seven of these sites represent new purion customers , and the other eleven locations are first in-fab purion placements by existing purion customers . the company 's gross margin for 2017 was 36.6 % , down from 37.3 % in 2016 . 2017 gross margin was impacted by a $ 6.2 million excess inventory reserve charge taken on legacy tools and parts in the fourth quarter of 2017 , which reduced full year 2017 gross margin by 1.5 percentage points . without the impact of this excess inventory charge , gross margins in 2017 would have been at the company 's highest annual level in 11 years . we also worked diligently to ensure that manufacturing and operating expense levels remain well aligned to business conditions . consolidation and partnering within the semiconductor chip manufacturing industry has resulted in a smaller number of customers . our net revenue from our ten largest customers accounted for 73.3 % of total revenue for the year ended december 31 , 2017 compared to 70.2 % and 76.8 % of revenue for the years ended december 31 , 2016 and 2015 , respectively . for the year ended december 31 , 2017 , the company had two customers representing 24.9 % and 13.1 % of total revenue , respectively . critical accounting estimates management 's discussion and analysis of our financial condition and results of operations are based upon axcelis ' consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses , and related disclosure of contingent assets and liabilities . on an on‑going basis , we evaluate our estimates and assumptions . management 's estimates are based on historical experience and on various other assumptions that are believed to be reasonable under 18 the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following accounting policies are critical in the portrayal of our financial condition and results of operations and require management 's most significant judgments and estimates in the preparation of our consolidated financial statements . for additional accounting policies see note 2 to the consolidated financial statements for the year ended december 31 , 2017 included in this annual report on form 10-k. revenue recognition our revenue recognition policy involves significant judgment by management . as described below , we consider a broad array of facts and circumstances in determining when to recognize revenue , including contractual service obligations to the customer , the complexity of the customer 's post‑delivery acceptance provisions , payment history , customer creditworthiness and the installation process . our system sales transactions are made up of multiple elements , including the system itself and elements that are not delivered simultaneously with the system . these undelivered elements might include a combination of installation services , extended warranty and support and spare parts , all of which are generally covered by a single sales price . our system revenue arrangements with multiple elements are divided into separate units of accounting if specified criteria are met , including whether the delivered element has stand‑alone value to the customer . if the criteria are met , then the consideration received is allocated among the separate units based on their relative selling price , and the revenue is recognized separately for each of the separate units . we determine selling price for each unit of accounting ( element ) using vendor specific objective evidence ( “ vsoe ” ) or third‑party evidence ( “ tpe ” ) , if they exist , otherwise , we use best estimated selling price ( “ besp ” ) . we generally expect that we will not be able to establish tpe due to the nature of our products , and , as such , we typically will determine selling price using vsoe or besp . where required , we determine besp for an individual element based on consideration of both market and company‑specific factors , including the selling price and profit margin for similar products , the cost to produce the deliverable and the anticipated margin on that deliverable and the characteristics of the markets in which the deliverable is sold . systems are not sold separately and vsoe or tpe is not available for the systems element . therefore the selling price associated with systems is based on besp . the allocated value for installation in the arrangement includes either ( i ) the relative selling price of the installation or ( ii ) the portion of the sales price that will not be received until the installation is completed ( the “ retention ” ) . the selling price of elements such as extended warranty for support , spare parts and support labor is also based on besp . for the majority of regions , the selling price of installation is based upon the fair value of the service performed , including labor , which is based upon the estimated time to complete the installation at hourly rates , and material components , both of which are sold separately , or vsoe . in regions where vsoe does not exist the company uses besp . story_separator_special_tag % , compared with $ 23.3 million in 2015. the increase was primarily due to an increase in new tool evaluation costs . general and administrative replace_table_token_8_th our general and administrative expenses result primarily from the costs associated with our executive , finance , information technology , legal and human resource functions . 2017 compared with 2016 general and administrative expense was $ 30.8 million in 2017 , an increase of $ 6.4 million , or 26.0 % compared with $ 24.5 million in 2016. the increase was primarily due to variable incentive plan expense and to a lesser extent to increased headcount . 26 2016 compared with 2015 general and administrative expense was $ 24.5 million in 2016 , a decrease of $ 0.6 million , or 2.4 % compared with $ 25.1 million in 2015. the decrease was primarily due to a reduction in personnel costs driven by a decrease in variable incentive plan expense . restructuring the company from time to time incurs expenses relating to restructuring . 2017 compared with 2016 during the year ended december 31 , 2016 we recorded $ 0.3 million to restructuring expense due to a consolidation in our customer base . 2016 compared with 2015 during the year ended december 31 , 2016 we recorded $ 0.3 million to restructuring expense due to a consolidation in our customer base . during the year ended december 31 , 2015 , we recorded an immaterial charge to restructuring expense . other ( expense ) income other ( expense ) income consists primarily of interest relating to the lease obligation we incurred in connection with the 2015 sale of our headquarters facility ( “ sale leaseback ” ) and other financing obligations , foreign exchange gains and losses attributable to fluctuations of the u.s. dollar against the local currencies of certain of the countries in which we operate , as well as interest earned on our invested cash balances . 2017 compared with 2016 other expense for the year ended december 31 , 2017 was $ 4.0 million , which includes $ 5.1 million of interest expense related to our sale leaseback obligation and other miscellaneous expense of $ 0.7 million , offset by interest income of $ 0.7 million and $ 1.1 million of foreign currency translation gains . other expense for the year ended december 31 , 2016 was $ 5.6 million and includes interest expense of $ 5.1 million , interest income of $ 0.2 million and $ 0.6 million of foreign currency translation loss . 2016 compared with 2015 other expense for the years ended december 31 , 2016 and 2015 was $ 5.6 million and $ 5.5 million , respectively and includes interest related to our sale leaseback obligation of $ 5.1 million and $ 4.8 million , respectively . income taxes income tax ( benefit ) expense was $ ( 83.1 ) million , $ 0.1 million and $ 0.5 million for the years ended december 31 , 2017 , 2016 and 2015 , respectively . the income tax benefit of $ 83.1 million in 2017 was primarily due to the release of our valuation allowance on our deferred tax assets . our income tax expense for the years ended december 31 , 2016 and 2015 is due to operating results of foreign entities in jurisdictions in europe and asia , where we earn taxable income . we have significant net operating loss carryforwards in the united states and certain european jurisdictions , and , as a result , we do not currently pay significant income taxes in those jurisdictions . at december 31 , 2017 , the company had $ 90.3 million of deferred tax assets worldwide relating to net operating loss carryforwards , tax credit carryforwards and other temporary differences , which are available to reduce income taxes in future years . the company has continued to maintain a $ 7.1 million valuation allowance in the u.s. 27 against certain tax credits and state net operating losses due to the uncertainty of their realization based on long-term company forecasts and the expiration dates on these attributes . in releasing the valuation allowance in 2017 , we considered the weight of all available evidence in determining whether a valuation allowance was required against the company 's deferred tax assets at december 31 , 2017. after consideration of both positive and negative evidence , management concluded that it is more likely than not that a substantial portion of its deferred tax assets will be realized . the positive evidence considered was three year u.s. historical cumulative profitability , projected future taxable income and length of carry-forward periods of net operating losses and tax credits . the primary negative is the volatile semiconductor industry that the company operates in . if future operating results of the u.s. or these foreign jurisdictions significantly exceed expectations it is reasonably possible that there could be a further reduction in the valuation allowance in the future . further reduction of the valuation allowance , in whole or in part , would result in a non-cash income tax benefit during the period of reduction . on december 22 , 2017 , the tax cuts and jobs act ( the “ 2017 tax act ” ) was signed into law . the 2017 tax act eliminates the deferral of u.s. income tax on the historical un-repatriated earnings by imposing the transition toll tax , which is a one-time mandatory deemed repatriation tax on undistributed foreign earnings . as of december 31 , 2017 , we have accrued income tax liabilities of $ 0.4 million under the transition toll tax after utilization of foreign tax credits and research and development credits . the transition toll tax will be paid over an eight-year period , starting in 2018 , and will not accrue interest . the 2017 tax act includes a federal statutory rate reduction from 35 % to 21 % , the elimination or reduction of

liquidity and capital resources our liquidity is affected by many factors . some of these relate specifically to the operations of our business . for example , our sales and other factors relate to the uncertainties of global economies , including the availability of credit and the condition of the overall semiconductor capital equipment industry . our established cost structure does not vary significantly with changes in volume . we experience fluctuations in operating results and cash flows depending on fluctuations in our revenue level . in 2017 , $ 56.3 million of cash was provided by operating activities . this compares to $ 8.8 million of cash used to support operations in 2016. cash and cash equivalents at december 31 , 2017 was $ 133.4 million , compared to $ 70.8 million at december 31 , 2016. approximately $ 16.4 million of cash was located in foreign jurisdictions as of december 31 , 2017. in addition to the cash and cash equivalent balance at december 31 , 2017 , the company had $ 7.5 million in restricted cash which relates to a $ 5.9 million letter of credit associated with the security deposit for the lease on our corporate headquarters in beverly , massachusetts , a $ 0.8 million letter of credit relating to workers ' compensation insurance , a $ 0.7 million letter of credit associated with a bank guarantee and a $ 0.1 million deposit relating to customs activity .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources our liquidity is affected by many factors . some of these relate specifically to the operations of our business . for example , our sales and other factors relate to the uncertainties of global economies , including the availability of credit and the condition of the overall semiconductor capital equipment industry . our established cost structure does not vary significantly with changes in volume . we experience fluctuations in operating results and cash flows depending on fluctuations in our revenue level . in 2017 , $ 56.3 million of cash was provided by operating activities . this compares to $ 8.8 million of cash used to support operations in 2016. cash and cash equivalents at december 31 , 2017 was $ 133.4 million , compared to $ 70.8 million at december 31 , 2016. approximately $ 16.4 million of cash was located in foreign jurisdictions as of december 31 , 2017. in addition to the cash and cash equivalent balance at december 31 , 2017 , the company had $ 7.5 million in restricted cash which relates to a $ 5.9 million letter of credit associated with the security deposit for the lease on our corporate headquarters in beverly , massachusetts , a $ 0.8 million letter of credit relating to workers ' compensation insurance , a $ 0.7 million letter of credit associated with a bank guarantee and a $ 0.1 million deposit relating to customs activity .
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 Suspicious Activity Report : seven of these sites represent new purion customers , and the other eleven locations are first in-fab purion placements by existing purion customers . the company 's gross margin for 2017 was 36.6 % , down from 37.3 % in 2016 . 2017 gross margin was impacted by a $ 6.2 million excess inventory reserve charge taken on legacy tools and parts in the fourth quarter of 2017 , which reduced full year 2017 gross margin by 1.5 percentage points . without the impact of this excess inventory charge , gross margins in 2017 would have been at the company 's highest annual level in 11 years . we also worked diligently to ensure that manufacturing and operating expense levels remain well aligned to business conditions . consolidation and partnering within the semiconductor chip manufacturing industry has resulted in a smaller number of customers . our net revenue from our ten largest customers accounted for 73.3 % of total revenue for the year ended december 31 , 2017 compared to 70.2 % and 76.8 % of revenue for the years ended december 31 , 2016 and 2015 , respectively . for the year ended december 31 , 2017 , the company had two customers representing 24.9 % and 13.1 % of total revenue , respectively . critical accounting estimates management 's discussion and analysis of our financial condition and results of operations are based upon axcelis ' consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses , and related disclosure of contingent assets and liabilities . on an on‑going basis , we evaluate our estimates and assumptions . management 's estimates are based on historical experience and on various other assumptions that are believed to be reasonable under 18 the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following accounting policies are critical in the portrayal of our financial condition and results of operations and require management 's most significant judgments and estimates in the preparation of our consolidated financial statements . for additional accounting policies see note 2 to the consolidated financial statements for the year ended december 31 , 2017 included in this annual report on form 10-k. revenue recognition our revenue recognition policy involves significant judgment by management . as described below , we consider a broad array of facts and circumstances in determining when to recognize revenue , including contractual service obligations to the customer , the complexity of the customer 's post‑delivery acceptance provisions , payment history , customer creditworthiness and the installation process . our system sales transactions are made up of multiple elements , including the system itself and elements that are not delivered simultaneously with the system . these undelivered elements might include a combination of installation services , extended warranty and support and spare parts , all of which are generally covered by a single sales price . our system revenue arrangements with multiple elements are divided into separate units of accounting if specified criteria are met , including whether the delivered element has stand‑alone value to the customer . if the criteria are met , then the consideration received is allocated among the separate units based on their relative selling price , and the revenue is recognized separately for each of the separate units . we determine selling price for each unit of accounting ( element ) using vendor specific objective evidence ( “ vsoe ” ) or third‑party evidence ( “ tpe ” ) , if they exist , otherwise , we use best estimated selling price ( “ besp ” ) . we generally expect that we will not be able to establish tpe due to the nature of our products , and , as such , we typically will determine selling price using vsoe or besp . where required , we determine besp for an individual element based on consideration of both market and company‑specific factors , including the selling price and profit margin for similar products , the cost to produce the deliverable and the anticipated margin on that deliverable and the characteristics of the markets in which the deliverable is sold . systems are not sold separately and vsoe or tpe is not available for the systems element . therefore the selling price associated with systems is based on besp . the allocated value for installation in the arrangement includes either ( i ) the relative selling price of the installation or ( ii ) the portion of the sales price that will not be received until the installation is completed ( the “ retention ” ) . the selling price of elements such as extended warranty for support , spare parts and support labor is also based on besp . for the majority of regions , the selling price of installation is based upon the fair value of the service performed , including labor , which is based upon the estimated time to complete the installation at hourly rates , and material components , both of which are sold separately , or vsoe . in regions where vsoe does not exist the company uses besp . story_separator_special_tag % , compared with $ 23.3 million in 2015. the increase was primarily due to an increase in new tool evaluation costs . general and administrative replace_table_token_8_th our general and administrative expenses result primarily from the costs associated with our executive , finance , information technology , legal and human resource functions . 2017 compared with 2016 general and administrative expense was $ 30.8 million in 2017 , an increase of $ 6.4 million , or 26.0 % compared with $ 24.5 million in 2016. the increase was primarily due to variable incentive plan expense and to a lesser extent to increased headcount . 26 2016 compared with 2015 general and administrative expense was $ 24.5 million in 2016 , a decrease of $ 0.6 million , or 2.4 % compared with $ 25.1 million in 2015. the decrease was primarily due to a reduction in personnel costs driven by a decrease in variable incentive plan expense . restructuring the company from time to time incurs expenses relating to restructuring . 2017 compared with 2016 during the year ended december 31 , 2016 we recorded $ 0.3 million to restructuring expense due to a consolidation in our customer base . 2016 compared with 2015 during the year ended december 31 , 2016 we recorded $ 0.3 million to restructuring expense due to a consolidation in our customer base . during the year ended december 31 , 2015 , we recorded an immaterial charge to restructuring expense . other ( expense ) income other ( expense ) income consists primarily of interest relating to the lease obligation we incurred in connection with the 2015 sale of our headquarters facility ( “ sale leaseback ” ) and other financing obligations , foreign exchange gains and losses attributable to fluctuations of the u.s. dollar against the local currencies of certain of the countries in which we operate , as well as interest earned on our invested cash balances . 2017 compared with 2016 other expense for the year ended december 31 , 2017 was $ 4.0 million , which includes $ 5.1 million of interest expense related to our sale leaseback obligation and other miscellaneous expense of $ 0.7 million , offset by interest income of $ 0.7 million and $ 1.1 million of foreign currency translation gains . other expense for the year ended december 31 , 2016 was $ 5.6 million and includes interest expense of $ 5.1 million , interest income of $ 0.2 million and $ 0.6 million of foreign currency translation loss . 2016 compared with 2015 other expense for the years ended december 31 , 2016 and 2015 was $ 5.6 million and $ 5.5 million , respectively and includes interest related to our sale leaseback obligation of $ 5.1 million and $ 4.8 million , respectively . income taxes income tax ( benefit ) expense was $ ( 83.1 ) million , $ 0.1 million and $ 0.5 million for the years ended december 31 , 2017 , 2016 and 2015 , respectively . the income tax benefit of $ 83.1 million in 2017 was primarily due to the release of our valuation allowance on our deferred tax assets . our income tax expense for the years ended december 31 , 2016 and 2015 is due to operating results of foreign entities in jurisdictions in europe and asia , where we earn taxable income . we have significant net operating loss carryforwards in the united states and certain european jurisdictions , and , as a result , we do not currently pay significant income taxes in those jurisdictions . at december 31 , 2017 , the company had $ 90.3 million of deferred tax assets worldwide relating to net operating loss carryforwards , tax credit carryforwards and other temporary differences , which are available to reduce income taxes in future years . the company has continued to maintain a $ 7.1 million valuation allowance in the u.s. 27 against certain tax credits and state net operating losses due to the uncertainty of their realization based on long-term company forecasts and the expiration dates on these attributes . in releasing the valuation allowance in 2017 , we considered the weight of all available evidence in determining whether a valuation allowance was required against the company 's deferred tax assets at december 31 , 2017. after consideration of both positive and negative evidence , management concluded that it is more likely than not that a substantial portion of its deferred tax assets will be realized . the positive evidence considered was three year u.s. historical cumulative profitability , projected future taxable income and length of carry-forward periods of net operating losses and tax credits . the primary negative is the volatile semiconductor industry that the company operates in . if future operating results of the u.s. or these foreign jurisdictions significantly exceed expectations it is reasonably possible that there could be a further reduction in the valuation allowance in the future . further reduction of the valuation allowance , in whole or in part , would result in a non-cash income tax benefit during the period of reduction . on december 22 , 2017 , the tax cuts and jobs act ( the “ 2017 tax act ” ) was signed into law . the 2017 tax act eliminates the deferral of u.s. income tax on the historical un-repatriated earnings by imposing the transition toll tax , which is a one-time mandatory deemed repatriation tax on undistributed foreign earnings . as of december 31 , 2017 , we have accrued income tax liabilities of $ 0.4 million under the transition toll tax after utilization of foreign tax credits and research and development credits . the transition toll tax will be paid over an eight-year period , starting in 2018 , and will not accrue interest . the 2017 tax act includes a federal statutory rate reduction from 35 % to 21 % , the elimination or reduction of

