UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________



FORM 10‑K



☒  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended December 31, 20142016



OR



☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________to____________



Commission File No. 001-34220

__________________________





3D SYSTEMS CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

_______________  _____________________________



(Registrant’s Telephone Number, Including Area Code): (803) 326‑3900



Securities registered pursuant to Section 12(b) of the Act:





Securities registered pursuant to Section 12(g) of the Act: None

__________________________



Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐



Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒



Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes ☒ No ☐



Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒☐



Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one):





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act.) Yes ☐ No ☒



The aggregate market value of the registrant’s common stock held by non-affiliates of the registrant on June 30, 20142016 was $6,169,912,421.$1,437,534,741. For purposes of this computation, it has been assumed that the shares beneficially held by directors and executive officers of the registrant were “held by affiliates.” This assumption is not to be deemed an admission by these persons that they are affiliates of the registrant.



The number of outstanding shares of the registrant’s common stock as of February 18, 201522, 2017 was 111,210,093.113,163,336.



DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant’s definitive proxy statement for its 20152017 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K.



A

3D SYSTEMS CORPORATION

Annual Report on Form 10‑K for the
Year Ended December 31, 20142016



TABLE OF CONTENTS





This Annual Report on Form 10-K (“Form 10-K”) contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Many of the forward-looking statements are located in Part II, Item 7 of this Form 10-K under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. In many cases, you can identify forward-looking statements by terms such as “believes,” “belief,” “expects,” “may”, “will”, “estimates,” “intends,” “anticipates,” or “plans” or the negative of these terms or other comparable terminology.  Forward-looking statements are based upon management’s beliefs, assumptions and current expectations concerning future events and trends, using information currently available, and are necessarily subject to uncertainties, many of which are outside our control.Although we believe that the expectations reflected in the forward-looking statements are reasonable, forward-looking statements are not, and should not be relied upon as a guarantee of future performance or results, nor will they necessarily prove to be accurate indications of the times at or by which any such performance or results will be achieved. A number of important factors could cause actual results to differ materially from those expressed in or implied by the forward-looking statements.  Factors that might cause such differences include, but are not limited to, those discussed in Part I, Item 1A of this Form 10-K under the heading “Risk Factors.” All subsequent written and oral forward-looking statements attributable to the Company or to individuals acting on our behalf are expressly qualified in their entirety by this discussion. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.

PART I

Item 1. Business



General



3D Systems Corporation (“3D Systems” or the “Company” or “we” or “us”) is a holding company incorporated in Delaware in 1993 that operates through subsidiaries in North America and South America (collectively referred to as “Americas”), Europe and the AmericasMiddle East (collectively referred to as “EMEA”) and the Asia Pacific region (“APAC”), as well as Europe and the Middle East (“EMEA”). We distributemarket our products and services in those areas as well as in other parts of the world. We are a leading global provider ofprovide comprehensive 3D printing centric solutions, and are pioneering 3D printing for everyone. We provide the most advanced and comprehensive 3D design-to-manufacturing solutions, including 3D printers, print materials, software, on demand manufacturing services and cloud sourced custom parts.digital design tools. Our powerful digital thread, a seamless information exchange across design and manufacturing, empowers professionals and consumers everywhere to bring their ideas to life in material choices including plastics, metals, ceramics and edibles. Our leadingprecision healthcare solutionscapabilities include end-to-end simulation, training and planningVirtual Surgical Planning (“VSP™”), and printing of surgical instruments and devices for personalized surgery and patient specific medical and dental devices. Our democratized 3D digital design and inspection products provide seamless interoperability between additive and subtractive manufacturing and incorporate the latest immersive computing technologies. Our products and services replace and complement traditional methods with improved results and reduced time to outcome. These solutions are used to rapidly design, create, communicate, plan, guide, prototype or produce functional parts, devices and assemblies, empoweringsurgical guides and instruments. Our solutions support advanced applications in a wide range of industries including healthcare, aerospace, automotive and durable goods. 3D Systems has a 30 year history of experience and expertise which have proven vital to our development of an ecosystem that enables customers to manufacture the future.optimize product designs, transform workflows, bring innovative products to market and drive new business models.  



Over the past three decades, entire industries have transformed their design-to-manufacturing processes using 3D content-to-print solutions. Companies utilizing 3D printing technology have the freedom to create and manufacture precision products on demand, with no additional cost for complexity or uniqueness. Customers can use our 3D printing solutions to mass customizedesign and locally print what they need, when they need it, often in a more cost effective way, by eliminatingmanufacture complex and unique parts, eliminate expensive tooling, produce parts locally or in small batches and longreduce lead times while significantly reducing the adverse environmental impacts that are often associated with traditional manufacturing.

We pioneered 3D printing and  digital manufacturing with the invention of stereolithography (“SLA”) and the universally used .stl file format almost 30 years ago. Subsequently, we developed selective laser sintering (“SLS”), multi-jet printing (“MJP”), film transfer imaging (“FTI”), color jet printing (“CJP”), direct metal printing (“DMP”) and plastic jet printing (“PJP”) 3D printing technologies. Over the past decades, our customers have strengthened their competitive advantage by embracing our solutionstime to enhance and accelerate their product development cycles and, as our technology has advanced, amarket. A growing number of customers haveare shifting from prototyping applications to also transitioned to direct manufacturingusing 3D printing for production. We believe this shift will be further driven by our continued advancement and innovation of end use parts and custom products. Today, we continue to drive the adoption of large-scale custom manufacturing solutions, including the printing of highly complex end use parts in a variety of aerospace, defense, automotive and healthcare applications worldwide. At the same time, we are democratizing 3D printing solutions by extending thethat improve durability, repeatability, productivity and total cost of operations.

Products

We offer a comprehensive range of our affordable 3D printing solutions to the engineer’s desktop, classroomprinters, print materials, software, haptic devices, scanners and living room. virtual surgical simulators.



3D printers can print almost anything, from patient-specific medical devices to functional aerospacePrinters and automotive parts and from personalized accessories and jewelry to customized toys, art and decor. Materials

Our portfolio of 3D printers ranges from less than $1,000 to over $1 million and includestransform digital data input generated by 3D design software, CAD software or other 3D design tools, into printed parts using several unique print engines that employ proprietary, additive layer by layer building processes with a variety of print materials. We offer a broad range of 3D printing processes designed to meet our customers’ most demanding design, prototyping, testing, tooling, productiontechnologies including Stereolithography (“SLA”), Selective Laser Sintering (“SLS”), Direct Metal Printing (“DMP”), MultiJet Printing (“MJP”) and manufacturing requirements. We also offer proprietary software printer drivers and pre-sale and post-sale services, ranging from applications development and custom engineered production solutions to installation, warranty and maintenance services related to our products.ColorJet Printing (“CJP”), which are discussed in more detail below. 



Our printers utilize a wide range of print materials, the majority of which are proprietary print materials that we develop, blend and market. Our comprehensive range of print materials range from realincludes plastic, nylon, metal, composite, elastomeric, wax, polymeric dental materials and plastic and composites to metal, nylon, and even edibleClass IV bio-compatible materials. We augment and complement our own portfolio of engineered print materials with materials that we develop with or purchase from third parties under private label and distribution arrangements.

We also provide software and haptic and perceptual devices for creativity and design, including 3D digital design, scan-to-CAD, scan-to-print, reverse engineering, inspection, sculpting and medical modeling and simulation applications. Our products provide seamless integration for our customers’ entire workflow from 3D design to fabrication. 

To satisfy our customers’ entire design-to-manufacturing requirements, we also provide custom manufacturing services via Quickparts®, our on-demand cloud printed parts services. Through Quickparts, we offer a broad range of precision parts capabilities produced from a wide range of additive and traditional manufacturing processes and materials.

For

We work closely with our healthcare customers we also offer virtual surgical planningto optimize the performance of our print materials in their applications. Our expertise in materials science and medical modeling services, digitizing scanners,formulation, combined with our process, software and simulation products. Our healthcare digital thread provides seamless workflowequipment, enables us to help our customers select the material that best meets their needs with a comprehensive portfolio of solutions to go from the training room to the operating room, enabling personalized medicineoptimal cost and improved healthcare procedures andperformance results.



Our expertlyAs part of our solutions approach, our currently offered printers, with the exception of direct metal printers, have built-in intelligence to make them integrated, 3D productsclosed systems. For these printers, we furnish print materials specifically designed for use in those printers and services provide a seamless workflow through 3D design and fabrication, transforming the manner in which our customers design, develop and manufacture. We continue to develop new products and services and have expanded our technology platform and 3D ecosystem through internal developments, relationships with third parties and acquisitions. We maintain ongoing product development programs that are focused onpackaged in smart cartridges and delivery systems. These integrated materials are designed to enhance system functionality, productivity, materials shelf life and overall printer reliability, in addition to providing our customers with the most comprehensive portfolio of 3D content-to-print solutions. We are focusing on expanding and enhancing our comprehensive menu of 3D printing centric solutions in areas that we believe represent significant growth opportunities for our business, including the aerospace, automotive, healthcare, education, and consumer marketplaces.

Recent Developments

In October 2014, we entered into a $150.0 million five-year revolving, unsecured credit facility with PNC Bank as Administrative Agent, and certain other lenders. The agreement comprises a revolving loan facility that provides for advances in the initial aggregate principal amount of up to $150.0 million. Subject to certain terms and conditions contained in the agreement, the Company may, at its option and subject to customary conditions, request an increase in the aggregate principal amount available under the credit facility by an additional $75.0 million. 

In November 2014, we revealed several new products and design-to-manufacturing solutions at EuroMold 2014. The ProX 400 direct metal 3D printer is twice as fast as the ProX 300 and features a build area twice as large, and features several factory production enhancements. The ProXTM 800 enhances our SLA technology with new features for greater production efficiency, including revolutionary print head and materialbuilt-in quality management systems, space-saving footprint and easy-to-use operator controls. The ProX 500 Plus builds on our existing ProX 500 by expanding the range of materials, increasing print speeds and providing a higher resolution output. We also introduced new high performance materials for the ProX 500 Plus: DuraForm® ProX™ GF, a glass-filled nylon material formulated for added stiffness and temperature resitance; DuraForm ProX AF+, an alloy-filled nylon with a realistic cast metal appearance, extreme tensile strength and high heat deflection properties; and DuraForm ProX EX, a Nylon material that provides exceptional impact strength, increased durability and remarkable flexibility. We also introduced new materials for the ProJet 1200 Micro-SLA 3D printer that expand applications for dental labs, jewelers, manufacturers, engineers and artists, adding FTX Cast, FTX Gold, FTX Silver, FTX Gray and FTX Clear. New materials showcased for the ProJet 5500X offer another level of versatility with tough, functional-grade, flexible elastomers in black and natural-translucent that result in parts that can be stretched, twisted, mashed and handled to withstand challenging applications without failure or tearing. We also introduced the Capture® Mini, a scan-based design and inspection system for small, precise parts, and 3DSPRINT™, a cloud and desktop-based platform that streamlines workflow by enabling collaboration, storage, access, file management, sharing and printing.

In November 2014, we entered into a definitive agreement to acquire all of the outstanding shares of Cimatron Ltd. (“Cimatron”), a leading provider of integrated 3D CAD/CAM software products and solutions for manufacturing. We completed the acquisition of Cimatron on February 9, 2015. The acquisition of Cimatron adds complementary technology, extends our sales coverage globally and multiplexes cross-selling opportunities.

In November 2014, we completed the acquisition of 70% of the outstanding shares of Robtec, creating 3D Systems Latin America. Headquartered in Sao Paulo, Brazil, Robtec is the largest Latin-American additive manufacturing service bureau and the leading 3D printing and scanning products distributor in the region. With key operations in Brazil, Argentina, Chile, Uruguay and Mexico, and well-established printer and scanner distribution activities, the addition of Robtec provides us with a strong Latin American presence and brings long-term relationships with leading aerospace and automotive companies, including Embraer, Siemens, Volkswagen, Fiat, CenPra, Visteon and Mercedes.

In January 2015, we announced the acquisition of botObjects and we launched the full-color Cube Pro C at CES. This is the first plastic jet printer that is capable of printing in full color. The Cube Pro C is part of our consumer portfolio and is ideal for classroom, home and the engineer’s desktop. The acquisition of botObjects closed in December 2014.

At the International Consumer Electronics Show 2015 in January, we also showcased our new Touch™ haptic 3D stylus, the Ekocycle™ Cube® 3D printer and the CoCoJet™ 3D printer as well as apps, gaming platforms and a variety of lifestyle collections from fashion to food and entertainment. The Touch stylus comes with an OpenHaptics Software Developer Kit for digital design and virtual gaming and is an easy to use, powerful perceptual device that provides a virtual sculpting experience and is ideal for designers, artists, students, gamers and hobbyists. The Ekocycle prints in plastic from recycled post-consumer waste, and was launched in collaboration with The Coca-Cola Company and will.i.am. We are also leading the way in personalized, edible 3D printing and previewed the CoCoJet 3D printer that we are currently developing in collaboration with The Hershey Company, and launched a partnership with the Culinary Institute of America to advance 3D printing in the culinary arts through education, exploration, and experimentation. 

Products

We offer the most comprehensive range of 3D printers, materials, perceptual devices, scanners, software and simulators within the additive manufacturing industry.

3D Printers

Our 3D printers transform digital data input from any format generated by 3D design software, CAD software, or 3D scanning and sculpting devices, to printed parts using ourfully integrated engineered plastic, metal, nylon, rubber, wax and composite print materials.    

Our 3D printers convert our print materials into solid cross-sections, layer by layer, to print the desired fully fused objects, employing one of our proprietary print engines, which are discussed in more detail below. We offer printers capable of making multiple distinct parts at the same time, highly accurate geometries in a wide range of sizes and shapes with a variety of material performance characteristics.workflow solution.



SLA Printers



Our stereolithographySLA 3D printers offerscure liquid resin materials with a wide range of capabilities, including size, speed, accuracy, throughput and surface finish in different formats and price points. Our SLA printers come in a variety of print formats and footprint sizes, from the desktop micro-SLA ProJet 1200laser beam to our extra-large build volume ProX 950. Our SLA printers are designed to quickly and economically produce durable plastic parts with unprecedented surface smoothness, featurehigh resolution, edge definition and tolerances that rival the accuracy of CNC-machinedmachined or molded plastic parts. We offer SLA printers with a wide range of materials, sizes and price points that are well-suited for prototypes, end-use parts, casting patterns and molds, tooling, fixtures and medical models.



OurFor SLA printers, we offer a variety of liquid resin materials under the Accura® brand name. The resins are used fordesigned to mimic specific, engineered thermoplastics and provide a wide varietyrange of characteristics, including tough, durable, clear, castable, polypropylene-like, ABS-like, high-temperature resistant and Class IV bio-compatible materials.

We are also developing a 3D printing technology that utilizes a light-curing process we refer to as our Figure 4 platform. Figure 4 is an ultra-fast additive manufacturing technology in discrete modules, allowing it to be placed into automated assembly lines and integrated with secondary processes, including material recovery, washing, curing and finishing steps. Unlike other photopolymer 3D printing, Figure 4 is capable of manufacturing parts in hybrid materials (multi-mode polymerization) that offer toughness, durability, biocompatibility, high temperature deflection and even elastomeric properties. This opens the door to new end-use applications ranging fromin the fields of healthcare, durable goods, automotive, aerospace to consumer and entertainment and electronics to healthcare, including mass customization of orthodontics, hearing aids and surgical guides and kits.beyond.



SLS Printers



Our selective laser sinteringSLS 3D printers use a laser beam to melt and fuse (sinter) powder-based nylon and engineered plastic and composite print materials to produce very strong and durable parts. Customer uses of our SLS printers include functional test models and end-use parts, which enables our customers to create customized parts economically without tooling. The combination of print materials’ flexibility, part functionalitysuch as housings, machinery components, ducting, tooling, jigs and high throughput of our SLS print engine makes it well suited for rapid manufacturing of durable parts. Our SLS printers are used for applications in various industries, including aerospace, automotive, packaging, industrial machineryfixtures and medical devices.devices and personalized surgery kits and guides. 



DMOur proprietary SLS materials include a range of soft and rigid plastics, nylon and composite materials marketed under the DuraForm®, LaserForm® and CastForm™ brand names. These materials are available in a variety of lightweight, tough, versatile, high temperature, flexible and durable formulations.

DMP Printers



Our direct metal printing 3D printers produce chemically pure, fully dense metal parts, by sinteringDMP solutions use a laser beam to sinter powders in a variety of different metals materialsto produce fully dense parts with outstanding surface finish and ceramic materials. Our DMresolution. We offer DMP printers that can process a wide range of materials and powders, including powdersmaterials with very fine granularity (less than 10 microns), enabling outstanding surface finish and resolution.proven manufacturing applications. We offer direct metal printerssell DMP systems in severalvarious sizes and certain models are optimized for specific metals, including our recently introduced ProX 400, which features the largest build area in its class. Customers use our ProX direct metal printers for dental, medical, aerospacetitanium, stainless steel and automotive applications.

MJP Printers

nickel super alloys. Our multi-jet printing portfolio utilizes jetting head technology to deliver high quality, accurate and tough parts in plastics, wax, and engineered materials. These printers offer the capability to print in ultra-fine resolution for precision parts and to print multiple materials in a single part. Our MJP printers come with a five-year print head warranty and are designed to print high-definition, functional and durable parts for form, fit and function analysis, as well as patterns for casting. Our MJPDMP printers are usedwell-suited for consumer goods,medical and dental implants, aerospace, automotive, and hi-tech and industrial design, medical, dentalapplications, such as conformal cooling, simplifying assemblies, light weight parts, enhanced fluid flow, topology optimization and jewelry applications.

CJP Printers

Our color jet printing solutions produce parts in plastic and ceramic-like materials using powder materials and binders. Our CJP printers produce parts in pixel-by-pixel full color, in the full range of colors. Our CJP printers are ideal for MCAD, architecture, design communication, education, art, consumer goods and medical modeling applications.

FTI Printers

Our film transfer imaging printers use light curing technology to print durable plastic parts with a smooth surface finish and true to design detail. Parts printed on these ProJet printers can be drilled, machined, painted and metal-plated after building and parts can be printed in six different colors. FTI printers are used in desktop printing and functional prototyping applications.

PJP Printers

Our plastic jet printing 3D printers utilize a proven, simple, clean and compact plastic extrusion print engine technology designed for office, home and classroom use. Our PJP printers are engineered to be accurate and affordable and are equipped with up to three compact precision print heads for multi-color, multi-material printing with quick material changeovers and multiple print modes available. PJP printers offer an easy to use interface, enabling fast, multi-color printing in a single build in PLA or ABS plastic or nylon. Our Cube 3D printer is certified kid-safe and offers a plug and play experience, including smart cartridges that include built in extruder nozzles for an easy and reliable consumer printing experience. Cube Pro offers a robust, climate controlled desktop 3D printer with a user friendly, intuitive experience. Our newest PJP printer, the Cube Pro C, is the first in its class to offer full color printing in PLA or ABS plastic. Our PJP printers are ideal for the engineer’s desktop as well as at home and in the classroom use.

Softwareother complex parts.



We offer proprietary software tools for an integrated, seamless digital workflow. We offer software packages and design tools for reverse engineering, inspection and haptic design packages, enabling our customers to open scan data directly in the CAD parametric environment, design in Voxel CAD and sculpt. We also offer intuitive packages designed for students and home users. With the acquisition of Cimatron in February 2015, a leading CAD/CAM provider, we now offer CAD and CAM software packages designed for the manufacturing industry. We also offer proprietary software and drivers embedded within our printers.

Other Products

We offer affordable 3D scanners and perceptual devices to democratize access to 3D content creation and enable seamless integration with our software and 3D printers. We offer scanners in a range of price points and capabilities from compact and ultra-precise professional scanners to affordable, intuitive scanners designed for the consumer and optimized for 3D printing. We also offer haptic devices that enable freeform sculpting and design, which are ideal for artists, designers and healthcare applications.

We also offer 3D virtual reality simulators for medical applications. These 3D simulators expand our healthcare digital thread to offer solutions from the training room all the way to the operating room. We also provide digitizing scanners for medical and mechanical applications.

Materials

As part of our integrated solutions approach, we blend, package and sell proprietary, consumable, engineered plastic, nylon, metal and composite materials under several leading brand names for use in our printers. We market our SLA materials under the Accura® brand, our SLS materials under the DuraForm, CastForm™ and LaserForm™ brands andpowder materials for our MJP, CJP, FTI and micro-SLA printers under the VisiJet brand. We augment and complement our own portfolio of print materials with materials that we purchase from third parties under private label and distribution arrangements.

With the exception of our direct metal printers, our currently offered printers have built-in intelligence that communicates vital processing and quality statistics in real time. For these printers, we furnish integrated print materials that are specifically designed for use in those printers and that are packaged in smart cartridges designed to enhance system functionality, up-time, materials shelf life and overall printer reliability, with the objective of providing our customers with a built-in quality management system and a fully integrated work flow solution.

We work closely with our customers to optimize the performance of our print materials in their applications. Our expertise in print materials formulation, combined with our process, software and equipment design strengths, enables us to help our customers select the print material that best meets their needs and obtain optimal cost and performance results. We also work with third parties to develop different types of print materials designed to meet the needs of our customers.

SLA Materials

We offer a variety of plastic-like performance characteristics and attributes designed to mimic specific, engineered, thermoplastic materials under the Accura® brand name. When used in our SLA printers, our proprietary liquid resins turn into a solid surface one layer at a time, and through an additive building process, all the layers bond and fuse to make a solid part. SLA print materials include general purpose as well as specialized materials and are ideal for fit and form testing, wind tunnel testing, casting, patterns and molds, show models and healthcare applications.  

To further complement and expand the range of materials we offer to our customers, we also distribute SLA materials under recognized third-party brand names.

SLS Materials

Our proprietary selective laser sintering materials and composites includes a range of rigid plastic, elastomeric and nylon materials as well as various composites of these ingredients. Our SLS printers have built-in versatility; therefore, the same printers can be used to process multiple materials.

Our DuraForm laser sintering materials include CastForm and LaserForm proprietary SLS materials. SLS materials are used to create durable, functional end-use parts, prototypes and durable patterns as well as assembly jigs and fixtures. They are also used to produce flexible parts, high-temperature resistant parts, patterns for investment casting, functional tooling such as injection molding tool inserts, and end-use parts for customized advanced manufacturing applications. 

Product designers and developers from major automotive, aerospace and consumer products companies use SLS parts extensively as functional test models, including in harsh test environment conditions. Aerospace and medical companies use our SLS printers to produce end-use parts directly, which enables them to create customized parts economically without tooling.  

DMP Materials

Our direct metal printing materials include very fine metal and ceramic powders. These materials include ceramics,titanium, stainless steels, tool steels, super alloys, non-ferrous alloys, precious metals and alumina. Our DMP printers and materials are used for chemically pure, fully dense, fine feature detail printing of end use parts and patterns in aerospace, automotive and healthcare applications. Super alloys are commonly used in parts of gas turbine engines that are subject to high temperatures and require high strength, high temperature creep resistance, phase stability and oxidation and corrosion resistance. Non-ferrous metals include aluminum and titanium. Precious metals such as gold, silver and platinum and exotic or rare metals such as cobalt, mercury or tungsten can also be processed.aluminum.



VisiJet Print MaterialsMJP Printers



VisiJet print materials consist of a wide range ofOur MJP 3D printers utilize jetting head technology to deliver precise, tough parts with exceptional resolution in tough plastic, compositewax, elastomer and wax materials, including durableengineered materials that provide injection-molded like properties.we sell under the VisiJet plastic materials are used® brand name. MJP printers offer the capability to print in demanding, high end prototyping, casting and manufacturing applications. VisiJetwax printrigid or flexible materials and special dissolvable supportmultiple materials arein one build, making them ideal for directmechanical functional testing, rapid tooling, jigs and fixtures, casting applications such as custom jewelry manufacturing, dental crownspatterns, over-molding and bridge work and other casting and micro-casting applications.medical models.

PJP Print Materials

CJP Printers



Materials for use in our PJPOur CJP 3D printers produce parts from our VisiJet branded, powder-based ceramic-like materials. CJP printers build high-definition, full-color parts that can be sanded, drilled, tapped, painted and electroplated, which further expands the options available for finished part characteristics. CJP printers are ideal for producing models used in mechanical design, healthcare, architecture, education, entertainment and packaging applications.

Software and Related Products

We also provide multi-color, durable, real plastic parts,digital design tools, including polylatic acid (PLA), acrylonitrile butadiene styrene (ABS)software, scanners and polyamide (Nylon).haptic devices. We offer solutions for product design, mold and die design, 3D scan-to-print, reverse engineering, production machining and inspection. These products are designed to enable a more seamless workflow for customers. We also offer proprietary software and drivers embedded within our printers that provide part preparation, part placement, support placement, build platform management and print materials are packaged in proprietary smart cartridgesqueue management.

Other Products

As part of our solutions for precision healthcare, we also offer 3D virtual reality simulators and simulator modules for medical applications. These 3D simulators offer clinicians a variety of properties, including tough polymer materials strong enoughrealistic hands-on experience to master critical skills, prepare for car bumpersupcoming procedures and biodegradable thermoplastics.create patient specific simulations. We also provide digitizing scanners for medical and mechanical applications.



Services



Warranty, Maintenance and Training Services



We provide a variety of customer services, and local application support and field support on a worldwide basis for our products. For our 3D printers and software, we provide these services and field support either directly or through a network of authorized resellers or other sources. We are continuing to expand our reseller channel for our consumer and professional 3D printers and software and to train our resellers to perform installation and maintenance services for our printers.  

The services and field support that we provide includesproducts, including installation of new printers at customers’ sites, printer warranties, several maintenance agreement options and a wide variety ofagreements, periodic hardware upgrades and software updates and performance enhancement packages.updates. We also provide services to assist our customers and resellerspartners in developing new applications for our technologies, to facilitate the use of our technology for the customers’specific applications, to train customers on the use of newly acquiredour printers and to maintain our printers at customers’ sites.

We provide these services and field support either directly or through a network of reseller partners. We employ customer-support sales engineers to support our worldwide customer base, and we are continuing to strengthen and enhance our partner network. We distribute spare parts on a worldwide basis to our customers.



All of our 3D printers are sold with maintenance support that generally covers a warranty period ranging from 90 days to one year. We generally offer service contracts that enable our customers to continue maintenance coverage beyond the initial warranty period. These service contracts are offered with various levels of support and options and are priced accordingly. We employ customer-support sales engineers in North America, South America, in several countries in Europe and in parts of the Asia Pacific region to support our worldwide customer base. As a key element of warranty and service contract maintenance, ourOur service engineers provide regularly scheduled preventive maintenance visits to customer sites. Wesites, and we also provide training to our distributors and resellerspartners to enable them to perform these services.

We distribute spare parts on a worldwide basis to our customers, primarily from locations in the U.S., South America, EMEA and Asia Pacific.



We also offer upgrade kits for certain of our printers that enable our existing customers to take advantage of new or enhanced printer capabilities; however,capabilities. In some cases, we have discontinued upgrade support and maintenance agreements for certain of our older legacy printers.



Quickparts ServicesOn-Demand Solutions



We provide an extensive suite of on-demand parts servicesmanufacturing through our Quickparts branded global network of fulfillment facilities. Our Quickparts service offersfacilities worldwide in the Americas, EMEA and APAC. We provide a broad range of prototyping, production and finishing capabilities for precision plastic and metal parts service capabilities produced fromand tooling with a wide range of 3D printing and traditional materials using a variety of additive and traditional manufacturing processes.  Customers may procure

In addition to the sales of parts, we, and our sales partners, utilize our on-demand parts operation as a complete range of precision parts services using a variety of finishing, moldingsales and casting capabilities. In addition,lead generation tool. Third party preferred service providers and leading service bureaus can also use our on-demand custom parts service as their comprehensive order-fulfillment center.

Consumer Services

In addition to our consumer 3D printers, we offer Cubify, our online hosting and publishing platform providing simple-to-use content creation tools, content downloads, cloud printing services and licensing arrangements and hosting for third parties. In addition to Cubify, weWe also provide consumer serviceson-demand professional 3D scanning, printing and parts production related to the entertainment industry through our Gentle Giant brand. We are continuing to expand our consumer offerings, including partnerships and open software development kit for developers and designers, expanded content and Cubify exclusive designs, and apps to create and modify 3D digital data.brand™.  



Software Services



In addition to our software license products, we offer customers post sale software maintenance, which includes updates and software support for our design, reverse engineeringsoftware products. Our software is sold with maintenance service that generally covers a period of one year. We offer multi-year maintenance contracts that enable our customers to continue maintenance coverage beyond the initial one year period. These software service contracts typically include free software updates and inspection software packages.various levels of technical support.

Healthcare Services



We provideThrough our precision healthcare services, through our Medical Modeling, LayerWisewe provide surgical planning, modeling, prototyping and Simbionix brands. We providemanufacturing services, including printing and finishing of medical and dental devices, models and tools, as well as modeling and design services, including virtual surgical planning (VSP™), printing and finishing of medical study models and devices, including surgical kits, implants and other personalized medical devices.VSP™. We also provide service on our surgical simulators that are sold through Simbionix.under our SimbionixTM brand.



Global Operations



We operate in the Americas, Europe, the Middle EastEMEA and the Asia PacificAPAC regions, and distributemarket our products and services in those areas as well as to other parts of the world. Revenue in countries outside the U.S. accounted for 49.1%, 44.5% and 44.5% of consolidated revenue in the years ended December 31, 2014, 2013 and 2012, respectively.



In maintaining foreign operations outside the U.S., we expose our business to risks inherent in such operations, including currency fluctuations. Information on foreign exchange risk appears in Part I, Item 1A, “Risk Factors”, Part II, Item 7A, “Quantitative and Qualitative Disclosures about Market Risk” and Item 8, “Financial Statements and Supplementary Data,” of this Form 10‑K, which information is incorporated herein by reference.10-K. 



Financial information about geographic areas, including revenue, long-lived assets and cash balances, appears in Note 21 to the Consolidated Financial Statements and in Part I, Item 1A, “Risk Factors”, Part II, Item 7A, “Quantitative and Qualitative Disclosures about Market Risk” and Part II, Item 8, “Financial Statements and Supplementary Data,” of this Form 10-K which information is incorporated herein by reference.(“Consolidated Financial Statements”).



Marketing and Customers



Our sales and marketing strategy focuses on an integrated approach that is directed at providing 3D content-to-printcomprehensive solutions and servicesdesigned to meet customer needs. We use a widefull range of customer needs. This integrated approach includes the salesmarketing and marketing of our entire portfolio of products and services.

Our sales organization is responsible for the sale of all oflead generation tools to promote our products and services on a worldwide basisbasis. Our marketing department supports our global sales organization and for the managementdistribution channels by providing marketing materials, potential sales leads and coordination of our growing network of authorized resellers. With the exception of our online channels and direct Quickparts salespersons, weco-marketing funds.

We sell our productssolutions globally through a direct sales force, partner channel and services primarily through resellers who are supported by our own experiencedin certain geographies, appointed distributors. Our sales organization includes channel managers, direct sales managers consisting of salespersons who workpeople and application engineers throughout the Americas, EMEA and Asia Pacific.  OurAPAC, who are responsible for the sale of products and services and for the management of our network of channel partners.

Additionally, our application engineers provide professional services through pre-sales and post-sales support, and assist existing customers so that they can take advantage ofwith leveraging our latest print materialssolutions and production techniques to improve part quality and machine productivity. This group also leverages our customer contacts to help identify new application opportunities that utilizeapplications and sales opportunities. Our on-demand manufacturing service also expands our proprietary processescustomer relationships and access to our Quickparts printing service. As of December 31, 2014, our worldwide sales, application and service staff consisted of 202 employees.

In certain areas of the world where we do not operate directly, we have appointed sales agents and distributors who are authorized to sell our products and services on our behalf. Certain of those agents and distributors also provide services to customers in those geographic areas.  

As a complement to our printers and materials sales, we maintain our Quickparts on demand parts service, a global network of parts printing service locations, which we sell through a direct sales team and our online platform. In addition to providing a comprehensive range of services to customers, Quickparts also provides relationship building and lead generationgenerates leads for future sales of our products.

Our consumer oriented 3D printers, scanners, software, content and services are available online through Cubify and through retail stores and distributors as well as through our reseller channel.sales.  



Our customers include major companies and small and midsize businesses in a broad range of industries, including manufacturers ofhealthcare, automotive, aerospace, computer, electronic,government, defense, technology, electronics, education, consumer energygoods and healthcare products. Purchasers of our printers include original equipment manufacturers (OEM’s), government agencies, universities and other educational institutions, independent service bureaus and individual consumers.energy.  No single customer accounted for more than 10 percent of our consolidated revenue for  the years ended December 31, 2014, 20132016, 2015 or 2012.  2014.  

Production and Supplies

At our Rock Hill, South Carolina location, we assemble MJP, CJP and certain models of our SLA 3D printers, as well as other equipment related to these printers. We assemble certain models of our DMP printers in our Riom, France facility. We produce our Simbionix branded 3D simulators in Airport City, Israel.

Production and Supplies

We assemble our Cube and Cube Pro 3D printers, our ProJet 1000 through 7000 3D printers and other equipment at our Rock Hill, South Carolina facilities. Our ProJet x60 series of 3D printers are assembled at our Andover, Massachusetts location. Our Herndon, Virginia facility produces our Vidar digitizers as well as provides additional Cube 3D printers assembly. Our Simbionix branded 3D simulators are produced in our facility in Airport City, Israel. Our direct metals printers are produced in the U.S. and France.



We outsource certain productionSLA, SLS and DMP printer assembly and refurbishment activities to selected design, engineering and engineeringmanufacturing companies in the United States and suppliers.Belgium. These suppliers also carry out quality control procedures on our printers prior to their shipment to customers. As part of these activities, these suppliers have responsibility for procuring the components and sub-assemblies that are used in our printers.either from us or third party suppliers. We purchase finished printers from these suppliers pursuant to forecasts and customer orders that we supply to them. While the outsourced suppliers of our printers have responsibility for the supply chain and inventory of the components for the printers they assemble, the components, parts and sub-assemblies that are used in our printers are generally available from several potential suppliers.



We produce print materials at our facilities in Andover, Massachusetts;Rock Hill, South Carolina; Barberton, Ohio; Marly Switzerland and Rock Hill, South Carolina.Grüningen, Switzerland. We also have arrangements with third parties who blend certain print materials according to our specifications certain print materials that we sell under our own brand names. As discussed above,names, and we also purchase certain print materials from third parties for resale to our customers.



Our equipment assembly and print materials blending activities, on-demand parts services and certain research and development activities are subject to compliance with applicable federal, state and local provisions regulating the storage, use and discharge of materials into the environment. We believe that we are in compliance, in all material respects, with such regulations as currently in effect and that continued compliance with them will not have a material adverse effect on our capital expenditures, results of operations or consolidated financial position.



Research and Development



The 3D printing industry is experiencingcontinues to experience rapid technological change.change and developments in hardware, software and materials. Consequently, we have ongoing research and development programs to develop new printers and print materialsproducts and to enhance our product linesportfolio of products and services, as well as to improve and expand the capabilities of our printers, print materials and software. These include significant technology platform developments for products, materials and software.solutions. Our development efforts are often augmented by development arrangements with research institutions, customers, suppliers, of material and hardware and the assembly and design firms, that we have engaged to assemble our printers. From time to time, we also engage third party engineering companies and specialty print materials companiescompanies.

Research and development expenses were $88.4 million, $92.8 million and $75.4 million in specific development projects.2016, 2015 and 2014, respectively.



In addition to our internally developed technology platforms, we have acquired products orand technologies developed by others by acquiring business entities that held ownership rights to thesuch products and technologies. In other instances, we have licensed or purchased the intellectual property rights of technologies developed by third parties through licensing agreements that may obligate us to pay a license fee or royalty, typically based upon a dollar amount per unit or a percentage of the revenue generated by such products. As noted below, the amount of such royalties was not material to our results of operations or consolidated financial position for the three-year period ended December 31, 2014.

Research and development expenses were $75.4 million, $43.5 million and $23.2 million in 2014, 2013 and 2012, respectively.

No software development costs from acquisitions were capitalized in 2014. We capitalized $0.3 million of software development costs from acquisitions in 2013. We did not capitalize any software development costs in 2012. See Note 6 to the Consolidated Financial Statements. 



Intellectual Property



We regard our technology platforms and materials as proprietary and seek to protect them through copyrights, patents, trademarks and trade secrets. At December 31, 20142016 and 2013,2015, we held 1,0611,171 and 9731,114 patents worldwide, respectively. At December 31, 2014,2016 and 2015, we also had 262249 and 264 pending patent applications worldwide, including applications covering inventions contained in our recently introduced printers.respectively. The principal issued patents covering aspects of our various technologies will expire at varying times through the year 2027.



WeIn addition, we are also a party to various licenses that have had the effect of broadening the range of the patents, patent applications and other intellectual property available to us.

We have also entered into licensing or cross-licensing arrangements with various companies in the United States and in other countries that enable those companies to utilize our technologies in their products or that enable us to use their technologies in our products. Under certain of these licenses, we are entitled to receive, or we are obligated to pay, royalties for the sale of licensed products in the U.S. or in other countries. The amount of such royalties was not material to our results of operations or consolidated financial position for the three-year period ended December 31, 2014.2016.



We believe that, while our patents and licenses provide us with a competitive advantage, our success also depends primarily on our marketing, business development, and applications know-how and on our ongoing research and development efforts. Accordingly, we believe the expiration of any of the patents, patent applications or licenses discussed above would not be material to our business or financial position.



Competition



We face competition from the development of new technologies or techniques not encompassed by the patents that we own or license and from the conventional technologies.



Our competitors also include other suppliers of 3D printers printand materials, and software, including CAD design and scanningproduction software, tools and scanners, as well as suppliers of forming manufacturing solutions such as vacuum casting equipment. A numberequipment, and suppliers of companies currently sell print materials that compete with those we sell.healthcare simulators.  Numerous suppliers of these products operate both internationally and regionally, and many of them have well-recognized product lines that compete with us in a wide range of our product applications. Our competitors are also companies that manufacture or utilize machines that are used to make models, prototypes, molds and parts. These competitors include suppliers of CNC machines, plastics molding equipment, including injection-molding equipment, traditional machining, milling and grinding equipment, and businesses and service bureaus that use such equipment to produce models, prototypes, and molds and to manufacture parts on demand. Conventional machining, plastic molding and metal casting techniques continue to be the most common methods by which plastic and metal parts and tool inserts are manufactured today.



Competition for most of our 3D printers is based primarily on technology capabilities, process know-how, product application know-how and the ability to provide a full range of products and services to meet customer needs. Accordingly, our ongoing research and development programs are intended to enable us to maintain technological leadership. Certain of the companies producingproviding competing products or providing competingservices, and those currently developing 3D printing products and services, are well established and may have greater financial resources than us.

Our competitors are also companies that manufacture machines that make, or use machines to make, models, prototypes, molds and small-volume to medium-volume manufacturing parts. These competitors include suppliers of CNC, suppliers of plastics molding equipment, including injection-molding equipment, suppliers of traditional machining, milling and grinding equipment, and businesses that use such equipment to produce models, prototypes, molds and manufacturing parts. These conventional machining, plastic molding and metal casting techniques continue to be the most common methods by which plastic and metal parts, models, functional prototypes and metal tool inserts are manufactured today.we have.



We believe that our future success depends on our ability to provide high quality solutions, enhance our existing products and services,portfolio, introduce new products and services on a timely and cost-effective basis, meet changing customer needs, extend our core technologies to new applications and anticipate and respond to emerging standards, business models, service delivery methods and other technological changes.



Employees



At December 31, 2014,2016 and 2015, we had 2,1362,445 and 2,492  full-time employees.employees, respectively.  Although some of our employees outside the U.S. are subject to local statutory employment and labor arrangements, none of our U.S. employees are covered by collective bargaining agreements. We have not experienced any material work stoppages and believe that our relations with our employees are satisfactory.



Available Information



Our website address is www.3DSystems.com.  The information contained on our website is neither a part of, nor incorporated by reference into, this Form 10-K. We make available free of charge through our website our Annual Reports on Form 10‑K, Quarterly Reports on Form 10‑Q, Current Reports on Form 8‑K, amendments to those reports and other documents that we file with the Securities and Exchange Commission (“SEC”), as soon as reasonably practicable after we electronically file them with, or furnish them to, the SEC. In addition, theThe public may read and copy materials we file with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549. Information on the operation of the public reference room can be obtained by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, from which investors can electronically access our SEC filings.



SeveralMany of our corporate governance materials, including our Code of Conduct, Code of Ethics for Senior Financial Executives and Directors, Corporate Governance Guidelines, the current charters of each of the standing committees of the Board of Directors and our corporate charter documents and by-laws are available on our website. 

Executive and Other Officers



The information appearing in the table below sets forth the current position or positions held by each of our executive officers and his or her age as of February 1,  2015.28, 2017. All of our executive officers serve at the pleasure of the Board of Directors. There are no family relationships among any of our executive officers or directors.



We have employed eachMr. Joshi was appointed the Company’s President and Chief Executive Officer, effective April 1, 2016. Prior to joining the Company, Mr. Joshi worked at Hewlett-Packard Company (“HP”) from 1980 until his retirement on March 21, 2012.  From 2001 to 2012, he was Executive Vice President of HP’s Imaging and Printing Group, following two decades of research, engineering and management in HP’s imaging and printing systems. In addition to his service on our Board of Directors, Mr. Joshi currently serves on the individuals inBoard of Directors of Harris Corporation and formerly served on the foregoing table, other than Theodore A. Hull, Mark W. WrightBoard of Directors at Yahoo! Inc. and David R. Styka, for more than five years.Wipro Ltd.



Mr. Hull assumedis a founder of the roleCompany and has served on our Board of Directors since 1993.  He has served as Chief Technology Officer since 1997 and as Executive Vice President since 2000. He has also previously served in various other executive capacities at the Company since 1986, including Chief Executive Officer, Vice Chairman of the Board of Directors and President and Chief Financial Officer on November 4, 2014.  Operating Officer.

Mr. Hull’s career spans more than three decades of progressing financial leadership roles in high-tech companies and sector leaders including Cisco, Maxtor and IBM. Most recently, heJohnson has served as Executive Vice President and Chief FinancialLegal Officer of Fusion-io, a provider of advanced flash storage solutions,since November 2014.  He served as Interim President and Chief Executive Officer, Chief Legal Officer and Secretary from December 2013 until the company's purchase by SanDisk Corporation in July 2014. Mr. Hull servedOctober 2015 to April 2016 and as Vice President, Finance at Cisco Systems, Inc. a manufacturer of IP networking productsGeneral Counsel and services,Secretary from 2007April 2012 to September 2013.November 2014.  Previously, he served as Assistant General Counsel and Assistant Secretary.

Dr. McAlea currently serves as Executive Vice President, General Manager, Metals & Healthcare. Dr. McAlea joined the Company in May 2003 and has served in various executive positions since that time. 



Mr. Wright assumed the role ofMcMullen joined 3D Systems as Executive Vice President, and Chief OperatingFinancial Officer in July 2016. From 2014 to 2016, he was Chief Financial Officer of Eastman Kodak Company, a technology company focused on October 27, 2014.imaging. Before that, Mr. Wright joins the Company after an 18-yearMcMullen had a 32 year career at EMC Corporation, a Fortune 500 provider of web-based computing systemsHP and data storage products. Most recently, he servedits acquired companies, including positions as Senior Vice President of Business DevelopmentFinance and Operations – Lenovo, since April 2014. He served as theCorporate Treasurer of HP, Chief OperatingFinancial Officer Flash Product Division from October 2012 to April 2014, served as Senior Vice President, Strategic Operations, IIP Division from January to October 2012, Senior Vice President, Business Operations, Unified Storage Division from January 2011 to January 2012of HP’s Imaging and Printing Group and Vice President Operations and Business Transformation, Unified Storage Division from 2008 to January 2011.

Mr. Styka assumed the role of Vice President and Chief Accounting Officer on January 14, 2015. Mr. Styka joins the Company after serving as Vice President – Finance and Treasurer at Family Dollar Stores, Inc. a value retailer. At Family Dollar, Mr. Styka served as Vice President – FinanceStrategy for Compaq’s Worldwide Sales and Treasurer since April 2014, Vice President – Finance from March 2011 to April 2014, and Divisional Vice President – Tax and Inventory from July 2008 to March 2011. Services Group.



Item 1A. Risk Factors

Forward-Looking Statements 

Certain statements made in this Form 10-K that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include the cautionary statements and risk factors set forth below as well as other statements made in this Form 10-K that may involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from historical results or from any future results or projections expressed or implied by such forward-looking statements.

In addition to the statements set forth below that explicitly describe risks and uncertainties to which our business and our financial condition and results of operations are subject, readers are urged to consider statements in future or conditional tenses or that include terms such as “believes,” “belief,” “expects,” “intends,” “anticipates” or “plans” that appear in this Form 10-K to be uncertain and forward-looking. Forward-looking statements may include comments as to our beliefs, expectations and projections as to future events and trends affecting our business. Forward-looking statements are based upon our beliefs, assumptions and current expectations concerning future events and trends, using information currently available to us, and are necessarily subject to uncertainties, many of which are outside our control. We assume no obligation, and do not intend, to update these forward-looking statements, except as required by applicable law. The factors stated under the heading “Cautionary Statements and Risk Factors” set forth below, as well as other factors, could cause actual results to differ materially from those reflected or predicted in forward-looking statements.

If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary materially from those reflected in or suggested by forward-looking statements. Any forward-looking statement that you read in this Form 10-K reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, financial condition, growth strategy and liquidity. All subsequent written and oral forward-looking statements attributable to us or to individuals acting on our behalf are expressly qualified in their entirety by this discussion. You should specifically consider the factors identified in this Form 10-K, which would cause actual results to differ from those referred to in forward-looking statements.

Cautionary Statements and Risk Factors



The risks and uncertainties described below are not the only risks and uncertainties that we face. Additional risks and uncertainties not currently known to us or that we currently deem not to be material also may impair our business operations, results of operations and financial condition. If any of the risks described below or if any other risks and uncertainties not currently known to us or that we currently deem not to be material actually occurs, our business, results of operations and financial condition could be materially adversely affected. In that event, the trading price of our common stock could decline, and you could lose all or part of your investment in our common stock.  

The risks discussed below also include forward‑looking statements that are intended to provide our current expectations with regard to those risks. There can be no assurance that our current expectations will be met, and our actual results may differ substantially from the expectations expressed in these forward‑looking statements.

We have made, and expect to continue to make, strategic acquisitions that may involve significant risks and uncertainties.  We may not realize the anticipated benefits of past or future acquisitions and integration of these acquisitions may disrupt our business and divert management.

We completed ten acquisitions in 2014. We also intend to continue to evaluate acquisition opportunities in the future in an effort to expand our business and enhance stockholder value. Acquisitions involve certain risks and uncertainties including:

We have experienced rapid and significant growth in our operations, both organically and from acquisitions, and we intend to continue to grow. The adaptation of our infrastructure to our growth will require, among other things, continued development of our financial and management controls and management information systems, management of our sales channel, continued capital expenditures, the ability to attract and retain qualified management personnel and the training of new personnel. We cannot be sure that our infrastructure, systems, procedures, business processes and managerial controls will be adequate to support the significant growth in our operations. Any delays in, or problems associated with, implementing, or transitioning to, new or enhanced systems, procedures, or controls to accommodate and support the requirements of our business and operations and to effectively and efficiently integrate acquired operations may adversely affect our ability to meet customer requirements, manage our product inventory, and record and report financial and management information on a timely and accurate basis. These potential negative effects could prevent us from realizing the benefits of an acquisition transaction or other growth opportunity. In that event, our competitive position, revenues, revenue growth, results of operations and liquidity could be adversely affected, which could, in turn, adversely affect our share price and shareholder value.



We face significant competition in many aspects of our business, which could cause our revenue and gross profit margins to decline. Competition could also cause us to reduce sales prices or to incur additional marketing or production costs, which could result in decreased revenue, increased costs and reduced margins.



We compete for customers with a wide variety of producers of equipment and software for models, prototypes, other three-dimensional objects and end-use parts as well as producers of print materials and services for this equipment. Some of our existing and potential competitors are researching, designing, developing and marketing other types of competitive equipment and software, print materials and services. Certain of these competitors may have financial, marketing, manufacturing, distribution and other resources substantially greater than ours.



We also expect that future competition may arise from the development of allied or related techniques for equipment and print materials that are not encompassed by our patents, from the issuance of patents to other companies that may inhibit our ability to develop certain products and from improvements to existing print materials and equipment technologies.

Some of our patents have recently expired and others will expire in coming years. Upon expiration of those patents, our competitors may introduce products using the technology previously protected by the expired patents whichand those products may have lower prices than those of our products. To compete, we may need to reduce our prices for those products, which could adversely affect our revenues, margins and profitability. Additionally, the expiration of our patents could reduce barriers to entry into additive manufacturing, which could result in the reduction of our sales and earnings potential. If competitors using technology previously protected by our expired patents were to introduce products of inferior quality, our potential customers may view the technology negatively, which would have an adverse effect on our image and reputation and on our ability to compete with systems using other additive fabrication technologies.



We intend to continue to follow a strategy of continuing product development to enhance our position to the extent practicable. We cannot assure you that we will be able to maintain our current position in the field or continue to compete successfully against current and future sources of competition. If we do not keep pace with technological change and introduce new products, we may lose revenue and demand for our products. We also incur significant costs associated with the investment in our product development in furtherance of our strategy that may not result in increased revenue or demand for our products and which could negatively affect our operating results.



We believe that our future success may dependdepends on our ability to deliver products that meet changing technology and customer needs.



Our business may be affected by rapid technological change, changes in user and customer requirements and preferences, frequent new product and service introductions embodying new technologies and the emergence of new standards and practices, any of which could render our existing products and proprietary technology obsolete. Accordingly, our ongoing research and development programs are intended to enable us to maintain technological leadership. We believe that to remain competitive we must continually enhance and improve the functionality and features of our products, services and technologies. However, there is a risk that we may not be able to:













If we are unable to meet changing technology and customer needs, our competitive position, revenue, results of operations and financial condition could be adversely affected.

We have made, and may make in the future, strategic acquisitions that may involve significant risks and uncertainties.  We may not realize the anticipated benefits of past or future acquisitions and integration of these acquisitions may disrupt our business and divert management.

From time to time, we evaluate acquisition candidates that fit our business objectives. For example, in January 2017, we acquired Vertex-Global Holding B.V., a provider of dental materials. Acquisitions involve certain risks and uncertainties, including, among others, the following:

Historically, we have grown organically and from acquisitions, and we intend to continue to grow. Our infrastructure will require, among other things, continued development of our financial and management controls and management information systems, management of our sales channel, continued capital expenditures, the ability to attract and retain qualified management personnel and the training of new personnel. We cannot be sure that our infrastructure, systems, procedures, business processes and managerial controls will be adequate to support the growth in our operations. Any delays in, or problems associated with, implementing, or transitioning to, new or enhanced systems, procedures, or controls to accommodate and support the requirements of our business and operations and to effectively and efficiently integrate acquired operations may adversely affect our ability to meet customer requirements, manage our product inventory, and record and report financial and management information on a timely and accurate basis. These potential negative effects could prevent us from realizing the benefits of an acquisition transaction or other growth opportunity. In that event, our competitive position, revenues, results of operations and financial condition could be adversely affected. 

Our balance sheet contains several categories of intangible assets totaling $841.1 million at December 31, 2014 that we could be required to write off or write down in the future in the event of the impairment of certain of those assets arising from any deterioration in our future performance or other circumstances. Such write-offs or write-downs could adversely impact our future earnings and stock price, and our ability to obtain financing.financing in the future. 



At December 31, 2014,2016, we had $589.5$181.2 million in goodwill capitalized on our balance sheet. Accounting Standards Codification (“ASC”) 350, “Intangibles – Goodwillsheet and Other,” requires that goodwill and some long-lived intangibles be tested for impairment at least annually. In addition, goodwill and intangible assets are tested for impairment at other times as circumstances warrant, and such testing could result in write-downs of some of our goodwill and long‑lived intangibles. Impairment is measured as the excess of the carrying value of the goodwill or intangible asset over the fair value of the underlying asset. A key factor in determining whether impairment has occurred is the relationship between our market capitalization and our book value. Accordingly, we may, from time to time, incur impairment charges, which are recorded as operating expenses when they are incurred and would reduce our net income and adversely affect our operating results in the period in which they are incurred.

As of December 31, 2014, we had $251.6$121.5 million of other intangible assets, net consisting of licenses, patents, and other intangibles that we amortize over time. Any material impairment to any of these items would result in a non-cash charge and would not impactcapitalized on our cash position or cash flows, but such a charge could adversely affect our results of operations and stockholders’ equity and could affect the trading pricebalance sheet, which represented 35.7% of our common stock in the period in which they are incurred.total assets.

As discussed below, we completed several business acquisitions during 2014, 2013 and 2012. The

A majority of theour acquisitions have resulted in our recording additional goodwill on our consolidated balance sheet. This goodwill typically arisesarose because the purchase price for these businesses reflectsreflected a number of factors including the future earnings and cash flow potential of these businesses, the multiples to earnings, cash flow and other factors, such as prices at which similar businesses have been purchased by other acquirers, the competitive nature of the process by which we acquired the business, and the complementary strategic fit and resulting synergies these businesses bring to existing operations.



For additional information, see Notes 6 and 7 to the Consolidated Financial Statements and “Management’s Discussion and AnalysisAs a result of Financial Condition and Resultsour annual impairment testing in 2015, we recorded goodwill impairment charges of Operations—Critical Accounting Policies and Significant Estimates—Goodwill$443.7 million and other intangible assets impairment charges of $93.5 million in the fourth quarter of 2015. The impairment charges were non-cash in nature and long-lived assets.”

Global economic, politicaldid not impact our cash position or cash flows, but such charges, and social conditions may harm our ability to do business, increase our costs and negativelypossible additional charges in the future could adversely affect our stock price.     

results of operations and stockholders’ equity and could adversely affect the trading price of our common stock. We are subjectwill monitor our reporting units in an effort to global economic, politicaldetermine whether events and social conditions that may cause customerscircumstances warrant further interim impairment testing. We could be required to delaywrite off or reduce technology purchases due to economic downturns, volatility in fuel and other energy costs, difficultieswrite down additional amounts in the financial services sector and credit markets, geopolitical uncertainties andfuture in the event of deterioration in our future performance, sustained slower growth or other macroeconomic factors affecting spending behavior. We face risks that may arise from financial difficulties experienced by our suppliers, resellers or customers, including:circumstances.



We may incur substantial costs enforcing or acquiring intellectual property rights and defending against third partythird-party claims as a result of litigation or other proceedings.



In connection with the enforcement of our own intellectual property rights, the acquisition of third-party intellectual property rights or disputes related to the validity or alleged infringement of third party intellectual property rights, including patent rights, we have been, are currently and may in the future be, subject to claims, negotiations or complex, protracted litigation. Intellectual property disputes and litigation may be costly and can be disruptive to our business operations by diverting attention and energies of management and key technical personnel, and by increasing our costs of doing business. Although we have successfully defended or resolved past litigation and disputes, we may not prevail in any ongoing or future litigation and disputes.disputes, which could adversely affect our results of operations and financial condition.  



Third-party intellectual property claims asserted against us could subject us to significant liabilities, require us to enter into royalty and licensing arrangements on unfavorable terms, prevent us from assembling or licensing certain of our products, subject us to injunctions restricting our sale of products, cause severe disruptions to our operations or the marketplaces in which we compete or require us to satisfy indemnification commitments with our customers including contractual provisions under various license arrangements. In addition, we may incur significant costs in acquiring the necessary third-party intellectual property rights for use in our products. Any of these could seriously harm our business.



We may not be able to protect our intellectual property rights and confidential information, including our digital content, from third-party infringers or unauthorized copying, use or disclosure.



Although we defend our intellectual property rights and endeavor to combat unlicensed copying and use of our digital content and intellectual property rights through a variety of techniques, preventing unauthorized use or infringement of our rights (“piracy attacks”) is inherently difficult. If our intellectual property becomes subject to piracy attacks, they may harm our business.

Additionally, we endeavor to protect the secrecy of our digital content, confidential information and trade secrets. If unauthorized disclosure of our trade secrets occurs, we could potentially lose trade secret protection. The loss of trade secret protection could make it easier for third parties to compete with our products by copying previously confidential features, which could adversely affect our business, results of operations, revenue and operating margins. We also seek to protect our confidential information and trade secrets through the use of non-disclosure agreements. However, there is a risk that our confidential information and trade secrets may be disclosed or published without our authorization, and in these situations it may be difficult and/or costly for us to enforce our rights.

Our business could be adversely impacted in the event of a failure of our information technology infrastructure or adversely impacted by a successful cyber-attack.

We have experienced cyber security threats, threats to our information technology infrastructure and unauthorized attempts to gain access to our sensitive information. Prior cyber-attacks directed at us have not had a material impact on our business or financial results; however, this may not continue to be the case in the future. Cyber security assessment analyses undertaken by us have identified and prioritized steps to enhance our cyber security safeguards. We are in the process of implementing these recommendations to enhance our threat detection and mitigation processes and procedures. Despite the implementation of these new safeguards, there can be no assurance that we will adequately protect our information or that we will not experience any future successful attacks. The threats we face vary from attacks common to most industries to more advanced and persistent, highly organized adversaries who target us because of the products and services we provide. If we are unable to protect sensitive information, our customers or governmental authorities could question the adequacy of our threat mitigation and detection processes and procedures. Due to the evolving nature of these security threats, however, the impact of any future incident cannot be predicted.

We may be required to expend significant additional resources to modify our cyber security protective measures, to investigate and remediate vulnerabilities or other exposures or to make required notifications, and we may be subject to litigation and financial losses. These costs related to cyber or other security threats or disruptions may not be fully insured or indemnified by other means. Occurrence of any of these events could adversely affect our internal operations, the services we provide to our customers, our financial results or our reputation; or such events could result in the loss of competitive advantages derived from our research and development efforts or other intellectual property or early obsolescence of our products and services.



If we cease to generate net cash flow from operations and if we are unable to raise additional capital, our financial condition could be adversely affected and we may not be able to execute our growth strategy.



We cannot assure you that we will continue to generate cash from operations or other potential sources to fund future working capital needs and meet capital expenditure requirements.



If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring or incurring additional debt or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to obtain additional capital or refinance any indebtedness will depend on, among other things, the capital markets, our financial condition at such time and the terms and conditions of any such financing or indebtedness. We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations.



During 2014 we carried out one capital markets transaction and received $299.7 million of net proceeds. We also entered into a revolving, unsecured credit facility with PNC Bank, National Association, as Administrative Agent, and certain other lenders party thereto during 2014.  The Credit Agreement comprises a revolving loan facility that provides for advances in the initial aggregate principal amount of up to $150.0 million. From time-to-time we may seek access to additional external sources of capital to fund working capital needs, capital expenditures, acquisitions, and for other general corporate purposes. However, we cannot assure you that capital would be available from external sources such as bank credit facilities, debt or equity financings or other potential sources to fund any of those future needs. 

If our ability to generate cash flow from operations and our existing cash becomes inadequate to meet our needs, our options for addressing such capital constraints include, but are not limited to, (i) obtaining additional debt financing or increasing the limit on our current revolving credit facility, (ii) accessing the public capital markets, or (iii) delaying certain of our existing development projects. If it became necessary to obtain additional debt financing it is likely that such alternatives in the current market environment would be on less favorable terms than we have historically obtained, which could have an adverse impact on our consolidated financial position, results of operations or cash flows.

The lack of additional capital resulting from any inability to generate cash flow from operations or to raise equity or debt financing could force us to substantially curtail or cease operations and would, therefore, have an adverse effect on our business and financial condition. Furthermore, we cannot assure you that any necessary funds, if available, would be available on attractive terms or that they would not have a significantly dilutive effect on our existing stockholders. If our financial condition worsens and we become unable to attract additional equity or debt financing or enter into other strategic transactions, we could become insolvent or be forced to declare bankruptcy, and we would not be able to execute our growth strategy.

Global economic, political and social conditions and financial markets may harm our ability to do business, adversely affect our sales, costs, results of operations and cash flow. 

We are subject to global economic, political and social conditions that may cause customers to delay or reduce technology purchases due to economic downturns, volatility in fuel and other energy costs, difficulties in the financial services sector and credit markets, geopolitical uncertainties and other macroeconomic factors affecting spending behavior. We face risks that may arise from financial difficulties experienced by our suppliers, resellers or customers, including, among others, the following:

Our uneven sales cycle makes planning and inventory management difficult and future financial results less predictable.

Our quarterly sales often have reflected a pattern in which a disproportionate percentage of each quarter’s total sales occurs towards the end of the quarter. This uneven sales pattern makes predicting net revenue, earnings, cash flow from operations and working capital for each financial period difficult, increases the risk of unanticipated variations in our quarterly results and financial condition and places pressure on our inventory management and logistics systems. If predicted demand is substantially greater than orders, there may be excess inventory. Alternatively, if orders substantially exceed predicted demand, we may not be able to fulfill all of the orders received in each quarter and such orders may be cancelled. Depending on when they occur in a quarter, developments such as a systems failure, component pricing movements, component shortages or global logistics disruptions could adversely impact our inventory levels and results of operations in a manner that is disproportionate to the number of days in the quarter affected.



The variety of products that we sell could cause significant quarterly fluctuations in our gross profit margins, and those fluctuations in margins could cause fluctuations in operating income or loss and net income or loss.



We continuously work to expand and improve our products, materials and services offerings, the number of geographic areas in which we operate and the distribution channels we use to reach various target product applications and customers. This variety of products, applications and channels involves a range of gross profit margins that can cause substantial quarterly fluctuations in gross profit and gross profit margins depending upon the mix of product shipments from quarter to quarter. Additionally, the introduction of new products or services may further heighten quarterly fluctuations in gross profit and gross profit margins due to manufacturing ramp-up and start-up costs. We may experience significant quarterly fluctuations in gross profit margins or operating income or loss due to the impact of the mix of products, channels or geographic areas in which we sell our products from period to period. In some quarters, it is possible that our financial performance could be below expectations of analysts and investors. If so, the price of our common stock may be volatile or decline and our cost of capital may increase.

We derive a significant portion of our revenue from business conducted outside the U.S and are subject to the risks of doing business outside the U.S.



For the year ended 2014, 49.1% of our consolidated revenue is derived from customers in countries outside the U.S. There areWe face many risks inherent in conducting business activities outside the U.S. that, unless managed properly, may adversely affect our profitability, including our ability to collect amounts due from customers. While most of our operations outside the U.S. are conducted in highly developed countries, theyour operations could be adversely affected by:by, among others, the following:





















These uncertainties may make it difficult for us and our customers to accurately plan future business activities and may lead our customers in certain countries to delay purchases of our products and services. More generally, these geopolitical, social and economic conditions could result in increased volatility in global financial markets and economies.



The consequences of terrorism or armed conflicts are unpredictable, and we may not be able to foresee events that could have an adverse effect on our market opportunities or our business. We are uninsured for losses and interruptions caused by terrorism, acts of war and similar events.



While the geographic areas outside the U.S. in which we operate are generally not considered to be highly inflationary, our foreign operations are sensitive to fluctuations in currency exchange rates arising from, among other things, certain intercompany transactions that are generally denominated, for example, in U.S. dollars rather than their respective functional currencies.



Moreover, our operations are exposed to market risk from changes in interest rates and foreign currency exchange rates and commodity prices, which may adversely affect our results of operations and financial condition. We seek to minimize these risks through regular operating and financing activities and, when we consider it to be appropriate, through the use of derivative financial instruments. We do not purchase, holdHowever, our efforts to minimize our exposure to market risks from changes in interest rates, foreign currency exchange rates and commodity prices may prove to be insufficient or sell derivative financial instruments for trading or speculative purposes.unsuccessful.

We depend on our supply chain for components and sub-assemblies used in our 3D printers and other products and for raw materials used in our print materials. If these relationships were to terminate or be disrupted, our business could be disrupted while we locatedlocate alternative suppliers and our expenses may increase.



We  have outsourced the assembly of certain of our printers to third party suppliers, we purchase components and sub-assemblies for our printers from third partythird-party suppliers, and we purchase raw materials that are used in our print materials, as well as certain of those print materials, from third partythird-party suppliers.



While there are several potential suppliers of the components, parts and sub-assemblies for our products, we currently choose to use only one or a limited number of suppliers for several of these components, including our lasers, print materials and certain jetting components. Our reliance on a single or limited number of suppliers involves many risks, including:including, among others, the following:











While we believe that we can obtain all the components necessary for our products from other manufacturers, we require any new supplier to become “qualified” pursuant to our internal procedures, which could involve evaluation processes of varying durations. We generally have our printers and other products assembled based on our internal forecasts and the supply of raw materials, assemblies, components and finished goods from third parties, which are subject to various lead times.  In addition, at any time, certain suppliers may decide to discontinue production of an assembly, component or raw material that we use. Any unanticipated change in the sources of our supplies, or unanticipated supply limitations, could increase production or related costs and consequently reduce margins.



If our forecasts exceed actual orders, we may hold large inventories of slow-moving or unusable parts, which could have an adverse effect on our cash flow, profitability and results of operations. Inversely, we may lose orders if our forecast is low and we are unable to meet demand.



We have engaged selected design and manufacturing companies to assemble certain of our production printers. In carrying out these outsourcing activities, we face a number of risks, including:including, among others, the following:







The costs and effects of litigation, investigations or similar matters involving us or our subsidiaries, or adverse facts and developments related thereto, could materially affect our business, operating results and financial condition.



We sell complex hardware and software products, materials and services that can contain undetected design and manufacturing defects or errors when first introduced or as enhancements are released that, despite testing, are not discovered until after the product has been installed and used by customers. Sophisticated software and applications, such as those sold by us, may contain “bugs” that can unexpectedly interfere with the software’s intended operation. Defects may also occur in components and products we purchase from third parties. There can be no assurance we will be able to detect and fix all defects in the hardware, software, materials and services we sell. Failure to do so could result in lost revenue, product returns, product liability, delayed market acceptance of those products and services, claims from distributors, end-users or others, increased end-user service and support costs, and significant warranty claims and other expenses to correct the defects, diversion of management time and attention and harm to our reputation.

Our operations could suffer if we are unable to attract and retain key management or other key employees.



Our success depends upon the continued service and performance of our senior management and other key personnel. Our senior executive team is critical to the management of our business and operations, as well as to the development and execution of our strategy. The loss of the services of one or more members of our senior executive team could delay or prevent the successful implementation of our growth strategy, or our commercialization of new applications for our systems or other products, or could otherwise adversely affect our ability to manage our company effectively and carry out our business plan. Members of our senior management team may resign at any time. High demand exists for senior management and other key personnel (including scientific, technical and sales personnel) in the 3D printing industry, and there can be no assurance that we will be able to retain such personnel. We experience intense competition for qualified personnel.

While we intend to continue to provide competitive compensation packages to attract and retain key personnel, some of our competitors for these employees have greater resources and more experience, making it difficult for us to compete successfully for key personnel. If we cannot attract and retain sufficiently qualified technical employees for our research and development and manufacturing operations, we may be unable to achieve the synergies expected from mergers and acquisitions that we may effect from time to time, or to develop and commercialize new products or new applications for existing products. Furthermore, possible shortages of key personnel, including engineers, in the regions surrounding our facilities could require us to pay more to hire and retain key personnel, thereby increasing our costs.



Our products and services may experience quality problems from time to time that can result indecreased sales and operating margin  and harm to our reputation.

We sell complex hardware and software products, materials and services that can contain design and manufacturing defects. Sophisticated software and applications, such  as those sold  by us, may contain “bugs” that can unexpectedly interfere with the software’s intended  operation. Defects may also occur  in components  and products we purchase from third parties.  There can  be  no assurance we will  be able  to detect  and fix all defects  in the hardware,  software, materials and services we sell. Failure  to  do  so could result  in lost revenue, significant warranty and other expenses and harm  to our reputation.

We may be subject to product liability claims, which could result in material expense, diversion of management time and attention and damage to our business reputation.



ProductsThe sale and support of our products entails the risk of product liability claims.From time to time,we may become subject to product liability claims that could lead to significant expenses.  The risk may be heightened when we provide products into certain markets, such as complex as those we offerhealthcare, aerospace and automotive industries.

This risk of product liability claims may contain undetected defectsalso be greater due to the use of certain hazardous chemicals used in the production of certain of our products, including irritants, harmful chemicals and chemicals dangerous to the environment. We may also be subject to claims that our printers have been, or errors when first introduced or as enhancements are releasedmay be used to, create parts that despite testing, are not discovered until afterin compliance with legal requirements or that infringe on the product has been installed and used by customers. This could result in lost revenue, delayed marketplace acceptanceintellectual property rights of the product, claims from customers or others, damage to our reputation and business or significant costs to correct the defect or error.others.



We attempt to include provisions in our agreements with customers that are designed to limit our exposure to potential liability for damages arising from defects or errors in our products.products and other issues. However, the nature and extent of these limitations vary from customer to customer. Their effect is subject to a variety of legal limitations and it is possible that these limitations may not be effective as a result of unfavorable judicial decisions or laws enacted in the future.



The sale and support of our products entails the risk of product liability claims. Any product liability claim brought against us, regardless of its merit, could result in materialsignificant expense, diversion of management time and attention, damage to our business reputation and failure to retain existing customers or to attract new customers.

We face risks Although we maintain product liability insurance, such insurance is subject to deductibles and there is no guarantee that such insurance will be available or adequate to protect against all such claims. Costs or payments made in connection with changes in energy-related expenses.product liability claims could adversely affect our financial condition and results of operations.



We and our suppliers depend on various energy products in processes used to produce our products. Generally, we acquire products at market prices and do not use financial instruments to hedge energy prices. As a result, we are exposed to market risks related to changes in energy prices. In addition, many of the customers and industries to whom we market our products and services are directly or indirectly dependent upon the cost and availability of energy resources.

Our business and profitability may be adversely affected to the extent that our or our customers’ energy-related expenses increase, both as a result of higher costs of producing, and potentially lower profit margins in selling, our products and services and because increased energy costs may cause our customers to delay or reduce purchases of our products and services.

We rely on our management information systems for inventory management, distribution and other key functions. If our information systems fail to adequately perform these functions, or if we experience an interruption in their operation, our business and operating results could be adversely affected.

The efficient operation of our business is dependent on our management information systems. We rely on our management information systems:systems to, among other things, effectively manage our accounting and financial functions, including maintaining our internal controls; to manage our manufacturing and supply chain processes; and to maintain our research and development data. The failure of our management information systems to perform properly could disrupt our business and product development, which may result in decreased sales, increased overhead costs, excess or obsolete inventory, and product shortages, causing our business and operating results to suffer. Although we take steps to secure our management information systems, including our computer systems, intranet and Internet sites, email and other telecommunications and data networks, the security measures we have implemented may not be effective and our systems may be vulnerable to theft, loss, damage and interruption from a number of potential sources and events, including unauthorized access or security breaches, natural or man-made disasters, cyber-attacks, computer viruses, power loss or other disruptive events. Our reputation and financial condition could be adversely affected if, as a result of a significant cyber event or otherwise, our operations are disrupted or shut down; our confidential, proprietary information is stolen or disclosed; we incur costs or are required to pay fines in connection with stolen customer, employee, or other confidential information; we must dedicate significant resources to system repairs or increase cyber security protection; or we otherwise incur significant litigation or other costs.



Our common stock price has been and may continue to be volatile.

The market price of our common stock has experienced, and may continue to experience, considerable volatility. Between January 1, 2013 and December 31, 2014,  after giving effect to the three-for-two stock split in the nature of a 50% stock dividend that we distributed in February 2013, the trading price of our common stock has ranged from a low of $28.38 per share to a high of $96.42 per share.

Numerous factors could have a significant effect on the price of our common stock, including those described or referred to in this “Risk Factors” section of this Form 10-K, as well as, among other things:

The number of shares of common stock issuable in a stock offering, the issuance of restricted stock awards or the issuance of shares in connection with certain acquisitions or the conversion of the notes could dilute the ownership interest of existing stockholders and may affect the market price for our common stock.

We may issue additional securities, from time to time, as necessary to provide flexibility to execute our growth strategy.  We raised net proceeds of approximately  $299.7 million and $272.1 million through issuances of common stock in 2014 and 2013, respectively.

Our Certificate of Incorporation, as amended, authorizes our issuance of up to a total 220.0 million shares of common stock, of which 112.2 million shares have been issued or are otherwise currently reserved for issuance. Future issuances could have the effect of diluting our earnings per share as well as our existing stockholders’ individual ownership percentages and could lead to volatility in our common stock price.

Additionally, subject to the limitations of our Certificate of Incorporation and applicable law, we are not restricted from issuing additional common stock, including securities that are convertible into or exchangeable for, or that represent the right to receive, common stock. The issuance of additional shares of our common stock in connection with future acquisitions or other issuances of our common stock or convertible securities, including outstanding options, may dilute the ownership interest of our common stockholders.

Sales of a substantial number of shares of our common stock or other equity-related securities in the public market could depress the market price of our common stock and impair our ability to raise capital through the sale of additional equity or equity-linked securities. We cannot predict the effect that future sales of our common stock or other equity-related securities would have on the market price of our common stock.

Our business involves the use of hazardous materials, and we must comply with environmental, health and safety laws and regulations, which can be expensive and restrict how we do business. 

Our business involves the blending, controlled storage, use and disposal of hazardous materials. We and our suppliers are subject to federal, state and local as well as foreign laws and regulations governing the use, manufacture, storage, handling and disposal of these hazardous materials. Although we believe that the safety procedures utilized by us for handling and disposing of these materials comply with the standards prescribed by these laws and regulations, we cannot eliminate the risk of accidental contamination or injury from these materials. In the event of an accident, state, federal or foreign authorities may curtail the use of these materials and interrupt our business operations. If we are subject to any liability as a result of activities involving hazardous materials, our business and financial condition may be adversely affected and our reputation may be harmed.

Regulations related to conflict-free minerals may cause us to incur additional expenses and may create challenges with our customers. 

The Dodd-Frank Wall Street Reform and Consumer Protection Act contains provisions to improve transparency and accountability regarding the use of “conflict” minerals mined from the Democratic Republic of Congo (the “DRC”) and adjoining countries. The SEC has established annual disclosure and reporting requirements for those companies who use “conflict” minerals sourced from the DRC and adjoining countries in their products. These requirements could adversely affect the sourcing, supply and pricing of materials used in our products. As there may be only a limited number of suppliers offering conflict-free minerals, we cannot ensure that we will be able to obtain these conflict-free minerals in sufficient quantities or at competitive prices. Compliance with these requirements may also increase our costs, including costs that may be incurred in conducting due diligence procedures to determine the sources of certain minerals used in our products and other potential changes to products, processes or sources of supply as a consequence of such verification activities. In addition, we may face challenges with our customers if we are unable to sufficiently verify the origins of the minerals used in our products.

Our Board of Directors is authorized to issue up to 5 million shares of preferred stock.

The Board of Directors is authorized to issue up to 5 million shares of preferred stock, none of which is currently issued or outstanding. The Board of Directors is authorized to issue these shares of preferred stock in one or more classes or series without further action of the stockholders and in that regard to determine the issue price, rights, preferences and privileges of any such class or series of preferred stock generally without any further vote or action by the stockholders. The rights of the holders of any outstanding series of preferred stock may adversely affect the rights of holders of common stock.  

Our ability to issue preferred stock gives us flexibility concerning possible acquisitions and financings, but it could make it more difficult for a third party to acquire a majority of our outstanding common stock. In addition, any preferred stock that is issued may have other rights, including dividend rights, liquidation preferences and other economic rights, senior to the common stock, which could have an  adverse effect on the market value of our common stock.

Certain provisions of Delaware law contain anti-takeover provisions that may make it more difficult to effect a change in our control.

Certain provisions of the Delaware General Corporation Law could delay or prevent an acquisition or change in control and the replacement of our incumbent directors and management, even if doing so might be beneficial to our stockholders by providing them with the opportunity to sell their shares, possibly at a premium over the then market price of our common stock. One of these Delaware laws prohibits us from engaging in a business combination with any interested stockholder (as defined in the statute) for a period of three years from the date that the person became an interested stockholder, unless certain conditions are met.

Changes in, or interpretation of, tax rules and regulations may impact our effective tax rate and future profitability. 

We are a U.S. based, multinational company subject to taxation in multiple U.S. and foreign tax jurisdictions. Our future effective tax rates could be adversely affected by changes in statutory tax rates or interpretation of tax rules and regulations in jurisdictions in which we do business, changes in the amount of revenue or earnings in the countries with varying statutory tax rates, or by changes in the valuation of deferred tax assets and liabilities.

In addition, we are subject to audits and examinations of previously filed income tax returns by the Internal Revenue Service (“IRS”) and other domestic and foreign tax authorities. We regularly assess the potential impact of such examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that we expect may result from the current examinations. We believe such estimates to be reasonable; however, there is no assurance that the final determination of any examination will not have an adverse effect on our operating results and financial position. 

We are subject to U.S. and other anti-corruption laws, trade controls, economic sanctions and similar laws and regulations. Our failure to comply with these laws and regulations could subject us to civil, criminal and administrative penalties and harm our reputation. 



Doing business on a worldwide basis requires us to comply with the laws and regulations of the U.S. government and various foreign jurisdictions. These laws and regulations place restrictions on our operations, trade practices, partners and investments.

In particular, our operations are subject to U.S. and foreign anti-corruption and trade control laws and regulations, such as the Foreign Corrupt Practices Act (“FCPA”) and United Kingdom Bribery Act (the “Bribery Act”), export controls and economic sanctions programs, including those administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”), the State Department's Directorate of Defense Trade Controls (“DDTC”), and the Bureau of Industry and Security (“BIS”). As a result of doing business in foreign countries and with foreign customers, we are exposed to a heightened risk of violating anti-corruption and trade control laws and sanctions regulations.



As part of our business, we may deal with state-owned business enterprises, the employees of which are considered foreign officials for purposes of the FCPA’s prohibition on providing anything of value to foreign officials for the purposes of obtaining or retaining business or securing any improper business advantage. In addition, the provisions of the Bribery Act extend beyond bribery of foreign public officials and also apply to transactions with individuals that a government does not employ. Some of the international locations in which we operate lack a developed legal system and have higher than normal levels of corruption. Our continued expansion outside the U.S., including in Brazil, China, India and developing countries, and our development of new partnerships and joint venture relationships worldwide, could increase the risk of FCPA, OFAC or Bribery Act violations in the future.



As an exporter, we must comply with various laws and regulations relating to the export of products and technology from the U.S. and other countries having jurisdiction over our operations. In the U.S., these laws include the International Traffic in Arms Regulations (“ITAR”) administered by the DDTC, the Export Administration Regulations (“EAR”) administered by the BIS and trade sanctions against embargoed countries and destinations administered by OFAC. The EAR governs products, parts, technology and software which present military or weapons proliferation concerns, so-called “dual use” items, and ITAR governs military items listed on the United States Munitions List. Prior to shipping certain items, we must obtain an export license or verify that license exemptions are available. Any failures to comply with these laws and regulations could result in fines, adverse publicity and restrictions on our ability to export our products, and repeat failures could carry more significant penalties. 



Violations of anti-corruption and trade control laws and sanctions regulations are punishable by civil penalties, including fines, denial of export privileges, injunctions, asset seizures, debarment from government contracts and revocations or restrictions of licenses, as well as criminal fines and imprisonment. We have established policies and procedures designed to assist our compliance with applicable U.S. and international anti-corruption and trade control laws and regulations, including the FCPA, the Bribery Act and trade controls and sanctions programs administered by OFAC, the DDTC and BIS, and have trained our employees to comply with these laws and regulations. However, there can be no assurance that all of our employees, consultants, agents or other associated persons will not take actions in violation of our policies and these laws and regulations, andregulations. Additionally, there can be no assurance that our policies and procedures will effectively prevent us from violating these regulations in every transaction in which we may engage or provide a defense to any alleged violation. In particular, we may be held liable for the actions that our joint venture partners take inside or outside of the United States, even though our partners may not be subject to these laws. Such a violation, even if our policies prohibit it, could have an adverse effect on our reputation, business, financial condition and results of operations. In addition, various state and municipal governments, universities and other investors maintain prohibitions or restrictions on investments in companies that do business with sanctioned countries, persons and entities, which could adversely affect our reputation, business, financial condition and results of operations.

Changes in, or interpretation of, tax rules and regulations may impact our effective tax rate and future profitability. 

We are a U.S. based, multinational company subject to taxation in multiple U.S. and foreign tax jurisdictions. Our future effective tax rates could be adversely affected by changes in statutory tax rates or interpretation of tax rules and regulations in jurisdictions in which we do business, changes in the amount of revenue or earnings in the countries with varying statutory tax rates, or by changes in the valuation of deferred tax assets and liabilities.

In addition, we are subject to audits and examinations of previously filed income tax returns by the Internal Revenue Service and other domestic and foreign tax authorities. We regularly assess the potential impact of such examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that we expect may result from the current examinations. We believe such estimates to be reasonable; however, there is no assurance that the final determination of any examination will not have an adverse effect on our operating results and financial position.

Our business involves the use of hazardous materials, and we must comply with environmental, health and safety laws and regulations, which can be expensive and restrict how we do business. 

Our business involves the blending, controlled storage, use and disposal of hazardous materials. We and our suppliers are subject to federal, state and local as well as foreign laws and regulations governing the use, manufacture, storage, handling and disposal of these hazardous materials. Although we believe that the safety procedures utilized by us for handling and disposing of these materials comply with the standards prescribed by these laws and regulations, we cannot eliminate the risk of accidental contamination or injury from these materials. In the event of an accident, local, state, federal or foreign authorities may curtail the use of these materials and interrupt our business operations. If we are subject to any liability as a result of activities involving hazardous materials, our business and financial condition may be adversely affected and our reputation may be harmed.

Our common stock price has been and may continue to be volatile.

The market price of our common stock has experienced, and may continue to experience, considerable volatility. Between January 1, 2015 and December 31, 2016, the trading price of our common stock has ranged from a low of $6.00 per share to a high of $33.97 per share. Numerous factors could have a significant effect on the price of our common stock, including those described or referred to in this “Risk Factors” section of this Form 10-K, as well as, among other things:

Some anti-takeover provisions contained in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

We have provisions in our certificate of incorporation and by-laws each of which could have the effect of rendering more difficult or discouraging an acquisition of the Company deemed undesirable by our Board of Directors. These include provisions:

These provisions, alone or together, could deter or delay hostile takeovers, proxy contests and changes in control or our management. As a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation Law, which prevents some stockholders from engaging in certain business combinations without approval of the holders of substantially all of our outstanding common stock.

Any provision of our certificate of incorporation or by-laws or Delaware law that has the effect of delaying or deterring a change in control of the Company could limit the opportunity for our stockholders to receive a premium for their shares of our stock and also could affect the price that some investors are willing to pay for our stock.

Item 1B. Unresolved Staff Comments



None.

Item 2. Properties



We occupy an 80,000Our headquarters is located in Rock Hill, South Carolina. As of December 31, 2016, we leased 1.1 million square footfeet and owned 0.1 million square feet, primarily located in the U.S., as summarized below.

Our corporate headquarters research and development and manufacturing facility in Rock Hill, South Carolina which we lease pursuant toalso serves as a lease agreement with Lex Rock Hill, LP. After its initial term ending August 31, 2021, the lease provides us with the option to renew the lease for two additional five-year terms as well as the right to cause Lex Rock Hill, LP, subject to certain termsresearch and conditions, to expand the leased premises during the term of the lease,development site. Other major research and development locations include Cary, North Carolina; San Diego, California; Seoul, Korea; Tel Aviv, Israel; Valencia, California and Wilsonville, Oregon, among others.  We believe our existing facilities and equipment are in which case the term of the lease would be extended. The lease is a triple net leasegood operating condition and providesare suitable for the paymentconduct of base rent of approximately $0.7 million annually from 2014 through 2020, with a  rent escalationour business. We will continue to make investments in 2016 through 2021. Under the terms of the lease, we are obligatedcapital equipment as needed to pay all taxes, insurance, utilitiesmeet anticipated demand for our products. See “Item 1. Business – Production and other operating costs with respectSupplies” and Notes 12 and 21 to the leased premises. Pursuant to the termsConsolidated Financial Statements for further discussion of the lease, we exercised the right to purchase the undeveloped land surrounding the leased premises in March 2011. We purchased this 11-acre parcel contiguous to our Rock Hill facility for future expansion and additional facility capacity to continue to expand in-house manufacturing activities for printers and print materials.facilities.

In addition, we own our Lawrenceburg, Tennessee production facility and lease various other facilities throughout the world. The table below summarizes those facilities greater than 10,000 square feet per location.  



Item 3. Legal Proceedings



For information relatingSecurities and Derivative Litigation

The Company and certain of its former executive officers have been named as defendants in a consolidated putative stockholder class action lawsuit pending in the United States District Court for the District of South Carolina. The consolidated action is styled KBC Asset Management NV v. 3D Systems Corporation, et al., Case No. 0:15-cv-02393-MGL. The Amended Consolidated Complaint (the “Complaint”), which was filed on December 9, 2015, alleges that defendants violated the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 10b-5 promulgated thereunder by making false and misleading statements and omissions and that the former officers are control persons under Section 20(a) of the Exchange Act. The Complaint was filed on behalf of stockholders who purchased shares of the Company’s common stock between October 29, 2013, and May 5, 2015 and seeks monetary damages on behalf of the purported class. Defendants filed a motion to legal proceedings, see Note 22 todismiss the Consolidated Financial Statements containedComplaint in Part II, Item 8its entirety on January 14, 2016, which was denied by Memorandum Opinion and Order dated July 25, 2016 (the “Order”). Defendants filed a motion for reconsideration of this Annual Reportthe Order on Form 10-K.August 4, 2016, which was denied by Order dated February 24, 2017.

Nine related derivative complaints have been filed by purported Company stockholders against certain of the Company’s former executive officers and members of its Board of Directors.  The Company is named as a nominal defendant in all nine actions. The derivatives complaints are styled as follows: (1) Steyn v. Reichental, et al., Case No. 2015-CP-46-2225, filed on July 27, 2015 in the Court of Common Pleas for the 16th Judicial Circuit, County of York, South Carolina (“Steyn”); (2) Piguing v. Reichental, et al., Case No. 2015-CP-46-2396, filed on August 7, 2015 in the Court of Common Pleas for the 16th Judicial Circuit, County of York, South Carolina (“Piguing”); (3) Booth v. Reichental, et al., Case No. 15-692-RGA, filed on August 6, 2015 in the United States District Court for the District of Delaware; (4) Nally v. Reichental, et al., Case No. 15-cv-03756-MGL, filed on September 18, 2015 in the United States District Court for the District of South Carolina; (5) Gee v. Hull, et al., Case No. BC-610319, filed on February 17, 2016 in the Superior Court for the State of California, County of Los Angeles (“Gee”); (6) Foster v. Reichental, et al., Case No. 0:16-cv-01016-MGL, filed on April 1, 2016 in the United States District Court for the District of South Carolina; (7) Lu v. Hull, et al., Case No. BC629730, filed on August 5, 2016 in the Superior Court for the State of California, County of Los Angeles (“Lu”); (8) Howes v. Reichental, et al., Case No. 0:16-cv-2810-MGL, filed on August 11, 2016 in the United States District Court for the District of South Carolina; and (9) Ameduri v. Reichental, et al., Case No. 0:16-cv-02995-MGL, filed on September 1, 2016 in the United States District Court for the District of South Carolina. Steyn and Piguing were consolidated into one action styled as In re 3D Systems Corp. Shareholder Derivative Litig., Lead Case No. 2015-CP-46-2225 in the Court of Common Pleas for the 16th Judicial Circuit, County of York, South Carolina. Gee and Lu were consolidated into one action styled as Gee v. Hull, et al., Case No. BC610319 in the Superior Court for the State of California, County of Los Angeles.

The derivative complaints allege claims for breach of fiduciary duty, abuse of control, gross mismanagement, waste of corporate assets and unjust enrichment and seek, among other things, monetary damages and certain corporate governance actions.

All of the derivative complaints listed above have been stayed until the earlier of the close of discovery or the deadline for appealing a dismissal in the KBC Asset Management NV securities class action.  

The Company believes the claims alleged in the putative securities class action and the derivative lawsuits are without merit and intends to defend the Company and its officers and directors vigorously.

Ronald Barranco and Print3D Corporation v. 3D Systems Corporation, et. al.

On August 23, 2013, Ronald Barranco, a former Company employee, filed two lawsuits against the Company and certain officers in the United States District Court for the District of Hawaii. The first lawsuit (“Barranco I”) is captioned Ronald Barranco and Print3D Corporation v. 3D Systems Corporation, 3D Systems, Inc., and Damon Gregoire, Case No. CV 13-411 LEK RLP, and alleges seven causes of action relating to the Company’s acquisition of Print3D Corporation (of which Mr. Barranco was a 50% shareholder) and the subsequent employment of Mr. Barranco by the Company. The second lawsuit (“Barranco II”) is captioned Ronald Barranco v. 3D Systems Corporation, 3D Systems, Inc., Abraham Reichental, and Damon Gregoire, Case No. CV 13-412 LEK RLP, and alleges the same seven causes of action relating to the Company’s acquisition of certain website domains from Mr. Barranco and the subsequent employment of Mr. Barranco by the Company.  Both Barranco I and Barranco II allege the Company breached certain purchase agreements in order to avoid paying Mr. Barranco additional monies pursuant to royalty and earn out provisions in the agreements. The Company and its officers timely filed responsive pleadings on October 22, 2013 seeking, inter alia, to dismiss Barranco I due to a mandatory arbitration agreement and for lack of personal jurisdiction and to dismiss Barranco II for lack of personal jurisdiction.

With regard to Barranco I, the Hawaii district court, on February 28, 2014, denied the Company’s motion to dismiss and its motion to transfer venue to South Carolina for the convenience of the parties. However, the Hawaii court recognized that the plaintiff’s claims are all subject to mandatory and binding arbitration in Charlotte, North Carolina. Because the Hawaii court was without authority to compel arbitration outside of Hawaii, the court ordered that the case be transferred to the district court encompassing Charlotte (the United States District Court for the Western District of North Carolina) so that court could compel arbitration in Charlotte. On April 17, 2014, Barranco I was transferred in to the Western District of North Carolina. Plaintiff filed a demand for arbitration on October 29, 2014. On December 9, 2014, the Company filed its answer to plaintiff’s demand for arbitration. On February 2, 2015, plaintiff filed an amended demand that removed Mr. Gregoire as a defendant from the matter, and on February 4, 2015 the Company filed its amended answer. The parties selected an arbitrator and arbitration took place in June 2015 in Charlotte, North Carolina.

On September 28, 2015, the arbitrator issued a final award in favor of Mr. Barranco with respect to two alleged breaches of contract and implied covenants arising out of the contract.  The arbitrator found that the Company did not commit fraud or make any negligent misrepresentations to Mr. Barranco. Pursuant to the award, the Company is to pay approximately $11.3 million, which includes alleged actual damages of approximately $7.3 million, fees and expenses of approximately $2.3 million and prejudgment interest of approximately $1.7 million. The Company disagrees with the single arbitrator’s findings and conclusions and believes the arbitrator’s decision exceeds his authority and disregards the applicable law. As an initial response, the Company filed a motion for modification on September 30, 2015, based on mathematical errors in the computation of damages and fees. On October 16, 2015, the arbitrator issued an order denying the Company’s motion and sua sponte issuing a modified final award in favor of Mr. Barranco in the same above-referenced amounts, but making certain substantive changes to the award, which changes the Company believes were improper and outside the scope of his authority and the American Arbitration Association rules. On November 20, 2015, the Company filed a motion to vacate the arbitration award in the federal court in the Western District of North Carolina.  Claimants also filed a motion to confirm the arbitration award. A hearing was held on the motions on June 29, 2016 in federal court in the Western District of North Carolina. The court requested supplemental briefing by the parties, which briefs were filed on July 11, 2016.

On August 31, 2016, the court issued an Order granting in part and denying in part Plaintiff’s motion to confirm the arbitration award and for judgment, entering judgment in the principal amount of the arbitration award and denying Plaintiff’s motion for fees and costs.  The court denied the Company’s motion to vacate.  On September 7, 2016, Plaintiff filed a motion to amend the judgment to include prejudgment interest.  The Company opposed that motion and the parties submitted briefing, which is currently pending before the court. On September 28, 2016 the Company filed a motion to alter or amend the judgment.  Plaintiff opposed the motion and the parties submitted briefing, which is currently pending before the court.

Notwithstanding the Company’s right to appeal, given the arbitrator’s decision, the Company recorded an $11.3 million expense provision for this matter in the quarter ended September 30, 2015. The provision is subject to adjustment based on the ultimate outcome of the Company’s appeal. If it is ultimately determined that money is owed following the full appellate process in federal court, the Company intends to fund any amounts to be paid from cash on hand. This amount has been classified as a long-term liability given the customary timeline of an appeals process. The Company will review this classification periodically.

With regard to Barranco II, the Hawaii district court, on March 17, 2014, denied the Company’s motion to dismiss and its motion to transfer venue to South Carolina. However, the Hawaii court dismissed Count II in plaintiff’s complaint alleging breach of the employment agreement.  The Company filed an answer to the complaint in the Hawaii district court on March 31, 2014.  On November 19, 2014, the Company filed a motion for summary judgment on all claims which was heard on January 20, 2015. On January 30, 2015, the court entered an order granting in part and denying in Part the Company’s motion for summary judgment. The Order narrowed the plaintiff’s claim for breach of contract and dismissed the plaintiff’s claims for fraud and negligent misrepresentation. As a result, Messrs. Reichental and Gregoire were dismissed from the lawsuit. The case was tried to a jury in May 2016, and on May 27, 2016 the jury found that the Company was not liable for either breach of contract or breach of the implied covenant of good faith and fair dealing.  Additionally, the jury found in favor of the Company on its counterclaim against Mr. Barranco and determined that Mr. Barranco violated his non-competition covenant with the Company. The Court is expected to order an accounting with respect to the counterclaim.

The Company is involved in various other legal matters incidental to its business. Although the Company cannot predict the results of litigation with certainty, the Company believes that the disposition of these legal matters will not have a material adverse effect on its consolidated results of operations or consolidated financial position.

Item 4. Mine Safety Disclosures



Not applicable.

PART II



Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities



On May 26, 2011, we transferred the listing of our Common Stock toOur common stock is listed on the New York Stock Exchange (“NYSE”) under the trading symbol “DDD.” Prior to that, our Common Stock was listed on The NASDAQ Global Market (“NASDAQ”) and traded under the symbol “TDSC.” The following table sets forth, for the periods indicated, the range of high and low prices of our common stock, $0.001 par value, as quoted on the NYSE, with ticker DDD. In addition, we completed a three-for-two stock split in the form of a 50% stock dividend, effective February 15, 2013, which is reflected in the prices in the table below.NYSE.







As of February 18, 2015,22, 2017, our outstanding common stock was held by approximately 879955  stockholders of record. This figure does not reflect the beneficial ownership of shares held in the nominee name.



Dividends



We do not currently pay, and have not paid, any dividends on our common stock, and we currently intend to retain any future earnings for use in our business. Any future determination as to the declaration of dividends on our common stock will be made at the discretion of the Board of Directors and will depend on our earnings, operating and financial condition, capital requirements and other factors deemed relevant by the Board of Directors, including the applicable requirements of the Delaware General Corporation Law, which provides that dividends are payable only out of surplus or current net profits.



The payment of dividends on our common stock may be restricted by the provisions of credit agreements or other financing documents that we may enter into or the terms of securities that we may issue from time to time.  Currently, no such agreements or documents limit our declaration of dividends or payments of dividends, other than our $150 million five-year revolving, unsecured credit facility with PNC Bank, National Association, which limits the amount of cash dividends that we may pay in any one fiscal year to $30.0 million.



Issuance of Unregistered Securities and Issuer Purchases of Equity Securities



On February 18, 2014, as part of the consideration for the acquisition of the business and assets of Digital PlaySpace, Inc., we issued 0.03 million unregistered shares of 3D Systems Corporation common stock to Digital Playspace, Inc., which represented to us that it was an “Accredited Investor” as defined in Regulation D of the Securities Act of 1933, as amended, in reliance on the private offering exemptions contained in Section 4(2) of the Securities Act of 1933, as amended, and on Regulation D promulgated thereunder. The fair value of the consideration paid for this acquisition, net of cash acquired, was approximately $4.0 million, of which approximately $2.0 million was paid in cash and $2.0 million was paid in unregistered shares of the Company’s common stock.

On April 2, 2014, as part of the consideration for the acquisition of 100% of the shares of Medical Modeling Inc., we issued 0.3 million unregistered shares of 3D Systems Corporation common stock to the sellers of Medical Modeling Inc., each of whom represented to us that he was an “Accredited Investor” as defined in Regulation D of the Securities Act of 1933, as amended, in reliance on the private offering exemptions contained in Section 4(2) of the Securities Act of 1933, as amended, and on Regulation D promulgated thereunder. The fair value of the consideration paid for this acquisition, net of cash acquired, was approximately $69.0 million, of which approximately $51.5 million was paid in cash and $17.5 million was paid in unregistered shares of the Company’s common stock.

On August 6, 2014, as part of the consideration for the acquisition of certain assets of Bordner and Associates, Inc. d/b/a Laser Reproductions,  we issued 0.09 million unregistered shares of 3D Systems Corporation common stock to Bordner and Associates, Inc., which represented to us that it was an “Accredited Investor” as defined in Regulation D of the Securities Act of 1933, as amended, in reliance on the private offering exemptions contained in Section 4(2) of the Securities Act of 1933, as amended, and on Regulation D promulgated thereunder. The fair value of the consideration paid for this acquisition, net of cash acquired, was approximately $17.5 million, of which approximately $13.1 million was paid in cash and $4.4 million was paid in unregistered shares of the Company’s common stock.

We did not repurchase any of our equity securities during the year ended 2014,2016, except for unvested restricted stock awards repurchased or forfeited pursuant to our 2004 and 2015 Incentive Stock Plan. See Note 14 to the Consolidated Financial Statements.Plans. For information regarding the securities authorized for issuance under our equity compensation plans, see “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters – Equity Compensation Plans” under Part III, Item 12.12 of this Form 10-K. Also see Note 14 to the Consolidated Financial Statements.



Issuer purchases of equity securities

Stock Performance Graph



The graph below shows, for the five years ended December 31, 2014,2016, the cumulative total return on an investment of $100 assumed to have been made on December 31, 20092011 in our common stock. For purposes of the graph, cumulative total return assumes the reinvestment of all dividends. The graph compares such return with those of comparable investments assumed to have been made on the same date in (a) the NYSE Composite Index,  (b) the S&P 500 Information Technology Index and (c) the S&P Mid-Cap 400 Index, which are published market indices with which we are sometimes compared.



Although total return for the assumed investment assumes the reinvestment of all dividends on December 31 of the year in which such dividends were paid, we paid no cash dividends on our common stock during the periods presented.



Our common stock is listed on the NYSE (trading symbol: DDD). 



COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN*



*  $100 invested on 12/31/09 in stock or index, including reinvestment of dividends. Fiscal yearyears ending December 31.