UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
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 Number:
(Exact name of registrant as specified in its charter)
| ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
(Address of Principal Executive Offices)
(
(Registrant’s telephone number)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
| Trading symbol |
| Name of Exchange on which registered |
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.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ◻ |
| Accelerated filer | ☐ |
| ||
☒ | Smaller reporting company | Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of August 8, 2022, there were
As of August 8, 2022, there were
TABLE OF CONTENTS
2
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q may be forward-looking statements. These forward-looking statements are often, but not always, made through the use of words or phrases such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecasts,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding:
● | our business strategy for our Growth Direct platform and systems; |
● | our future results of operations and financial position, including our expectations regarding revenue, operating expenses and ability to generate cash flow; |
● | our expectations and assumptions related to our future funding requirements and available capital resources, which may be impacted by market uptake of our Growth Direct system, our research and development activities and the expansion of our sales, marketing, manufacturing and distribution capabilities; |
● | our ability to maintain and expand our customer base for our Growth Direct platform and systems; |
● | our exploration of strategic alternatives for the Company; |
● | the effectiveness of enhancements of our sales processes; |
● | the anticipated impact of our restructuring on the Company; |
● | anticipated trends and growth rates in our business and in the markets in which we operate; |
● | our research and development activities and prospective new features, products and product approvals; |
● | our ability to anticipate market needs and successfully develop new and enhanced solutions to meet those needs, including prospective products; |
● | our expectations regarding the potential impact of the ongoing COVID-19 pandemic on our business, operations and the markets in which we and our customers operate; |
● | our expectations regarding the potential impact of inflation and deflation and corresponding fluctuations in interest rates on our business and operating costs; |
● | our ability to adequately protect our intellectual property; and |
● | our ability to hire and retain necessary qualified employees to grow our business and expand our operations. |
We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the important factors discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 under the heading “Risk Factors.” The forward-looking statements in this Quarterly Report on Form 10-Q are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.
You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required
3
by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements contained in this Quarterly Report on Form 10-Q, whether as a result of any new information, future events or otherwise.
TRADEMARKS
Solely for convenience, our trademarks and trade names in this report are referred to without the ® and ™ symbols, but such references should not be construed as any indicator that we will not assert, to the fullest extent under applicable law, our rights thereto.
4
PART I —FINANCIAL INFORMATION
Item 1. Financial Statements
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated balance sheets
(Unaudited)
(In thousands, except share and per share amounts)
June 30, | December 31, | |||||
| 2022 |
| 2021 | |||
Assets |
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Current assets: |
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Cash and cash equivalents | $ | | $ | | ||
Short-term investments |
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Accounts receivable |
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Inventory |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Right-of-use assets, net | | — | ||||
Long-term investments | | | ||||
Other long-term assets |
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Restricted cash |
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Total assets | $ | | $ | | ||
Liabilities and Stockholders’ Equity |
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Current liabilities: | ||||||
Accounts payable | $ | | $ | | ||
Accrued expenses and other current liabilities |
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Deferred revenue |
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Lease liabilities, short-term |
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| — | ||
Total current liabilities |
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Deferred rent, long term |
| — |
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Lease liabilities, long-term |
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| — | ||
Other long-term liabilities | | | ||||
Total liabilities |
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Commitments and contingencies (Note 17) |
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Stockholders’ equity: |
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Class A common stock, $ |
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Class B common stock, $ | | | ||||
Preferred stock, $ | ||||||
Additional paid-in capital |
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Accumulated deficit |
| ( |
| ( | ||
Accumulated other comprehensive loss |
| ( |
| ( | ||
Total stockholders’ equity |
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Total liabilities and stockholders’ equity | $ | | $ | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated statements of operations
(Unaudited)
(In thousands, except share and per share amounts)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Revenue: |
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Product revenue | $ | | $ | | $ | | $ | | ||||
Service revenue |
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Non-commercial revenue |
| — |
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| — |
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Total revenue |
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Costs and operating expenses: |
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Cost of product revenue |
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Cost of service revenue |
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Cost of non-commercial revenue |
| — |
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| — |
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Research and development |
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Sales and marketing |
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General and administrative |
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Total costs and operating expenses |
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Loss from operations |
| ( |
| ( |
| ( |
| ( | ||||
Other income (expense): |
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Interest expense |
| ( |
| ( |
| ( |
| ( | ||||
Change in fair value of preferred stock warrant liability |
| — |
| ( |
| — |
| ( | ||||
Other income (expense), net |
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| ( | ||||
Total other income (expense), net |
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| ( |
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| ( | ||||
Loss before income taxes |
| ( |
| ( |
| ( |
| ( | ||||
Income tax (benefit) expense |
| ( |
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| ( |
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Net loss |
| ( |
| ( |
| ( |
| ( | ||||
Accretion of redeemable convertible preferred stock to redemption value |
| — |
| ( |
| — |
| ( | ||||
Cumulative redeemable convertible preferred stock dividends |
| — |
| ( |
| — |
| ( | ||||
Net loss attributable to common stockholders — basic and diluted | ( | ( | ( | ( | ||||||||
Net loss per share attributable to Class A and Class B common stockholders — basic and diluted | ( | ( | ( | ( | ||||||||
Weighted average common shares outstanding — basic and diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
6
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated statements of comprehensive loss
(Unaudited)
(In thousands)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||
Other comprehensive income: |
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Unrealized loss on short-term investments, net of tax |
| ( |
| ( |
| ( |
| ( | ||||
Comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( |
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated statements of stockholders’ equity
(Unaudited)
(In thousands, except share amounts)
Accumulated | ||||||||||||||||||||||||||||
Class A | Class B | Additional | other | |||||||||||||||||||||||||
Preferred stock | Common stock | Common stock | paid-in | Accumulated | comprehensive | |||||||||||||||||||||||
| Shares |
| Amount |
|
| Shares |
| Amount |
| Shares |
| Amount |
| capital |
| deficit |
| loss |
| Total | ||||||||
Balances at December 31, 2021 | — | $ | — | | $ | | | $ | |
| $ | | $ | ( | $ | ( | $ | | ||||||||||
Conversion of Class B common stock to Class A common stock |
| — | — | | | ( | ( | — | — | — | — | |||||||||||||||||
Restricted stock award liability accretion |
| — |
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| — |
| — | — | — | — | | — | — | | ||||||||||||||
Issuance of Class A common stock upon exercise of common stock options | — |
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| — |
| | | — | — | | — | — | | |||||||||||||||
Stock-based compensation expense |
| — |
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| — |
| — | — | — | — | | — | — |
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Net loss | — | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||
Balances at March 31, 2022 | — | $ | — | | $ | | | $ | |
| $ | | $ | ( | $ | ( | $ | | ||||||||||
Restricted stock award liability accretion |
| — |
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| — |
| — | — | — | — | | — | — | | ||||||||||||||
Stock-based compensation expense |
| — |
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| — |
| — | — | — | — | | — | — |
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Net loss | — | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||
Balances at June 30, 2022 |
| — |
| $ | — |
| |
| $ | | |
| $ | |
| $ | |
| $ | ( |
| $ | ( |
| $ | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated statements of stockholders’ deficit
(Unaudited), continued
(In thousands, except share amounts)
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| Accumulated |
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Redeemable convertible | Class A | Class B | Additional | other | ||||||||||||||||||||||||
preferred stock | Common stock | Common stock | paid-in | Accumulated | comprehensive | |||||||||||||||||||||||
| Shares |
| Amount |
|
| Shares |
| Amount |
| Shares |
| Amount |
| capital |
| deficit |
| income (loss) |
| Total | ||||||||
Balances at December 31, 2020 |
| | $ | | | $ | | — | — | $ | | $ | ( |
| $ | |
| $ | ( | |||||||||
Issuance of Series D1 redeemable convertible preferred stock, net of issuance costs of $ |
| | | — | — | — | — | — | — | — |
|
| — | |||||||||||||||
Issuance of Series D2 redeemable convertible preferred stock, net of issuance costs of $ |
| | | — | — | — | — | — | — | — |
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| — | |||||||||||||||
Accretion of redeemable convertible preferred stock to redemption value |
| — | | — | — | — | — | ( | — | — |
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| ( | |||||||||||||||
Cumulative redeemable convertible preferred stock dividends |
| — | | — | — | — | — | ( | — | — |
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| ( | |||||||||||||||
Issuance of Class A common stock upon exercise of common stock options |
| — | — | | | — | — | | — | — |
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Issuance of restricted Class A common stock awards |
| — | — | | | — | — | ( | — | — |
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| — | |||||||||||||||
Stock-based compensation expense |
| — | — | — | — | — | — | | — | — |
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Net loss |
| — | — | — | — | — | — | — | ( | — |
|
| ( | |||||||||||||||
Balances at March 31, 2021 |
| | $ | | | $ | | — | — | $ | | $ | ( |
| $ | |
| $ | ( | |||||||||
Series D1 issuance costs |
| — | ( | — | — | — | — | — | — | — |
|
| — | |||||||||||||||
Series D2 issuance costs |
| — | ( | — | — | — | — | — | — | — |
|
| — | |||||||||||||||
Accretion of redeemable convertible preferred stock to redemption value |
| — | | — | — | — | — | ( | — | — |
|
| ( | |||||||||||||||
Cumulative redeemable convertible preferred stock dividends |
| — | | — | — | — | — | ( | — | — |
|
| ( | |||||||||||||||
Issuance of Class A common stock upon exercise of common stock options |
| — | — | | | — | — | | — | — |
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Stock-based compensation expense |
| — | — | — | — | — | — | | — | — |
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Net loss |
| — | — | — | — | — | — | — | ( | — |
|
| ( | |||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||
Balances at June 30, 2021 |
| |
| $ | |
| | $ | | — | $ | — |
| $ | |
| $ | ( |
| $ | — |
| $ | ( |
The accompanying notes are an integral part of these condensed consolidated financial statements.
9
RAPID MICRO BIOSYSTEMS, INC.
Condensed consolidated statements of cash flows
(Unaudited)
(In thousands)
| Six Months Ended June 30, | |||||
2022 | 2021 | |||||
Cash flows from operating activities: |
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Net loss | $ | ( | $ | ( | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
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Depreciation and amortization expense |
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Stock-based compensation expense |
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Change in fair value of preferred stock warrant liability |
| — |
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Provision recorded for inventory |
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Noncash lease expense |
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Noncash interest expense |
| — |
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Loss (gain) on disposal of property and equipment | | ( | ||||
Accretion on investments |
| ( |
| ( | ||
Other | ( | — | ||||
Changes in operating assets and liabilities |
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Accounts receivable |
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Inventory |
| ( |
| ( | ||
Prepaid expenses and other current assets |
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Other long-term assets |
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| ( | ||
Accounts payable |
| ( |
| ( | ||
Accrued expenses and other current liabilities |
| ( |
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Deferred revenue |
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| ( | ||
Deferred rent, long term |
| — |
| ( | ||
Net cash used in operating activities |
| ( |
| ( | ||
Cash flows from investing activities: |
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Purchases of property and equipment |
| ( |
| ( | ||
Proceeds from sale of property and equipment | — | | ||||
Purchases of investments | ( | — | ||||
Maturity of investments |
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Net cash (used) provided by investing activities |
| ( |
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Cash flows from financing activities: |
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Proceeds from issuance of redeemable convertible preferred stock, net of issuance costs |
| — |
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Proceeds from issuance of Class A common stock upon stock option exercise |
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Proceeds from issuance of restricted Class A stock award |
| — |
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Payments on finance lease obligations | ( | — | ||||
Payments of deferred offering costs |
| — |
| ( | ||
Net cash provided by financing activities |
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Net (decrease) increase in cash, cash equivalents and restricted cash |
| ( |
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Cash, cash equivalents and restricted cash at beginning of period |
| |
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Cash, cash equivalents and restricted cash at end of period | $ | | $ | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
10