SEC – ‘UPLOAD’ from 9/7/05 re: Cynosure Inc – ‘LETTER’

On:  Wednesday, 9/7/05, at 10:43am ET   ·   Private-to-Public:  Filing ¶  –  Release Delayed to:  7/14/06   ·   Accession #:  0-5-46121

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Delayed-Release Comment or Other Letter from the SEC
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: LETTER      Comment or Other Letter from the SEC                   8±    32K 


Mail Stop 6010                                                                  
September 1, 2005                                                   

Michael R. Davin                                                                
Cynosure, Inc.                                                                  
5 Carlisle Road                                                                 
Westford, MA 01886                                                              

Re:     Cynosure, Inc.                                                          
Registration Statement on Form S-1                                  
Filed August 11, 2005                                               
File No. 333-127463                                             

Dear Mr. Davin:                                                                 

We have reviewed your filing and have the following                 
comments.                                                                       
Where indicated, we think you should revise your document 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 comments or any other aspect               
of                                                                              
our review.  Feel free to call us at the telephone numbers listed               
at                                                                              
the end of this letter.                                                         

Cover Page                                                                      
1. Please confirm that any preliminary prospectus you circulate                 
will                                                                            
include all non-Rule 430A information.  This includes the price                 
range                                                                           
and related information based on a bona fide estimate of the                    
public                                                                          
offering price within that range, and other information that was                
left                                                                            
blank throughout the document.  Also, note that we may have                     
additional comments after you file this information.                            

2. Briefly explain that you will have two classes of common stock               
outstanding after this offering and that the class B common stock               
will have enhanced voting rights.  State the percentage of class B              
common stock El.En. will hold after the offering.                               

Summary, page 1                                                                 

3. We note the risk factor on page 14, which states that you                    
derived                                                                         
4-6% of your revenues from your distribution relationship with                  
El.En.                                                                          
for PhotoLight, PhotoSilk and Tri-Active LaserDermology products.               
Briefly describe here which products are responsible for a                      
material                                                                        
portion of your revenues, and expand the Business section to                    
discuss                                                                         
in more detail.                                                                 
4. Provide support for the industry statistics and studies cited                
throughout the filing.  Advise whether the registrant paid Michael              
Moretti/Medical Insight, Inc., and other named sources for the                  
market                                                                          
research, and advise whether each source consented to the                       
reference                                                                       
to its name and the use of its industry data in the filing.                     
5. Briefly define "non-traditional physician customers."                        

Relationship with El.En. S.p.A., page 4                                         
6. Expand to disclose El.En.`s current ownership interest.  Also                
identify any other principal shareholders.                                      
7. Please revise the discussion of the indemnity payments to                    
underwriters to more specifically describe the indemnity                        
provisions                                                                      
of the underwriting agreement underlying your potential liability               
to                                                                              
El.En.  Provide full details in the cross-referenced section or                 
elsewhere.                                                                      
Our Dual Class Capital Structure, page 4                                        
8. Please revise the first sentence to clarify, if true, that you               
presently have only one class of equity security, i.e., common                  
stock.                                                                          

Risk Factors, page 8                                                            

The expense and potential unavailability..., page 12                            

9. Please provide a more detailed discussion in the Business or                 
MD&A                                                                            
section to describe the extent to which your revenues have been                 
adversely affected by the unavailability of malpractice insurance               
coverage for customers using your products.                                     

Risks related to our relationship with El.En., page 13                          

10. At an appropriate place in the prospectus, please provide a                 
detailed discussion of the anticipated ongoing control                          
relationship                                                                    
with El.En.  For example, it is unclear whether and when El.En.`s               
intends to divest itself of the Class B shares, and, if so, how                 
that                                                                            
determination will influence its commercial relationships with                  
you,                                                                            
and potential competitive activities.                                           

If we fail to comply with state laws..., page 19                                

11. Expand to address whether there have been any instances where               
you                                                                             
have been found to have sold your products to other than "licensed              
practitioners."                                                                 

New regulations may limit..., page 20                                           

12. If material, describe recent instances where changing                       
regulation                                                                      
has limited the marketability of your products.                                 
Capitalization, page 25                                                         

13. "Cash and cash equivalents" is not a component of                           
capitalization                                                                  
for purposes of this disclosure.  Please revise to delete that                  
item                                                                            
from the capitalization table.                                                  

Dilution, page 26                                                               

14. We note the bullet at the bottom of the page.  Please expand                
the                                                                             
disclosure to explain how the amounts and percentages in the table              
would change if you assume exercise of all the outstanding stock                
options.                                                                        

15. Reconcile the disclosure in footnotes (1) and (2) with the                  
disclosure under the caption "Stock Issuances" on page 80.                      

Business, page 47                                                               

Overview, page 47                                                               

16. We note your disclosure that you have introduced 11 new                     
products                                                                        
since 2002 and your reference to your "strong reputation                        
established                                                                     
over 14 years."   Please expand the disclosure to discuss in more               
detail the business of the registrant prior to the acquisition by               
El.En.  Also discuss in more detail the comprehensive                           
reorganization                                                                  
that took place in 2003.                                                        

Sales and Marketing, page 58                                                    

17. Discuss customer purchase financing options provided by you or              
third parties.                                                                  

Certain Relationships and Related Party Transactions, page 80                   

18. Reconcile the disclosure here, which states that you issued                 
class                                                                           
B common stock, with disclosure elsewhere, which makes no                       
reference                                                                       
to class B common stock or specifically states that no shares are               
authorized or outstanding.  See, for example, page 25.                          

Description of Capital Stock, page 84                                           

19. Please revise to clarify the term "class B conversion date."                
Is                                                                              
this a specific date?  If not, what will trigger its occurrence?                

Approval Rights of Holders of Class B Common Stock, page 86                     

20. We note the last paragraph under this caption.  Expand the                  
disclosure on pages 5 and 13 to discuss.                                        

21. Reconcile this disclosure with that on page 87, which states,               
"Because of our dual class structure, El.En. will continue to be                
able                                                                            
to control our board of directors even if it owns less than 50% of              
the shares our of (sic) outstanding common stock."                              

Underwriting, page 97                                                           

Electronic Distribution                                                         

22. Identify any members of the underwriting syndicate that will                
engage in any electronic offer, sale or distribution of the shares              
and describe their procedures to us supplementally.  If you become              
aware of any additional members of the underwriting syndicate that              
may engage in electronic offers, sales or distributions after you               
respond to this comment, promptly supplement your response to                   
identify those members and provide us with a description of their               
procedures.                                                                     

Briefly describe any electronic distribution in the filing.                     

Also, in your discussion of the procedures, tell us how your                    
procedures ensure that the distribution complies with Section 5 of              
the Securities Act.  In particular:                                             

- the communications used;                                                      
- the availability of the preliminary prospectus;                               
- the manner of conducting the distribution and sale, such as the               
use                                                                             
of indications of interest or conditional offers; and                           
- the funding of an account and payment of the purchase price.                  

Finally tell us whether you or the underwriters have any                        
arrangements                                                                    
with a third party to host or access your preliminary prospectus                
on                                                                              
the internet.  If so, identify the party and the website, describe              
the material terms of your agreement and provide us with a copy of              
any written agreement.  Provide us also with copies of all                      
information concerning your company or prospectus that has                      
appeared                                                                        
on their website. Again, if you subsequently enter into any such                
arrangements, promptly supplement your response.                                

We may have further comment.                                                    

Financial Statements                                                            

23. Please update the financial statements when required by Rule                
3-12                                                                            
of Regulation S-X.                                                              

Note 1. Summary of Significant Accounting Policies, page F-8                    

Inventory, page F-9                                                             

24. With respect to demonstration equipment not sold within a                   
year,                                                                           
please expand to clarify how you measure the amount transferred to              
fixed assets.  Since this equipment would apparently be considered              
"used," please clarify whether lower of cost or market adjustments              
are necessary, including how those adjustments are measured.                    

Revenue Recognition, page F-10                                                  

25. We see that you distribute products for El.En.. With respect                
to                                                                              
those products, tell us about your consideration of the financial               
reporting guidance from EITF 99-19.                                             
26. We see your extensive use of distributors.  Tell us about the               
significant terms of sales to or through distributors.  Show us                 
that                                                                            
it is appropriate to recognize revenue on transactions with                     
distributors prior to re-sale to third party customers.                         

Note 3. Segment and Geographic Information, page F-15                           

27. Revise to also disclose domestic sales; that is, the amount of              
sales attributed to the United States.  Refer to paragraph 38(a)                
to                                                                              
SFAS 131.                                                                       
28. We note your disclosure of "net assets by geographic area."                 
Please revise to also disclose the amounts of long lived assets by              
geographic area. See paragraph 38(b) of SFAS 131.                               

Note 5. Investment in Sona MedSpa, page F-16                                    

29. Show us how you applied the S-X Rule 3-09 income test in                    
assessing whether financial statements should be provided for the               
investment in Sona MedSpa.                                                      
30. Tell us about the significant terms and conditions of the                   
amended                                                                         
laser placement and revenue sharing arrangement with the new                    
owners                                                                          
of Sona MedSpa.  Clarify how you measure revenues under the                     
arrangement.  Also tell us whether you have continuing service,                 
maintenance or other obligations with respect to the placed                     
equipment. Tell us how these obligations, if any, are considered                
in                                                                              
your revenue practices.                                                         

Note 9. Stock-Based Compensation, page F-19                                     

31. Provide us with an itemized chronological schedule detailing                
each                                                                            
issuance of stock options and warrants for the twelve months ended              
June 30, 2005 and through the date of your response. Include the                
following information for each issuance or grant date:                          
a. Number of shares issued or issuable in the grant,                            
b. Purchase price or exercise price per share,                                  
c. Any restriction or vesting terms,                                            
d. Identity of the recipient and relationship to the company,                   
e. Nature and terms of any concurrent transactions with the                     
recipient,                                                                      
f. Amount of any recorded compensation and,                                     
g. The timing of all offering discussions with your underwriters,               
including possible offering pricing ranges.                                     

Tell us how you determined the fair value of your common shares                 
for                                                                             
stock compensation purposes. Highlight any transactions with                    
unrelated parties believed by management to be particularly                     
evident                                                                         
of an objective fair value per share.  Progressively bridge                     
management`s estimate of fair value per share to the current                    
estimated IPO price per share, and identify all material positive               
and                                                                             
negative events occurring during the period which could reasonably              
contribute to variances in fair value.  Please note that we will                
not                                                                             
conclude our evaluation of your response until you have included                
an                                                                              
offering price in the filing.                                                   

Note 12. Commitments and Contingencies, page F-24                               

32. Expand to also make disclosure about the potential impact of                
pending litigation on results of operations and cash flows.                     
Alternatively, express your assertion in terms of the financial                 
statements taken as a whole.                                                    

Exhibits                                                                        

33. Please include an updated and signed consent from your                      
independent auditors with any amendment.                                        

As appropriate, please amend your registration statement in         
response to these comments.  You may wish to provide us with                    
marked                                                                          
copies of the amendment to expedite our review.  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 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 filing to be certain that the                 
filing includes all information required under the Securities Act               
of                                                                              
1933 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.                                                     

Notwithstanding our comments, in the event the company              
requests                                                                        
acceleration of the effective date of the pending registration                  
statement, it should furnish a letter, at the time of such                      
request,                                                                        
acknowledging that:                                                             

* should the Commission or the staff, acting pursuant to delegated              
authority, declare the filing effective, it does not foreclose the              
Commission from taking any action with respect to the filing;                   

* the action of the Commission or the staff, acting pursuant to                 
delegated authority, in declaring the filing effective, does not                
relieve the company from its full responsibility for the adequacy               
and                                                                             
accuracy of the disclosure in the filing; and                                   

* the company may not assert staff comments and the declaration of              
effectiveness 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 connection with our review of                
your                                                                            
filing or in response to our comments on your filing.                           

We will consider a written request for acceleration of the          
effective date of the registration statement as confirmation of                 
the                                                                             
fact that those requesting acceleration are aware of their                      
respective                                                                      
responsibilities under the Securities Act of 1933 and the                       
Securities                                                                      
Exchange Act of 1934 as they relate to the proposed public                      
offering                                                                        
of the securities specified in the above registration statement.                
We                                                                              
will act on the request and, pursuant to delegated authority,                   
grant                                                                           
acceleration of the effective date.                                             

We direct your attention to Rules 460 and 461 regarding             
requesting acceleration of a registration statement.  Please allow              
adequate time after the filing of any amendment for further review              
before submitting a request for acceleration.  Please provide this              
request at least two business days in advance of the requested                  
effective date.                                                                 

You may contact Patrick Enunwaonye at (202) 551-3545 or Gary        
Todd, accounting reviewer, at (202) 551-3605 if you have questions              
regarding comments on the financial statements and related                      
matters.                                                                        
Please contact Alan Morris at (202) 551-3601 or me at (202) 551-                
3800                                                                            
with any other questions.                                                       

          Sincerely,

            Peggy Fisher
                  Assistant Director

cc.  Corey C. Dufresne (Wilmer Cutler-Boston)                                   
Via FAX (617) 526-5000                                                          

Michael R. Davin                                                                
Cynosure, Inc.                                                                  
September 1, 2005                                                               
Page 9                                                                          

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘UPLOAD’ Filing		Date		Other Filings
Release Delayed to:		7/14/06		CORRESP,  UPLOAD
Filed on:		9/7/05		UPLOAD
		9/1/05		UPLOAD
		8/11/05		S-1,  UPLOAD
		6/30/05		UPLOAD
				List all Filings

1 Previous Filing that this Filing References

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 8/11/05  Cynosure Inc.                     S-1¶                  18:1.9M                                   Bowne of Boston/FA