plan liabilities.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 147.10 Td (Gain on business combination) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 123.10 Td (On November 7, 2016, we acquired Rofin at a price of $32.50 per share of Rofin common stock \(See Note 3 "Business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 111.10 Td (Combinations"\). ) Tj ET Q q 0 0 0 rg BT 118.34 111.10 Td (W) Tj ET Q q 0 0 0 rg BT 126.98 111.10 Td (e recognized a gain of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 217.77 111.10 Td ($5.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 266.66 111.10 Td ( in the first quarter of fiscal 2017 on the increase in fair value from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 99.10 Td (date of purchase for the shares we already owned.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 75.10 Td (Amortization of intangible assets) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 63.10 Td () Tj ET Q endstream endobj 79 0 obj <>] /Rotate 0 /Contents 80 0 R>> endobj 80 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (39) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (Amortization of intangible assets increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 225.22 742.10 Td ($3.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.12 742.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.61 742.10 Td (three months ended) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.92 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.42 742.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 461.01 742.10 Td ( compared to the same ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (period last year) Tj ET Q q 0 0 0 rg BT 111.09 730.10 Td (. ) Tj ET Q q 0 0 0 rg BT 115.91 730.10 Td (The increase was primarily due to the acquisition of Rofin in the first quarter of fiscal 2017 partially of) Tj ET Q q 0 0 0 rg BT 527.27 730.10 Td (fset by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (the completion of amortization of certain intangibles from prior acquisitions.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 50.00 706.10 Td () Tj ET Q BT /F2 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.00 694.10 Td (OTHER INCOME \(EXPENSE\) NET) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (Other income \(expense\), net, changed by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.60 670.10 Td ($5.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 265.49 670.10 Td ( from other expense of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 358.52 670.10 Td ($0.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 407.41 670.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 434.90 670.10 Td (first quarter) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.83 670.10 Td ( of fiscal 2016 to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (other income of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.81 658.10 Td ($5.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.70 658.10 Td ( in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.20 658.10 Td (first quarter) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.12 658.10 Td ( of fiscal 2017. ) Tj ET Q q 0 0 0 rg BT 301.43 658.10 Td (The increase in net other income was primarily due to $13.1 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (million higher net foreign exchange gains partially of) Tj ET Q q 0 0 0 rg BT 263.36 646.10 Td (fset by $8.0 million higher interest expense. ) Tj ET Q q 0 0 0 rg BT 441.20 646.10 Td (The higher foreign exchange ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (gains were primarily due to a gain of $1) Tj ET Q q 0 0 0 rg BT 209.58 634.10 Td (1.3 million on forward contracts associated with our foreign exchange risk related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (the commitment of our Euro ) Tj ET Q q 0 0 0 rg BT 166.18 622.10 Td (T) Tj ET Q q 0 0 0 rg BT 171.59 622.10 Td (erm Loan and the issuance of the Euro ) Tj ET Q q 0 0 0 rg BT 328.02 622.10 Td (T) Tj ET Q q 0 0 0 rg BT 333.43 622.10 Td (erm Loan to finance the acquisition of Rofin. Interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (expense increased due to interest on the Euro ) Tj ET Q q 0 0 0 rg BT 233.09 610.10 Td (T) Tj ET Q q 0 0 0 rg BT 238.50 610.10 Td (erm Loan and interest on the commitment of the Euro ) Tj ET Q q 0 0 0 rg BT 456.03 610.10 Td (T) Tj ET Q q 0 0 0 rg BT 461.44 610.10 Td (erm Loan to fund the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (acquisition of Rofin as well as amortization of debt issuance costs related to the Euro ) Tj ET Q q 0 0 0 rg BT 392.78 598.10 Td (T) Tj ET Q q 0 0 0 rg BT 398.19 598.10 Td (erm Loan.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td (INCOME ) Tj ET Q q 0 0 0 rg BT 94.54 574.10 Td (T) Tj ET Q q 0 0 0 rg BT 100.47 574.10 Td (AXES ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (The ef) Tj ET Q q 0 0 0 rg BT 75.63 550.10 Td (fective tax rate on income from continuing operations before income taxes for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.23 550.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.34 550.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.64 550.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 509.64 550.10 Td ( of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.97 550.10 Td (35.2%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.80 550.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (was higher than the statutory rate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 196.34 538.10 Td (35.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 222.17 538.10 Td ( primarily due to Rofin transaction costs not deductible for tax purposes, tax costs of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (Rofin restructuring, ) Tj ET Q q 0 0 0 rg BT 130.82 526.10 Td (ASC 740-10 \(formerly FIN48\) tax liabilities for transfer pricing, stock-based compensation not deductible ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.10 Td (for tax purposes and limitations on the deductibility of compensation under IRC Section 162\(m\). ) Tj ET Q q 0 0 0 rg BT 439.47 514.10 Td (These amounts are partially ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.10 Td (of) Tj ET Q q 0 0 0 rg BT 58.15 502.10 Td (fset by dif) Tj ET Q q 0 0 0 rg BT 98.52 502.10 Td (ferences related to the benefit of income subject to foreign tax rates that are lower than U.S. tax rates including the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 490.10 Td (Singapore tax exemption and the benefit of federal research and development tax credits. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 478.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.10 Td (The ef) Tj ET Q q 0 0 0 rg BT 75.63 466.10 Td (fective tax rate on income from continuing operations before income taxes for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.23 466.10 Td (first) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.34 466.10 Td ( quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.64 466.10 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 509.64 466.10 Td ( of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.97 466.10 Td (25.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 548.80 466.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.10 Td (was lower than the statutory rate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.56 454.10 Td (35.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 219.39 454.10 Td ( primarily due to dif) Tj ET Q q 0 0 0 rg BT 299.75 454.10 Td (ferences related to the benefit of income subject to foreign tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.10 Td (rates that are lower than U.S. tax rates including the Singapore tax exemption, the benefit of foreign tax credits and the benefit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.10 Td (of federal research and development tax credits including renewal of the federal research and development credits for fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.10 Td (2015. ) Tj ET Q q 0 0 0 rg BT 74.82 418.10 Td (These amounts are partially of) Tj ET Q q 0 0 0 rg BT 196.26 418.10 Td (fset by deemed dividend inclusions under the Subpart F tax rules, stock-based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 406.10 Td (compensation not deductible for tax purposes and limitations on the deductibility of compensation under IRC Section 162\(m\). ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 382.10 Td (LIQUIDITY) Tj ET Q q 0 0 0 rg BT 104.09 382.10 Td ( ) Tj ET Q q 0 0 0 rg BT 106.04 382.10 Td (AND CAPIT) Tj ET Q q 0 0 0 rg BT 160.57 382.10 Td (AL) Tj ET Q q 0 0 0 rg BT 173.91 382.10 Td ( RESOURCES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 62.50 358.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.08 358.10 Td (, we had assets classified as cash and cash equivalents and short-term investments, in an aggregate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.10 Td (amount of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 93.33 346.10 Td ($360.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.22 346.10 Td (, compared to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 209.42 346.10 Td ($400.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.31 346.10 Td ( at October 1, 2016. Our cash and cash equivalents and short-term ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 334.10 Td (investments included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 137.21 334.10 Td ($157.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 196.10 334.10 Td ( of cash at Rofin entities. In addition, at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.89 334.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 435.48 334.10 Td (, we had ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.58 334.10 Td ($13.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.47 334.10 Td ( of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 322.10 Td (restricted cash. ) Tj ET Q q 0 0 0 rg BT 111.92 322.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.42 322.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 203.00 322.10 Td (, approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.26 322.10 Td ($236.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 327.15 322.10 Td ( of our cash and securities was heldin certain of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 310.10 Td (foreign subsidiaries, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.59 310.10 Td ($217.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.49 310.10 Td ( of which was denominated in currencies other than the U.S. dollar) Tj ET Q q 0 0 0 rg BT 459.36 310.10 Td (. ) Tj ET Q q 0 0 0 rg BT 463.80 310.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.30 310.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 554.89 310.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 298.10 Td (we had approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.36 298.10 Td ($225.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 200.25 298.10 Td ( of cash held by foreign subsidiaries where we intend to permanently reinvest our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 286.10 Td (accumulated earnings in these entities and our current plans do not demonstrate a need for these funds to support our domestic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 274.10 Td (operations. If, however) Tj ET Q q 0 0 0 rg BT 142.34 274.10 Td (, a portion of these funds are needed for and distributed to our operations in the United States,we may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 262.10 Td (be subject to additional U.S.income taxes and foreign withholding taxes. ) Tj ET Q q 0 0 0 rg BT 344.94 262.10 Td (An exception to U.S. taxation may be the repatriation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 250.10 Td (of foreign funds that had been previously taxed in the U.S. as Subpart F income. ) Tj ET Q q 0 0 0 rg BT 373.64 250.10 Td (The amount of the U.S. and foreign taxes due ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 238.10 Td (would depend on the amount and manner of repatriation, as well as the location from where the funds are repatriated. ) Tj ET Q q 0 0 0 rg BT 521.32 238.10 Td (W) Tj ET Q q 0 0 0 rg BT 529.96 238.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 226.10 Td (actively monitor the third-party depository institutions that hold these assets, primarily focusing on the safety of principal and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 214.10 Td (secondarily maximizing yield on these assets. ) Tj ET Q q 0 0 0 rg BT 235.05 214.10 Td (W) Tj ET Q q 0 0 0 rg BT 243.69 214.10 Td (e diversify our cash and cash equivalents and investments among various ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 202.10 Td (financial institutions, money market funds, sovereign debt and other securities in order to reduce our exposure should any one ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 190.10 Td (of these financial institutions or financial instruments fail or encounter dif) Tj ET Q q 0 0 0 rg BT 345.29 190.10 Td (ficulties. ) Tj ET Q q 0 0 0 rg BT 382.32 190.10 Td (T) Tj ET Q q 0 0 0 rg BT 387.73 190.10 Td (o date, we have not experienced any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.10 Td (material loss or lack of access to our invested cash, cash equivalents or short-term investments. However) Tj ET Q q 0 0 0 rg BT 469.19 178.10 Td (, we can provide no ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 166.10 Td (assurances that access to our invested cash, cash equivalents or short-term investments will not be impacted by adverse ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 154.10 Td (conditions in the financial markets. In the first quarter of fiscal 2017, we spent a significant portion of our foreign funds on the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 142.10 Td (Rofin acquisition. ) Tj ET Q q 0 0 0 rg BT 123.98 142.10 Td (W) Tj ET Q q 0 0 0 rg BT 132.62 142.10 Td (e did not repatriate foreign funds to our domestic operations to fund this acquisition. ) Tj ET Q q 0 0 0 rg BT 472.08 142.10 Td (W) Tj ET Q q 0 0 0 rg BT 480.72 142.10 Td (e expect to have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 130.10 Td (adequate foreign funds in the future to service the acquisition debt and do not anticipate any repatriation of foreign funds to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 118.10 Td (operate our domestic business.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 94.10 Td (In fiscal 2016, 2015 and 2014, we converted a total of $160.6 million of cash and securities held in certain of our foreign ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 82.10 Td (subsidiaries to U.S. dollars and invested those funds within a European subsidiary whose functional currency is the U.S. dollar) Tj ET Q q 0 0 0 rg BT 556.02 82.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 70.10 Td (In the first quarter of fiscal 2017, we used these funds to purchase Rofin and pay related acquisition expenses. ) Tj ET Q q 0 0 0 rg BT 492.19 70.10 Td (The converted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 58.10 Td (funds were not repatriated to the U.S. and no U.S. tax was triggered on the transfer of these funds to the European subsidiary) Tj ET Q q 0 0 0 rg BT 548.66 58.10 Td (. ) Tj ET Q endstream endobj 81 0 obj <>] /Rotate 0 /Contents 82 0 R>> endobj 82 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (40) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (See ITEM 3. QUANTIT) Tj ET Q q 0 0 0 rg BT 147.51 742.10 Td (A) Tj ET Q q 0 0 0 rg BT 153.62 742.10 Td (TIVE ) Tj ET Q q 0 0 0 rg BT 178.34 742.10 Td (AND QUALIT) Tj ET Q q 0 0 0 rg BT 238.92 742.10 Td (A) Tj ET Q q 0 0 0 rg BT 245.03 742.10 Td (TIVE DISCLOSURES ) Tj ET Q q 0 0 0 rg BT 339.48 742.10 Td (ABOUT) Tj ET Q q 0 0 0 rg BT 373.75 742.10 Td ( MARKET) Tj ET Q q 0 0 0 rg BT 418.29 742.10 Td ( RISK below for more information ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (about risks and trends related to foreign currencies.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (Sour) Tj ET Q q 0 0 0 rg BT 70.38 706.10 Td (ces and Uses of Cash) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (Historically) Tj ET Q q 0 0 0 rg BT 96.56 682.10 Td (, our primary source of cash has been provided by operations. Other sources of cash in the past three fiscal years ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (include proceeds from our Euro ) Tj ET Q q 0 0 0 rg BT 179.50 670.10 Td (T) Tj ET Q q 0 0 0 rg BT 184.91 670.10 Td (erm Loan used to finance the acquisition of Rofin, proceeds received from the sale of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (stock through our employee stock purchase plan as well as borrowings under our domestic line of credit. Our historical uses of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (cash have primarily been for the repurchase of our common stock, acquisitions of businesses and technologies, capital ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (expenditures and debt issuance costs. Supplemental information pertaining to our historical sources and uses of cash is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (presented as follows and should be read in conjunction with our condensed consolidated statements of cash flows and the notes ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (to condensed consolidated financial statements:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 463.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 552.60 311.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 364.00 552.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 454.00 552.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 458.00 552.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 522.60 311.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 364.00 522.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 454.00 522.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 458.00 522.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 492.60 311.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 364.00 492.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 454.00 492.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 458.00 492.60 90.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 364 586.6 m 454 586.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 454 586.6 m 458 586.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 458 586.6 m 548 586.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 364 565.6 m 454 565.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 458 586.6 m 548 586.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 458 565.6 m 548 565.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 589.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 419.10 590.83 Td (Three Months Ended) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 568.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 385.25 577.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 400.50 569.83 Td (2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.25 577.83 Td (January 2,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 494.50 569.83 Td (2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 555.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 431.15 556.83 Td (\(inthousands\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 542.27 Td (Net cash provided by operating activities) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 366.50 542.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 422.65 542.28 Td (82,641) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.50 542.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 516.65 542.27 Td (14,262) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 527.27 Td (Sales of shares under employee stock plans) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 427.65 527.28 Td (3,866) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.65 527.27 Td (3,521) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 512.27 Td (Borrowings, net of repayments) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 417.65 512.28 Td (718,514) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.65 512.27 Td (5,000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 497.27 Td (Acquisition of businesses, net of cash acquired) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 414.30 497.33 Td (\(740,481) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 497.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 534.15 497.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 482.27 Td (Debt issuance costs) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 419.30 482.33 Td (\(25,824) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 482.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 534.15 482.27 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 467.27 Td (Capital expenditures) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 419.30 467.33 Td (\(15,390) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 450.15 467.28 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.30 467.32 Td (\(4,765) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 544.15 467.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 451.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 439.10 Td (Net cash provided by operating activities increased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 269.37 439.10 Td ($68.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 323.26 439.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 354.64 439.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.18 439.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.67 439.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.67 439.10 Td ( compared to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 427.10 Td (same period one year ago. ) Tj ET Q q 0 0 0 rg BT 157.00 427.10 Td (The increase in cash provided by operating activities was primarily due to higher cash flows due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 415.10 Td (higher non-cash expenses for amortization, stock-based compensation and depreciation, higher net income, higher deferred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 403.10 Td (revenue and accounts payable balances, higher cash flows from the timing of shipments of lar) Tj ET Q q 0 0 0 rg BT 424.98 403.10 Td (ge systems from inventory and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 391.10 Td (higher cash flows from accounts receivable partially of) Tj ET Q q 0 0 0 rg BT 270.01 391.10 Td (fset by lower accrued payroll balances. ) Tj ET Q q 0 0 0 rg BT 428.37 391.10 Td (W) Tj ET Q q 0 0 0 rg BT 437.01 391.10 Td (e believe that our existing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 379.10 Td (cash, cash equivalents and short term investments combined with cash to be provided by operating activities and amounts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 367.10 Td (available under our revolving credit facility will be adequate to cover our working capital needs and planned capital ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 355.10 Td (expenditures for at least the next 12 months to the extent such items are known or are reasonably determinable based on current ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 343.10 Td (business and market conditions. However) Tj ET Q q 0 0 0 rg BT 216.51 343.10 Td (, we may elect to finance certain of our capital expenditure requirements through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 331.10 Td (other sources of capital. ) Tj ET Q q 0 0 0 rg BT 147.84 331.10 Td (W) Tj ET Q q 0 0 0 rg BT 156.47 331.10 Td (e continue to follow our strategy to further strengthen our financial position by using available cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 319.10 Td (flow to fund operations. ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 50.00 307.10 Td () Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.00 295.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 295.10 Td (e intend to continue to consider acquisition opportunities at valuations we believe are reasonable based upon market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 283.10 Td (conditions. However) Tj ET Q q 0 0 0 rg BT 132.92 283.10 Td (, we cannot accurately predict the timing, size and success of our acquisition ef) Tj ET Q q 0 0 0 rg BT 449.01 283.10 Td (forts or our associated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 271.10 Td (potential capital commitments. Furthermore, we cannot assure you that we will be able to acquire businesses on terms ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 259.10 Td (acceptable to us. ) Tj ET Q q 0 0 0 rg BT 118.68 259.10 Td (W) Tj ET Q q 0 0 0 rg BT 127.31 259.10 Td (e expect to fund future acquisitions through additional borrowings \(as in our acquisition of Rofin\), existing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 247.10 Td (cash balances and cash flows from operations. If required, we will consider the issuance of securities. ) Tj ET Q q 0 0 0 rg BT 458.29 247.10 Td (The extent to which we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 235.10 Td (will be willing or able to use our common stock to make acquisitions will depend on its market value at the time and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 223.10 Td (willingness of potential sellers to accept it as full or partial payment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 199.10 Td (On November 7, 2016, we entered into the Credit ) Tj ET Q q 0 0 0 rg BT 250.23 199.10 Td (Agreement by and among us, Coherent Holding GmbH, as borrower \(the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 187.10 Td (Borrower\), and certain of our direct and indirect subsidiaries from time to time party thereto, as guarantors, the lenders from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 175.10 Td (time to time party thereto, Barclays, as administrative agent and an L/C Issuer) Tj ET Q q 0 0 0 rg BT 361.73 175.10 Td (, BAML) Tj ET Q q 0 0 0 rg BT 395.25 175.10 Td ( as an L/C Issuer) Tj ET Q q 0 0 0 rg BT 462.06 175.10 Td (, and MUFG as an L/C ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 163.10 Td (Issuer) Tj ET Q q 0 0 0 rg BT 73.33 163.10 Td (. ) Tj ET Q q 0 0 0 rg BT 78.15 163.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 123.14 163.10 Td (Agreement provides for a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 228.10 163.10 Td (670.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 281.99 163.10 Td ( Euro senior secured term loan facility \(the "Euro ) Tj ET Q q 0 0 0 rg BT 481.66 163.10 Td (T) Tj ET Q q 0 0 0 rg BT 487.07 163.10 Td (erm Loan"\) and a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 151.10 Td ($100.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 108.89 151.10 Td ( senior secured revolving credit facility \("Revolving Credit Facility"\) with a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.03 151.10 Td ($30.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 468.92 151.10 Td ( letter of credit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 139.10 Td (sublimit and a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 109.16 139.10 Td ($10.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 163.05 139.10 Td ( swing line sublimit. ) Tj ET Q q 0 0 0 rg BT 247.04 139.10 Td (The Borrower may increase the aggregate revolving commitments or borrow ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 127.10 Td (incremental term loans in an aggregate principal amount not to exceed the sum of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.77 127.10 Td ($150.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 437.67 127.10 Td ( and an amount that would not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 115.10 Td (cause the senior secured net leverage ratio to be greater than 2.75 to 1.00, subject to certain conditions, including obtaining ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 103.10 Td (additional commitments from the lenders then party to the Credit ) Tj ET Q q 0 0 0 rg BT 312.16 103.10 Td (Agreement or new lenders. On November 7, 2016, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 91.10 Td (Borrower borrowed the full ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 162.74 91.10 Td (670.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.64 91.10 Td ( Euros under the Euro ) Tj ET Q q 0 0 0 rg BT 306.71 91.10 Td (T) Tj ET Q q 0 0 0 rg BT 312.12 91.10 Td (erm Loan and its proceeds were used to finance the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 79.10 Td (acquisition of Rofin and pay related fees and expenses. On November 7, 2016, we also used ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.73 79.10 Td (10.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.62 79.10 Td ( Euro of the capacity ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 67.10 Td (under the Revolving Credit Facility for the issuance of a letter of credit.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.9333333333333333 0.15294117647058825 0.1411764705882353 rg BT 336.86 67.10 Td ( ) Tj ET Q endstream endobj 83 0 obj <>] /Rotate 0 /Contents 84 0 R>> endobj 84 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (41) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (Loans under the Credit ) Tj ET Q q 0 0 0 rg BT 143.87 742.10 Td (Agreement bear interest, at the Borrower) Tj ET Q q 0 0 0 rg BT 308.06 742.10 Td () Tj ET Q q 0 0 0 rg BT 310.83 742.10 Td (s option, at a rate equal to either \(i\)\(x\) in the case of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (calculations with respect to U.S. Dollars or certain other alternative currencies, the London interbank of) Tj ET Q q 0 0 0 rg BT 464.95 730.10 Td (fered rate \(the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (LIBOR\) or \(y\) in the case of calculations with respect to the Euro, the euro interbank of) Tj ET Q q 0 0 0 rg BT 409.41 718.10 Td (fered rate \("EURIBOR" and, together ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (with LIBOR, the "Eurocurrency Rate"\) or \(ii\) a base rate \(the Base Rate\) equal to the highest of \(x\) the federal funds rate, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td (plus 0.50%, \(y\) the prime rate then in ef) Tj ET Q q 0 0 0 rg BT 209.77 694.10 Td (fect and \(z\) the Eurocurrency Rate for loans denominated in U.S. dollars applicable to a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (one-month interest period, plus 1.0%, in each case, plus an applicable mar) Tj ET Q q 0 0 0 rg BT 346.67 682.10 Td (gin. ) Tj ET Q q 0 0 0 rg BT 364.27 682.10 Td (The applicable mar) Tj ET Q q 0 0 0 rg BT 441.27 682.10 Td (gin for Euro ) Tj ET Q q 0 0 0 rg BT 492.47 682.10 Td (T) Tj ET Q q 0 0 0 rg BT 497.88 682.10 Td (erm Loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (borrowed as Eurocurrency Rate loans, is 3.50% initially) Tj ET Q q 0 0 0 rg BT 273.46 670.10 Td (, and following the first anniversary of the Closing Date ranges from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (3.00% to 3.50% depending on the consolidated total gross leverage ratio at the time of determination. For Euro ) Tj ET Q q 0 0 0 rg BT 496.65 658.10 Td (T) Tj ET Q q 0 0 0 rg BT 502.06 658.10 Td (erm Loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (borrowed as Base Rate Loans, the applicable mar) Tj ET Q q 0 0 0 rg BT 247.52 646.10 Td (gin initially is 2.50%, and following the first anniversary of the Closing Date ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td (ranges from 2.00% to 2.50% depending upon the consolidated total gross leverage ratio at the time of determination. ) Tj ET Q q 0 0 0 rg BT 518.86 634.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (applicable mar) Tj ET Q q 0 0 0 rg BT 108.96 622.10 Td (gin for revolving loans borrowed as Eurocurrency Rate Loans, ranges from 3.75% to 4.25%, and for revolving ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (loans borrowed as Base Rate Loans, ranges from 2.75% to 3.25%, in each case, based on the consolidated total gross leverage ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (ratio at the time of determination. Interest on Base Rate Loans is payable quarterly in arrears. Interest on Eurocurrency Rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (Loans is payable at the end of the applicable interest period \(or at three month intervals if the interest period exceeds three ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td (months\). Interest periods for Eurocurrency Rate loans may be, at the Borrower) Tj ET Q q 0 0 0 rg BT 364.99 574.10 Td () Tj ET Q q 0 0 0 rg BT 367.77 574.10 Td (s option, one, two, three or six months. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 94.99 550.10 Td (Agreement requires the Borrower to make scheduled quarterly payments on the Euro ) Tj ET Q q 0 0 0 rg BT 437.47 550.10 Td (T) Tj ET Q q 0 0 0 rg BT 442.88 550.10 Td (erm Loan of 0.25% of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.10 Td (original principal amount of the Euro ) Tj ET Q q 0 0 0 rg BT 201.45 538.10 Td (T) Tj ET Q q 0 0 0 rg BT 206.86 538.10 Td (erm Loan, with any remaining principal payable at maturity) Tj ET Q q 0 0 0 rg BT 445.29 538.10 Td (. ) Tj ET Q q 0 0 0 rg BT 449.74 538.10 Td (A) Tj ET Q q 0 0 0 rg BT 456.41 538.10 Td ( commitment fee accrues ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.10 Td (on any unused portion of the revolving loan commitments under the Credit ) Tj ET Q q 0 0 0 rg BT 351.61 526.10 Td (Agreement at a rate of 0.375% or 0.5% depending ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.10 Td (on the consolidated total gross leverage ratio at any time of determination. ) Tj ET Q q 0 0 0 rg BT 349.45 514.10 Td (The Borrower is also obligated to pay other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.10 Td (customary fees for a credit facility of this size and type.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 478.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 94.99 478.10 Td (Agreement contains customary af) Tj ET Q q 0 0 0 rg BT 229.48 478.10 Td (firmative covenants, including covenants regarding the payment of taxes and other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.10 Td (obligations, maintenance of insurance, reporting requirements and compliance with applicable laws and regulations, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.10 Td (negative covenants, including covenants limiting the ability of us and our subsidiaries to, among other things, incur debt, grant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.10 Td (liens, make investments, make certain restricted payments, transact with af) Tj ET Q q 0 0 0 rg BT 349.16 442.10 Td (filiates, and sell assets.) Tj ET Q q 0 0 0 rg BT 442.85 442.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 487.84 442.10 Td (Agreement also ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.10 Td (requires us and our subsidiaries to maintain a senior secured net leverage ratio as of the last day of each fiscal quarter of less of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.10 Td (than or equal to 3.50 to 1.00. ) Tj ET Q q 0 0 0 rg BT 167.58 418.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 212.57 418.10 Td (Agreement contains customary events of default that include, among other things, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 406.10 Td (payment defaults, cross defaults with certain other indebtedness, violation of covenants, inaccuracy of representations and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 394.10 Td (warranties in any material respect, change in control of us and the Borrower) Tj ET Q q 0 0 0 rg BT 353.65 394.10 Td (, judgment defaults, and bankruptcy and insolvency ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 382.10 Td (events. If an event of default exists, the lenders may require the immediate payment of all Obligations, as defined in the Credit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.10 Td (Agreement, and may exercise certain other rights and remedies provided for under the Credit ) Tj ET Q q 0 0 0 rg BT 424.03 370.10 Td (Agreement, the other loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.10 Td (documents and applicable law) Tj ET Q q 0 0 0 rg BT 170.14 358.10 Td (. ) Tj ET Q q 0 0 0 rg BT 174.96 358.10 Td (The acceleration of such obligations is automatic upon the occurrence of a bankruptcy and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.10 Td (insolvency event of default. ) Tj ET Q q 0 0 0 rg BT 163.39 346.10 Td (W) Tj ET Q q 0 0 0 rg BT 172.03 346.10 Td (e were in compliance with all covenants at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 344.74 346.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 423.33 346.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 322.10 Td (The aggregate consideration paid by us to the former Rofin stockholders in the first quarter of fiscal 2017 was approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 310.10 Td ($904.5 million, excluding related transaction fees and expenses. ) Tj ET Q q 0 0 0 rg BT 308.35 310.10 Td (W) Tj ET Q q 0 0 0 rg BT 316.99 310.10 Td (e also paid $15.3 million due to the cancellation of options ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 298.10 Td (held by employees of Rofin. ) Tj ET Q q 0 0 0 rg BT 165.91 298.10 Td (W) Tj ET Q q 0 0 0 rg BT 174.55 298.10 Td (e paid $5.2 million of debt issuance costs in fiscal 2016 and incurred approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 511.96 298.10 Td ($25.8 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 286.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 286.10 Td ( of debt issuance costs in the first quarter of fiscal 2017. In the fourth quarter of fiscal 2016, and the first quarter of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 274.10 Td (fiscal 2017, we recorded an interest char) Tj ET Q q 0 0 0 rg BT 211.69 274.10 Td (ge of $1.1 million and $2.7 million, respectively) Tj ET Q q 0 0 0 rg BT 404.34 274.10 Td (, in other income \(expense\) in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 262.10 Td (consolidated statement of operations related to the debt financing commitment. In the first quarter of fiscal 2017, we made our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 250.10 Td (first debt principal payment of $1.8 million, recorded interest expense on the Euro ) Tj ET Q q 0 0 0 rg BT 381.11 250.10 Td (T) Tj ET Q q 0 0 0 rg BT 386.52 250.10 Td (erm Loan of $4.6 million and recorded $0.6 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 238.10 Td (million amortization of debt issuance costs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 214.10 Td (In relation to the acquisition of Rofin, we paid Barclays, our financial advisor) Tj ET Q q 0 0 0 rg BT 360.07 214.10 Td (, a fee of approximately $9.5 million, $1.0 million ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 202.10 Td (of which was paid upon delivery of the fairness opinion in the second quarter of fiscal 2016, and the remaining portion of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 190.10 Td (which was paid upon consummation of the acquisition in the first quarter of fiscal 2017; these fees were recorded as SG&A) Tj ET Q q 0 0 0 rg BT 544.31 190.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.10 Td (expense. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 154.10 Td (Additional sources of cash available to us were international currency lines of credit and bank credit facilities totaling ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 523.16 154.10 Td ($29.3 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 142.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 142.10 Td ( as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.05 142.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 181.64 142.10 Td (, of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 224.40 142.10 Td ($21.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 278.30 142.10 Td ( was unused and available. ) Tj ET Q q 0 0 0 rg BT 387.52 142.10 Td (These unsecured international credit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 130.10 Td (facilities were used in Europe and Japan during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 256.88 130.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 327.42 130.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.90 130.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 384.90 130.10 Td (. ) Tj ET Q q 0 0 0 rg BT 389.35 130.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.79 130.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 492.38 130.10 Td (, we had utilized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 118.10 Td ($5.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.89 118.10 Td ( of the international credit facilities as guarantees in Europe and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.85 118.10 Td ($1.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.74 118.10 Td ( as short-term borrowings in Japan. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 94.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 62.50 94.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.08 94.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 146.08 94.10 Td ($2.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 194.98 94.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 214.41 94.10 Td ($1) Tj ET Q q 0 0 0 rg BT 224.04 94.10 Td (1.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 267.93 94.10 Td ( of cash collateralized primarily for domestic and international ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 82.10 Td (guarantees was restricted and classified as current and non-current restricted cash, respectively) Tj ET Q q 0 0 0 rg BT 428.07 82.10 Td (, on our condensed consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 70.10 Td (balance sheet.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 50.00 58.10 Td () Tj ET Q endstream endobj 85 0 obj <>] /Rotate 0 /Contents 86 0 R>> endobj 86 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (42) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (Our ratio of current assets to current liabilities was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 255.21 742.10 Td (3.6) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 267.71 742.10 Td (:1 at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 287.71 742.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.29 742.10 Td ( compared to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.00 742.10 Td (4.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 433.50 742.10 Td (:1 at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 453.49 742.10 Td (October1, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.20 742.10 Td (. ) Tj ET Q q 0 0 0 rg BT 523.02 742.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (decrease in our ratio is primarily due to the use of cash to in our acquisition of Rofin partially of) Tj ET Q q 0 0 0 rg BT 434.44 730.10 Td (fset by the impact of Rofin's ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td (current assets and current liabilities. Our cash and cash equivalents, short-term investments and working capital are as follows:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 635.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 679.60 320.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 373.00 679.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 679.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 467.00 679.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 53.00 649.60 320.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 373.00 649.60 90.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 649.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 467.00 649.60 90.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 373 692.6 m 463 692.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 692.6 m 557 692.6 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 695.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 385.25 696.83 Td (December 31, 2016) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 484.55 696.83 Td (October 1, 2016) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 55.50 682.32 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 440.15 683.83 Td (\(inthousands\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 669.27 Td (Cash and cash equivalents) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 375.50 669.28 Td ($) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 426.65 669.28 Td (360,217) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.50 669.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.65 669.27 Td (354,347) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 654.27 Td (Short-term investments) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 444.15 654.28 Td (125) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.65 654.27 Td (45,606) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 55.50 639.27 Td (Working capital) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 426.65 639.28 Td (809,070) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.65 639.27 Td (614,145) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 623.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 611.10 Td (Contractual Obligations and Off-Balance Sheet ) Tj ET Q q 0 0 0 rg BT 254.17 611.10 Td (Arrangements) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 599.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 587.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 587.10 Td (e have no of) Tj ET Q q 0 0 0 rg BT 107.60 587.10 Td (f-balance sheet arrangements as defined under Regulation S-K of the Securities ) Tj ET Q q 0 0 0 rg BT 427.21 587.10 Td (Act of 1933. ) Tj ET Q q 0 0 0 rg BT 479.80 587.10 Td (The following ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 575.10 Td (summarizes our contractual obligations at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 219.67 575.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 298.26 575.10 Td ( and the ef) Tj ET Q q 0 0 0 rg BT 340.00 575.10 Td (fect such obligations are expected to have on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 563.10 Td (liquidity and cash flow in future periods \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 57.50 520.60 180.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 237.50 520.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 297.50 520.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 301.50 520.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 361.50 520.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 520.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 425.50 520.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 520.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.50 520.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.50 520.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 57.50 492.60 180.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 237.50 492.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 297.50 492.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 301.50 492.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 361.50 492.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 492.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 425.50 492.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 492.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.50 492.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.50 492.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 57.50 464.60 180.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 237.50 464.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 297.50 464.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 301.50 464.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 361.50 464.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 464.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 425.50 464.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 464.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.50 464.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.50 464.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 57.50 436.60 180.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 237.50 436.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 297.50 436.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 301.50 436.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 361.50 436.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 365.50 436.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 425.50 436.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 429.50 436.60 60.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.50 436.60 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.50 436.60 60.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237.5 520.6 m 297.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 520.6 m 361.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 520.6 m 425.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 520.6 m 489.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 520.6 m 553.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 520.6 m 361.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 520.6 m 425.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 520.6 m 489.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 520.6 m 553.5 520.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 436.6 m 361.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 436.6 m 425.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 436.6 m 489.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 436.6 m 553.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237.5 436.6 m 297.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237.5 423.6 m 297.5 423.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237.5 421.6 m 297.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 436.6 m 361.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 423.6 m 361.5 423.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301.5 421.6 m 361.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 436.6 m 425.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 423.6 m 425.5 423.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 365.5 421.6 m 425.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 436.6 m 489.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 423.6 m 489.5 423.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 429.5 421.6 m 489.5 421.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 436.6 m 553.5 436.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 423.6 m 553.5 423.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493.5 421.6 m 553.5 421.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 258.25 524.83 Td (Total) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 314.65 532.68 Td (Less than) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 320.50 524.68 Td (1year) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 375.55 524.83 Td (1 to 3years) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 439.55 524.83 Td (3 to 5years) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 504.95 532.68 Td (Mor) Tj ET Q q 0 0 0 rg BT 519.91 532.68 Td (e than) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 510.85 524.68 Td (5years) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 511.17 Td (Operating lease payments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.00 511.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 266.15 511.17 Td (49,820) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 304.00 511.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.15 511.17 Td (15,259) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.00 511.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 394.15 511.17 Td (20,010) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.00 511.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.15 511.17 Td (8,384) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 496.00 511.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.15 511.17 Td (6,167) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 497.17 Td (Asset retirement obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 271.15 497.17 Td (5,551) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 342.65 497.17 Td (707) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.15 497.17 Td (1,781) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 475.65 497.17 Td (94) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.15 497.17 Td (2,969) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 483.17 Td (Debt principal, interest and fees) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 261.15 483.17 Td (912,992) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.15 483.17 Td (28,910) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.15 483.17 Td (114,212) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.15 483.17 Td (74,537) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 517.15 483.17 Td (695,333) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 469.17 Td (Pension obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 266.15 469.17 Td (36,521) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 335.15 469.17 Td (1,425) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.15 469.17 Td (2,054) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.15 469.17 Td (2,584) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.15 469.17 Td (30,458) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 455.17 Td (Purchase commitments for inventory) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 261.15 455.17 Td (119,898) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.15 455.17 Td (111,949) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.15 455.17 Td (7,788) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 470.65 455.17 Td (161) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 539.65 455.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 441.17 Td (Purchase obligations-other) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 266.15 441.17 Td (16,082) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.15 441.17 Td (14,290) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.65 441.17 Td (836) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 470.65 441.17 Td (956) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 539.65 441.17 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 427.17 Td (Total) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.00 427.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 253.60 427.17 Td (1,140,864) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 304.00 427.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.15 427.17 Td (172,540) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.00 427.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.15 427.17 Td (146,681) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.00 427.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.15 427.17 Td (86,716) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 496.00 427.17 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 517.15 427.17 Td (734,927) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 399.10 Td (Because of the uncertainty as to the timing of such payments, we have excluded cash payments related to our contractual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 387.10 Td (obligations for our deferred compensation plans aggregating $31.1 million at October1, 2016.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 363.10 Td (Changes in Financial Condition) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 351.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 339.10 Td (Cash provided by operating activities during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.23 339.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.78 339.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.26 339.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.26 339.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.81 339.10 Td ($82.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 447.71 339.10 Td (, which included net income ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 327.10 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.83 327.10 Td ($30.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 114.72 327.10 Td (, cash provided by operating assets and liabilities of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 324.12 327.10 Td ($25.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.01 327.10 Td ( \(primarily increases in deferred income ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 315.10 Td (of) Tj ET Q q 0 0 0 rg BT 58.15 315.10 Td (fset decreases in accrued payroll\), depreciation and amortization of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 329.14 315.10 Td ($21.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 383.03 315.10 Td (, non-cash restructuring char) Tj ET Q q 0 0 0 rg BT 497.25 315.10 Td (ges of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 523.91 315.10 Td ($4.4 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 303.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 303.10 Td (, stock-based compensation expense of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 237.18 303.10 Td ($5.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 286.07 303.10 Td (, net decreases in deferred tax assets of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 444.05 303.10 Td ($1.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 492.94 303.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.38 303.10 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 561.27 303.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 291.10 Td (other partially of) Tj ET Q q 0 0 0 rg BT 117.02 291.10 Td (fset by the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.17 291.10 Td ($5.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 210.06 291.10 Td ( gain on business combination and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 350.60 291.10 Td ($1.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.49 291.10 Td ( net cash flows used by discontinued ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 279.10 Td (operations. Cash provided by operating activities during the first three months of fiscal 2016 was $14.3 million, which included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 267.10 Td (net income of $20.3 million, depreciation and amortization of $8.5 million, stock-based compensation expense of $3.7 million ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 255.10 Td (and $0.2 million other partially of) Tj ET Q q 0 0 0 rg BT 185.35 255.10 Td (fset by cash used by operating assets and liabilities of $14.9 million and net increases in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 243.10 Td (deferred tax assets of $3.5 million.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 219.10 Td (Cash used in investing activities during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 224.70 219.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 295.24 219.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 332.72 219.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 352.72 219.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.28 219.10 Td ($730.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.17 219.10 Td (, which included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 501.04 219.10 Td ($740.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.93 219.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 207.10 Td (net of cash acquired to purchase Rofin, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.33 207.10 Td ($15.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 265.22 207.10 Td ( used to acquire property and equipment, purchase and upgrade buildings, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 195.10 Td (net of proceeds from dispositions partially of) Tj ET Q q 0 0 0 rg BT 229.78 195.10 Td (fset by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.22 195.10 Td ($25.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 313.11 195.10 Td ( net sales of available-for) Tj ET Q q 0 0 0 rg BT 413.97 195.10 Td (-sale securities. Cash used in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 183.10 Td (investing activities during the first three months of fiscal 2016 was $3.6 million, which included $4.7 million used to acquire ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 171.10 Td (property and equipment and improve buildings net of proceeds from dispositions partially of) Tj ET Q q 0 0 0 rg BT 420.30 171.10 Td (fset by $1.1 million net sales of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 159.10 Td (available-for) Tj ET Q q 0 0 0 rg BT 100.88 159.10 Td (-sale securities. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 147.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 135.10 Td (Cash provided by financing activities during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.23 135.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.78 135.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.26 135.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 373.26 135.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.81 135.10 Td ($681.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.71 135.10 Td (, which included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.58 135.10 Td ($718.5 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 123.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 123.10 Td ( net borrowings and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.10 123.10 Td ($3.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 209.99 123.10 Td ( generated from our employee stock option and purchase plans partially of) Tj ET Q q 0 0 0 rg BT 507.21 123.10 Td (fset by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 123.10 Td ($25.8 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 111.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.89 111.10 Td ( debt issuance costs and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 176.92 111.10 Td ($15.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 230.82 111.10 Td ( outflows due to net settlement of restricted stock. Cash provided by financing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 99.10 Td (activities during the first three months of fiscal 2016 was $3.2 million, which included $5.0 million net short-term borrowings ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 87.10 Td (and $3.5 million generated from our employee stock option and purchase plans partially of) Tj ET Q q 0 0 0 rg BT 413.05 87.10 Td (fset by $5.3 million outflows due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 75.10 Td (net settlement of restricted stock. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 63.10 Td () Tj ET Q endstream endobj 87 0 obj <>] /Rotate 0 /Contents 88 0 R>> endobj 88 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (43) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (Changes in exchange rates during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 202.17 742.10 Td (first three months) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 272.71 742.10 Td ( of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 310.20 742.10 Td (2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.20 742.10 Td ( resulted in a decrease in cash balances of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 499.29 742.10 Td ($13.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.18 742.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.9333333333333333 0.15294117647058825 0.1411764705882353 rg BT 555.68 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.00 730.10 Td (Changes in exchange rates during the first three months of fiscal 2016 decreased our cash balances by $2.1 million.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 718.10 Td () Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 50 704.53505859375 m 225.771484375 704.53505859375 l s q 0 0 0 rg BT 50.00 706.10 Td (RECENT) Tj ET Q q 0 0 0 rg BT 91.49 706.10 Td ( ) Tj ET Q q 0 0 0 rg BT 93.44 706.10 Td (ACCOUNTING ST) Tj ET Q q 0 0 0 rg BT 176.88 706.10 Td (ANDARDS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (See Note 2. Recent ) Tj ET Q q 0 0 0 rg BT 133.03 682.10 Td (Accounting Standards in the Notes to Condensed Consolidated Financial Statements for a full description ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.10 Td (of recent accounting pronouncements, including the respective dates of adoption or expected adoption and ef) Tj ET Q q 0 0 0 rg BT 485.50 670.10 Td (fects on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (condensed consolidated financial position, results of operations and cash flows.) Tj ET Q endstream endobj 89 0 obj <>] /Rotate 0 /Contents 90 0 R>> endobj 90 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (44) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 742.25 Td (ITEM 3. QUANTIT) Tj ET Q q 0 0 0 rg BT 135.10 742.25 Td (A) Tj ET Q q 0 0 0 rg BT 141.58 742.25 Td (TIVE ) Tj ET Q q 0 0 0 rg BT 167.98 742.25 Td (AND QUALIT) Tj ET Q q 0 0 0 rg BT 230.86 742.25 Td (A) Tj ET Q q 0 0 0 rg BT 237.34 742.25 Td (TIVE DISCLOSURES ) Tj ET Q q 0 0 0 rg BT 336.82 742.25 Td (ABOUT) Tj ET Q q 0 0 0 rg BT 372.20 742.25 Td ( MARKET) Tj ET Q q 0 0 0 rg BT 419.52 742.25 Td ( RISK) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 718.25 Td (Market risk disclosur) Tj ET Q q 0 0 0 rg BT 142.04 718.25 Td (es) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 694.25 Td (e are exposed to market risk related to changes in interest rates and foreign currency exchange rates. ) Tj ET Q q 0 0 0 rg BT 461.61 694.25 Td (W) Tj ET Q q 0 0 0 rg BT 470.25 694.25 Td (e do not use derivative ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td (financial instruments for speculative or trading purposes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 658.25 Td (Inter) Tj ET Q q 0 0 0 rg BT 71.48 658.25 Td (est rate sensitivity) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.25 Td (A) Tj ET Q q 0 0 0 rg BT 56.67 634.25 Td ( portion of our investment portfolio is composed of fixed income securities. ) Tj ET Q q 0 0 0 rg BT 361.70 634.25 Td (These securities are subject to interest rate risk ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.25 Td (and will fall in value if market interest rates increase. If market interest rates were to increase immediately \(whether due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.25 Td (changes in overall market rates or credit worthiness of the issuers of our individual securities\) and uniformly by 10% from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.25 Td (levels at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.54 598.25 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.13 598.25 Td (, the fair value of the portfolio, based on quoted market prices in active markets involving similar ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.25 Td (assets, would decline by an immaterial amount due to their short-term maturities. ) Tj ET Q q 0 0 0 rg BT 376.96 586.25 Td (W) Tj ET Q q 0 0 0 rg BT 385.60 586.25 Td (e have the ability to generally hold our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.25 Td (fixed income investments until maturity and therefore we would not expect our operating results or cash flows to be af) Tj ET Q q 0 0 0 rg BT 523.85 574.25 Td (fected to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.25 Td (any significant degree by the ef) Tj ET Q q 0 0 0 rg BT 175.60 562.25 Td (fect of a sudden change in market interest rates on our securities portfolio. If necessary) Tj ET Q q 0 0 0 rg BT 522.32 562.25 Td (, we may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.25 Td (sell short-term investments prior to maturity to meet our liquidity needs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.25 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 62.50 526.25 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.08 526.25 Td (, the fair value of our available-for) Tj ET Q q 0 0 0 rg BT 278.87 526.25 Td (-sale debt securities was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.28 526.25 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 427.17 526.25 Td (, all of which was classified as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.25 Td (short-term investments. ) Tj ET Q q 0 0 0 rg BT 146.75 514.25 Td (There were no gross unrealized gains and losses on available-for) Tj ET Q q 0 0 0 rg BT 405.06 514.25 Td (-sale debt securities at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 496.14 514.25 Td (December31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.25 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.00 502.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 478.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 478.25 Td (e ) Tj ET Q q 0 0 0 rg BT 65.06 478.25 Td (are ) Tj ET Q q 0 0 0 rg BT 79.24 478.25 Td (exposed ) Tj ET Q q 0 0 0 rg BT 113.99 478.25 Td (to ) Tj ET Q q 0 0 0 rg BT 123.75 478.25 Td (market ) Tj ET Q q 0 0 0 rg BT 153.49 478.25 Td (risks ) Tj ET Q q 0 0 0 rg BT 174.37 478.25 Td (related ) Tj ET Q q 0 0 0 rg BT 203.55 478.25 Td (to ) Tj ET Q q 0 0 0 rg BT 213.31 478.25 Td (fluctuations ) Tj ET Q q 0 0 0 rg BT 262.50 478.25 Td (in ) Tj ET Q q 0 0 0 rg BT 272.26 478.25 Td (interest ) Tj ET Q q 0 0 0 rg BT 303.67 478.25 Td (rates ) Tj ET Q q 0 0 0 rg BT 324.53 478.25 Td (related ) Tj ET Q q 0 0 0 rg BT 353.71 478.25 Td (to ) Tj ET Q q 0 0 0 rg BT 363.47 478.25 Td (our ) Tj ET Q q 0 0 0 rg BT 378.63 478.25 Td (T) Tj ET Q q 0 0 0 rg BT 384.04 478.25 Td (erm ) Tj ET Q q 0 0 0 rg BT 401.57 478.25 Td (Loan ) Tj ET Q q 0 0 0 rg BT 424.10 478.25 Td (Facility) Tj ET Q q 0 0 0 rg BT 454.00 478.25 Td (. ) Tj ET Q q 0 0 0 rg BT 458.04 478.25 Td (As ) Tj ET Q q 0 0 0 rg BT 471.14 478.25 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.45 478.25 Td (December31, ) Tj ET Q q 0 0 0 rg BT 539.51 478.25 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 559.51 478.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.25 Td (we ) Tj ET Q q 0 0 0 rg BT 63.67 466.25 Td (owed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 87.34 466.25 Td ($697.7 ) Tj ET Q q 0 0 0 rg BT 116.85 466.25 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 145.74 466.25 Td ( ) Tj ET Q q 0 0 0 rg BT 147.75 466.25 Td (on ) Tj ET Q q 0 0 0 rg BT 159.77 466.25 Td (this ) Tj ET Q q 0 0 0 rg BT 176.22 466.25 Td (loan ) Tj ET Q q 0 0 0 rg BT 195.45 466.25 Td (with ) Tj ET Q q 0 0 0 rg BT 215.24 466.25 Td (an ) Tj ET Q q 0 0 0 rg BT 226.69 466.25 Td (interest ) Tj ET Q q 0 0 0 rg BT 258.13 466.25 Td (rate ) Tj ET Q q 0 0 0 rg BT 275.13 466.25 Td (of ) Tj ET Q q 0 0 0 rg BT 285.47 466.25 Td (4.25%. ) Tj ET Q q 0 0 0 rg BT 315.67 466.25 Td (W) Tj ET Q q 0 0 0 rg BT 324.30 466.25 Td (e ) Tj ET Q q 0 0 0 rg BT 330.75 466.25 Td (performed ) Tj ET Q q 0 0 0 rg BT 374.41 466.25 Td (a ) Tj ET Q q 0 0 0 rg BT 380.86 466.25 Td (sensitivity ) Tj ET Q q 0 0 0 rg BT 423.98 466.25 Td (analysis ) Tj ET Q q 0 0 0 rg BT 458.21 466.25 Td (on ) Tj ET Q q 0 0 0 rg BT 470.22 466.25 Td (the ) Tj ET Q q 0 0 0 rg BT 484.45 466.25 Td (outstanding ) Tj ET Q q 0 0 0 rg BT 533.13 466.25 Td (portion ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.25 Td (of ) Tj ET Q q 0 0 0 rg BT 60.30 454.25 Td (our ) Tj ET Q q 0 0 0 rg BT 75.60 454.25 Td (debt ) Tj ET Q q 0 0 0 rg BT 94.79 454.25 Td (obligation ) Tj ET Q q 0 0 0 rg BT 137.32 454.25 Td (as ) Tj ET Q q 0 0 0 rg BT 147.62 454.25 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 157.92 454.25 Td (December31, ) Tj ET Q q 0 0 0 rg BT 215.97 454.25 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 235.97 454.25 Td (. ) Tj ET Q q 0 0 0 rg BT 240.45 454.25 Td (Should ) Tj ET Q q 0 0 0 rg BT 270.76 454.25 Td (the ) Tj ET Q q 0 0 0 rg BT 284.95 454.25 Td (current ) Tj ET Q q 0 0 0 rg BT 315.23 454.25 Td (average ) Tj ET Q q 0 0 0 rg BT 348.29 454.25 Td (interest ) Tj ET Q q 0 0 0 rg BT 379.69 454.25 Td (rate ) Tj ET Q q 0 0 0 rg BT 396.65 454.25 Td (increase ) Tj ET Q q 0 0 0 rg BT 431.38 454.25 Td (or ) Tj ET Q q 0 0 0 rg BT 441.68 454.25 Td (decrease ) Tj ET Q q 0 0 0 rg BT 478.06 454.25 Td (by ) Tj ET Q q 0 0 0 rg BT 490.04 454.25 Td (10%, ) Tj ET Q q 0 0 0 rg BT 512.84 454.25 Td (the ) Tj ET Q q 0 0 0 rg BT 527.03 454.25 Td (resulting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.25 Td (annual ) Tj ET Q q 0 0 0 rg BT 79.16 442.25 Td (increase ) Tj ET Q q 0 0 0 rg BT 114.41 442.25 Td (or ) Tj ET Q q 0 0 0 rg BT 125.24 442.25 Td (decrease ) Tj ET Q q 0 0 0 rg BT 162.15 442.25 Td (to ) Tj ET Q q 0 0 0 rg BT 172.43 442.25 Td (interest ) Tj ET Q q 0 0 0 rg BT 204.37 442.25 Td (expense ) Tj ET Q q 0 0 0 rg BT 239.07 442.25 Td (would ) Tj ET Q q 0 0 0 rg BT 266.57 442.25 Td (be ) Tj ET Q q 0 0 0 rg BT 278.51 442.25 Td (approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 338.77 442.25 Td ($2.9 ) Tj ET Q q 0 0 0 rg BT 358.77 442.25 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.66 442.25 Td ( ) Tj ET Q q 0 0 0 rg BT 390.16 442.25 Td (as ) Tj ET Q q 0 0 0 rg BT 400.99 442.25 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 411.82 442.25 Td (December31, ) Tj ET Q q 0 0 0 rg BT 470.41 442.25 Td (2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.41 442.25 Td (.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 418.25 Td (For) Tj ET Q q 0 0 0 rg BT 65.37 418.25 Td (eign curr) Tj ET Q q 0 0 0 rg BT 104.34 418.25 Td (ency exchange risk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 394.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 394.25 Td (e maintain operations in various countries outside of the United States and have foreign subsidiaries that manufacture and sell ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 382.25 Td (our products in various global markets. ) Tj ET Q q 0 0 0 rg BT 208.96 382.25 Td (The majority of our sales are transacted in U.S. dollars. However) Tj ET Q q 0 0 0 rg BT 468.75 382.25 Td (, we do generate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.25 Td (revenues in other currencies, primarily the Euro, the Japanese ) Tj ET Q q 0 0 0 rg BT 298.70 370.25 Td (Y) Tj ET Q q 0 0 0 rg BT 304.92 370.25 Td (en, the South Korean ) Tj ET Q q 0 0 0 rg BT 391.66 370.25 Td (W) Tj ET Q q 0 0 0 rg BT 400.30 370.25 Td (on and the Chinese Renminbi. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.25 Td (Additionally we have operations in dif) Tj ET Q q 0 0 0 rg BT 203.95 358.25 Td (ferent countries around the world with costs incurred in other local currencies, such as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.25 Td (British Pound Sterling, Singapore Dollars and Malaysian Ringgit. ) Tj ET Q q 0 0 0 rg BT 314.99 346.25 Td (As a result, our earnings, cash flows and cash balances are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 334.25 Td (exposed to fluctuations in foreign currency exchange rates. For example, we have significant manufacturing operations in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 322.25 Td (Europe so that a weakening Euro is advantageous to the Company) Tj ET Q q 0 0 0 rg BT 317.71 322.25 Td (s financial results. ) Tj ET Q q 0 0 0 rg BT 392.51 322.25 Td (W) Tj ET Q q 0 0 0 rg BT 401.15 322.25 Td (e attempt to limit these exposures ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 310.25 Td (through financial market instruments. ) Tj ET Q q 0 0 0 rg BT 202.84 310.25 Td (W) Tj ET Q q 0 0 0 rg BT 211.47 310.25 Td (e utilize derivative instruments, primarily forward contracts with maturities of four ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 298.25 Td (months or less, to manage our exposure associated with anticipated cash flows and net asset and liability positions denominated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 286.25 Td (in foreign currencies. Gains and losses on the forward contracts are mitigated by gains and losses on the underlying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 274.25 Td (instruments. ) Tj ET Q q 0 0 0 rg BT 101.48 274.25 Td (W) Tj ET Q q 0 0 0 rg BT 110.12 274.25 Td (e do not use derivative financial instruments for trading purposes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 262.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 250.25 Td (On occasion, we enter into currency forward exchange contracts to hedge specific anticipated foreign currency denominated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 238.25 Td (transactions generally expected to occur within the next 12months. ) Tj ET Q q 0 0 0 rg BT 322.24 238.25 Td (These cash flow hedges are designated for hedge ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 226.25 Td (accounting treatment and gains and losses on these contracts are recorded in accumulated other comprehensive income in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 214.25 Td (stockholder's equity and reclassified into earnings at the time that the related transactions being hedged are recognized in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 202.25 Td (earnings. See Note 6 "Derivative Instruments and Hedging ) Tj ET Q q 0 0 0 rg BT 287.08 202.25 Td (Activities".) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.25 Td (On ) Tj ET Q q 0 0 0 rg BT 64.17 178.25 Td (August 1, 2016, we purchased forward contracts totaling 670.0 million Euro, with a value date of November 30, 2016, to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 166.25 Td (limit our foreign exchange risk related to the commitment of our Euro ) Tj ET Q q 0 0 0 rg BT 332.51 166.25 Td (T) Tj ET Q q 0 0 0 rg BT 337.92 166.25 Td (erm Loan \(denominated in Euros\) in an amount of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 154.25 Td (Euro equivalent of $750.0 million to finance the U.S. dollar payment for the acquisition of Rofin. In the fourth quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 142.25 Td (2016, we recognized an unrealized loss of $2.2 million on these forward contracts. In the first quarter of fiscal 2017, we settled ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 130.25 Td (these forward contracts at a net gain of $9.1 million, resulting in a realized gain of $1) Tj ET Q q 0 0 0 rg BT 390.63 130.25 Td (1.3 million in the first quarter of fiscal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 118.25 Td (2017. See Note 6 "Derivative Instruments and Hedging ) Tj ET Q q 0 0 0 rg BT 273.20 118.25 Td (Activities".) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 94.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 94.25 Td (e do not anticipate any material adverse ef) Tj ET Q q 0 0 0 rg BT 227.54 94.25 Td (fect on our condensed consolidated financial position, results of operations or cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 82.25 Td (flows resulting from the use of these instruments. ) Tj ET Q q 0 0 0 rg BT 250.06 82.25 Td (There can be no assurance that these strategies will be ef) Tj ET Q q 0 0 0 rg BT 476.45 82.25 Td (fective or that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 70.25 Td (transaction losses can be minimized or forecasted accurately) Tj ET Q q 0 0 0 rg BT 291.19 70.25 Td (. ) Tj ET Q q 0 0 0 rg BT 296.01 70.25 Td (While we model currency valuations and fluctuations, these may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 58.25 Td (not ultimately be accurate. If a financial counterparty to any of our hedging arrangements experiences financial dif) Tj ET Q q 0 0 0 rg BT 508.23 58.25 Td (ficulties or is ) Tj ET Q endstream endobj 91 0 obj <>] /Rotate 0 /Contents 92 0 R>> endobj 92 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (45) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 742.10 Td (otherwise unable to honor the terms of the foreign currency hedge, we may experience material financial losses. In the current ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.10 Td (economic environment, the risk of failure of a financial party remains high.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 62.50 706.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.08 706.10 Td (, approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 206.34 706.10 Td ($236.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 265.23 706.10 Td ( of our cash, cash equivalents and short-term investments were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.10 Td (heldoutside the U.S. in certain of our foreign operations, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 280.78 694.10 Td ($217.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.67 694.10 Td ( of which was denominated in currencies other than the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.10 Td (U.S. dollar) Tj ET Q q 0 0 0 rg BT 93.06 682.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.10 Td (A) Tj ET Q q 0 0 0 rg BT 56.67 658.10 Td ( hypothetical 10% change in foreign currency rates on our forward contracts would not have a material impact on our results ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.10 Td (of operations, cash flows or financial position.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.10 Td (The following table provides information about our foreign exchange forward contracts at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.66 622.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.24 622.10 Td (. ) Tj ET Q q 0 0 0 rg BT 496.06 622.10 Td (The table ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.10 Td (presents the weighted average contractual foreign currency exchange rates, the value of the contracts in U.S. dollars at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.10 Td (contract exchange rate as of the contract maturity date and fair value. ) Tj ET Q q 0 0 0 rg BT 328.85 598.10 Td (The U.S. fair value represents the fair value of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.10 Td (contracts valued at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 127.47 586.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 206.05 586.10 Td ( rates.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 574.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.10 Td (Forward contracts to sell \(buy\) foreign currencies for U.S. dollars \(in thousands, except contract rates\):) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.10 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 518.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 518.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 518.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 518.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 518.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 518.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 488.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 488.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 488.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 488.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 488.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 488.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 458.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 458.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 458.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 458.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 458.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 428.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 428.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 428.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 428.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 428.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 398.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 398.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 398.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 398.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 398.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 368.60 277.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.50 368.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.50 368.60 70.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 471.50 368.60 4.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 475.50 368.60 70.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327.5 518.6 m 397.5 518.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401.5 518.6 m 471.5 518.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 475.5 518.6 m 545.5 518.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 327.5 518.6 m 397.5 518.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401.5 518.6 m 471.5 518.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 475.5 518.6 m 545.5 518.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 331.75 530.83 Td (A) Tj ET Q q 0 0 0 rg BT 336.93 530.83 Td (verageContract) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 354.00 522.83 Td (Rate) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 413.20 530.83 Td (U.S.Notional) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 410.10 522.83 Td (Contract) Tj ET Q q 0 0 0 rg BT 442.61 522.83 Td (V) Tj ET Q q 0 0 0 rg BT 447.65 522.83 Td (alue) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 502.85 530.83 Td (U.S.) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 492.15 522.83 Td (Fair) Tj ET Q q 0 0 0 rg BT 506.67 522.83 Td () Tj ET Q q 0 0 0 rg BT 508.52 522.83 Td (V) Tj ET Q q 0 0 0 rg BT 513.56 522.83 Td (alue) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 508.27 Td (Non-Designated - For US Dollars) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 493.27 Td (Euro) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.15 493.27 Td (1.0603) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 493.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 436.80 493.32 Td (\(80,995) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.65 493.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 493.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.80 493.32 Td (\(1,207) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 493.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 478.27 Td (Japanese Yen) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.15 478.27 Td (112.5411) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 478.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 440.15 478.27 Td (18,077) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 478.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.65 478.27 Td (733) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 463.27 Td (British Pound) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.15 463.27 Td (1.2490) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 463.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.65 463.27 Td (857) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 463.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.65 463.27 Td (17) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 448.27 Td (South Korean Won) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.65 448.27 Td (1,504.2915) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.15 448.27 Td (3,868) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 448.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 523.30 448.32 Td (\(944) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 448.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 433.27 Td (Chinese Renminbi) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.15 433.27 Td (6.9514) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 433.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.15 433.27 Td (8,141) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 433.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.65 433.27 Td (35) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 418.27 Td (Singapore Dollar) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.15 418.27 Td (1.4275) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 418.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 441.80 418.32 Td (\(4,194) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.65 418.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 418.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 528.30 418.32 Td (\(58) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 418.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 403.27 Td (Malaysian Ringgit) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.15 403.27 Td (4.5030) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 403.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.15 403.27 Td (2,174) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 403.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 528.30 403.32 Td (\(13) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.65 403.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 373.27 Td (Non-Designated - For Japanese Yen) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 358.27 Td (Euro) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.15 358.27 Td (116.0209) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 441.80 358.32 Td (\(1,942) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.65 358.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 358.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.65 358.27 Td (26) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 343.27 Td (US Dollar) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.15 343.27 Td (110.5580) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.30 343.32 Td (\(112) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.65 343.27 Td (\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.00 343.27 Td ($) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.65 343.27 Td (5) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 93 0 obj <>] /Rotate 0 /Contents 94 0 R>> endobj 94 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (46) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 742.25 Td (ITEM 4. CONTROLS ) Tj ET Q q 0 0 0 rg BT 147.24 742.25 Td (AND PROCEDURES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 718.25 Td (Management) Tj ET Q q 0 0 0 rg BT 109.06 718.25 Td (s Evaluation of Disclosur) Tj ET Q q 0 0 0 rg BT 215.28 718.25 Td (e Contr) Tj ET Q q 0 0 0 rg BT 247.59 718.25 Td (ols and Pr) Tj ET Q q 0 0 0 rg BT 290.75 718.25 Td (ocedur) Tj ET Q q 0 0 0 rg BT 320.00 718.25 Td (es) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 706.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.64 694.25 Td (e have evaluated the ef) Tj ET Q q 0 0 0 rg BT 150.07 694.25 Td (fectiveness of the design and operation of our disclosure controls and procedures, as such term is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td (defined in Rule13a-15\(e\)under the Securities Exchange ) Tj ET Q q 0 0 0 rg BT 278.81 682.25 Td (Act of 1934, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.24 682.25 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 431.82 682.25 Td ( \(Evaluation Date\). ) Tj ET Q q 0 0 0 rg BT 521.88 682.25 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 670.25 Td (controls evaluation was conducted under the supervision and with the participation of management, including our Chief ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 658.25 Td (Executive Of) Tj ET Q q 0 0 0 rg BT 102.85 658.25 Td (ficer and Chief Financial Of) Tj ET Q q 0 0 0 rg BT 215.41 658.25 Td (ficer) Tj ET Q q 0 0 0 rg BT 233.17 658.25 Td (. Based on this evaluation, our Chief Executive Of) Tj ET Q q 0 0 0 rg BT 437.10 658.25 Td (ficer and Chief Financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 646.25 Td (Of) Tj ET Q q 0 0 0 rg BT 60.37 646.25 Td (ficer concluded as of the Evaluation Date that our disclosure controls and procedures wereef) Tj ET Q q 0 0 0 rg BT 432.27 646.25 Td (fective in providing reasonable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 634.25 Td (assurance that information required to be disclosed by us in reports that we file or submit under the Securities Exchange ) Tj ET Q q 0 0 0 rg BT 532.09 634.25 Td (Act of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 622.25 Td (1934, as amended, is \(i\)recorded, processed, summarized and reported within the time periods specified in the Securities and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 610.25 Td (Exchange Commission) Tj ET Q q 0 0 0 rg BT 145.27 610.25 Td (s rulesand forms and \(ii\)accumulated and communicated to our management, including our Chief ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 598.25 Td (Executive Of) Tj ET Q q 0 0 0 rg BT 102.85 598.25 Td (ficer and Chief Financial Of) Tj ET Q q 0 0 0 rg BT 215.41 598.25 Td (ficer) Tj ET Q q 0 0 0 rg BT 233.32 598.25 Td (, as appropriate, to allow timely decisions regarding required disclosures.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 586.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 574.25 Td (Changes in Internal Contr) Tj ET Q q 0 0 0 rg BT 162.89 574.25 Td (ol over) Tj ET Q q 0 0 0 rg BT 191.86 574.25 Td ( Financial Reporting) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 562.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 550.25 Td (In November 2016, we completed the acquisition of Rofin-Sinar ) Tj ET Q q 0 0 0 rg BT 310.31 550.25 Td (T) Tj ET Q q 0 0 0 rg BT 315.72 550.25 Td (echnologies, Inc. \(Rofin\). ) Tj ET Q q 0 0 0 rg BT 431.89 550.25 Td (W) Tj ET Q q 0 0 0 rg BT 440.53 550.25 Td (e are in the process of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 538.25 Td (integrating Rofin into our systems and control environment as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 311.62 538.25 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 390.21 538.25 Td (. ) Tj ET Q q 0 0 0 rg BT 397.52 538.25 Td (W) Tj ET Q q 0 0 0 rg BT 406.16 538.25 Td (e believe that we have taken the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 526.25 Td (necessary steps to monitor and maintain appropriate internal control over financial reporting during this integration. Other than ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 514.25 Td (the impact of this business acquisition, there has been no change in our internal control over financial reporting that have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 502.25 Td (materially af) Tj ET Q q 0 0 0 rg BT 100.63 502.25 Td (fected, or are reasonably likely to materially af) Tj ET Q q 0 0 0 rg BT 287.58 502.25 Td (fect, our internal control over financial reporting during the three ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 490.25 Td (months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 108.33 490.25 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 186.91 490.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 466.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 52.50 466.25 Td (Inher) Tj ET Q q 0 0 0 rg BT 76.21 466.25 Td (ent Limitations over) Tj ET Q q 0 0 0 rg BT 162.69 466.25 Td ( Internal Contr) Tj ET Q q 0 0 0 rg BT 228.06 466.25 Td (ol) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 454.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 442.25 Td (Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 430.25 Td (financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 418.25 Td (accounting principles \("GAAP"\). Because of its inherent limitations, internal control over financial reporting may not prevent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 406.25 Td (or detect misstatements. ) Tj ET Q q 0 0 0 rg BT 148.31 406.25 Td (Also, projections of any evaluation of ef) Tj ET Q q 0 0 0 rg BT 309.47 406.25 Td (fectiveness to future periods are subject to the risk that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 394.25 Td (controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 382.25 Td (procedures may deteriorate. Our internal control over financial reporting is designed to provide reasonable assurance regarding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 370.25 Td (the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP) Tj ET Q q 0 0 0 rg BT 557.32 370.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 358.25 Td (Our internal control over financial reporting includes those policies and procedures that:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 346.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 334.25 Td (\(i\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 334.25 Td (pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 322.25 Td (dispositions of our assets;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 310.25 Td (\(ii\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 310.25 Td (provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 298.25 Td (statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 286.25 Td (being made only in accordance with authorizations of our management and directors; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.00 274.25 Td (\(iii\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 274.25 Td (provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.00 262.25 Td (disposition of our assets that could have a material ef) Tj ET Q q 0 0 0 rg BT 307.26 262.25 Td (fect on the financial statements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 238.25 Td (Management, including our Chief Executive Of) Tj ET Q q 0 0 0 rg BT 240.87 238.25 Td (ficer and Chief Financial Of) Tj ET Q q 0 0 0 rg BT 353.43 238.25 Td (ficer) Tj ET Q q 0 0 0 rg BT 371.34 238.25 Td (, does not expect that our internal controls will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 226.25 Td (prevent or detect all errors and all fraud. ) Tj ET Q q 0 0 0 rg BT 212.98 226.25 Td (A) Tj ET Q q 0 0 0 rg BT 219.65 226.25 Td ( control system, no matter how well designed and operated, can provide only ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 214.25 Td (reasonable, not absolute, assurance that the objectives of the control system are met. Further) Tj ET Q q 0 0 0 rg BT 418.37 214.25 Td (, the design of a control system ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 202.25 Td (must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 190.25 Td (Because of the inherent limitations in all control systems, no evaluation of internal controls can provide absolute assurance that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 178.25 Td (all control issues and instances of fraud, if any) Tj ET Q q 0 0 0 rg BT 235.13 178.25 Td (, have been detected. ) Tj ET Q q 0 0 0 rg BT 320.64 178.25 Td (Also, any evaluation of the ef) Tj ET Q q 0 0 0 rg BT 438.76 178.25 Td (fectiveness of controls in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 166.25 Td (future periods are subject to the risk that those internal controls may become inadequate because of changes in business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 154.25 Td (conditions, or that the degree of compliance with the policies or procedures may deteriorate.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 142.25 Td () Tj ET Q endstream endobj 95 0 obj <>] /Rotate 0 /Contents 96 0 R>> endobj 96 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (47) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 742.25 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 742.25 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 742.25 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 742.25 Td (II. OTHER INFORMA) Tj ET Q q 0 0 0 rg BT 177.99 742.25 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 730.25 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 718.25 Td (ITEM 1. LEGAL) Tj ET Q q 0 0 0 rg BT 123.63 718.25 Td ( PROCEEDINGS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (Information with respect to this item may be found in Note 1) Tj ET Q q 0 0 0 rg BT 293.19 694.25 Td (1 to our condensed consolidated financial statements in Part I, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td (Item 1 of this report and is incorporated herein by reference.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 648.25 Td (ITEM 1A. RISK F) Tj ET Q q 0 0 0 rg BT 128.21 648.25 Td (ACT) Tj ET Q q 0 0 0 rg BT 149.14 648.25 Td (ORS) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 624.25 Td (Y) Tj ET Q q 0 0 0 rg BT 54.14 624.25 Td (ou should car) Tj ET Q q 0 0 0 rg BT 108.77 624.25 Td (efully consider the followings risks when considering an investment in our Common Stock. These risks could ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 612.25 Td (materially affect our business, r) Tj ET Q q 0 0 0 rg BT 176.62 612.25 Td (esults of operations or financial condition, cause the trading price of our Common Stock to ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 600.25 Td (decline materially or cause our actual r) Tj ET Q q 0 0 0 rg BT 208.54 600.25 Td (esults to differ materially fr) Tj ET Q q 0 0 0 rg BT 318.17 600.25 Td (om those expected or those expr) Tj ET Q q 0 0 0 rg BT 446.37 600.25 Td (essed in any forwar) Tj ET Q q 0 0 0 rg BT 524.60 600.25 Td (d-) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 588.25 Td (looking statements made by us. These risks ar) Tj ET Q q 0 0 0 rg BT 234.94 588.25 Td (e not exclusive, and additional risks to which we ar) Tj ET Q q 0 0 0 rg BT 440.10 588.25 Td (e subject include, but ar) Tj ET Q q 0 0 0 rg BT 536.10 588.25 Td (e not ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 576.25 Td (limited to, the factors mentioned under Forwar) Tj ET Q q 0 0 0 rg BT 243.28 576.25 Td (d-Looking Statements and the risk of our businesses described elsewher) Tj ET Q q 0 0 0 rg BT 535.94 576.25 Td (e in ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 564.25 Td (this annual r) Tj ET Q q 0 0 0 rg BT 100.25 564.25 Td (eport. ) Tj ET Q q 0 0 0 rg BT 126.17 564.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 175.06 564.25 Td (, these risks and uncertainties described her) Tj ET Q q 0 0 0 rg BT 351.05 564.25 Td (ein ar) Tj ET Q q 0 0 0 rg BT 374.29 564.25 Td (e not the only ones facing us. Other events ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 552.25 Td (that we do not curr) Tj ET Q q 0 0 0 rg BT 125.79 552.25 Td (ently anticipate or that we curr) Tj ET Q q 0 0 0 rg BT 250.13 552.25 Td (ently deem immaterial also may affect our business, r) Tj ET Q q 0 0 0 rg BT 463.89 552.25 Td (esults of operations or ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 540.25 Td (financial condition.) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 49.5 501.28505859375 m 282.5224609375 501.28505859375 l s q 0 0 0 rg BT 49.50 502.85 Td (RISKS RELA) Tj ET Q q 0 0 0 rg BT 109.06 502.85 Td (TED ) Tj ET Q q 0 0 0 rg BT 131.94 502.85 Td (T) Tj ET Q q 0 0 0 rg BT 138.43 502.85 Td (O ) Tj ET Q q 0 0 0 rg BT 148.52 502.85 Td (THE MERGER ) Tj ET Q q 0 0 0 rg BT 219.46 502.85 Td (WITH ROFIN) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 482.85 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 482.85 Td (e may not be able to integrate the business of Rofin successfully with our own or realize the anticipated benefits of the ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 470.85 Td (merger) Tj ET Q q 0 0 0 rg BT 78.39 470.85 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 450.85 Td (W) Tj ET Q q 0 0 0 rg BT 80.64 450.85 Td (e will be required to devote significant management attention and resources to integrating our business practices with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 438.85 Td (those of Rofin. Potential dif) Tj ET Q q 0 0 0 rg BT 160.70 438.85 Td (ficulties that we may encounter as part of the integration process include the following:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 418.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 418.85 Td (the inability to successfully combine our business with Rofin in a manner that permits the combined company to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 406.85 Td (achieve the full syner) Tj ET Q q 0 0 0 rg BT 171.12 406.85 Td (gies and other benefits anticipated to result from the mer) Tj ET Q q 0 0 0 rg BT 397.25 406.85 Td (ger;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 386.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 386.85 Td (complexities associated with managing the combined businesses, including dif) Tj ET Q q 0 0 0 rg BT 399.98 386.85 Td (ficulty addressing possible dif) Tj ET Q q 0 0 0 rg BT 520.06 386.85 Td (ferences ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 374.85 Td (in corporate cultures and management philosophies and the challenge of integrating products, services, complex and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 362.85 Td (dif) Tj ET Q q 0 0 0 rg BT 96.43 362.85 Td (ferent information technology systems \(including dif) Tj ET Q q 0 0 0 rg BT 307.59 362.85 Td (ferent Enterprise Management Systems\), technology) Tj ET Q q 0 0 0 rg BT 517.16 362.85 Td (, networks ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 350.85 Td (and other assets of each of the companies in a cohesive manner; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 330.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 330.85 Td (potential unknown liabilities and unforeseen increased expenses or delays related to the mer) Tj ET Q q 0 0 0 rg BT 453.53 330.85 Td (ger and the integration of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 318.85 Td (Rofin, including as a result of the requirement for holding separate Rofin) Tj ET Q q 0 0 0 rg BT 380.42 318.85 Td (s business located in Hull, England.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 298.85 Td (In addition, we have operated independently prior to the mer) Tj ET Q q 0 0 0 rg BT 314.51 298.85 Td (ger and it is possible that the integration process following ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.85 Td (the mer) Tj ET Q q 0 0 0 rg BT 79.58 286.85 Td (ger could result in:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 266.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 266.85 Td (diversion of the attention of our management; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 246.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 246.85 Td (the disruption of, or the loss of momentum in, our business or inconsistencies in standards, controls, procedures or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 234.85 Td (policies, any of which could adversely af) Tj ET Q q 0 0 0 rg BT 249.43 234.85 Td (fect our ability to maintain relationships with customers, suppliers, employees ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 222.85 Td (and other constituencies or our ability to achieve the anticipated benefits of the mer) Tj ET Q q 0 0 0 rg BT 418.81 222.85 Td (ger) Tj ET Q q 0 0 0 rg BT 431.18 222.85 Td (, or could reduce our earnings or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 210.85 Td (otherwise adversely af) Tj ET Q q 0 0 0 rg BT 175.28 210.85 Td (fect our business and financial results. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 190.85 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 190.85 Td (In addition, prior to the mer) Tj ET Q q 0 0 0 rg BT 196.40 190.85 Td (ger) Tj ET Q q 0 0 0 rg BT 208.77 190.85 Td (, Rofin) Tj ET Q q 0 0 0 rg BT 239.33 190.85 Td (s business faced risks and uncertainties, including those faced by our business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 178.85 Td (and identified below) Tj ET Q q 0 0 0 rg BT 167.05 178.85 Td (. Rofin) Tj ET Q q 0 0 0 rg BT 197.60 178.85 Td (s business may not meet future expectations due to these factors despite our integration ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 166.85 Td (ef) Tj ET Q q 0 0 0 rg BT 93.09 166.85 Td (forts.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 146.85 Td (Our future results will suf) Tj ET Q q 0 0 0 rg BT 156.58 146.85 Td (fer if we do not ef) Tj ET Q q 0 0 0 rg BT 228.88 146.85 Td (fectively manage our expanded operations following the merger) Tj ET Q q 0 0 0 rg BT 490.81 146.85 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 126.85 Td (Following the mer) Tj ET Q q 0 0 0 rg BT 145.70 126.85 Td (ger) Tj ET Q q 0 0 0 rg BT 158.07 126.85 Td (, the size and complexity of the business of the combined company has increased significantly) Tj ET Q q 0 0 0 rg BT 534.26 126.85 Td (. Our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 114.85 Td (future success depends, in part, upon our ability to manage this expanded business, which will pose substantial challenges for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 102.85 Td (management, including challenges related to the management and monitoring of new operations and associated increased costs ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 90.85 Td (and complexity) Tj ET Q q 0 0 0 rg BT 110.78 90.85 Td (. ) Tj ET Q q 0 0 0 rg BT 115.60 90.85 Td (There can be no assurances that we will be successful or that we will realize the expected syner) Tj ET Q q 0 0 0 rg BT 496.65 90.85 Td (gies and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 78.85 Td (benefits anticipated from the mer) Tj ET Q q 0 0 0 rg BT 182.04 78.85 Td (ger) Tj ET Q q 0 0 0 rg BT 194.26 78.85 Td (.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 58.85 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 58.85 Td (e have incurred and will continue to incur substantial expenses related to the merger with and the integration of Rofin.) Tj ET Q endstream endobj 97 0 obj <>] /Rotate 0 /Contents 98 0 R>> endobj 98 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (48) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 742.10 Td (W) Tj ET Q q 0 0 0 rg BT 80.64 742.10 Td (e have and expect to continue to incur substantial expenses in connection with the mer) Tj ET Q q 0 0 0 rg BT 425.91 742.10 Td (ger and the integration of Rofin. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (There are a lar) Tj ET Q q 0 0 0 rg BT 107.33 730.10 Td (ge number of processes, policies, procedures, operations, technologies and systems that will need to be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (integrated, including purchasing, accounting and finance, sales, payroll, pricing, marketing and employee benefits. ) Tj ET Q q 0 0 0 rg BT 510.28 718.10 Td (While we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (have assumed that a certain level of expenses will be incurred, there are many factors beyond our control that could af) Tj ET Q q 0 0 0 rg BT 521.63 706.10 Td (fect the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (total amount or the timing of the integration expenses. Moreover) Tj ET Q q 0 0 0 rg BT 307.92 694.10 Td (, many of the expenses that will be incurred are, by their ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (nature, dif) Tj ET Q q 0 0 0 rg BT 90.41 682.10 Td (ficult to estimate accurately) Tj ET Q q 0 0 0 rg BT 200.54 682.10 Td (. ) Tj ET Q q 0 0 0 rg BT 205.36 682.10 Td (These expenses could, particularly in the near term, exceed the savings we expect to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 670.10 Td (achieve from the elimination of duplicative expenses and the realization of economies of scale and cost savings. ) Tj ET Q q 0 0 0 rg BT 499.72 670.10 Td (These ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (integration expenses could result in significant char) Tj ET Q q 0 0 0 rg BT 255.37 658.10 Td (ges to earnings which we cannot currently quantify) Tj ET Q q 0 0 0 rg BT 459.38 658.10 Td (. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 638.10 Td (Charges to earnings resulting from the application of the purchase method of accounting to the Rofin acquisition may ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 626.10 Td (adversely af) Tj ET Q q 0 0 0 rg BT 98.46 626.10 Td (fect our results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 606.10 Td (In accordance with generally accepted accounting principles, we have accounted for the Rofin acquisition using the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 594.10 Td (purchase method of accounting, which will result in char) Tj ET Q q 0 0 0 rg BT 276.75 594.10 Td (ges to earnings that could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 485.65 594.10 Td (fect on the market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 582.10 Td (value of our common stock following completion of the acquisition. Under the purchase method of accounting, we will allocate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 570.10 Td (the total purchase price of Rofin) Tj ET Q q 0 0 0 rg BT 181.40 570.10 Td (s net tangible and identifiable intangible assets based upon their estimated fair values at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 558.10 Td (acquisition date. ) Tj ET Q q 0 0 0 rg BT 117.36 558.10 Td (The excess of the purchase price over net tangible and identifiable intangible assets will be recorded as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 546.10 Td (goodwill. ) Tj ET Q q 0 0 0 rg BT 89.88 546.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.51 546.10 Td (e will incur additional depreciation and amortization expense over the useful lives of certain of the net tangible and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 534.10 Td (intangible assets acquired in connection with the acquisition. In addition, to the extent the value of goodwill or intangible assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 522.10 Td (with indefinite lives becomes impaired, we may be required to incur material char) Tj ET Q q 0 0 0 rg BT 377.25 522.10 Td (ges relating to the impairment of those assets. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 510.10 Td (These depreciation, amortization and potential impairment char) Tj ET Q q 0 0 0 rg BT 303.39 510.10 Td (ges could have a material impact on our results of operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (Our indebtedness following the merger is substantially greater than our indebtedness prior to the merger) Tj ET Q q 0 0 0 rg BT 479.55 490.10 Td (. This increased ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (level of indebtedness could adversely af) Tj ET Q q 0 0 0 rg BT 211.22 478.10 Td (fect us, including by decreasing our business flexibility) Tj ET Q q 0 0 0 rg BT 436.97 478.10 Td (, and will increase our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (borrowing costs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.50 446.10 Td (In November 2016 we entered into the Credit ) Tj ET Q q 0 0 0 rg BT 255.34 446.10 Td (Agreement which provides for a 670 million Euro term loan, all of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.10 Td (has been drawn, and a $100 million revolving credit facility) Tj ET Q q 0 0 0 rg BT 288.23 434.10 Td (, under which a 10 million Euro letter of credit has been issued. ) Tj ET Q q 0 0 0 rg BT 544.36 434.10 Td (W) Tj ET Q q 0 0 0 rg BT 553.00 434.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.10 Td (may incur additional indebtedness in the future by accessing the revolving credit facility under the Credit ) Tj ET Q q 0 0 0 rg BT 472.15 422.10 Td (Agreement and/or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.10 Td (entering into new financing arrangements. Our ability to pay interest and repay the principal of our current indebtedness is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.10 Td (dependent upon our ability to manage our business operations and the ongoing interest rate environment. ) Tj ET Q q 0 0 0 rg BT 471.44 398.10 Td (There can be no ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 386.10 Td (assurance that we will be able to manage any of these risks successfully) Tj ET Q q 0 0 0 rg BT 335.98 386.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.50 366.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 116.49 366.10 Td (Agreement contains customary af) Tj ET Q q 0 0 0 rg BT 250.98 366.10 Td (firmative covenants, including covenants regarding the payment of taxes and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 354.10 Td (other obligations, maintenance of insurance, reporting requirements and compliance with applicable laws and regulations, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 342.10 Td (negative covenants, including covenants limiting the ability of us and our subsidiaries to, among other things, incur debt, grant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 330.10 Td (liens, make investments, make certain restricted payments, transact with af) Tj ET Q q 0 0 0 rg BT 348.66 330.10 Td (filiates, and sell assets. ) Tj ET Q q 0 0 0 rg BT 442.35 330.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 487.34 330.10 Td (Agreement also ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 318.10 Td (requires us and our subsidiaries to maintain a senior secured net leverage ratio as of the last day of each fiscal quarter of less of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 306.10 Td (than or equal to 3.50 to 1.00.) Tj ET Q q 0 0 0 rg BT 169.58 306.10 Td (The Credit ) Tj ET Q q 0 0 0 rg BT 214.57 306.10 Td (Agreement contains customary events of default that include, among other things, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 294.10 Td (payment defaults, cross defaults with certain other indebtedness, violation of covenants, inaccuracy of representations and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 282.10 Td (warranties in any material respect, change in control of the Company and the Borrower) Tj ET Q q 0 0 0 rg BT 397.86 282.10 Td (, judgment defaults, and bankruptcy and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 270.10 Td (insolvency events.If an event of default exists, the lenders may require the immediate payment of all Obligations, as defined in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 258.10 Td (the Credit ) Tj ET Q q 0 0 0 rg BT 91.16 258.10 Td (Agreement, and may exercise certain other rights and remedies provided for under the Credit ) Tj ET Q q 0 0 0 rg BT 465.19 258.10 Td (Agreement, the other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 246.10 Td (loan documents and applicable law) Tj ET Q q 0 0 0 rg BT 189.36 246.10 Td (. ) Tj ET Q q 0 0 0 rg BT 194.18 246.10 Td (The acceleration of such obligations is automatic upon the occurrence of a bankruptcy and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 234.10 Td (insolvency event of default. ) Tj ET Q q 0 0 0 rg BT 162.89 234.10 Td (There can be no assurance that we will have suf) Tj ET Q q 0 0 0 rg BT 354.02 234.10 Td (ficient financial resources or we will be able to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 222.10 Td (arrange financing to repay our borrowings at such time. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 202.10 Td (Our substantially increased indebtedness and higher debt-to-equity ratio following completion of the mer) Tj ET Q q 0 0 0 rg BT 492.26 202.10 Td (ger in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (comparison to that prior to the mer) Tj ET Q q 0 0 0 rg BT 188.73 190.10 Td (ger will have the ef) Tj ET Q q 0 0 0 rg BT 265.74 190.10 Td (fect, among other things, of reducing our flexibility to respond to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (changing business and economic conditions and will increase our borrowing costs. In addition, the amount of cash required to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (service our increased indebtedness levels and thus the demands on our cash resources will be greater than the amount of cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (flows required to service our indebtedness or that of Rofin individually prior to the mer) Tj ET Q q 0 0 0 rg BT 398.68 154.10 Td (ger) Tj ET Q q 0 0 0 rg BT 410.90 154.10 Td (. ) Tj ET Q q 0 0 0 rg BT 415.72 154.10 Td (The increased levels of indebtedness ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (could also reduce funds available for our investments in product development as well as capital expenditures, dividends, share ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (repurchases and other activities and may create competitive disadvantages for us relative to other companies with lower debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (levels.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 98.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 98.10 Td (e may not be able to divest the Rofin business located in Hull, England on favorable terms.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 78.10 Td (On October26, 2016, the European Commission approved under the EU Mer) Tj ET Q q 0 0 0 rg BT 382.03 78.10 Td (ger Regulation our acquisition of Rofin, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 66.10 Td (conditional on the divestment of Rofin) Tj ET Q q 0 0 0 rg BT 206.98 66.10 Td (s low power CO) Tj ET Q BT /F1 10.00 Tf ET BT /F1 6.50 Tf ET q 0 0 0 rg BT 272.25 64.67 Td (2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 275.50 66.10 Td ( laser business based in Hull, United Kingdom \(the Hull Business\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 54.10 Td (after the closing of the acquisition.) Tj ET Q q 0 0 0 rg BT 190.67 54.10 Td (W) Tj ET Q q 0 0 0 rg BT 199.30 54.10 Td (e are required to hold the Hull Business separate until such time as it is divested. During ) Tj ET Q endstream endobj 99 0 obj <>] /Rotate 0 /Contents 100 0 R>> endobj 100 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (49) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (fiscal years 2013 through 2015, the Hull Business had annual revenues of approximately 23-25 million British Pound Sterling ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (and, accordingly) Tj ET Q q 0 0 0 rg BT 115.49 730.10 Td (, we will not have the revenue from the Hull Business once it is sold. If we are unable to successfully timely ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (divest the Hull Business or if the European Commission does not approve a proposed sale thereof, then a divestiture trustee ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (may be appointed by the European Commission and the terms for any sale of the Hull Business will be at the discretion of such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (trustee. During the period of time in which we are holding the Hull Business separate, the conditions for such structure may be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (a distraction on certain members of our senior management team.) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 49.5 660.53505859375 m 297.9130859375 660.53505859375 l s q 0 0 0 rg BT 49.50 662.10 Td (BUSINESS ENVIRONMENT) Tj ET Q q 0 0 0 rg BT 177.41 662.10 Td ( ) Tj ET Q q 0 0 0 rg BT 179.35 662.10 Td (AND INDUSTR) Tj ET Q q 0 0 0 rg BT 248.18 662.10 Td (Y) Tj ET Q q 0 0 0 rg BT 255.03 662.10 Td ( ) Tj ET Q q 0 0 0 rg BT 257.35 662.10 Td (TRENDS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 650.10 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 638.10 Td (Our) Tj ET Q q 0 0 0 rg BT 67.10 638.10 Td ( operating r) Tj ET Q q 0 0 0 rg BT 117.46 638.10 Td (esults, including net sales, net income \(loss\) and adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 398.89 638.10 Td ( in dollars and as a per) Tj ET Q q 0 0 0 rg BT 495.96 638.10 Td (centage of net ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 626.10 Td (sales, as well as our) Tj ET Q q 0 0 0 rg BT 131.82 626.10 Td ( stock price have varied in the past, and our) Tj ET Q q 0 0 0 rg BT 318.31 626.10 Td ( futur) Tj ET Q q 0 0 0 rg BT 342.85 626.10 Td (e operating r) Tj ET Q q 0 0 0 rg BT 397.65 626.10 Td (esults, including those r) Tj ET Q q 0 0 0 rg BT 498.04 626.10 Td (esults fr) Tj ET Q q 0 0 0 rg BT 532.02 626.10 Td (om the ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 614.10 Td (newly acquir) Tj ET Q q 0 0 0 rg BT 104.60 614.10 Td (ed Rofin business, will continue to be subject to quarterly and annual fluctuations based upon numer) Tj ET Q q 0 0 0 rg BT 534.49 614.10 Td (ous ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 602.10 Td (factors, including those discussed in this Item 1A) Tj ET Q q 0 0 0 rg BT 256.75 602.10 Td ( and thr) Tj ET Q q 0 0 0 rg BT 291.02 602.10 Td (oughout this r) Tj ET Q q 0 0 0 rg BT 350.85 602.10 Td (eport. Our) Tj ET Q q 0 0 0 rg BT 396.22 602.10 Td ( stock price will continue to be subject ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 590.10 Td (to daily variations as well. Our) Tj ET Q q 0 0 0 rg BT 180.43 590.10 Td ( futur) Tj ET Q q 0 0 0 rg BT 204.97 590.10 Td (e operating r) Tj ET Q q 0 0 0 rg BT 259.78 590.10 Td (esults and stock price may not follow any past tr) Tj ET Q q 0 0 0 rg BT 465.43 590.10 Td (ends or) Tj ET Q q 0 0 0 rg BT 496.64 590.10 Td ( meet our) Tj ET Q q 0 0 0 rg BT 537.00 590.10 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 578.10 Td (guidance and expectations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.10 Td (Our net sales and operating results, such as adjusted EBITDA) Tj ET Q q 0 0 0 rg BT 296.11 554.10 Td ( percentage, net income \(loss\) and operating expenses, and our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (stock price have varied in the past and may vary significantly from quarter to quarter and from year to year in the future. ) Tj ET Q q 0 0 0 rg BT 533.58 542.10 Td (W) Tj ET Q q 0 0 0 rg BT 542.22 542.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.10 Td (believe a number of factors, many of which are outside of our control, could cause these variations and make them dif) Tj ET Q q 0 0 0 rg BT 521.38 530.10 Td (ficult to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (predict, including:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 506.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 494.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 494.10 Td (general economic uncertainties in the macroeconomic and local economies facing us, our customers and the markets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 482.10 Td (we serve;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 470.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 458.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 458.10 Td (fluctuations in demand for our products or downturns in the industries that we serve;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 446.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 434.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 434.10 Td (the ability of our suppliers, both internal and external, to produce and deliver components and parts, including sole or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 422.10 Td (limited source components, in a timely manner) Tj ET Q q 0 0 0 rg BT 273.11 422.10 Td (, in the quantity) Tj ET Q q 0 0 0 rg BT 335.23 422.10 Td (, quality and prices desired;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 398.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 398.10 Td (the timing of receipt and conversion of bookings to net sales;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 374.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 374.10 Td (the concentration of a significant amount of our backlog, and resultant net sales, with a few customers in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 362.10 Td (Microelectronics market;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 350.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 338.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 338.10 Td (rescheduling of shipments or cancellation of orders by our customers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 314.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 314.10 Td (fluctuations in our product mix;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 302.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 290.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 290.10 Td (the ability of our customers' other suppliers to provide suf) Tj ET Q q 0 0 0 rg BT 316.80 290.10 Td (ficient material to support our customers' products;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 278.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 266.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 266.10 Td (currency fluctuations and stability) Tj ET Q q 0 0 0 rg BT 221.20 266.10 Td (, in particular the Euro, the Japanese ) Tj ET Q q 0 0 0 rg BT 368.83 266.10 Td (Y) Tj ET Q q 0 0 0 rg BT 375.05 266.10 Td (en, the South Korean ) Tj ET Q q 0 0 0 rg BT 461.79 266.10 Td (W) Tj ET Q q 0 0 0 rg BT 470.43 266.10 Td (on, the Chinese RMB ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 254.10 Td (and the US dollar as compared to other currencies;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 242.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 230.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 230.10 Td (commodity pricing;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 218.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 206.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 206.10 Td (introductions of new products and product enhancements by our competitors, entry of new competitors into our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 194.10 Td (markets, pricing pressures and other competitive factors;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 182.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 170.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 170.10 Td (our ability to develop, introduce, manufacture and ship new and enhanced products in a timely manner without ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 158.10 Td (defects;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 134.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 134.10 Td (our ability to successfully expand our manufacturing capacity in Gttingen, Germany and add optics fabrication ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 122.10 Td (capacity at our site in Richmond, California;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 98.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 98.10 Td (our ability to manage our manufacturing capacity and that of our suppliers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 86.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 74.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 74.10 Td (our reliance on contract manufacturing;) Tj ET Q endstream endobj 101 0 obj <>] /Rotate 0 /Contents 102 0 R>> endobj 102 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (50) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 742.10 Td (our reliance in part upon the ability of our OEM customers to develop and sell systems that incorporate our laser ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 730.10 Td (products;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 706.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 706.10 Td (our customers' ability to manage their susceptibility to adverse economic conditions;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 694.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 682.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td (the rate of market acceptance of our new products;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 670.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 658.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 658.10 Td (the ability of our customers to pay for our products;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 646.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 634.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 634.10 Td (expenses associated with acquisition-related activities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 622.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 610.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 610.10 Td (seasonal sales trends;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 586.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 586.10 Td (access to applicable credit markets by us, our customers and their end customers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 574.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 562.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 562.10 Td (delays or reductions in customer purchases of our products in anticipation of the introduction of new and enhanced ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 550.10 Td (products by us or our competitors;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 538.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 526.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 526.10 Td (our ability to control expenses;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 514.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 502.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 502.10 Td (the level of capital spending of our customers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 490.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 478.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 478.10 Td (potential excess and/or obsolescence of our inventory;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 466.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 454.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 454.10 Td (costs and timing of adhering to current and developing governmental regulations and reviews relating to our products ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 442.10 Td (and business;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 430.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 418.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 418.10 Td (costs related to acquisitions of technology or businesses;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 406.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 394.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 394.10 Td (impairment of goodwill, intangible assets and other long-lived assets;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 382.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 370.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 370.10 Td (our ability to meet our expectations and forecasts and those of public market analysts and investors;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 358.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 346.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 346.10 Td (the availability of research funding by governments with regard to our customers in the scientific business, such as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 334.10 Td (universities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 322.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 310.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 310.10 Td (continued government spending on defense-related and scientific research projects where we are a subcontractor;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 298.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 286.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 286.10 Td (maintenance of supply relating to products sold to the government on terms which we would prefer not to accept;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 274.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 262.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 262.10 Td (changes in policy) Tj ET Q q 0 0 0 rg BT 154.83 262.10 Td (, interpretations, or challenges to the allowability of costs incurred under government cost accounting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 250.10 Td (standards;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 226.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 226.10 Td (damage to our reputation as a result of coverage in social media, Internet blogs or other media outlets;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 202.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 202.10 Td (managing our and other parties' compliance with contracts in multiple languages and jurisdictions;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 178.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 178.10 Td (managing our internal and third party sales representatives and distributors, including compliance with all applicable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 166.10 Td (laws;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 142.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 142.10 Td (impact of government economic policies on macroeconomic conditions;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 118.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 118.10 Td (costs and expenses from litigation;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 94.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 94.10 Td (costs associated with designing around or payment of licensing fees associated with issued patents in our fields of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 82.10 Td (business;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 58.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 58.10 Td (government support of alternative ener) Tj ET Q q 0 0 0 rg BT 240.82 58.10 Td (gy industries, such as solar;) Tj ET Q endstream endobj 103 0 obj <>] /Rotate 0 /Contents 104 0 R>> endobj 104 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (51) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 742.10 Td (negative impacts related to the recent Brexit vote by the United Kingdom, particularly with regard to sales from our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 730.10 Td (Glasgow) Tj ET Q q 0 0 0 rg BT 120.40 730.10 Td (, Scotland facility to other jurisdictions and purchases of supplies from outside the United Kingdom by such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 718.10 Td (facility; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 706.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 694.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 694.10 Td (the future impact of legislation, rulemaking, and changes in accounting, tax, defense procurement, trade or export ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td (policies; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 670.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 658.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 658.10 Td (distraction of management related to acquisition, integration or divestment activities.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (In addition, we often recognize a substantial portion of our sales in the last month of our fiscal quarters. Our expenses for any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (given quarter are typically based on expected sales and if sales are below expectations in any given quarter) Tj ET Q q 0 0 0 rg BT 476.43 622.10 Td (, the adverse impact ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (of the shortfall on our operating results may be magnified by our inability to adjust spending quickly enough to compensate for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (the shortfall. ) Tj ET Q q 0 0 0 rg BT 102.36 598.10 Td (W) Tj ET Q q 0 0 0 rg BT 111.00 598.10 Td (e also base our manufacturing on our forecasted product mix for the quarter) Tj ET Q q 0 0 0 rg BT 413.11 598.10 Td (. If the actual product mix varies ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (significantly from our forecast, we may not be able to fill some orders during that quarter) Tj ET Q q 0 0 0 rg BT 406.21 586.10 Td (, which would result in delays in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (shipment of our products. ) Tj ET Q q 0 0 0 rg BT 154.21 574.10 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 203.55 574.10 Td (, variations in timing of sales, particularly for our higher priced, higher mar) Tj ET Q q 0 0 0 rg BT 504.67 574.10 Td (gin products, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (can cause significant fluctuations in quarterly operating results.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 550.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (Due to these and other factors, such as varying product mix, we believe that quarter) Tj ET Q q 0 0 0 rg BT 383.63 538.10 Td (-to-quarter and year) Tj ET Q q 0 0 0 rg BT 462.83 538.10 Td (-to-year comparisons of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (our historical operating results may not be meaningful. ) Tj ET Q q 0 0 0 rg BT 271.02 526.10 Td (Y) Tj ET Q q 0 0 0 rg BT 277.24 526.10 Td (ou should not rely on our results for any quarter or year as an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (indication of our future performance. Our operating results in future quarters and years may be below public market analysts' or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (investors' expectations, which would likely cause the price of our stock to fall. In addition, over the past several years, U.S. and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (global equity markets have experienced significant price and volume fluctuations that have af) Tj ET Q q 0 0 0 rg BT 423.63 490.10 Td (fected the stock prices of many ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (technology companies both in and outside our industry) Tj ET Q q 0 0 0 rg BT 268.54 478.10 Td (. ) Tj ET Q q 0 0 0 rg BT 273.36 478.10 Td (There has not always been a direct correlation between this volatility ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (and the performance of particular companies subject to these stock price fluctuations. ) Tj ET Q q 0 0 0 rg BT 393.36 466.10 Td (These factors, as well as general ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (economic and political conditions or investors' concerns regarding the credibility of corporate financial statements, may have a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (material adverse ef) Tj ET Q q 0 0 0 rg BT 125.38 442.10 Td (fect on the market price of our stock in the future.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 418.10 Td (e depend on sole source or limited source suppliers, both internal and external, for some of our key components and ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (materials, including exotic materials, certain cutting-edge optics and crystals, in our products, which make us susceptible to ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (supply shortages or price fluctuations that could adversely af) Tj ET Q q 0 0 0 rg BT 299.88 394.10 Td (fect our business, particularly our ability to meet our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (customers' delivery requirements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 358.10 Td (e currently purchase several key components and materials used in the manufacture of our products from sole source or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (limited source suppliers, both internal and external. In particular) Tj ET Q q 0 0 0 rg BT 306.24 346.10 Td (, from time-to-time our customers require us to ramp up ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (production and/or accelerate delivery schedules of our products. Our key suppliers may not have the ability to increase their ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (production in line with our customers) Tj ET Q q 0 0 0 rg BT 202.34 322.10 Td ( demands. ) Tj ET Q q 0 0 0 rg BT 245.21 322.10 Td (This can become acute during times of high growth in our customers) Tj ET Q q 0 0 0 rg BT 523.01 322.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (businesses. Our failure to timely receive these key components and materials would likely cause delays in the shipment of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (products, which would likely negatively impact both our customers and our business. Some of these suppliers are relatively ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (small private companies that may discontinue their operations at any time and which may be particularly susceptible to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (prevailing economic conditions. Some of our suppliers are located in regions which may be susceptible to natural disasters, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (such as the flooding in ) Tj ET Q q 0 0 0 rg BT 142.36 262.10 Td (Thailand and the earthquake, tsunami and resulting nuclear disaster in Japan and severe flooding and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (power loss in the Eastern part of the United States in recent years. ) Tj ET Q q 0 0 0 rg BT 315.35 250.10 Td (W) Tj ET Q q 0 0 0 rg BT 323.99 250.10 Td (e typically purchase our components and materials through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (purchase orders or agreed upon terms and conditions and we do not have guaranteed supply arrangements with many of these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (suppliers. For certain long-lead time supplies or in order to lock-in pricing, we may be obligated to place purchase orders which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (are not cancelable or otherwise assume liability for a lar) Tj ET Q q 0 0 0 rg BT 273.39 214.10 Td (ge amount of the ordered supplies, which limit our ability to adjust ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (down our inventory liability in the event of market downturns or other customer cancellations or rescheduling of their purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (orders for our products. Some of our products, particularly in the flat panel display industry) Tj ET Q q 0 0 0 rg BT 414.88 190.10 Td (, require designs and specifications ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (which are at the cutting-edge of available technologies. Our and our customers' designs and specifications frequently change to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (meet rapidly evolving market demands. ) Tj ET Q q 0 0 0 rg BT 210.01 166.10 Td (Accordingly certain of our products require components and supplies which may be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (technologically dif) Tj ET Q q 0 0 0 rg BT 124.57 154.10 Td (ficult and unpredictable to manufacture. By their very nature, these types of components may only be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (available by a single supplier) Tj ET Q q 0 0 0 rg BT 165.58 142.10 Td (. ) Tj ET Q q 0 0 0 rg BT 170.40 142.10 Td (These characteristics further pressure the timely delivery of such components. ) Tj ET Q q 0 0 0 rg BT 484.83 142.10 Td (W) Tj ET Q q 0 0 0 rg BT 493.46 142.10 Td (e may fail to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (obtain these supplies in a timely manner in the future. ) Tj ET Q q 0 0 0 rg BT 266.77 130.10 Td (W) Tj ET Q q 0 0 0 rg BT 275.40 130.10 Td (e may experience dif) Tj ET Q q 0 0 0 rg BT 358.79 130.10 Td (ficulty identifying alternative sources of supply ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (for certain components used in our products and may have to incur expenses and management distraction in assisting our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (current and future suppliers to meet our and our customers' technical requirements. ) Tj ET Q q 0 0 0 rg BT 383.51 106.10 Td (W) Tj ET Q q 0 0 0 rg BT 392.15 106.10 Td (e would experience further delays while ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (identifying, evaluating and testing the products of these potential alternative suppliers. Furthermore, financial or other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (dif) Tj ET Q q 0 0 0 rg BT 60.43 82.10 Td (ficulties faced by these suppliers or significant changes in demand for these components or materials could limit their ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (availability) Tj ET Q q 0 0 0 rg BT 93.84 70.10 Td (. ) Tj ET Q q 0 0 0 rg BT 98.66 70.10 Td (W) Tj ET Q q 0 0 0 rg BT 107.29 70.10 Td (e continue to consolidate our supply base and move supplier locations. ) Tj ET Q q 0 0 0 rg BT 392.05 70.10 Td (When we transition locations we may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (increase our inventory of such products as a safety stock during the transition, which may cause the amount of inventory ) Tj ET Q endstream endobj 105 0 obj <>] /Rotate 0 /Contents 106 0 R>> endobj 106 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (52) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (reflected on our balance sheet to increase. ) Tj ET Q q 0 0 0 rg BT 218.86 742.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 268.76 742.10 Td (, many of our customers rely on sole source suppliers. In the event of a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (disruption of our customers' supply chain, orders from our customers could decrease or be delayed.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (Any interruption or delay in the supply of any of these components or materials, or the inability to obtain these components and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (materials from alternate sources at acceptable prices and within a reasonable amount of time, or our failure to properly manage ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (these moves, would impair our ability to meet scheduled product deliveries to our customers and could cause customers to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 670.10 Td (cancel orders. ) Tj ET Q q 0 0 0 rg BT 107.34 670.10 Td (W) Tj ET Q q 0 0 0 rg BT 115.98 670.10 Td (e have historically relied exclusively on our own production capability to manufacture certain strategic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (components, crystals, semiconductor lasers, fiber) Tj ET Q q 0 0 0 rg BT 245.99 658.10 Td (, lasers and laser) Tj ET Q q 0 0 0 rg BT 311.87 658.10 Td (-based systems and recently acquired the capability to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (manufacture certain lar) Tj ET Q q 0 0 0 rg BT 142.04 646.10 Td (ge format optics. Because we manufacture, package and test these components, products and systems at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (our own facilities, and such components, products and systems are not readily available from other sources, any interruption in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (manufacturing would adversely af) Tj ET Q q 0 0 0 rg BT 186.21 622.10 Td (fect our business. Since many of our products have lengthy qualification periods, our ability ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (to introduce multiple suppliers for parts may be limited. In addition, our failure to achieve adequate manufacturing yields of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (these items at our manufacturing facilities may materially and adversely af) Tj ET Q q 0 0 0 rg BT 348.09 598.10 Td (fect our operating results and financial condition.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 574.10 Td (e participate in the microelectronics market, which requires significant research and development expenses to develop and ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (maintain products and a failure to achieve market acceptance for our products could have a significant negative impact on ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (our business and results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (The microelectronics market is characterized by rapid technological change, frequent product introductions, the volatility of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (product supply and demand, changing customer requirements and evolving industry standards. ) Tj ET Q q 0 0 0 rg BT 430.62 514.10 Td (The nature of this market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (requires significant research and development expenses to participate, with substantial resources invested in advance of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (material sales of our products to our customers in this market. ) Tj ET Q q 0 0 0 rg BT 298.89 490.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 348.79 490.10 Td (, our product of) Tj ET Q q 0 0 0 rg BT 410.82 490.10 Td (ferings may become obsolete given ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (the frequent introduction of alternative technologies. In the event either our customers' or our products fail to gain market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (acceptance, or the microelectronics market fails to grow) Tj ET Q q 0 0 0 rg BT 273.19 466.10 Td (, it would likely have a significant negative ef) Tj ET Q q 0 0 0 rg BT 456.01 466.10 Td (fect on our business and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (results of operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 430.10 Td (e participate in the flat panel display market, which has a relatively limited number of end customer manufacturers. Our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (backlog, timing of net sales and results of operations could be negatively impacted in the event our customers reschedule or ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (cancel orders.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (In the flat panel display market, there are a relatively limited number of manufacturers who are the end customers for our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (annealing products. In the first quarter of fiscal 2017, ) Tj ET Q q 0 0 0 rg BT 267.21 370.10 Td (Advanced Process Systems Corporation, an integrator in the flat panel ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (display market based in South Korea, contributed more than 10% of our revenue. Given macroeconomic conditions, varying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (consumer demand and technical process limitations at manufacturers, our customers may seek to reschedule or cancel orders. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (This was recently seen with a requested expedited shipment of a Linebeam 1500 product for our third fiscal quarter of 2015, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (which delivery date was then changed at the customer) Tj ET Q q 0 0 0 rg BT 265.90 322.10 Td () Tj ET Q q 0 0 0 rg BT 268.68 322.10 Td (s request back to its originally scheduled date in the fourth fiscal quarter ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (of 2015. ) Tj ET Q q 0 0 0 rg BT 85.15 310.10 Td (These lar) Tj ET Q q 0 0 0 rg BT 121.89 310.10 Td (ger flat panel-related systems have lar) Tj ET Q q 0 0 0 rg BT 273.59 310.10 Td (ge average selling prices. ) Tj ET Q q 0 0 0 rg BT 376.60 310.10 Td (Any rescheduling or canceling of such orders ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (by our customers will likely have a significant impact on our quarterly or annual net sales and results of operations and could ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (negatively impact inventory values and backlog. ) Tj ET Q q 0 0 0 rg BT 245.28 286.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 295.18 286.10 Td (, challenges in meeting evolving technological requirements for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (these complex products by us and our suppliers could also result in delays in shipments, rescheduled or canceled orders by our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (customers. ) Tj ET Q q 0 0 0 rg BT 94.87 262.10 Td (This could negatively impact our backlog, timing of net sales and results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.94 238.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.53 238.10 Td (, flat panel display systems represented 58% of our backlog. Since our backlog includes higher ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (average selling price flat panel display systems, any delays or cancellation of shipments could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 532.20 226.10 Td (fect on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (our financial results.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (Some of our laser systems are complex in design and may contain defects that are not detected until deployed by our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (customers, which could increase our costs and reduce our net sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (Lasers and laser systems are inherently complex in design and require ongoing regular maintenance. ) Tj ET Q q 0 0 0 rg BT 453.35 154.10 Td (The manufacture of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (lasers, laser products and systems involves a highly complex and precise process. ) Tj ET Q q 0 0 0 rg BT 377.20 142.10 Td (As a result of the technological complexity of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (our products, in particular the flat panel annealing systems, changes in our or our suppliers' manufacturing processes or the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (inadvertent use of defective materials by us or our suppliers could result in a material adverse ef) Tj ET Q q 0 0 0 rg BT 433.63 118.10 Td (fect on our ability to achieve ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (acceptable manufacturing yields and product reliability) Tj ET Q q 0 0 0 rg BT 269.60 106.10 Td (. ) Tj ET Q q 0 0 0 rg BT 274.42 106.10 Td (T) Tj ET Q q 0 0 0 rg BT 279.83 106.10 Td (o the extent that we do not achieve and maintain our projected yields ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (or product reliability) Tj ET Q q 0 0 0 rg BT 131.60 94.10 Td (, our business, operating results, financial condition and customer relationships would be adversely ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (af) Tj ET Q q 0 0 0 rg BT 57.09 82.10 Td (fected. ) Tj ET Q q 0 0 0 rg BT 86.33 82.10 Td (W) Tj ET Q q 0 0 0 rg BT 94.97 82.10 Td (e provide warranties on a majority of our product sales, and reserves for estimated warranty costs are recorded ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (during the period of sale. ) Tj ET Q q 0 0 0 rg BT 152.07 70.10 Td (The determination of such reserves requires us to make estimates of failure rates and expected costs to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (repair or replace the products under warranty) Tj ET Q q 0 0 0 rg BT 229.32 58.10 Td (. ) Tj ET Q q 0 0 0 rg BT 234.14 58.10 Td (W) Tj ET Q q 0 0 0 rg BT 242.78 58.10 Td (e typically establish warranty reserves based on historical warranty costs for ) Tj ET Q endstream endobj 107 0 obj <>] /Rotate 0 /Contents 108 0 R>> endobj 108 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (53) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (each product line. If actual return rates and/or repair and replacement costs dif) Tj ET Q q 0 0 0 rg BT 362.23 742.10 Td (fer significantly from our estimates, adjustments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (to cost of sales may be required in future periods which could have an adverse ef) Tj ET Q q 0 0 0 rg BT 372.82 730.10 Td (fect on our results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (Our customers may discover defects in our products after the products have been fully deployed and operated, including under ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (the end user's peak stress conditions. In addition, some of our products are combined with products from other vendors, which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (may contain defects. ) Tj ET Q q 0 0 0 rg BT 133.91 682.10 Td (As a result, should problems occur) Tj ET Q q 0 0 0 rg BT 272.38 682.10 Td (, it may be dif) Tj ET Q q 0 0 0 rg BT 328.02 682.10 Td (ficult to identify the source of the problem. If we are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 670.10 Td (unable to identify and fix defects or other problems, we could experience, among other things:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 646.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 646.10 Td (loss of customers or orders;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 622.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 622.10 Td (increased costs of product returns and warranty expenses;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 598.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 598.10 Td (damage to our brand reputation;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 574.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 574.10 Td (failure to attract new customers or achieve market acceptance;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 550.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 550.10 Td (diversion of development, engineering and manufacturing resources; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 526.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 526.10 Td (legal actions by our customers and/or their end users.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (The occurrence of any one or more of the foregoing factors could seriously harm our business, financial condition and results of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (Continued volatility in the advanced packaging and semiconductor manufacturing markets could adversely af) Tj ET Q q 0 0 0 rg BT 501.55 466.10 Td (fect our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (business, financial condition and results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (A) Tj ET Q q 0 0 0 rg BT 56.17 430.10 Td ( portion of our net sales in the microelectronics market depends on the demand for our products by advanced packaging ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (applications and semiconductor equipment companies. ) Tj ET Q q 0 0 0 rg BT 270.93 418.10 Td (These markets have historically been characterized by sudden and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (severe cyclical variations in product supply and demand, which have often severely af) Tj ET Q q 0 0 0 rg BT 393.91 406.10 Td (fected the demand for semiconductor ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (manufacturing equipment, including laser) Tj ET Q q 0 0 0 rg BT 216.47 394.10 Td (-based tools and systems. ) Tj ET Q q 0 0 0 rg BT 320.45 394.10 Td (The timing, severity and duration of these market cycles are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (dif) Tj ET Q q 0 0 0 rg BT 60.43 382.10 Td (ficult to predict, and we may not be able to respond ef) Tj ET Q q 0 0 0 rg BT 276.29 382.10 Td (fectively to these cycles. ) Tj ET Q q 0 0 0 rg BT 376.90 382.10 Td (The continuing uncertainty in these markets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (severely limits our ability to predict our business prospects or financial results in these markets.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (During industry downturns, our net sales from these markets may decline suddenly and significantly) Tj ET Q q 0 0 0 rg BT 450.43 346.10 Td (. Our ability to rapidly and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (ef) Tj ET Q q 0 0 0 rg BT 57.09 334.10 Td (fectively reduce our cost structure in response to such downturns is limited by the fixed nature of many of our expenses in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (near term and by our need to continue our investment in next-generation product technology and to support and service our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (products. In addition, due to the relatively long manufacturing lead times for some of the systems and subsystems we sell to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (these markets, we may incur expenditures or purchase raw materials or components for products we cannot sell. ) Tj ET Q q 0 0 0 rg BT 499.63 298.10 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 548.97 298.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (downturns in the semiconductor capital equipment market may materially harm our operating results. Conversely) Tj ET Q q 0 0 0 rg BT 502.62 286.10 Td (, when upturns ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (in these markets occur) Tj ET Q q 0 0 0 rg BT 138.79 274.10 Td (, we must be able to rapidly and ef) Tj ET Q q 0 0 0 rg BT 276.62 274.10 Td (fectively increase our manufacturing capacity to meet increases in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (customer demand that may be extremely rapid, and if we fail to do so we may lose business to our competitors and our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (relationships with our customers may be harmed.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 226.10 Td (e are exposed to risks associated with worldwide economic conditions and related uncertainties which could negatively ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (impact demand for our products and results of operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (V) Tj ET Q q 0 0 0 rg BT 55.43 190.10 Td (olatility and disruption in the capital and credit markets, depressed consumer confidence, government economic policies, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (negative economic conditions, volatile corporate profits and reduced capital spending could negatively impact demand for our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (products. In particular) Tj ET Q q 0 0 0 rg BT 137.68 166.10 Td (, it is dif) Tj ET Q q 0 0 0 rg BT 170.83 166.10 Td (ficult to develop and implement strategy) Tj ET Q q 0 0 0 rg BT 332.08 166.10 Td (, sustainable business models and ef) Tj ET Q q 0 0 0 rg BT 476.32 166.10 Td (ficient operations, as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (well as ef) Tj ET Q q 0 0 0 rg BT 87.63 154.10 Td (fectively manage supply chain relationships in the face of such conditions including uncertainty regarding the ability ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (of some of our suppliers to continue operations and provide us with uninterrupted supply flow) Tj ET Q q 0 0 0 rg BT 425.45 142.10 Td (. Our ability to maintain our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (research and development investments in our broad product of) Tj ET Q q 0 0 0 rg BT 299.24 130.10 Td (ferings may be adversely impacted in the event that our sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (decline and do not increase in the future. Spending and the timing thereof by consumers and businesses have a significant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (impact on our results and, where such spending is delayed or canceled, it could have a material negative impact on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (operating results. Current global economic conditions remain uncertain and challenging. ) Tj ET Q q 0 0 0 rg BT 405.33 94.10 Td (W) Tj ET Q q 0 0 0 rg BT 413.96 94.10 Td (eakness in our end markets could ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (negatively impact our net sales, gross mar) Tj ET Q q 0 0 0 rg BT 217.33 82.10 Td (gin and operating expenses, and consequently have a material adverse ef) Tj ET Q q 0 0 0 rg BT 507.31 82.10 Td (fect on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (business, financial condition and results of operations.) Tj ET Q endstream endobj 109 0 obj <>] /Rotate 0 /Contents 110 0 R>> endobj 110 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (54) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (Uncertainty in global fiscal policy has likely had an adverse impact on global financial markets and overall economic activity in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (recent years.Should this uncertain financial policy recur) Tj ET Q q 0 0 0 rg BT 275.13 730.10 Td (, it would likely negatively impact global economic activity) Tj ET Q q 0 0 0 rg BT 513.03 730.10 Td (. ) Tj ET Q q 0 0 0 rg BT 519.97 730.10 Td (Any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (weakness in global economies would also likely have negative repercussions on U.S. and global credit and financial markets, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (and further exacerbate sovereign debt concerns in the European Union. ) Tj ET Q q 0 0 0 rg BT 338.27 706.10 Td (All of these factors would likely adversely impact the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (global demand for our products and the performance of our investments, and would likely have a material adverse ef) Tj ET Q q 0 0 0 rg BT 516.10 694.10 Td (fect on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (business, results of operations and financial condition.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (The financial turmoil that has af) Tj ET Q q 0 0 0 rg BT 177.88 658.10 Td (fected the banking system and financial markets in recent years could result in tighter credit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (markets, and lower levels of liquidity in some financial markets. ) Tj ET Q q 0 0 0 rg BT 309.25 646.10 Td (There could be a number of follow-on ef) Tj ET Q q 0 0 0 rg BT 472.06 646.10 Td (fects from a tightened ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (credit environment on our business, including the insolvency of key suppliers or their inability to obtain credit to finance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (development and/or manufacture products resulting in product delays; inability of customers to obtain credit to finance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (purchases of our products and/or customer insolvencies; and failure of financial institutions negatively impacting our treasury ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (functions. In the event our customers are unable to obtain credit or otherwise pay for our shipped products it could significantly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (impact our ability to collect on our outstanding accounts receivable. Other income and expense also could vary materially from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (expectations depending on gains or losses realized on the sale or exchange of financial instruments; impairment char) Tj ET Q q 0 0 0 rg BT 515.83 574.10 Td (ges ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (resulting from revaluations of debt and equity securities and other investments; interest rates; cash balances; and changes in fair ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (value of derivative instruments. ) Tj ET Q q 0 0 0 rg BT 178.45 550.10 Td (V) Tj ET Q q 0 0 0 rg BT 184.38 550.10 Td (olatility in the financial markets and any overall economic uncertainty increase the risk that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (the actual amounts realized in the future on our financial instruments could dif) Tj ET Q q 0 0 0 rg BT 363.11 538.10 Td (fer significantly from the fair values currently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (assigned to them. Uncertainty about current global economic conditions could also continue to increase the volatility of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (stock price.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (In addition, political and social turmoil related to international conflicts, terrorist acts, civil unrest and mass migration may put ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (further pressure on economic conditions in the United States and the rest of the world. Unstable economic, political and social ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (conditions make it dif) Tj ET Q q 0 0 0 rg BT 136.80 466.10 Td (ficult for our customers, our suppliers and us to accurately forecast and plan future business activities. If ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (such conditions persist, our business, financial condition and results of operations could suf) Tj ET Q q 0 0 0 rg BT 415.37 454.10 Td (fer) Tj ET Q q 0 0 0 rg BT 425.92 454.10 Td (. ) Tj ET Q q 0 0 0 rg BT 430.36 454.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 480.27 454.10 Td (, unstable economic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (conditions can provide significant pressures and burdens on individuals, which could cause them to engage in inappropriate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (business conduct. See PartI,Item4. CONTROLS ) Tj ET Q q 0 0 0 rg BT 256.42 430.10 Td (AND PROCEDURES.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (Our cash and cash equivalents and short-term investments are managed through various banks around the world and ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (volatility in the capital and credit market conditions could cause financial institutions to fail or materially harm service ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (levels provided by such banks, both of which could have an adverse impact on our ability to timely access funds.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 358.10 Td (orld capital and credit markets have been and may continue to experience volatility and disruption. In some cases, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (markets have exerted downward pressure on stock prices and credit capacity for certain issuers, as well as pressured the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (solvency of some financial institutions. ) Tj ET Q q 0 0 0 rg BT 208.74 334.10 Td (These financial institutions, including banks, have had dif) Tj ET Q q 0 0 0 rg BT 439.90 334.10 Td (ficulty timely performing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (regular services and in some cases have failed or otherwise been lar) Tj ET Q q 0 0 0 rg BT 320.04 322.10 Td (gely taken over by governments. ) Tj ET Q q 0 0 0 rg BT 453.15 322.10 Td (W) Tj ET Q q 0 0 0 rg BT 461.79 322.10 Td (e maintain our cash, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (cash equivalents and short-term investments with a number of financial institutions around the world. Should some or all of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (these financial institutions fail or otherwise be unable to timely perform requested services, we would likely have a limited ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (ability to timely access our cash deposited with such institutions, or) Tj ET Q q 0 0 0 rg BT 319.33 286.10 Td (, in extreme circumstances the failure of such institutions ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (could cause us to be unable to access cash for the foreseeable future. If we are unable to quickly access our funds when we need ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (them, we may need to increase the use of our existing credit lines or access more expensive credit, if available. If we are unable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (to access our cash or if we access existing or additional credit or are unable to access additional credit, it could have a negative ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (impact on our operations, including our reported net income. In addition, the willingness of financial institutions to continue to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (accept our cash deposits will impact our ability to diversify our investment risk among institutions.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 202.10 Td (e are exposed to credit risk and fluctuations in the market values of our investment portfolio.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (Although we have not recognized any material losses on our cash, cash equivalents and short-term investments, future declines ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (in their market values could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 267.83 166.10 Td (fect on our financial condition and operating results. Given the global ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (nature of our business, we have investments both domestically and internationally) Tj ET Q q 0 0 0 rg BT 376.83 154.10 Td (. ) Tj ET Q q 0 0 0 rg BT 381.65 154.10 Td (There has recently been growing pressure on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (the creditworthiness of sovereign nations, particularly in Europe where a significant portion of our cash, cash equivalents and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (short-term investments are invested, which results in corresponding pressure on the valuation of the securities issued by such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (nations. ) Tj ET Q q 0 0 0 rg BT 82.83 118.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 132.74 118.10 Td (, our overall investment portfolio is often concentrated in government-issued securities such as U.S. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (T) Tj ET Q q 0 0 0 rg BT 55.26 106.10 Td (reasury securities and government agencies, corporate notes, commercial paper and money market funds. Credit ratings and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (pricing of these investments can be negatively impacted by liquidity) Tj ET Q q 0 0 0 rg BT 321.83 94.10 Td (, credit deterioration or losses, financial results, or other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (factors. ) Tj ET Q q 0 0 0 rg BT 81.16 82.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 131.06 82.10 Td (, liquidity issues or political actions by sovereign nations could result in decreased values for our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (investments in certain government securities. ) Tj ET Q q 0 0 0 rg BT 232.23 70.10 Td (As a result, the value or liquidity of our cash, cash equivalents and short-term ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (investments could decline or become materially impaired, which could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 439.72 58.10 Td (fect on our financial condition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 46.10 Td (and operating results. See Item3. Quantitative and Qualitative Disclosures about Market Risk.) Tj ET Q endstream endobj 111 0 obj <>] /Rotate 0 /Contents 112 0 R>> endobj 112 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (55) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (Our future success depends on our ability to increase our sales volumes and decrease our costs to of) Tj ET Q q 0 0 0 rg BT 460.72 730.10 Td (fset potential declines in ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (the average selling prices \(ASPs\) of our products and, if we are unable to realize greater sales volumes and lower costs, ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (our operating results may suf) Tj ET Q q 0 0 0 rg BT 170.45 706.10 Td (fer) Tj ET Q q 0 0 0 rg BT 181.56 706.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (Our ability to increase our sales volume and our future success depends on the continued growth of the markets for lasers, laser ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 670.10 Td (systems and related accessories, as well as our ability to identify) Tj ET Q q 0 0 0 rg BT 306.28 670.10 Td (, in advance, emer) Tj ET Q q 0 0 0 rg BT 379.11 670.10 Td (ging markets for laser) Tj ET Q q 0 0 0 rg BT 466.38 670.10 Td (-based systems. ) Tj ET Q q 0 0 0 rg BT 531.47 670.10 Td (W) Tj ET Q q 0 0 0 rg BT 540.11 670.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (cannot assure you that we will be able to successfully identify) Tj ET Q q 0 0 0 rg BT 296.56 658.10 Td (, on a timely basis, new high-growth markets in the future. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (Moreover) Tj ET Q q 0 0 0 rg BT 88.53 646.10 Td (, we cannot assure you that new markets will develop for our products or our customers' products, or that our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (technology or pricing will enable such markets to develop. Future demand for our products is uncertain and will depend to a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (great degree on continued technological development and the introduction of new or enhanced products. If this does not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (continue, sales of our products may decline and our business will be harmed.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 586.10 Td (e have in the past experienced decreases in the ) Tj ET Q q 0 0 0 rg BT 246.11 586.10 Td (ASPs of some of our products. ) Tj ET Q q 0 0 0 rg BT 370.83 586.10 Td (As competing products become more widely ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (available, the ) Tj ET Q q 0 0 0 rg BT 104.75 574.10 Td (ASPs of our products may decrease. If we are unable to of) Tj ET Q q 0 0 0 rg BT 337.83 574.10 Td (fset any decrease in our ) Tj ET Q q 0 0 0 rg BT 434.18 574.10 Td (ASPs by increasing our sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (volumes, our net sales will decline. In addition, to maintain our gross mar) Tj ET Q q 0 0 0 rg BT 343.98 562.10 Td (gins, we must continue to reduce the cost of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (manufacturing our products while maintaining their high quality) Tj ET Q q 0 0 0 rg BT 306.29 550.10 Td (. From time to time, our products, like many complex ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (technological products, may fail in greater frequency than anticipated. ) Tj ET Q q 0 0 0 rg BT 332.26 538.10 Td (This can lead to further char) Tj ET Q q 0 0 0 rg BT 445.08 538.10 Td (ges, which can result in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (higher costs, lower gross mar) Tj ET Q q 0 0 0 rg BT 166.79 526.10 Td (gins and lower operating results. Furthermore, as ) Tj ET Q q 0 0 0 rg BT 364.81 526.10 Td (ASPs of our current products decline, we must ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (develop and introduce new products and product enhancements with higher mar) Tj ET Q q 0 0 0 rg BT 369.77 514.10 Td (gins. If we cannot maintain our gross mar) Tj ET Q q 0 0 0 rg BT 536.22 514.10 Td (gins, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (our operating results could be seriously harmed, particularly if the ) Tj ET Q q 0 0 0 rg BT 315.81 502.10 Td (ASPs of our products decrease significantly) Tj ET Q q 0 0 0 rg BT 490.40 502.10 Td (.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (Our future success depends on our ability to develop and successfully introduce new and enhanced products that meet the ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (needs of our customers.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (Our current products address a broad range of commercial and scientific research applications in the photonics markets. ) Tj ET Q q 0 0 0 rg BT 530.81 442.10 Td (W) Tj ET Q q 0 0 0 rg BT 539.45 442.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (cannot assure you that the market for these applications will continue to generate significant or consistent demand for our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (products. Demand for our products could be significantly diminished by disrupting technologies or products that replace them ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (or render them obsolete. Furthermore, the new and enhanced products in certain markets generally continue to be smaller in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (size and have lower ) Tj ET Q q 0 0 0 rg BT 130.58 394.10 Td (ASPs, and therefore, we have to sell more units to maintain revenue levels. ) Tj ET Q q 0 0 0 rg BT 432.72 394.10 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 482.06 394.10 Td (, we must continue ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (to invest in research and development in order to develop competitive products.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (Our future success depends on our ability to anticipate our customers' needs and develop products that address those needs. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (Introduction of new products and product enhancements will require that we ef) Tj ET Q q 0 0 0 rg BT 365.60 346.10 Td (fectively transfer production processes from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (research and development to manufacturing and coordinate our ef) Tj ET Q q 0 0 0 rg BT 312.54 334.10 Td (forts with those of our suppliers to achieve volume production ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (rapidly) Tj ET Q q 0 0 0 rg BT 77.18 322.10 Td (. If we fail to transfer production processes ef) Tj ET Q q 0 0 0 rg BT 258.87 322.10 Td (fectively) Tj ET Q q 0 0 0 rg BT 293.20 322.10 Td (, develop product enhancements or introduce new products in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (suf) Tj ET Q q 0 0 0 rg BT 61.54 310.10 Td (ficient quantities to meet the needs of our customers as scheduled, our net sales may be reduced and our business may be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (harmed.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 274.10 Td (e face risks associated with our foreign operations and sales that could harm our financial condition and results of ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (For the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.42 238.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.00 238.10 Td (, 81% of our net sales were derived from customers outside of the United States. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (For fiscal 2016, fiscal 2015 and fiscal 2014, 76%, 73%, and 74%, respectively) Tj ET Q q 0 0 0 rg BT 362.39 226.10 Td (, of our net sales were derived from customers ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (outside of the United States. ) Tj ET Q q 0 0 0 rg BT 164.49 214.10 Td (A) Tj ET Q q 0 0 0 rg BT 171.16 214.10 Td ( majority of Rofin) Tj ET Q q 0 0 0 rg BT 246.42 214.10 Td (s sales have also been to customers outside of the United States in recent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (years. ) Tj ET Q q 0 0 0 rg BT 75.42 202.10 Td (W) Tj ET Q q 0 0 0 rg BT 84.06 202.10 Td (e anticipate that foreign sales, particularly in ) Tj ET Q q 0 0 0 rg BT 263.99 202.10 Td (Asia, will continue to account for a significant portion of our net sales in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (the foreseeable future. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (A) Tj ET Q q 0 0 0 rg BT 56.17 166.10 Td ( global economic slowdown or a natural disaster could have a negative ef) Tj ET Q q 0 0 0 rg BT 349.22 166.10 Td (fect on various foreign markets in which we operate, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (such as the earthquake, tsunami and resulting nuclear disaster in Japan and the flooding in ) Tj ET Q q 0 0 0 rg BT 412.00 154.10 Td (Thailand in recent years. Such a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (slowdown may cause us to reduce our presence in certain countries, which may negatively af) Tj ET Q q 0 0 0 rg BT 421.69 142.10 Td (fect the overall level of business in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (such countries. Our foreign sales are primarily through our direct sales force. ) Tj ET Q q 0 0 0 rg BT 359.40 130.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 409.30 130.10 Td (, some foreign sales are made through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (foreign distributors and representatives. Our foreign operations and sales are subject to a number of risks, including:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 94.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 94.10 Td (longer accounts receivable collection periods;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 70.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 70.10 Td (the impact of recessions and other economic conditions in economies outside the United States;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 46.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 46.10 Td (unexpected changes in regulatory requirements;) Tj ET Q endstream endobj 113 0 obj <>] /Rotate 0 /Contents 114 0 R>> endobj 114 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (56) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 730.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 730.10 Td (certification requirements;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 706.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 706.10 Td (environmental regulations;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 682.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td (reduced protection for intellectual property rights in some countries;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 658.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 658.10 Td (potentially adverse tax consequences;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 634.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 634.10 Td (political and economic instability;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 610.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 610.10 Td (import/export regulations, tarif) Tj ET Q q 0 0 0 rg BT 208.90 610.10 Td (fs and trade barriers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 586.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 586.10 Td (compliance with applicable United States and foreign anti-corruption laws;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 562.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 562.10 Td (cultural and management dif) Tj ET Q q 0 0 0 rg BT 200.00 562.10 Td (ferences;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 538.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 538.10 Td (reliance in some jurisdictions on third party sales channel partners; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 514.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 514.10 Td (preference for locally produced products; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 490.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 490.10 Td (shipping and other logistics complications.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (Our business could also be impacted by international conflicts, terrorist and military activity) Tj ET Q q 0 0 0 rg BT 417.92 466.10 Td (, civil unrest and pandemic illness ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (which could cause a slowdown in customer orders, cause customer order cancellations or negatively impact availability of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (supplies or limit our ability to timely service our installed base of products.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 418.10 Td (e are also subject to the risks of fluctuating foreign currency exchange rates, which could materially adversely af) Tj ET Q q 0 0 0 rg BT 508.33 418.10 Td (fect the sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (price of our products in foreign markets, as well as the costs and expenses of our foreign subsidiaries. ) Tj ET Q q 0 0 0 rg BT 458.10 406.10 Td (While we use forward ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (exchange contracts and other risk management techniques to hedge our foreign currency exposure, we remain exposed to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (economic risks of foreign currency fluctuations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 358.10 Td (e may not be able to protect our proprietary technology which could adversely af) Tj ET Q q 0 0 0 rg BT 387.71 358.10 Td (fect our competitive advantage.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (Maintenance of intellectual property rights and the protection thereof is important to our business. ) Tj ET Q q 0 0 0 rg BT 443.93 334.10 Td (W) Tj ET Q q 0 0 0 rg BT 452.57 334.10 Td (e rely on a combination of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (patent, copyright, trademark and trade secret laws and restrictions on disclosure to protect our intellectual property rights. Our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (patent applications may not be approved, any patents that may be issued may not suf) Tj ET Q q 0 0 0 rg BT 387.84 310.10 Td (ficiently protect our intellectual property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (and any issued patents may be challenged by third parties. Other parties may independently develop similar or competing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (technology or design around any patents that may be issued to us. ) Tj ET Q q 0 0 0 rg BT 314.54 286.10 Td (W) Tj ET Q q 0 0 0 rg BT 323.18 286.10 Td (e cannot be certain that the steps we have taken will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (prevent the misappropriation of our intellectual property) Tj ET Q q 0 0 0 rg BT 274.33 274.10 Td (, particularly in foreign countries where the laws may not protect our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (proprietary rights as fully as in the United States. Further) Tj ET Q q 0 0 0 rg BT 277.39 262.10 Td (, we may be required to enforce our intellectual property or other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (proprietary rights through litigation, which, regardless of success, could result in substantial costs and diversion of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (management's attention. ) Tj ET Q q 0 0 0 rg BT 148.22 238.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 198.12 238.10 Td (, there may be existing patents of which we are unaware that could be pertinent to our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (business and it is not possible for us to know whether there are patent applications pending that our products might infringe ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (upon since these applications are often not publicly available until a patent is issued or published.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 190.10 Td (e may) Tj ET Q q 0 0 0 rg BT 81.43 190.10 Td (, in the future, be subject to claims or litigation from third parties, for claims of infringement of their proprietary ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (rights or to determine the scope and validity of our proprietary rights or the proprietary rights of competitors or other rights ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (holders. These claims could result in costly litigation and the diversion of our technical and management personnel. ) Tj ET Q q 0 0 0 rg BT 529.44 166.10 Td (Adverse ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (resolution of litigation may harm our operating results or financial condition.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (In recent years, there has been significant litigation in the United States and around the world involving patents and other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (intellectual property rights. ) Tj ET Q q 0 0 0 rg BT 160.40 118.10 Td (This has been seen in our industry) Tj ET Q q 0 0 0 rg BT 296.39 118.10 Td (, for example in the recently concluded patent-related litigation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (between IMRA) Tj ET Q q 0 0 0 rg BT 110.88 106.10 Td ( ) Tj ET Q q 0 0 0 rg BT 112.83 106.10 Td (America,Inc. \("Imra"\) and IPG Photonics Corporation and in Imra's recently brought litigation against two of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (our German subsidiaries. From time to time, like many other technology companies, we have received communications from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (other parties asserting the existence of patent rights, copyrights, trademark rights or other intellectual property rights which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (such third parties believe may cover certain of our products, processes, technologies or information. In the future, we may be a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (party to litigation to protect our intellectual property or as a result of an alleged infringement of others' intellectual property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 46.10 Td (whether through direct claims or by way of indemnification claims of our customers, as, in some cases, we contractually agree ) Tj ET Q endstream endobj 115 0 obj <>] /Rotate 0 /Contents 116 0 R>> endobj 116 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (57) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (to indemnify our customers against third-party infringement claims relating to our products. ) Tj ET Q q 0 0 0 rg BT 419.51 742.10 Td (These claims and any resulting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (lawsuit, if successful, could subject us to significant liability for damages or invalidation of our proprietary rights. ) Tj ET Q q 0 0 0 rg BT 507.55 730.10 Td (These ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (lawsuits, regardless of their success, would likely be time-consuming and expensive to resolve and would divert management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (time and attention. ) Tj ET Q q 0 0 0 rg BT 126.15 706.10 Td (Any potential intellectual property litigation could also force us to do one or more of the following:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 682.10 Td ( ) Tj ET Q BT /F1 3.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.25 682.10 Td (stop manufacturing, selling or using our products that use the infringed intellectual property;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 658.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 658.10 Td (obtain from the owner of the infringed intellectual property right a license to sell or use the relevant technology) Tj ET Q q 0 0 0 rg BT 530.26 658.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 646.10 Td (although such license may not be available on reasonable terms, or at all; or) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 622.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 622.10 Td (redesign the products that use the technology) Tj ET Q q 0 0 0 rg BT 265.36 622.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (If we are forced to take any of these actions or are otherwise a party to lawsuits of this nature, we may incur significant losses ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (and our business may be seriously harmed. ) Tj ET Q q 0 0 0 rg BT 223.73 586.10 Td (W) Tj ET Q q 0 0 0 rg BT 232.37 586.10 Td (e do not have insurance to cover potential claims of this type.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (Under accounting principles generally accepted in the United States, we review our intangible assets for impairment when ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill is required to be tested for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (impairment at least annually) Tj ET Q q 0 0 0 rg BT 162.42 514.10 Td (. Factors that may be considered in determining whether a change in circumstances indicating that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (the carrying value of our goodwill or other intangible assets may not be recoverable include declines in our stock price and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (market capitalization or future cash flows projections. ) Tj ET Q q 0 0 0 rg BT 267.21 490.10 Td (A) Tj ET Q q 0 0 0 rg BT 273.88 490.10 Td ( decline in our stock price, or any other adverse change in market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (conditions, particularly if such change has the ef) Tj ET Q q 0 0 0 rg BT 243.14 478.10 Td (fect of changing one of the critical assumptions or estimates we used to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (calculate the estimated fair value of our reporting units, could result in a change to the estimation of fair value that could result ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (in an impairment char) Tj ET Q q 0 0 0 rg BT 137.34 454.10 Td (ge. ) Tj ET Q q 0 0 0 rg BT 151.23 454.10 Td (Any such material char) Tj ET Q q 0 0 0 rg BT 244.07 454.10 Td (ges, whether related to goodwill or purchased intangible assets, may have a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (material negative impact on our financial and operating results.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 418.10 Td (e depend on skilled personnel to operate our business ef) Tj ET Q q 0 0 0 rg BT 287.20 418.10 Td (fectively in a rapidly changing market, and if we are unable to ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (retain existing or hire additional personnel when needed, our ability to develop and sell our products could be harmed.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (Our ability to continue to attract and retain highly skilled personnel will be a critical factor in determining whether we will be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (successful in the future. Recruiting and retaining highly skilled personnel in certain functions continues to be dif) Tj ET Q q 0 0 0 rg BT 498.93 370.10 Td (ficult. ) Tj ET Q q 0 0 0 rg BT 524.48 370.10 Td (At ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (certain locations where we operate, the cost of living is extremely high and it may be dif) Tj ET Q q 0 0 0 rg BT 402.82 358.10 Td (ficult to retain key employees and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (management at a reasonable cost. ) Tj ET Q q 0 0 0 rg BT 185.93 346.10 Td (W) Tj ET Q q 0 0 0 rg BT 194.56 346.10 Td (e may not be successful in attracting, assimilating or retaining qualified personnel to fulfill ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (our current or future needs. Our failure to attract additional employees and retain our existing employees could adversely af) Tj ET Q q 0 0 0 rg BT 543.86 334.10 Td (fect ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (our growth and our business.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (Our future success depends upon the continued services of our executive of) Tj ET Q q 0 0 0 rg BT 351.17 298.10 Td (ficers and other key engineering, sales, marketing, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (manufacturing and support personnel, any of whom may leave and our ability to ef) Tj ET Q q 0 0 0 rg BT 380.89 286.10 Td (fectively transition to their successors. Our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (inability to retain or to ef) Tj ET Q q 0 0 0 rg BT 149.57 274.10 Td (fectively transition to their successors could harm our business and our results of operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (The long sales cycles for our products may cause us to incur significant expenses without of) Tj ET Q q 0 0 0 rg BT 427.95 250.10 Td (fsetting net sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (Customers often view the purchase of our products as a significant and strategic decision. ) Tj ET Q q 0 0 0 rg BT 409.68 226.10 Td (As a result, customers typically ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (expend significant ef) Tj ET Q q 0 0 0 rg BT 133.18 214.10 Td (fort in evaluating, testing and qualifying our products before making a decision to purchase them, resulting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (in a lengthy initial sales cycle. ) Tj ET Q q 0 0 0 rg BT 172.89 202.10 Td (While our customers are evaluating our products and before they place an order with us, we may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (incur substantial sales and marketing and research and development expenses to customize our products to the customers' ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (needs. ) Tj ET Q q 0 0 0 rg BT 77.09 178.10 Td (W) Tj ET Q q 0 0 0 rg BT 85.73 178.10 Td (e may also expend significant management ef) Tj ET Q q 0 0 0 rg BT 268.25 178.10 Td (forts, increase manufacturing capacity and order long lead-time ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (components or materials prior to receiving an order) Tj ET Q q 0 0 0 rg BT 254.71 166.10 Td (. Even after this evaluation process, a potential customer may not purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (our products. ) Tj ET Q q 0 0 0 rg BT 104.22 154.10 Td (As a result, these long sales cycles may cause us to incur significant expenses without ever receiving net sales to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (of) Tj ET Q q 0 0 0 rg BT 57.65 142.10 Td (fset such expenses.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (The markets in which we sell our products are intensely competitive and increased competition could cause reduced sales ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (levels, reduced gross margins or the loss of market share.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (Competition in the various photonics markets in which we provide products is very intense. ) Tj ET Q q 0 0 0 rg BT 418.42 82.10 Td (W) Tj ET Q q 0 0 0 rg BT 427.06 82.10 Td (e compete against a number of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (lar) Tj ET Q q 0 0 0 rg BT 59.87 70.10 Td (ge public and private companies, including CVI Melles Griot, NovantaInc.,IPG Photonics Corporation, Lumentum ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (Holdings Inc., MKS Instruments, Inc. and ) Tj ET Q q 0 0 0 rg BT 219.86 58.10 Td (T) Tj ET Q q 0 0 0 rg BT 225.61 58.10 Td (rumpfGmbH, as well as other smaller companies. Some of our competitors are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 46.10 Td (lar) Tj ET Q q 0 0 0 rg BT 59.87 46.10 Td (ge companies that have significant financial, technical, marketing and other resources. ) Tj ET Q q 0 0 0 rg BT 407.33 46.10 Td (These competitors may be able to ) Tj ET Q endstream endobj 117 0 obj <>] /Rotate 0 /Contents 118 0 R>> endobj 118 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (58) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (devote greater resources than we can to the development, promotion, sale and support of their products. Some of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (competitors are much better positioned than we are to acquire other companies in order to gain new technologies or products ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (that may displace our product lines. ) Tj ET Q q 0 0 0 rg BT 194.19 718.10 Td (Any of these acquisitions could give our competitors a strategic advantage. ) Tj ET Q q 0 0 0 rg BT 496.33 718.10 Td (Any business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (combinations or mer) Tj ET Q q 0 0 0 rg BT 132.08 706.10 Td (gers among our competitors, forming lar) Tj ET Q q 0 0 0 rg BT 294.08 706.10 Td (ger companies with greater resources, could result in increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (competition, price reductions, reduced mar) Tj ET Q q 0 0 0 rg BT 220.92 694.10 Td (gins or loss of market share, any of which could materially and adversely af) Tj ET Q q 0 0 0 rg BT 523.98 694.10 Td (fect our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (business, results of operations and financial condition.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (Additional competitors may enter the markets in which we serve, both foreign and domestic, and we are likely to compete with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (new companies in the future. ) Tj ET Q q 0 0 0 rg BT 167.62 646.10 Td (W) Tj ET Q q 0 0 0 rg BT 176.25 646.10 Td (e may encounter potential customers that, due to existing relationships with our competitors, are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (committed to the products of) Tj ET Q q 0 0 0 rg BT 164.85 634.10 Td (fered by these competitors. Further) Tj ET Q q 0 0 0 rg BT 304.69 634.10 Td (, our current or potential customers may determine to develop ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (and produce products for their own use which are competitive to our products. ) Tj ET Q q 0 0 0 rg BT 364.97 622.10 Td (As a result of the foregoing factors, we expect ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (that competitive pressures may result in price reductions, reduced mar) Tj ET Q q 0 0 0 rg BT 329.78 610.10 Td (gins, loss of sales and loss of market share. In addition, in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (markets where there are a limited number of customers, competition is particularly intense.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (If we fail to accurately forecast component and material requirements for our products, we could incur additional costs and ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (incur significant delays in shipments, which could result in a loss of customers.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 538.10 Td (e use rolling forecasts based on anticipated product orders and material requirements planning systems to determine our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (product requirements. It is very important that we accurately predict both the demand for our products and the lead times ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (required to obtain the necessary components and materials. ) Tj ET Q q 0 0 0 rg BT 288.41 514.10 Td (W) Tj ET Q q 0 0 0 rg BT 297.04 514.10 Td (e depend on our suppliers for most of our product components ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (and materials. Lead times for components and materials that we order vary significantly and depend on factors including the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (specific supplier requirements, the size of the order) Tj ET Q q 0 0 0 rg BT 254.02 490.10 Td (, contract terms and current market demand for components. For substantial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (increases in our sales levels of certain products, some of our suppliers may need at least nine months lead-time. If we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (overestimate our component and material requirements, we may have excess inventory) Tj ET Q q 0 0 0 rg BT 396.78 466.10 Td (, which would increase our costs. If we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (underestimate our component and material requirements, we may have inadequate inventory) Tj ET Q q 0 0 0 rg BT 418.99 454.10 Td (, which could interrupt and delay ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (delivery of our products to our customers. ) Tj ET Q q 0 0 0 rg BT 219.47 442.10 Td (Any of these occurrences would negatively impact our net sales, business or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (operating results.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (Our reliance on contract manufacturing and outsourcing may adversely impact our financial results and operations due to ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (our decreased control over the performance and timing of certain aspects of our manufacturing.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (Our manufacturing strategy includes partnering with contract manufacturers to outsource non-core subassemblies and less ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (complex turnkey products, including some performed at international sites located in ) Tj ET Q q 0 0 0 rg BT 391.08 358.10 Td (Asia and Eastern Europe. Our ability to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (resume internal manufacturing operations for certain products and components in a timely manner may be eliminated. ) Tj ET Q q 0 0 0 rg BT 523.88 346.10 Td (The cost, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (quality) Tj ET Q q 0 0 0 rg BT 76.62 334.10 Td (, performance and availability of contract manufacturing operations are and will be essential to the successful production ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (and sale of many of our products. Our financial condition or results of operation could be adversely impacted if any contract ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (manufacturer or other supplier is unable for any reason, including as a result of the impact of worldwide economic conditions, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (to meet our cost, quality) Tj ET Q q 0 0 0 rg BT 145.77 298.10 Td (, performance, and availability standards. ) Tj ET Q q 0 0 0 rg BT 313.31 298.10 Td (W) Tj ET Q q 0 0 0 rg BT 321.95 298.10 Td (e may not be able to provide contract manufacturers with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (product volumes that are high enough to achieve suf) Tj ET Q q 0 0 0 rg BT 258.70 286.10 Td (ficient cost savings. If shipments fall below forecasted levels, we may incur ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (increased costs or be required to take ownership of the inventory) Tj ET Q q 0 0 0 rg BT 307.65 274.10 Td (. ) Tj ET Q q 0 0 0 rg BT 312.10 274.10 Td (Also, our ability to control the quality of products produced ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (by contract manufacturers may be limited and quality issues may not be resolved in a timely manner) Tj ET Q q 0 0 0 rg BT 450.65 262.10 Td (, which could adversely ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (impact our financial condition or results of operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (If we fail to ef) Tj ET Q q 0 0 0 rg BT 107.08 226.10 Td (fectively manage our growth or) Tj ET Q q 0 0 0 rg BT 235.41 226.10 Td (, alternatively) Tj ET Q q 0 0 0 rg BT 291.14 226.10 Td (, our spending during downturns, our business could be ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (disrupted, which could harm our operating results.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (Growth in sales, combined with the challenges of managing geographically dispersed operations, can place a significant strain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (on our management systems and resources, and our anticipated growth in future operations could continue to place such a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (strain. ) Tj ET Q q 0 0 0 rg BT 76.54 166.10 Td (The failure to ef) Tj ET Q q 0 0 0 rg BT 141.04 166.10 Td (fectively manage our growth could disrupt our business and harm our operating results. Our ability to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (successfully of) Tj ET Q q 0 0 0 rg BT 109.03 154.10 Td (fer our products and implement our business plan in evolving markets requires an ef) Tj ET Q q 0 0 0 rg BT 445.70 154.10 Td (fective planning and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (management process. In economic downturns, we must ef) Tj ET Q q 0 0 0 rg BT 281.20 142.10 Td (fectively manage our spending and operations to ensure our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (competitive position during the downturn, as well as our future opportunities when the economy improves, remain intact. ) Tj ET Q q 0 0 0 rg BT 536.99 130.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (failure to ef) Tj ET Q q 0 0 0 rg BT 95.96 118.10 Td (fectively manage our spending and operations could disrupt our business and harm our operating results.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (Historically) Tj ET Q q 0 0 0 rg BT 97.46 94.10 Td (, acquisitions have been an important element of our strategy) Tj ET Q q 0 0 0 rg BT 348.76 94.10 Td (. However) Tj ET Q q 0 0 0 rg BT 389.87 94.10 Td (, we may not find suitable acquisition ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (candidates in the future and we may not be able to successfully integrate and manage acquired businesses. ) Tj ET Q q 0 0 0 rg BT 490.25 82.10 Td (Any acquisitions ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (we make could disrupt our business and harm our financial condition.) Tj ET Q endstream endobj 119 0 obj <>] /Rotate 0 /Contents 120 0 R>> endobj 120 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (59) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 742.10 Td (e have in the past made strategic acquisitions of other corporations and entities, including Rofin in November 2016, as well as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (asset purchases, and we continue to evaluate potential strategic acquisitions of complementary companies, products and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (technologies. In the event of any future acquisitions, we could:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 694.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 694.10 Td (issue stock that would dilute our current stockholders' percentage ownership;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 670.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 670.10 Td (pay cash that would decrease our working capital;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 646.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 646.10 Td (incur debt;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 622.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 622.10 Td (assume liabilities; or) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 598.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 598.10 Td (incur expenses related to impairment of goodwill and amortization.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 71.50 574.10 Td (Acquisitions also involve numerous risks, including:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 550.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 550.10 Td (problems combining the acquired operations, systems, technologies or products;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 526.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 526.10 Td (an inability to realize expected operating ef) Tj ET Q q 0 0 0 rg BT 258.57 526.10 Td (ficiencies or product integration benefits;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 502.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 502.10 Td (dif) Tj ET Q q 0 0 0 rg BT 96.43 502.10 Td (ficulties in coordinating and integrating geographically separated personnel, or) Tj ET Q q 0 0 0 rg BT 411.42 502.10 Td (ganizations, systems and facilities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 478.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 478.10 Td (dif) Tj ET Q q 0 0 0 rg BT 96.43 478.10 Td (ficulties integrating business cultures;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 454.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 454.10 Td (unanticipated costs or liabilities, including the costs associated with improving the internal controls of the acquired ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 442.10 Td (company;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 418.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 418.10 Td (diversion of management's attention from our core businesses;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 394.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 394.10 Td (adverse ef) Tj ET Q q 0 0 0 rg BT 126.13 394.10 Td (fects on existing business relationships with suppliers and customers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 370.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 370.10 Td (potential loss of key employees, particularly those of the purchased or) Tj ET Q q 0 0 0 rg BT 365.51 370.10 Td (ganizations;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 346.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 346.10 Td (incurring unforeseen obligations or liabilities in connection with acquisitions; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 322.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 322.10 Td (the failure to complete acquisitions even after signing definitive agreements which, among other things, would result ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 310.10 Td (in the expensing of potentially significant professional fees and other char) Tj ET Q q 0 0 0 rg BT 381.34 310.10 Td (ges in the period in which the acquisition or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 298.10 Td (negotiations are terminated.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 274.10 Td (e cannot assure you that we will be able to successfully identify appropriate acquisition candidates, to integrate any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (businesses, products, technologies or personnel that we might acquire in the future or achieve the anticipated benefits of such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (transactions, which may harm our business.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (Our market is unpredictable and characterized by rapid technological changes and evolving standards demanding a ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (significant investment in research and development, and, if we fail to address changing market conditions, our business and ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (operating results will be harmed.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (The photonics industry is characterized by extensive research and development, rapid technological change, frequent new ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (product introductions, changes in customer requirements and evolving industry standards. Because this industry is subject to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (rapid change, it is dif) Tj ET Q q 0 0 0 rg BT 134.02 154.10 Td (ficult to predict its potential size or future growth rate. Our success in generating net sales in this industry ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (will depend on, among other things:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 118.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 118.10 Td (maintaining and enhancing our relationships with our customers;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 94.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 94.10 Td (the education of potential end-user customers about the benefits of lasers and laser systems; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 70.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 70.10 Td (our ability to accurately predict and develop our products to meet industry standards.) Tj ET Q endstream endobj 121 0 obj <>] /Rotate 0 /Contents 122 0 R>> endobj 122 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (60) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (For the three months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.42 742.10 Td (December31, 2016) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 240.00 742.10 Td (, our research and development costs were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 412.16 742.10 Td ($27.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 466.05 742.10 Td ( \() Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.88 742.10 Td (7.8%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 492.71 742.10 Td ( of net sales\). For ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (our fiscal years 2016, 2015 and 2014, our research and development costs were $81.8 million \(9.5% of net sales\), $81.5 million ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (\(10.2% of net sales\) and $79.1 million \(10.0% of net sales\), respectively) Tj ET Q q 0 0 0 rg BT 337.94 718.10 Td (. ) Tj ET Q q 0 0 0 rg BT 342.76 718.10 Td (W) Tj ET Q q 0 0 0 rg BT 351.40 718.10 Td (e cannot assure you that our expenditures for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (research and development will result in the introduction of new products or) Tj ET Q q 0 0 0 rg BT 350.40 706.10 Td (, if such products are introduced, that those products ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (will achieve suf) Tj ET Q q 0 0 0 rg BT 112.63 694.10 Td (ficient market acceptance or to generate sales to of) Tj ET Q q 0 0 0 rg BT 315.12 694.10 Td (fset the costs of development. Our failure to address rapid ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (technological changes in our markets could adversely af) Tj ET Q q 0 0 0 rg BT 273.96 682.10 Td (fect our business and results of operations.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 658.10 Td (e are exposed to lawsuits in the normal course of business which could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 458.87 658.10 Td (fect on our business, ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (operating results, or financial condition.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 622.10 Td (e are exposed to lawsuits in the normal course of our business, including product liability claims, if personal injury) Tj ET Q q 0 0 0 rg BT 516.83 622.10 Td (, death or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (commercial losses occur from the use of our products. ) Tj ET Q q 0 0 0 rg BT 268.70 610.10 Td (While we typically maintain business insurance, including directors' and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (of) Tj ET Q q 0 0 0 rg BT 57.65 598.10 Td (ficers' policies, litigation can be expensive, lengthy) Tj ET Q q 0 0 0 rg BT 261.52 598.10 Td (, and disruptive to normal business operations, including the potential ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (impact of indemnification obligations for individuals named in any such lawsuits. ) Tj ET Q q 0 0 0 rg BT 378.70 586.10 Td (W) Tj ET Q q 0 0 0 rg BT 387.34 586.10 Td (e may not, however) Tj ET Q q 0 0 0 rg BT 465.80 586.10 Td (, be able to secure ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (insurance coverage on terms acceptable to us in the future. Moreover) Tj ET Q q 0 0 0 rg BT 325.37 574.10 Td (, the results of complex legal proceedings are dif) Tj ET Q q 0 0 0 rg BT 519.85 574.10 Td (ficult to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (predict. ) Tj ET Q q 0 0 0 rg BT 81.71 562.10 Td (An unfavorable resolution of a particular lawsuit, including a recall or redesign of products if ultimately determined to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (be defective, could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 232.00 550.10 Td (fect on our business, operating results, or financial condition.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (W) Tj ET Q q 0 0 0 rg BT 57.65 526.10 Td (e use standard laboratory and manufacturing materials that could be considered hazardous and we could be liable for any ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (damage or liability resulting from accidental environmental contamination or injury) Tj ET Q q 0 0 0 rg BT 396.66 514.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (Although most of our products do not incorporate hazardous or toxic materials and chemicals, some of the gases used in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (excimer lasers and some of the liquid dyes used in some of our scientific laser products are highly toxic. In addition, our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (operations involve the use of standard laboratory and manufacturing materials that could be considered hazardous. ) Tj ET Q q 0 0 0 rg BT 509.35 466.10 Td (Also, if a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (facility fire were to occur at our Sunnyvale, California site and were to spread to a reactor used to grow semiconductor wafers, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (it could release highly toxic emissions. ) Tj ET Q q 0 0 0 rg BT 207.35 442.10 Td (W) Tj ET Q q 0 0 0 rg BT 215.98 442.10 Td (e believe that our safety procedures for handling and disposing of such materials ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (comply with all federal, state and of) Tj ET Q q 0 0 0 rg BT 193.44 430.10 Td (fshore regulations and standards. However) Tj ET Q q 0 0 0 rg BT 363.82 430.10 Td (, the risk of accidental environmental ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (contamination or injury from such materials cannot be entirely eliminated. In the event of such an accident involving such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (materials, we could be liable for damages and such liability could exceed the amount of our liability insurance coverage and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (resources of our business which could have an adverse ef) Tj ET Q q 0 0 0 rg BT 278.41 394.10 Td (fect on our financial results or our business as a whole.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (Compliance or the failure to comply with current and future environmental regulations could cause us significant expense.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 346.10 Td (e are subject to a variety of federal, state, local and foreign environmental regulations relating to the use, storage, dischar) Tj ET Q q 0 0 0 rg BT 541.38 346.10 Td (ge ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (and disposal of hazardous chemicals used during our manufacturing process or requiring design changes or recycling of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 322.10 Td (products we manufacture. If we fail to comply with any present and future regulations, we could be subject to future liabilities, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (the suspension of production or a prohibition on the sale of products we manufacture. In addition, such regulations could ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 298.10 Td (restrict our ability to expand our facilities or could require us to acquire costly equipment, or to incur other significant expenses ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 286.10 Td (to comply with environmental regulations, including expenses associated with the recall of any non-compliant product and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 274.10 Td (management of historical waste.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (From time to time new regulations are enacted, and it is dif) Tj ET Q q 0 0 0 rg BT 285.92 250.10 Td (ficult to anticipate how such regulations will be implemented and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (enforced. ) Tj ET Q q 0 0 0 rg BT 89.29 238.10 Td (W) Tj ET Q q 0 0 0 rg BT 97.93 238.10 Td (e continue to evaluate the necessary steps for compliance with regulations as they are enacted. ) Tj ET Q q 0 0 0 rg BT 477.04 238.10 Td (These regulations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (include, for example, the Registration, Evaluation, ) Tj ET Q q 0 0 0 rg BT 253.33 226.10 Td (Authorization and Restriction of Chemical substances \(REACH\), the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (Restriction on the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Directive \(RoHS\) and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 202.10 Td (aste Electrical and Electronic Equipment Directive \(WEEE\) enacted in the European Union which regulate the use of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (certain hazardous substances in, and require the collection, reuse and recycling of waste from, certain products we manufacture. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (This and similar legislation that has been or is in the process of being enacted in Japan, China, South Korea and various states ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (of the United States may require us to re-design our products to ensure compliance with the applicable standards, for example ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (by requiring the use of dif) Tj ET Q q 0 0 0 rg BT 153.46 154.10 Td (ferent types of materials. ) Tj ET Q q 0 0 0 rg BT 255.18 154.10 Td (These redesigns or alternative materials may detrimentally impact the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (performance of our products, add greater testing lead-times for product introductions or have other similar ef) Tj ET Q q 0 0 0 rg BT 484.72 142.10 Td (fects. ) Tj ET Q q 0 0 0 rg BT 508.42 142.10 Td (W) Tj ET Q q 0 0 0 rg BT 517.06 142.10 Td (e believe ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (we comply with all such legislation where our products are sold and we will continue to monitor these laws and the regulations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (being adopted under them to determine our responsibilities. In addition, we are monitoring legislation relating to the reduction ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (of carbon emissions from industrial operations to determine whether we may be required to incur any additional material costs ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (or expenses associated with our operations. ) Tj ET Q q 0 0 0 rg BT 225.11 94.10 Td (W) Tj ET Q q 0 0 0 rg BT 233.74 94.10 Td (e are not currently aware of any such material costs or expenses. ) Tj ET Q q 0 0 0 rg BT 493.73 94.10 Td (The SEC has ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (promulgated rules requiring disclosure regarding the use of certain conflict minerals mined from the Democratic Republic of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 70.10 Td (Congo and adjoining countries and procedures regarding a manufacturer's ef) Tj ET Q q 0 0 0 rg BT 355.18 70.10 Td (forts to prevent the sourcing of such minerals. ) Tj ET Q q 0 0 0 rg BT 541.34 70.10 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 58.10 Td (implementation of such rules has required us to incur additional expense and internal resources and may continue to do so in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 46.10 Td (future, particularly in the event that only a limited pool of suppliers are available to certify that products are free from conflict ) Tj ET Q endstream endobj 123 0 obj <>] /Rotate 0 /Contents 124 0 R>> endobj 124 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (61) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (minerals. Our failure to comply with any of the foregoing regulatory requirements or contractual obligations could result in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (our being directly or indirectly liable for costs, fines or penalties and third-party claims, and could jeopardize our ability to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 718.10 Td (conduct business in the United States and foreign countries.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 694.10 Td (Our and our customers' operations would be seriously harmed if our logistics or facilities or those of our suppliers, our ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (customers' suppliers or our contract manufacturers were to experience catastrophic loss.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (Our operations, logistics and facilities and those of our customers, suppliers and contract manufacturers could be subject to a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (catastrophic loss from fire, flood, earthquake, volcanic eruption, work stoppages, power outages, acts of war) Tj ET Q q 0 0 0 rg BT 482.85 646.10 Td (, pandemic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (illnesses, ener) Tj ET Q q 0 0 0 rg BT 105.41 634.10 Td (gy shortages, theft of assets, other natural disasters or terrorist activity) Tj ET Q q 0 0 0 rg BT 385.24 634.10 Td (. ) Tj ET Q q 0 0 0 rg BT 389.69 634.10 Td (A) Tj ET Q q 0 0 0 rg BT 396.36 634.10 Td ( substantial portion of our research and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (development activities, manufacturing, our corporate headquarters and other critical business operations are located near major ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (earthquake faults in Santa Clara, California, an area with a history of seismic events. ) Tj ET Q q 0 0 0 rg BT 389.67 610.10 Td (Any such loss or detrimental impact to any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (of our operations, logistics or facilities could disrupt our operations, delay production, shipments and net sales and result in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (lar) Tj ET Q q 0 0 0 rg BT 59.87 586.10 Td (ge expenses to repair or replace the facility) Tj ET Q q 0 0 0 rg BT 231.08 586.10 Td (. ) Tj ET Q q 0 0 0 rg BT 235.90 586.10 Td (While we have obtained insurance to cover most potential losses, after reviewing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (the costs and limitations associated with earthquake insurance, we have decided not to procure such insurance. ) Tj ET Q q 0 0 0 rg BT 494.17 574.10 Td (W) Tj ET Q q 0 0 0 rg BT 502.81 574.10 Td (e believe that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (this decision is consistent with decisions reached by numerous other companies located nearby) Tj ET Q q 0 0 0 rg BT 428.20 562.10 Td (. ) Tj ET Q q 0 0 0 rg BT 433.02 562.10 Td (W) Tj ET Q q 0 0 0 rg BT 441.65 562.10 Td (e cannot assure you that our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (existing insurance coverage will be adequate against all other possible losses.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 526.10 Td (Dif) Tj ET Q q 0 0 0 rg BT 62.65 526.10 Td (ficulties with our enterprise resource planning \(ERP\) system and other parts of our global information technology ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (system could harm our business and results of operation. If our network security measures are breached and unauthorized ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (access is obtained to a customer's data or our data or our information technology systems, we may incur significant legal ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (and financial exposure and liabilities.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (Like many modern multinational corporations, we maintain a global information technology system, including software ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (products licensed from third parties. ) Tj ET Q q 0 0 0 rg BT 198.63 454.10 Td (Any system, network or Internet failures, misuse by system users, the hacking into or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (disruption caused by the unauthorized access by third parties or loss of license rights could disrupt our ability to timely and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (accurately manufacture and ship products or to report our financial information in compliance with the timelines mandated by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (the SEC. ) Tj ET Q q 0 0 0 rg BT 89.50 418.10 Td (Any such failure, misuse, hacking, disruptions or loss would likely cause a diversion of management's attention from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (the underlying business and could harm our operations. In addition, a significant failure of our global information technology ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (system could adversely af) Tj ET Q q 0 0 0 rg BT 152.90 394.10 Td (fect our ability to complete an evaluation of our internal controls and attestation activities pursuant to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (Section 404 of the Sarbanes-Oxley ) Tj ET Q q 0 0 0 rg BT 190.86 382.10 Td (Act of 2002.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 356.70 Td (Our information systems are subject to attacks, interruptions and failures.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 336.70 Td (As part of our day-to-day business, we store our data and certain data about our customers in our global information technology ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 324.70 Td (system. ) Tj ET Q q 0 0 0 rg BT 82.10 324.70 Td (While our system is designed with access security) Tj ET Q q 0 0 0 rg BT 281.68 324.70 Td (, if a third party gains unauthorized access to our data, including any ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 312.70 Td (regarding our customers, such a security breach could expose us to a risk of loss of this information, loss of business, litigation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 300.70 Td (and possible liability) Tj ET Q q 0 0 0 rg BT 132.18 300.70 Td (. Our security measures may be breached as a result of third-party action, including intentional misconduct ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 288.70 Td (by computer hackers, employee error) Tj ET Q q 0 0 0 rg BT 198.20 288.70 Td (, malfeasance or otherwise. ) Tj ET Q q 0 0 0 rg BT 309.27 288.70 Td (Additionally) Tj ET Q q 0 0 0 rg BT 359.17 288.70 Td (, third parties may attempt to fraudulently induce ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 276.70 Td (employees or customers into disclosing sensitive information such as user names, passwords or other information in order to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 264.70 Td (gain access to our customers' data or our data, including our intellectual property and other confidential business information, or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 252.70 Td (our information technology systems. Because the techniques used to obtain unauthorized access, or to sabotage systems, change ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 240.70 Td (frequently and generally are not recognized until launched against a tar) Tj ET Q q 0 0 0 rg BT 333.64 240.70 Td (get, we may be unable to anticipate these techniques or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 228.70 Td (to implement adequate preventative measures. ) Tj ET Q q 0 0 0 rg BT 236.65 228.70 Td (Any unauthorized access could result in a loss of confidence by our customers, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 216.70 Td (damage our reputation, disrupt our business, lead to legal liability and negatively impact our future sales. ) Tj ET Q q 0 0 0 rg BT 471.34 216.70 Td (Additionally) Tj ET Q q 0 0 0 rg BT 521.24 216.70 Td (, such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 204.70 Td (actions could result in significant costs associated with loss of our intellectual property) Tj ET Q q 0 0 0 rg BT 395.99 204.70 Td (, impairment of our ability to conduct our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 192.70 Td (operations, rebuilding our network and systems, prosecuting and defending litigation, responding to regulatory inquiries or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 180.70 Td (actions, paying damages or taking other remedial steps.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 156.70 Td (Changes in tax rates, tax liabilities or tax accounting rulescould af) Tj ET Q q 0 0 0 rg BT 326.58 156.70 Td (fect future results.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 136.70 Td (As a global company) Tj ET Q q 0 0 0 rg BT 133.55 136.70 Td (, we are subject to taxation in the United States and various other countries and jurisdictions. Significant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 124.70 Td (judgment is required to determine our worldwide tax liabilities. ) Tj ET Q q 0 0 0 rg BT 305.00 124.70 Td (A) Tj ET Q q 0 0 0 rg BT 311.67 124.70 Td ( number of factors may af) Tj ET Q q 0 0 0 rg BT 415.06 124.70 Td (fect our future ef) Tj ET Q q 0 0 0 rg BT 482.34 124.70 Td (fective tax rates ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 112.70 Td (including, but not limited to:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 92.70 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 92.70 Td (changes in our current and future global structure based on the Rofin acquisition and restructuring that involved ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 80.70 Td (significant movement of U.S. and foreign entities;) Tj ET Q endstream endobj 125 0 obj <>] /Rotate 0 /Contents 126 0 R>> endobj 126 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (62) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 742.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 742.10 Td (change in the assessment of the ability to recognize our deferred tax assets and change in the valuation of our deferred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 730.10 Td (tax liabilities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 706.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 706.10 Td (the outcome of discussions with various tax authorities regarding intercompany transfer pricing arrangements;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 682.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 682.10 Td (changes that involve other acquisitions or restructuring or an increased investment in technology outside of the United ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 670.10 Td (States to better align asset ownership and business functions with revenues and profits; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 646.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 646.10 Td (changes in the composition of earnings in countries or states with dif) Tj ET Q q 0 0 0 rg BT 360.54 646.10 Td (fering tax rates;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 622.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 622.10 Td (the resolution of issues arising from tax audits with various tax authorities, and in particular) Tj ET Q q 0 0 0 rg BT 451.96 622.10 Td (, the outcome of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 610.10 Td (German tax audits of our tax returns for fiscal years 201) Tj ET Q q 0 0 0 rg BT 309.50 610.10 Td (1 - 2014 and the U.S. tax audit of our tax return for fiscal year ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 598.10 Td (2013;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 574.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 574.10 Td (adjustments to estimated taxes upon finalization of various tax returns;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 550.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 550.10 Td (increases in expenses not deductible for tax purposes, including impairments of goodwill in connection with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 538.10 Td (acquisitions;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 514.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 514.10 Td (our ability to meet the eligibility requirements for tax holidays of limited time tax-advantage status;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 490.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 490.10 Td (changes in available tax credits;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 466.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 466.10 Td (changes in share-based compensation;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 442.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 442.10 Td (changes in the tax laws or the interpretation of such tax laws, including the Base Erosion Profit Shifting \(BEPS\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 430.10 Td (project being conducted by the Or) Tj ET Q q 0 0 0 rg BT 221.66 430.10 Td (ganization for Economic Co-operation and Development \(OECD\);) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 406.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 406.10 Td (changes in generally accepted accounting principles; and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 382.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 382.10 Td (the repatriation of non-U.S. earnings for which we have not previously provided for U.S. taxes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 362.10 Td (As indicated above, we are engaged in discussions with various tax authorities regarding the appropriate level of profitability ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 350.10 Td (for Coherent entities and this may result in changes to our worldwide tax liabilities. In addition, we are subject to regular ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.10 Td (examination of our income tax returns by the Internal Revenue Service \(IRS\) and other tax authorities. From time to time the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 326.10 Td (United States, foreign and state governments make substantive changes to tax rulesand the application of rulesto companies, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 314.10 Td (including various announcements from the United States government potentially impacting our ability to defer taxes on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 302.10 Td (international earnings. ) Tj ET Q q 0 0 0 rg BT 141.23 302.10 Td (W) Tj ET Q q 0 0 0 rg BT 149.87 302.10 Td (e regularly assess the likelihood of favorable or unfavorable outcomes resulting from these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 290.10 Td (examinations to determine the adequacy of our provision for income taxes. ) Tj ET Q q 0 0 0 rg BT 351.08 290.10 Td (Although we believe our tax estimates are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 278.10 Td (reasonable, there can be no assurance that any final determination will not be materially dif) Tj ET Q q 0 0 0 rg BT 414.46 278.10 Td (ferent than the treatment reflected in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.10 Td (our historical income tax provisions and accruals, which could materially and adversely af) Tj ET Q q 0 0 0 rg BT 410.59 266.10 Td (fect our operating results and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.10 Td (financial condition.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 234.10 Td (Changing laws, regulations and standards relating to corporate governance and public disclosure may create uncertainty ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 222.10 Td (regarding compliance matters.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 198.10 Td (Federal securities laws, rulesand regulations, as well as the rulesand regulations of self-regulatory or) Tj ET Q q 0 0 0 rg BT 456.14 198.10 Td (ganizations such as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 186.10 Td (NASDAQ and the NYSE, require companies to maintain extensive corporate governance measures, impose comprehensive ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 174.10 Td (reporting and disclosure requirements, set strict independence and financial expertise standards for audit and other committee ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 162.10 Td (members and impose civil and criminal penalties for companies and their chief executive of) Tj ET Q q 0 0 0 rg BT 416.69 162.10 Td (ficers, chief financial of) Tj ET Q q 0 0 0 rg BT 512.01 162.10 Td (ficers and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 150.10 Td (directors for securities law violations. ) Tj ET Q q 0 0 0 rg BT 202.61 150.10 Td (These laws, rulesand regulations have increased and will continue to increase the scope, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 138.10 Td (complexity and cost of our corporate governance, reporting and disclosure practices, which could harm our results of operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 126.10 Td (and divert management's attention from business operations. Changing laws, regulations and standards relating to corporate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 114.10 Td (governance and public disclosure may create uncertainty regarding compliance matters. New or changed laws, regulations and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 102.10 Td (standards are subject to varying interpretations in many cases. ) Tj ET Q q 0 0 0 rg BT 299.43 102.10 Td (As a result, their application in practice may evolve over time. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 90.10 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 90.10 Td (e are committed to maintaining high standards of ethics, corporate governance and public disclosure. Complying with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 78.10 Td (evolving interpretations of new or changed legal requirements may cause us to incur higher costs as we revise current practices, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 66.10 Td (policies and procedures, and may divert management time and attention from revenue generating to compliance activities. If ) Tj ET Q endstream endobj 127 0 obj <>] /Rotate 0 /Contents 128 0 R>> endobj 128 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (63) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 742.10 Td (our ef) Tj ET Q q 0 0 0 rg BT 72.92 742.10 Td (forts to comply with new or changed laws, regulations and standards dif) Tj ET Q q 0 0 0 rg BT 361.00 742.10 Td (fer from the activities intended by regulatory or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 730.10 Td (governing bodies due to ambiguities related to practice, our reputation may also be harmed.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 706.10 Td (Governmental regulations, including duties, af) Tj ET Q q 0 0 0 rg BT 242.12 706.10 Td (fecting the import or export of products could negatively af) Tj ET Q q 0 0 0 rg BT 484.42 706.10 Td (fect our net sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 682.10 Td (The United States and many foreign governments impose tarif) Tj ET Q q 0 0 0 rg BT 298.70 682.10 Td (fs and duties on the import and export of products, including ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 670.10 Td (some of those which we sell. In particular) Tj ET Q q 0 0 0 rg BT 216.27 670.10 Td (, given our worldwide operations, we pay duties on certain products when they are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 658.10 Td (imported into the United States for repair work as well as on certain of our products which are manufactured by our foreign ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 646.10 Td (subsidiaries. ) Tj ET Q q 0 0 0 rg BT 101.54 646.10 Td (These products can be subject to a duty on the product value. ) Tj ET Q q 0 0 0 rg BT 347.85 646.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 397.76 646.10 Td (, the United States and various foreign ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 634.10 Td (governments have imposed tarif) Tj ET Q q 0 0 0 rg BT 177.89 634.10 Td (fs, controls, export license requirements and restrictions on the import or export of some ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 622.10 Td (technologies, especially encryption technology) Tj ET Q q 0 0 0 rg BT 236.57 622.10 Td (. From time to time, government agencies have proposed additional regulation of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 610.10 Td (encryption technology) Tj ET Q q 0 0 0 rg BT 138.55 610.10 Td (, such as requiring the escrow and governmental recovery of private encryption keys. Governmental ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 598.10 Td (regulation of encryption technology and regulation of imports or exports, or our failure to obtain required import or export ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 586.10 Td (approval for our products, could harm our international and domestic sales and adversely af) Tj ET Q q 0 0 0 rg BT 415.87 586.10 Td (fect our net sales. From time to time ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 574.10 Td (our duty calculations and payments are audited by government agencies. For example, we were audited in South Korea for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 562.10 Td (customs duties and value-added-tax for the period March 2009 to March 2014. ) Tj ET Q q 0 0 0 rg BT 366.73 562.10 Td (W) Tj ET Q q 0 0 0 rg BT 375.37 562.10 Td (e were liable for additional payments, duties, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 550.10 Td (taxes and penalties of $1.6 million, which we paid in the second quarter of fiscal 2016. ) Tj ET Q q 0 0 0 rg BT 398.58 550.10 Td (Any future assessments could have a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 538.10 Td (material adverse ef) Tj ET Q q 0 0 0 rg BT 125.38 538.10 Td (fect on our business or financial position, results of operations, or cash flows.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 514.10 Td (In addition, compliance with the directives of the Directorate of Defense ) Tj ET Q q 0 0 0 rg BT 341.99 514.10 Td (T) Tj ET Q q 0 0 0 rg BT 347.74 514.10 Td (rade Controls \(DDTC\) may result in substantial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 502.10 Td (expenses and diversion of management. ) Tj ET Q q 0 0 0 rg BT 211.12 502.10 Td (Any failure to adequately address the directives of DDTC could result in civil fines or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (suspension or loss of our export privileges, any of which could have a material adverse ef) Tj ET Q q 0 0 0 rg BT 407.55 490.10 Td (fect on our business or financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (position, results of operations, or cash flows.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (Failure to maintain ef) Tj ET Q q 0 0 0 rg BT 140.72 454.10 Td (fective internal controls may cause a loss of investor confidence in the reliability of our financial ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (statements or to cause us to delay filing our periodic reports with the SEC and adversely af) Tj ET Q q 0 0 0 rg BT 422.11 442.10 Td (fect our stock price.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (The SEC, as directed by Section404 of the Sarbanes-Oxley ) Tj ET Q q 0 0 0 rg BT 290.28 418.10 Td (Act of 2002, adopted rulesrequiring public companies to include a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (report of management on internal control over financial reporting in their annual reports on Form10-K that contain an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 394.10 Td (assessment by management of the ef) Tj ET Q q 0 0 0 rg BT 195.66 394.10 Td (fectiveness of our internal control over financial reporting. In addition, our independent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 382.10 Td (registered public accounting firm must attest to and report on the ef) Tj ET Q q 0 0 0 rg BT 318.96 382.10 Td (fectiveness of our internal control over financial reporting. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 370.10 Td (Although we test our internal control over financial reporting in order to ensure compliance with the Section404 requirements, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (our failure to maintain adequate internal controls over financial reporting could result in an adverse reaction in the financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 346.10 Td (marketplace due to a loss of investor confidence in the reliability of our financial statements or a delay in our ability to timely ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 334.10 Td (file our periodic reports with the SEC, which ultimately could negatively impact our stock price.) 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640.17 Td (Form of global performance restricted stock unit agreement under the 201) Tj ET Q q 0 0 0 rg BT 418.64 640.17 Td (1 Equity Incentive Plan) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 610.17 Td (10.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 610.17 Td (Offer letter with Thomas Merk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 580.17 Td (10.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 580.17 Td (Managing director agreement with Thomas Merk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 550.17 Td (10.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 550.17 Td (Fiscal 2016 Variable compensation plan payout scale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 520.17 Td (10.6**) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 520.17 Td (Fiscal 2017 Variable compensation plan payout scale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 490.17 Td (10.7+) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 490.17 Td (Credit ) Tj ET Q q 0 0 0 rg BT 149.94 490.17 Td (Agreement, dated as of November7, 2016, by and among Coherent,Inc., Coherent Holding GmbH, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 480.17 Td (the guarantors from time to time party thereto, the lenders from time to time party thereto, Barclays Bank ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 470.17 Td (PLC, as ) Tj ET Q q 0 0 0 rg BT 156.62 470.17 Td (Administrative ) Tj ET Q q 0 0 0 rg BT 218.56 470.17 Td (Agent and L/C Issuer) Tj ET Q q 0 0 0 rg BT 303.97 470.17 Td (, Bank of ) Tj ET Q q 0 0 0 rg BT 342.86 470.17 Td (America, N.A., as L/C Issuer) Tj ET Q q 0 0 0 rg BT 459.09 470.17 Td (, and ) Tj ET Q q 0 0 0 rg BT 480.85 470.17 Td (The Bank of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 460.17 Td (T) Tj ET Q q 0 0 0 rg BT 128.41 460.17 Td (okyo-Mitsubishi UJF) Tj ET Q q 0 0 0 rg BT 212.90 460.17 Td (,Ltd., as L/C Issuer \(Previously filed as Exhibit 10.1 to Form 8-K filed November 8, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 450.17 Td (2016\)) Tj ET Q 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Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 273.85 718.25 Td (SIGNA) Tj ET Q q 0 0 0 rg BT 304.78 718.25 Td (TURES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 706.25 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 694.25 Td (Pursuant to the requirements of the Securities Exchange ) Tj ET Q q 0 0 0 rg BT 276.05 694.25 Td (Act of 1934, the registrant has duly caused this Report to be signed on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 682.25 Td (its behalf by the undersigned, thereunto duly authorized.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 670.25 Td () Tj ET Q 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 373.5 600.75 m 562.5 600.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 373.5 525.75 m 562.5 525.75 l s BT /F2 1.00 Tf ET q 0 0 0 rg BT 81.00 656.57 Td () Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 357.00 650.48 Td (Coherent,Inc.) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 642.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.00 636.32 Td (\(Registrant\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 81.00 621.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.00 621.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 605.42 Td (Date:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 81.00 605.42 Td (February 9, 2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.00 605.42 Td (/s/:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 605.42 Td (JOHN R. AMBROSEO) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 597.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 597.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 591.32 Td (John R. Ambroseo) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 582.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 582.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 576.32 Td (President and Chief Executive Officer) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 567.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 567.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 561.32 Td (\(Principal Executive Officer\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 81.00 546.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.00 546.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 546.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 530.42 Td (Date:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 81.00 530.42 Td (February 9, 2017) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.00 530.42 Td (/s/:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 530.42 Td (KEVIN PALATNIK) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 522.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 522.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 516.32 Td (Kevin Palatnik) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 507.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 507.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 501.32 Td (Executive Vice President and Chief Financial) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 491.32 Td (Officer) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 81.00 482.56 Td () Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 357.00 482.56 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.00 476.32 Td (\(Principal Financial and Accounting Officer\)) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 137 0 obj <>] /Rotate 0 /Contents 138 0 R>> endobj 138 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 31.60 Td (68) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 267.30 730.25 Td (EXHIBIT) Tj ET Q q 0 0 0 rg BT 309.91 730.25 Td (INDEX ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 718.25 Td () Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 707.75 51.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 707.75 19.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 707.75 442.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 679.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 679.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 679.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 649.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 649.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 649.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 619.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 619.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 619.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 589.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 589.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 589.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 559.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 559.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 559.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 529.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 529.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 529.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 499.75 51.00 -55.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 499.75 19.00 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0.9333333333333333 1 rg /GS0 gs 101.50 147.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 147.75 442.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 117.75 51.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 101.50 117.75 19.00 -15.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 120.50 117.75 442.00 -15.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50.5 694.75 m 101.5 694.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 120.5 694.75 m 562.5 694.75 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 53.00 698.98 Td (ExhibitNo.) Tj ET Q BT /F2 1.00 Tf ET q 0 0 0 rg BT 110.50 697.47 Td () Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 321.20 698.98 Td (Description) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 685.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.00 684.42 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 685.32 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 670.32 Td (10.1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 670.32 Td (Form of global restricted stock unit agreement under the 2011 Equity Incentive Plan) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 640.32 Td (10.2) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 640.32 Td (Form of global performance restricted stock unit agreement under the 2011 Equity Incentive Plan) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 610.32 Td (10.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 610.32 Td (Offer letter with Thomas Merk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 580.32 Td (10.4) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 580.32 Td (Managing director agreement with Thomas Merk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 550.32 Td (10.5) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 550.32 Td (Fiscal 2016 Variable compensation plan payout scale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 520.32 Td (10.6**) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 520.32 Td (Fiscal 2017 Variable compensation plan payout scale) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 490.32 Td (10.7+) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 490.32 Td (Credit Agreement, dated as of November7, 2016, by and among Coherent,Inc., Coherent Holding GmbH,) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 480.32 Td (the guarantors from time to time party thereto, the lenders from time to time party thereto, Barclays Bank) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 470.32 Td (PLC, as Administrative Agent and L/C Issuer, Bank of America, N.A., as L/C Issuer, and The Bank of) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 460.32 Td (Tokyo-Mitsubishi UJF,Ltd., as L/C Issuer \(Previously filed as Exhibit 10.1 to Form 8-K filed November 8,) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 450.32 Td (2016\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 53.00 420.32 Td (31.1) Tj ET Q BT /F1 1.00 Tf ET q 0 0 0 rg BT 104.00 407.51 Td () Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 420.32 Td (Certification of Chief Executive Officer pursuant to Exchange Act Rule13a-14\(a\)/15d-14\(a\)as adopted) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.00 410.32 Td (pursuant to Section302 of the Sarbanes-Oxley Act of 2002.) 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