United States securities and exchange commission logo
July 17, 2020
Nicholas Curtis
Chief Executive Officer
LENSAR, Inc.
2800 Discovery Drive
Orlando FL
32826
Re: LENSAR, Inc.
Draft Registration
Statement on Form 10
Submitted June 19,
2020
CIK No. 0001320350
Dear Mr. Curtis:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form 10 submitted June 19, 2020
Information Statement Summary, page 1
1. Please revise your
summary to provide a more balanced discussion of your company and
products. Balance the
discussion of your strengths on page 3 with an equally prominent
discussion of your
weaknesses. Similarly, balance the discussion of your product benefits
on page 5 with an
equally prominent discussion of any detriments.
Overview, page 2
2. We note your statements
here and throughout your document that your technology
provides improved
visual outcomes, including your statement on page 6 that "several
Nicholas Curtis
FirstName LastNameNicholas Curtis
LENSAR, Inc.
Comapany
July NameLENSAR, Inc.
17, 2020
July 17,
Page 2 2020 Page 2
FirstName LastName
recent studies support the improved outcomes achieved using [y]our
laser system." It is
unclear if your statements are intended to compare your results to
those of your
competitors or traditional cataract surgery. Please revise to clarify.
Statements indicating
that your products are superior to those of your competitors should be
accompanied by
head to head studies. If your statements are intended to convey
superiority to competitors'
products, please provide a description of the head to head studies in
the discussion of your
business. If there are no head to head studies supporting your claim,
please revise your
disclosure to remove any comparisons to such products.
The Transition to Advanced Refractive Cataract Procedures, page 4
3. We note your disclosure that 43% of cataract patients do not achieve
the desired visual
outcome. Please clarify your basis for this statement and clarify
which procedures you
consider to be "advanced procedures".
Questions and Answers About the Separation and Distribution, page 17
4. Please revise the Q&A on page 20 to identify any conditions that may
be waived.
Similarly, revise page 74 and consider providing risk factor
disclosure discussing
potential consequences is certain conditions are waived.
Risk Factors, page 24
5. We note the separation agreement provides that each party will use
commercially
reasonable efforts to remove the other party as guarantor or obligor
with respect to the
first party's obligations or liabilities. To the extent you have not
yet been removed as a
guarantor or obligor on any DPL liabilities, please consider risk
factor disclosure
quantifying the obligation or liability or tell us why you believe
such disclosure is not
warranted.
6. Please consider risk factor disclosure discussing the potential
consequences to your
business if higher unemployment related to COVID-19 results in lower
rates of private
health insurance.
7. Please include a risk factor discussion indicating that the Spin-Off
is not a tax exempt
transaction, which may result in tax liabilities. The discussion
should clarify that any
amounts received in lieu of fractional shares may not be sufficient to
pay taxes resulting
from the transaction.
We cannot be certain that our net operating loss carryforwards will be
available to offset future
taxable income., page 37
8. Please expand your statement indicating your expectation that a
portion of your NOL and
R&D carryforwards will be eliminated at the time of the Prin-Off to
quantify the expected
elimination or to explain how the amount will be determined.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Nicholas Curtis
FirstName LastNameNicholas Curtis
LENSAR, Inc.
Comapany
July NameLENSAR, Inc.
17, 2020
July 17,
Page 3 2020 Page 3
FirstName LastName
Critical Accounting Policies and Significant Estimates
Product and Service Revenue Recognition, page 94
9. Please tell us your consideration of providing more robust critical
accounting policy
disclosures regarding the various judgments and assumptions made in
establishing your
most subjective accounting policies that are deemed critical, as
required by Item
303(a)(3)(ii) of Regulation S-K and SEC Release No. 34-48960. Revise
your disclosures
as appropriate. In revising your revenue recognition policy
disclosures, please include a
discussion of the key assumptions underlying your policies for
recognizing revenue from
your LENSAR system sales and leases, and related extended warranties,
and discuss
the potential events and/or changes in circumstances that could
reasonably be expected to
affect the key assumptions. Address specifics, such as the factors
that affect your
conclusion that the LENSAR system is a distinct performance
obligation, given that,
apparently, your customers cannot derive benefit from the system
without the purchase
of the disposable patient interface device and procedure licenses. In
your response, please
address all significant contract features, such as, for example, your
commitment to use
expanded remote diagnostics to increase system reliability and
encourage surgeon
confidence with the use of the system. Reference for us the paragraphs
within
the authoritative literature that support the critical elements of
your product revenue
recognition accounting policy in your response.
Business
Our Strengths, page 101
10. We note your statement estimating that you achieved 13% worldwide
market share in
femtosecond laser assisted cataract surgery in 2019 based on revenue.
Please provide your
basis for the overall market.
Lensar Laser System, page 109
11. Please identify the third party that conducted the survey ti evaluate
and assess surgeon
perceptions.
Intellectual Property, page 114
12. Please provide the jurisdictions for your foreign patents and the
expiration dates for your
patents.
13. Please update your description of the Patton License to disclose:
each party's rights and obligations under the agreement;
the aggregate amounts made to date;
whether the agreement contemplates royalty payments; and
expiration/termination provisions.
If there are royalty payments, please quantify the royalty rate or
provide a reasonable
range not exceeding 10 percentage points, and disclose when the
royalty provisions
expire. Additionally, file the agreement as an exhibit.
Nicholas Curtis
LENSAR, Inc.
July 17, 2020
Page 4
We also note your reference on page 90 to the licensing of
intellectual property from a
third party for $3.5 million. Please clarify whether this agreement is
the Patton License or
a separate agreement. If it is a separate license, please identify the
party, describe the
material terms and file the agreement or tell us why you believe it is
not required.
Manufacturing , page 114
14. We note your disclosure relating to your sole source suppliers, single
sourced suppliers
and developer and manufacturer of the phacoemulsification component.
Tot eh extent you
are substantially dependent on any agreements with these parties,
please identify them,
describe the material terms and file the agreements as exhibit. If you
believe you are not
substantially dependent on the agreements,please provide us with an
analysis supporting
your belief.
Concentration of Customers, page F-14
15. Please revise to provide the total amount or percentage of revenues
from each major
customer as required by ASC 280-10-50-42 and the percentage or amount
of accounts
receivable for the separate customer accounting for more than 10% of
accounts receivable.
You may contact Ibolya Ignat at 202-551-3636 or Terence O'Brien at
202-551-3355 if
you have questions regarding comments on the financial statements and related
matters. Alan
Campbell at 202-551-4224 or Suzanne Hayes at 202-551-3675 with any other
questions.
FirstName LastNameNicholas Curtis Sincerely,
Comapany NameLENSAR, Inc.
Division of
Corporation Finance
July 17, 2020 Page 4 Office of Life
Sciences
FirstName LastName