Mail Stop 6010
December 15,
2005
Via U.S. Mail
Carmen Diersen
Chief Financial Officer
American Medical Systems Holdings, Inc.
10700 Bren Road West
Minnetonka, Minnesota 55343
Re: American Medical Systems Holdings, Inc.
Form 10-K for fiscal year ended January 1, 2005
Filed March 17, 2005
File No. 000-30733
Dear Ms. Diersen:
We have reviewed your filings and have the following
comments.
We have limited our review of your filings to those issues we have
addressed in our comments. Where indicated, we think you should
revise your future filings in response to these comments. If you
disagree, we will consider your explanation as to why our comment
is
inapplicable or a revision is unnecessary. Please be as detailed
as
necessary in your explanation. In some of our comments, we may
ask
you to provide us with information so we may better understand
your
disclosure. After reviewing this information, we may raise
additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comment or on any other
aspects
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
Form 10-K for the Fiscal Year Ended January 1, 2005
Item 8. Financial Statements and Supplementary Data
Note 2. Acquisitions, page F-14
1. We see that you attribute the $31 million allocated to
intangible
assets and the $35 million allocated to in-process research and
development to an independent valuation. Since you attribute the
valuation to an expert, you should identify that expert and
present
their consent in any registration statement incorporating your
Form
10-K. Alternatively, in future filings, you should delete the
reference to the valuation expert and present disclosure
specifically
describing valuation methods and significant assumptions actually
applied in valuing individually material amounts. We will not
object
if you disclose in future filings, if true, that you considered
factors including independent valuations, as long as there is
detailed and specific disclosure about the valuation methods and
assumptions and disclosure that management is responsible for the
amounts recorded for those assets.
2. With respect to the $31 million, tell us and clarify in future
filings how much was allocated to (1) developed technology, (2)
customer relationships and (3) other intangible assets. Also
describe the nature of the developed technology, including why
your
accounting for that asset is appropriate under paragraph 39 of
SFAS
141. Clarify the basis for the ten year life assigned to that
technology.
Form 8-K dated October 27, 2005
3. We note that you present non-GAAP information in an earnings
release furnished on Form 8-K. When you disclose a non-GAAP
measure
in an earnings release furnished on Form 8-K, disclosures about
that
measure should fully conform Item 10(e)(1)(i) to Regulation S-K
and
should also consider the guidance from Question 8 to the FAQ
Regarding the Use of Non-GAAP Financial Measures. Please expand
future earnings releases to more fully conform to that guidance,
including disclosure about:
* The substantive reasons why management believes a non-GAAP
measure
provides useful information to investors;
* The specific manner in which management uses a non-GAAP measure
to
conduct or evaluate its business;
* The economic substance behind management`s decision to use a
non-
GAAP measure; and
* The material limitations associated with the use of a non-GAAP
measure as compared to the use of the most directly comparable
GAAP
measure and the manner in which management compensates for these
limitations when using the non-GAAP measure.
Please note that these disclosures should be specific to each non-
GAAP measure presented.
As appropriate, please respond to these comments within 10
business days or tell us when you will provide us with a response.
Please furnish a cover letter with your amendment that keys your
responses to our comments and provides any requested information.
Detailed cover letters greatly facilitate our review. Please file
your cover letter on EDGAR. Please understand that we may have
additional comments after reviewing your amendment and responses
to
our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision. Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:
* The company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* Staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* The company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.
You may contact Praveen Kartholy at (202) 551-3778 or me at
(202) 551-3605 if you have questions regarding these comments. In
this regard, do not hesitate to contact Brian Cascio, Accounting
Branch Chief, at (202) 551-3676.
Sincerely,
Gary Todd
Reviewing
Accountant
Ms. Carmen Diersen
American Medical Systems Holdings, Inc.
December 15, 2005
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