Advanced Medical Optics (EYE)

VISX relies upon a small number of customers for a significant portion of its revenues, which makes its financial position and operating results vulnerable to the loss of one of more of these customers.

A significant portion of VISX’s revenues is derived from sales to TLC Vision Corporation, or TLC. Sales to TLC accounted for 16% and 20% of VISX’s total revenues for the three months ended March 31, 2005 and 2004, respectively, and such sales accounted for 17%, 16% and 14% of VISX’s total revenues in 2004, 2003, and 2002, respectively. TLC accounted for 23%, 21%, 22% and 22% of VISX’s total receivables at March 31, 2005 and December 31, 2004, 2003 and 2002. Additionally, Taiwan Hwa-In Corporation accounted for 10% and 12% of VISX’s total receivables at March 31, 2005 and December 31, 2004. These customers are not subject to long-term arrangements obligating them to purchase products from VISX. Should VISX lose a significant customer or if anticipated sales to a significant customer do not materialize, VISX’s business, financial position and results of operations may suffer. In addition, should a significant customer become unable to pay balances owed, VISX would have to increase its charges for bad debt expense, which could have a material adverse effect on its business, financial position and results of operations.