Nova .(US:NVMI)2026-02-17 12:01Debt and Financing - The company currently has long-term debt consisting of Convertible Senior Notes, with no readily available sources of other short-term or long-term debt financing [316]. Research and Development - The company participates in research and development programs sponsored by the Israeli Innovation Authority, which can provide grants covering up to 55% of pre-approved R&D expenses [323]. - The company has previously entered into a royalty buyout arrangement with the IIA, paying approximately $12.9 million to be released from future royalty payments on certain funds [322]. - The company is involved in European consortia under the Horizon 2020 & Horizon Europe programs, which include specific obligations and potential penalties for non-compliance [319][320]. Revenue Recognition - The company recognizes revenue from sales of advanced process control systems, spare parts, labor hours, and service contracts under ASC 606 [332]. Inventory Management - Inventory is stated at the lower of cost or net realizable value, with periodic evaluations to address slow-moving items and technological obsolescence [335]. Business Combinations - The company allocates purchase price in business combinations to identifiable assets and liabilities based on fair values, with excess recorded as goodwill [336][337]. Tax Compliance - The company is subject to income taxes in multiple jurisdictions, requiring significant judgment in evaluating uncertain tax positions [339]. Manufacturing Compliance - The company must comply with local manufacturing obligations under the Innovation Law, which restricts manufacturing outside of Israel without prior approval [325]. - The company faces potential penalties for non-compliance with the Innovation Law, including mandatory repayment of grants and additional royalties [327].