☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware |
94-3125814 | |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Common Stock ($0.001 par value) |
IVAC |
The Nasdaq Stock Market LLC (Nasdaq Global Select) |
Large accelerated filer | ☐ | Accelerated filer | ☒ | |||
Non-accelerated filer |
☐ |
Smaller reporting company | ☒ | |||
Emerging growth company | ☐ |
Item 1. |
Business |
TFE Products |
Applications and Features | |
HDD Equipment Market | ||
200 Lean ® Disk Sputtering System |
• Uses PVD and chemical vapor deposition (“CVD”) technologies. • Deposits magnetic films, non-magnetic films and protective carbon-based overcoats.• Provides high-throughput for small-substrate processing. • Over 164 units installed. | |
Upgrades, spares, consumables and services (non-systems business) |
• Upgrades to the installed base to support the continued growth in areal density or reduce the manufacturing cost per disk. | |
DCP Market | ||
INTEVAC VERTEX ® System |
• Utilizes vertical sputtering for multiple film types. • Provides high-throughput for small-substrate processing. • Uses patented carbon deposition source. • Modular design enables expandability. • Enables low-temperature processing. | |
INTEVAC VERTEX ® Spectra System |
• Extension of the VERTEX system. • Incorporates multiple source technologies in a single system. • Uses proprietary ion beam processing for deposition and etching. • Enables unique patterned NCVM and hard AR coatings. | |
INTEVAC VERTEX ® Marathon System |
• Versatile platform for high volume manufacturing of multi-step, multi-layer optical coatings. • Enables diverse coatings - DiamondClad, patterned NCVM and AR films. | |
Solar PV Market | ||
INTEVAC MATRIX PVD System |
• Deposits electrical contacts and conductor layers, reflective layers, and transparent conductive oxide layers, all of which are critical to the efficiency of solar cells. • Includes patented Linear Scanning Magnetic Array (“LSMA”) magnetron source, with industry-leading target utilization rate of over 65 percent. • Provides high-throughput for small-substrate processing. | |
INTEVAC MATRIX Implant System |
• Utilizes the chambers and transport mechanism of the MATRIX platform while using the implant sources from the ENERG i | |
ENERG i ® Implant System |
• Supports both phosphorus and boron dopant technologies. • Extendable to new advanced solar cell structures. |
TFE Products |
Applications and Features | |
ASP Market | ||
INTEVAC MATRIX PVD System |
• Deposits barrier/seed layers for fan-out RDL.• Includes LSMA magnetron source, with industry-leading target utilization rate of over 65 percent. • Provides high-throughput and low cost of ownership for small-substrate or large panel processing. • Provides flexibility for handling round, square, or rectangular substrates for fan-out packaging. | |
Adjacent Markets | ||
INTEVAC MATRIX System |
• Incorporates multiple thin-film deposition techniques such as PVD, CVD, Etch, Implant, heating and cooling. • Consists of high-speed linear transport. • Flexible design enables handling of various different small substrate sizes and shapes. • Performs double-sided coating within vacuum. |
2021 |
2020 |
|||||||
Seagate Technology |
60 | % | 79 | % | ||||
Western Digital Corporation |
25 | % | 18 | % | ||||
Amkor Technology, Inc. |
10 | % | * |
Name |
Age |
Position | ||||
Executive Officers: |
||||||
Nigel D. Hunton |
61 | President and Chief Executive Officer | ||||
James Moniz |
64 | Executive Vice President, Finance and Administration, Chief Financial Officer, Secretary and Treasurer | ||||
Jay Cho |
57 | Executive Vice President and General Manager, TFE | ||||
Other Key Officers: |
||||||
Terry Bluck |
62 | Chief Technology Officer, TFE | ||||
Kimberly Burk |
56 | Senior Vice President, Global Human Resources |
Item 1A. |
Risk Factors |
Item 1B. |
Unresolved Staff Comments |
Item 2. |
Properties |
Location |
Square Footage |
Principal Use | ||||
Santa Clara, California |
169,583 | * | Corporate Headquarters; Marketing, Manufacturing, Engineering and Customer Support | |||
Singapore |
31,947 | Manufacturing and Customer Support | ||||
Malaysia |
1,291 | Customer Support | ||||
Shenzhen, China |
2,568 | Customer Support |
* | In connection with the disposition of our Photonics business, we entered into a lease assignment agreement with EOTECH that assigns the lease obligation for two buildings in our California campus consisting of 94,890 square feet of rentable space to EOTECH. As part of the assignment, we agreed to subsidize a portion of EOTECH’s lease payments through the remainder of the lease term which expires in March 2024. |
Item 3. |
Legal Proceedings |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
Item 6. |
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | Overview: |
• | Results of Operations: |
• | Liquidity and Capital Resources: |
• | Critical Accounting Policies and Estimates: |
Fiscal Year |
2021 |
2020 |
Change 2021 vs. 2020 |
|||||||||
(in thousands, except percentages and per share amounts) |
||||||||||||
Net revenues |
$ | 38,524 | $ | 52,128 | $ | (13,604 | ) | |||||
Gross profit |
$ | 7,067 | $ | 22,417 | $ | (15,350 | ) | |||||
Gross margin percent |
18.3 | % | 43.0 | % | (24.7) points | |||||||
Operating loss |
$ | (22,476 | ) | $ | (8,880 | ) | $ | (13,596 | ) | |||
Net loss from continuing operations |
$ | (23,057 | ) | $ | (10,435 | ) | $ | (12,622 | ) | |||
Net income from discontinued operations, net of tax |
$ | 49,677 | $ | 11,491 | $ | 38,186 | ||||||
Net income |
$ | 26,620 | $ | 1,056 | $ | 25,564 | ||||||
Net income per basic and diluted share |
$ | 1.09 | $ | 0.04 | $ | 1.05 |
2021 |
2020 |
Change 2021 vs. 2020 |
||||||||||
(in thousands) |
||||||||||||
Total net revenues |
$ | 38,524 | $ | 52,128 | $ | (13,604 | ) | |||||
|
|
|
|
|
|
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Total backlog |
$ | 24,725 | $ | 5,623 | ||||
|
|
|
|
2021 |
2020 |
|||||||
Seagate Technology |
60 | % | 79 | % | ||||
Western Digital Corporation |
25 | % | 18 | % | ||||
Amkor Technology, Inc. |
10 | % | * |
2021 |
2020 |
|||||||
(in thousands) |
||||||||
United States |
$ | 3,670 | $ | 6,450 | ||||
Asia |
31,004 | 45,611 | ||||||
Europe |
3,850 | 67 | ||||||
|
|
|
|
|||||
Total net revenues |
$ | 38,524 | $ | 52,128 | ||||
|
|
|
|
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands, except percentages) |
||||||||||||
Total gross profit |
$ | 7,067 | $ | 22,417 | $ | (15,350 | ) | |||||
% of net revenues |
18.3 | % | 43.0 | % |
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands) |
||||||||||||
Research and development expense |
$ | 12,176 | $ | 13,205 | $ | (1,029 | ) |
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands) |
||||||||||||
Selling, general and administrative expense |
$ | 17,367 | $ | 18,092 | $ | (725 | ) |
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands) |
||||||||||||
Interest income and other income (expense), net |
$ | (6 | ) | $ | 156 | $ | (162 | ) |
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands) |
||||||||||||
Provision for income taxes |
$ | 575 | $ | 1,711 | $ | (1,136 | ) |
Fiscal Year |
Change 2021 vs. 2020 |
|||||||||||
2021 |
2020 |
|||||||||||
(in thousands) |
||||||||||||
Income from discontinued operations, net of tax |
$ | 49,677 | $ | 11,491 | $ | 38,186 |
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Cash and cash equivalents |
$ | 102,728 | $ | 29,341 | ||||
Restricted cash |
786 | 787 | ||||||
Short-term investments |
10,221 | 14,839 | ||||||
Long-term investments |
7,427 | 5,388 | ||||||
|
|
|
|
|||||
Total cash, cash-equivalents, restricted cash and investments |
$ | 121,162 | $ | 50,355 | ||||
|
|
|
|
Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
Item 8. |
Financial Statements and Supplementary Data |
Page |
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30 | ||||
32 | ||||
33 | ||||
34 | ||||
35 | ||||
36 | ||||
37 |
/s/ BPM LLP |
We have served as the Company’s auditor since 2015. |
San Jose, California |
February 17, 2022 |
January 1, 2022 |
January 2, 2021 |
|||||||
(In thousands, except par value) |
||||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 102,728 | $ | 29,341 | ||||
Short-term investments |
10,221 | 14,839 | ||||||
Trade and other accounts receivable, net of allowances of $0 at both January 1, 2022 and January 2, 2021 |
14,261 | 28,646 | ||||||
Inventories |
5,791 | 21,689 | ||||||
Prepaid expenses and other current assets |
1,827 | 1,893 | ||||||
|
|
|
|
|||||
Total current assets |
134,828 | 96,408 | ||||||
Property, plant and equipment, net |
4,759 | 11,004 | ||||||
Operating lease right-of-use |
4,520 | 8,165 | ||||||
Long-term investments |
7,427 | 5,388 | ||||||
Restricted cash |
786 | 787 | ||||||
Deferred income taxes and other long-term assets |
5,449 | 5,486 | ||||||
|
|
|
|
|||||
Total assets |
$ | 157,769 | $ | 127,238 | ||||
|
|
|
|
|||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Current liabilities: |
||||||||
Current operating lease liabilities |
$ | 3,119 | $ | 2,853 | ||||
Accounts payable |
5,320 | 4,259 | ||||||
Accrued payroll and related liabilities |
5,505 | 7,679 | ||||||
Other accrued liabilities |
3,665 | 3,598 | ||||||
Customer advances |
2,107 | 33 | ||||||
|
|
|
|
|||||
Total current liabilities |
19,716 | 18,422 | ||||||
Noncurrent liabilities: |
||||||||
Noncurrent operating lease liabilities |
3,675 | 6,803 | ||||||
Other long-term liabilities |
363 | 457 | ||||||
|
|
|
|
|||||
Total noncurrent liabilities |
4,038 | 7,260 | ||||||
Commitments and contingencies |
||||||||
Stockholders’ equity: |
||||||||
Undesignated preferred stock, $0.001 par value, 10,000 shares authorized, no |
— | — | ||||||
Common stock, $0.001 par value: |
||||||||
Authorized shares — 50,000 issued and outstanding shares — 24,636 and 23,874 at January 1, 2022 and January 2, 2021, respectively |
25 | 24 | ||||||
Additional paid-in capital |
199,073 | 193,173 | ||||||
Treasury stock, 5,087 shares at both January 1, 2022 and January 2, 2021 |
(29,551 | ) | (29,551 | ) | ||||
Accumulated other comprehensive income |
578 | 640 | ||||||
Accumulated deficit |
(36,110 | ) | (62,730 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity |
134,015 | 101,556 | ||||||
|
|
|
|
|||||
Total liabilities and stockholders’ equity |
$ | 157,769 | $ | 127,238 | ||||
|
|
|
|
Year Ended, |
||||||||
January 1, 2022 |
January 2, 2021 |
|||||||
(In thousands, except per share amounts) |
||||||||
Net revenues |
$ | 38,524 | $ | 52,128 | ||||
Cost of net revenues |
31,457 | 29,711 | ||||||
|
|
|
|
|||||
Gross profit |
7,067 | 22,417 | ||||||
Operating expenses: |
||||||||
Research and development |
12,176 | 13,205 | ||||||
Selling, general and administrative |
17,367 | 18,092 | ||||||
|
|
|
|
|||||
Total operating expenses |
29,543 | 31,297 | ||||||
|
|
|
|
|||||
Operating loss |
(22,476 | ) | (8,880 | ) | ||||
|
|
|
|
|||||
Interest income |
29 | 284 | ||||||
Other income (expense), net |
(35 | ) | (128 | ) | ||||
|
|
|
|
|||||
Loss from continuing operations before provision for income taxes |
(22,482 | ) | (8,724 | ) | ||||
Provision for income taxes |
575 | 1,711 | ||||||
|
|
|
|
|||||
Net loss from continuing operations |
(23,057 | ) | (10,435 | ) | ||||
|
|
|
|
|||||
Income from discontinued operations: |
||||||||
Income (loss) from Photonics division, net of tax |
(4,664 | ) | 11,491 | |||||
Gain on sale of Photonics division, net of tax |
54,341 | — | ||||||
|
|
|
|
|||||
Total income from discontinued operations, net of tax |
49,677 | 11,491 | ||||||
|
|
|
|
|||||
Net income |
$ | 26,620 | $ | 1,056 | ||||
|
|
|
|
|||||
Net income (loss) per share: |
||||||||
Basic and diluted—continuing operations |
$ | (0.95 | ) | $ | (0.44 | ) | ||
Basic and diluted—discontinued operations |
$ | 2.04 | $ | 0.49 | ||||
Basic and diluted—net income |
$ | 1.09 | $ | 0.04 | ||||
Weighted average shares outstanding: |
||||||||
Basic and diluted |
24,348 | 23,669 |
Year Ended, |
||||||||
January 1, 2022 |
January 2, 2021 |
|||||||
(In thousands) |
||||||||
Net income |
$ | 26,620 | $ | 1,056 | ||||
Other comprehensive income (loss), before tax |
||||||||
Change in unrealized net gain on available-for-sale |
(68 | ) | (5 | ) | ||||
Foreign currency translation gains |
6 | 221 | ||||||
|
|
|
|
|||||
Other comprehensive income (loss), before tax |
(62 | ) | 216 | |||||
Income tax expense related to items in other comprehensive income (loss) |
— | — | ||||||
|
|
|
|
|||||
Other comprehensive income (loss), net of tax |
(62 | ) | 216 | |||||
|
|
|
|
|||||
Comprehensive income |
$ | 26,558 | $ | 1,272 | ||||
|
|
|
|
Common Stock |
Additional Paid-In Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
|||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||||||
Balance at December 28, 2019 |
23,346 | $ | 23 | $ | 188,290 | 4,989 | $ | (29,158 | ) | $ | 424 | $ | (63,786 | ) | $ | 95,793 | ||||||||||||||||
Shares issued in connection with: |
||||||||||||||||||||||||||||||||
Exercise of stock options |
67 | — | 326 | — | — | — | — | 326 | ||||||||||||||||||||||||
Settlement of RSUs |
244 | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Employee stock purchase plan |
392 | 1 | 1,570 | — | — | — | — | 1,571 | ||||||||||||||||||||||||
Shares withheld in connection with net share settlement of RSUs |
(77 | ) | — | (402 | ) | — | — | — | — | (402 | ) | |||||||||||||||||||||
Equity-based compensation expense |
— | — | 3,389 | — | — | — | — | 3,389 | ||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | 1,056 | 1,056 | ||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | 216 | — | 216 | ||||||||||||||||||||||||
Common stock repurchases |
(98 | ) | — | — | 98 | (393 | ) | — | — | (393 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Balance at January 2, 2021 |
23,874 | $ | 24 | $ | 193,173 | 5,087 | $ | (29,551 | ) | $ | 640 | $ | (62,730 | ) | $ | 101,556 | ||||||||||||||||
Shares issued in connection with: |
||||||||||||||||||||||||||||||||
Exercise of stock options |
76 | — | 440 | — | — | — | — | 440 | ||||||||||||||||||||||||
Settlement of RSUs |
383 | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Employee stock purchase plan |
435 | 1 | 2,191 | — | — | — | — | 2,192 | ||||||||||||||||||||||||
Shares withheld in connection with net share settlement of RSUs |
(132 | ) | — | (734 | ) | — | — | — | — | (734 | ) | |||||||||||||||||||||
Equity-based compensation expense |
— | — | 4,003 | — | — | — | — | 4,003 | ||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | 26,620 | 26,620 | ||||||||||||||||||||||||
Other comprehensive loss |
— | — | — | — | — | (62 | ) | — | (62 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Balance at January 1 2022 |
24,636 | $ | 25 | $ | 199,073 | 5,087 | $ | (29,551 | ) | $ | 578 | $ | (36,110 | ) | $ | 134,015 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
||||||||
January 1 2022 |
January 2, 2021 |
|||||||
(In thousands) |
||||||||
Operating activities |
||||||||
Net income |
$ | 26,620 | $ | 1,056 | ||||
Adjustments to reconcile net income to net cash and cash equivalents provided by operating activities: |
||||||||
Depreciation and amortization |
3,456 | 3,206 | ||||||
Net amortization (accretion) of investment premiums and discounts |
109 | 12 | ||||||
Amortization of intangible assets |
— | 274 | ||||||
Gain on sale of Photonics division |
(54,341 | ) | — | |||||
Asset impairment charges |
1,246 | — | ||||||
Equity-based compensation |
4,003 | 3,389 | ||||||
Straight-line rent adjustment and amortization of lease incentives |
(463 | ) | (286 | ) | ||||
Deferred income taxes |
25 | 917 | ||||||
Changes in assets and liabilities: |
||||||||
Accounts receivable |
10,850 | (27 | ) | |||||
Inventories |
9,597 | 3,218 | ||||||
Prepaid expenses and other assets |
6 | (462 | ) | |||||
Accounts payable |
(932 | ) | 60 | |||||
Accrued payroll and other accrued liabilities |
(1,972 | ) | 1,467 | |||||
Customer advances |
2,074 | (3,974 | ) | |||||
|
|
|
|
|||||
Total adjustments |
(26,342 | ) | 7,794 | |||||
|
|
|
|
|||||
Net cash and cash equivalents provided by operating activities |
278 | 8,850 | ||||||
Investing activities |
||||||||
Purchase of investments |
(17,148 | ) | (23,342 | ) | ||||
Proceeds from sales and maturities of investments |
19,550 | 25,355 | ||||||
Proceeds from sale of Photonics division |
70,000 | — | ||||||
Purchase of leasehold improvements and equipment |
(1,198 | ) | (2,612 | ) | ||||
|
|
|
|
|||||
Net cash and cash equivalents provided by (used in) investing activities |
71,204 | (599 | ) | |||||
Financing activities |
||||||||
Proceeds from issuance of common stock |
2,632 | 1,897 | ||||||
Common stock repurchases |
— | (393 | ) | |||||
Taxes paid related to net share settlement |
(734 | ) | (402 | ) | ||||
|
|
|
|
|||||
Net cash and cash equivalents provided by financing activities |
1,898 | 1,102 | ||||||
Effect of exchange rate changes on cash |
6 | 221 | ||||||
|
|
|
|
|||||
Net increase in cash, cash equivalents and restricted cash |
73,386 | 9,574 | ||||||
Cash, cash equivalents and restricted cash at beginning of period |
30,128 | 20,554 | ||||||
|
|
|
|
|||||
Cash, cash equivalents and restricted cash at end of period |
$ | 103,514 | $ | 30,128 | ||||
|
|
|
|
|||||
Cash paid (received) for: |
||||||||
Income taxes |
$ | 559 | $ | 850 | ||||
Income tax refund |
$ | (18 | ) | $ | (157 | ) |
Foreign currency |
Unrealized holding gains (losses) on available-for-sale investments |
Total |
||||||||||
(in thousands) |
||||||||||||
Balance at December 28, 2019 |
$ | 381 | $ | 43 | $ | 424 | ||||||
|
|
|
|
|
|
|||||||
Other comprehensive income (loss) before reclassification |
221 | (5 | ) | 216 | ||||||||
Amounts reclassified from other comprehensive income (loss) |
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Net current-period other comprehensive income (loss) |
221 | (5 | ) | 216 | ||||||||
|
|
|
|
|
|
|||||||
Balance at January 2, 2021 |
602 | 38 | 640 | |||||||||
|
|
|
|
|
|
|||||||
Other comprehensive income (loss) before reclassification |
6 | (68 | ) | (62 | ) | |||||||
Amounts reclassified from other comprehensive income (loss) |
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Net current-period other comprehensive income (loss) |
6 | (68 | ) | (62 | ) | |||||||
|
|
|
|
|
|
|||||||
Balance at January 1, 2022 |
$ | 608 | $ | (30 | ) | $ | 578 | |||||
|
|
|
|
|
|
Cash proceeds |
$ | 70,000 | ||
Working capital adjustment |
(74 | ) | ||
|
|
|||
69,926 | ||||
Assets sold: |
||||
Accounts receivable |
3,535 | |||
Inventories |
6,301 | |||
Other current assets |
72 | |||
Property, plant and equipment |
3,987 | |||
|
|
|||
Total assets sold |
13,895 | |||
Liabilities divested: |
||||
Accounts payable |
888 | |||
Other accrued expenses |
594 | |||
|
|
|||
Total liabilities divested |
1,482 | |||
Transaction and other costs |
(3,172 | ) | ||
|
|
|||
Gain on sale |
$ | 54,341 | ||
|
|
Year Ended, |
||||||||
January 1, 2022 |
January 2, 2021 |
|||||||
(In thousands, except per share amounts) |
||||||||
Net revenues: |
||||||||
Systems and components |
$ | 15,932 | $ | 22,751 | ||||
Technology development |
11,735 | 22,945 | ||||||
|
|
|
|
|||||
Total net revenues |
27,667 | 45,696 | ||||||
Cost of net revenues: |
||||||||
Systems and components |
12,252 | 12,520 | ||||||
Technology development |
8,885 | 15,048 | ||||||
|
|
|
|
|||||
Total cost of net revenues |
21,137 | 27,568 | ||||||
Gross profit |
6,530 | 18,128 |
Year Ended, |
||||||||
January 1, 2022 |
January 2, 2021 |
|||||||
(In thousands, except per share amounts) |
||||||||
Operating expenses: |
||||||||
Research and development |
2,653 | 888 | ||||||
Selling, general and administrative |
5,937 | 5,805 | ||||||
Asset impairment and restructuring charges |
2,604 | — | ||||||
|
|
|
|
|||||
Total operating expenses |
11,194 | 6,693 | ||||||
|
|
|
|
|||||
Operating income (loss)—discontinued operations |
(4,664 | ) | 11,435 | |||||
Other income (expense)—discontinued operations |
— | 56 | ||||||
|
|
|
|
|||||
Income (loss) discontinued operations before provision for (benefit from) income taxes |
(4,664 | ) | 11,491 | |||||
Gain on disposal of discontinued operations before income taxes |
54,341 | — | ||||||
|
|
|
|
|||||
Total income from discontinued operations, before tax |
49,677 | 11,491 | ||||||
Provision for (benefit from) income taxes |
— | — | ||||||
|
|
|
|
|||||
Net income from discontinued operations net of tax |
$ | 49,677 | $ | 11,491 | ||||
|
|
|
|
2021 |
2020 |
|||||||
(in thousands) |
||||||||
Depreciation and amortization |
$ | 1,366 | $ | 1,123 | ||||
Amortization of intangible assets |
$ | — | $ | 36 | ||||
Asset impairment charges |
$ | 1,246 | $ | — | ||||
Equity-based compensation |
$ | 1,167 | $ | 959 | ||||
Purchase of leasehold improvements and equipment |
$ | 429 | $ | 636 |
2021 |
2020 |
|||||||||||||||||||||||||||||||
(in thousands) |
||||||||||||||||||||||||||||||||
HDD |
DCP |
PV |
ASP |
Total |
HDD |
PV |
Total |
|||||||||||||||||||||||||
Systems, upgrades and spare parts | $ 28,300 |
$ 3 |
$ 258 |
$ 3,850 |
$ 32,411 |
$ 45,620 |
$ 426 |
$ 46,046 |
||||||||||||||||||||||||
Field service | 6,031 | 14 | 68 | — | 6,113 | 6,080 | 2 | 6,082 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Total TFE net revenues |
$ | 34,331 | $ | 17 | $ | 326 | $ | 3,850 | $ | 38,524 | $ | 51,700 | $ | 428 | $ | 52,128 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
2020 |
|||||||
(in thousands) |
||||||||
United States |
$ | 3,670 | $ | 6,450 | ||||
Asia |
31,004 | 45,611 | ||||||
Europe |
3,850 | 67 | ||||||
|
|
|
|
|||||
Total net revenues |
$ | 38,524 | $ | 52,128 | ||||
|
|
|
|
2021 |
2020 |
|||||||
(in thousands) |
||||||||
Products transferred at a point in time | $38,524 | $52,128 | ||||||
Products and services transferred over time | — | — | ||||||
Total net revenues |
$ | 38,524 | $ | 52,128 | ||||
January 1, 2022 |
January 2, 2021 |
Change |
||||||||||
(In thousands) |
||||||||||||
TFE: |
||||||||||||
Contract assets: |
||||||||||||
Accounts receivable, unbilled |
$ | 99 | $ | 369 | $ | (270 | ) | |||||
Contract liabilities: |
||||||||||||
Deferred revenue |
$ | 65 | $ | 482 | $ | (417 | ) | |||||
Customer advances |
2,107 | 33 | 2,074 | |||||||||
$ | 2,172 | $ | 515 | $ | 1,657 | |||||||
Photonics (included in discontinued operations): |
||||||||||||
Contract assets: |
||||||||||||
Accounts receivable, unbilled |
$ | — | $ | 5,439 | $ | (5,439 | ) | |||||
Retainage |
— | 126 | (126 | ) | ||||||||
$ | — | $ | 5,565 | $ | (5,565 | ) | ||||||
Contract liabilities: |
||||||||||||
Deferred revenue |
$ | — | $ | 779 | $ | (779 | ) | |||||
2021 |
2020 |
|||||||
Equity-based compensation by type of award: |
||||||||
Stock options | $198 | $504 | ||||||
RSUs |
2,819 | 1,936 | ||||||
Employee stock purchase plan |
986 | 949 | ||||||
|
|
|
|
|||||
Total equity-based compensation * |
$ | 4,003 | $ | 3,389 | ||||
|
|
|
|
2021 |
2020 |
|||||||
Stock Options: |
||||||||
Weighted-average fair value of grants per share |
— | $ | 1.82 | |||||
Expected volatility |
— | 46.06 | % | |||||
Risk free interest rate | — | 0.44% | ||||||
Expected term of options (in years) |
— | 4.39 | ||||||
Dividend yield |
— | None |
Shares |
Weighted Average Exercise Price |
Weighted Average Remaining Contractual Term (years) |
Aggregate Intrinsic Value |
|||||||||||||
Options outstanding at January 2, 2021 |
1,814,467 | $ | 6.66 | 3.08 | $ | 2,520,722 | ||||||||||
Options cancelled and forfeited |
(280,261 | ) | $ | 7.44 | ||||||||||||
Options exercised |
(76,619 | ) | $ | 5.74 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Options outstanding at January 1, 2022 |
1,457,587 | $ | 6.55 | 2.31 | $ | 7,622 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Options exercisable at January 1, 2022 |
1,267,664 | $ | 6.74 | 2.08 | $ | 3,513 |
Shares |
Weighted Average Grant Date Fair Value |
Weighted Average Remaining Contractual Term (years) |
Aggregate Intrinsic Value |
|||||||||||||
Non-vested RSUs at January 2, 2021 |
901,634 | $ | 5.30 | 1.50 | $ | 6,500,781 | ||||||||||
Granted |
606,705 | $ | 6.03 | |||||||||||||
Vested |
(382,747 | ) | $ | 5.71 | ||||||||||||
Cancelled |
(92,156 | ) | $ | 4.79 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Non-vested RSUs at January 1, 2022 |
1,033,436 | $ | 5.59 | 1.39 | $ | 4,867,484 | ||||||||||
|
|
|
|
|
|
|
|
2021 |
||||
Weighted-average fair value of grants per share |
$ | 7.65 | ||
Expected volatility |
56.26 | % | ||
Risk-free interest rate |
0.15 | % | ||
Dividend yield |
None |
2020 |
||||
Weighted-average fair value of grants per share |
$ | 3.16 | ||
Expected volatility |
46.7 | % | ||
Risk-free interest rate |
0.25 | % | ||
Dividend yield |
None |
2021 |
2020 |
|||||||
Stock Purchase Rights: |
||||||||
Weighted-average fair value of grants per share |
$ | 2.59 | $ | 2.20 | ||||
Expected volatility |
60.88 | % | 51.49 | % | ||||
Risk free interest rate |
0.08 | % | 0.14 | % | ||||
Expected term of purchase rights (in years) |
0.91 | 1.24 | ||||||
Dividend yield |
None | None |
2021 |
2020 |
|||||||
(in thousands, except per share amounts) |
||||||||
Shares purchased |
435 | 392 | ||||||
Weighted-average purchase price per share |
$ | 5.05 | $ | 4.01 | ||||
Aggregate intrinsic value of purchase rights exercised |
$ | 671 | $ | 765 |
2021 |
2020 |
|||||||
(in thousands, except per share amounts) |
||||||||
Net loss from continuing operations |
$ | (23,057 | ) | $ | (10,435 | ) | ||
Net income from discontinued operations, net of tax |
49,677 | 11,491 | ||||||
|
|
|
|
|||||
Net income |
$ | 26,620 | $ | 1,056 | ||||
|
|
|
|
|||||
Weighted-average shares – basic |
24,348 | 23,669 | ||||||
Effect of dilutive potential common shares |
— | — | ||||||
|
|
|
|
|||||
Weighted-average shares – diluted |
24,348 | 23,669 | ||||||
|
|
|
|
|||||
Basic and diluted net income (loss) per share: |
||||||||
Continuing operations |
$ | (0.95 | ) | $ | (0.44 | ) | ||
Discontinued operations |
$ | 2.04 | $ | 0.49 | ||||
Net income per share |
$ | 1.09 | $ | 0.04 |
2021 |
2020 |
|||||||
Seagate Technology |
47 | % | 45 | % | ||||
Western Digital Corporation |
30 | % | 16 | % | ||||
Amkor Technology, Inc. |
22 | % | * | |||||
U.S. Government (included in discontinued operations). |
— | 26 | % |
* | Less than 10% |
2021 |
2020 |
|||||||
Seagate Technology |
60 | % | 79 | % | ||||
Western Digital Corporation |
25 | % | 18 | % | ||||
Amkor Technology, Inc. |
10 | % | * |
* | Less than 10% |
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Trade receivables and other |
$ | 14,162 | $ | 22,712 | ||||
Unbilled costs and accrued profits |
99 | 5,934 | ||||||
Less: allowance for doubtful accounts |
— | — | ||||||
$ | 14,261 | $ | 28,646 | |||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Raw materials |
$ | 5,323 | $ | 9,999 | ||||
Work-in-progress |
468 | 4,832 | ||||||
Finished goods |
— | 6,858 | ||||||
$ | 5,791 | $ | 21,689 | |||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Leasehold improvements |
$ | 9,847 | $ | 16,323 | ||||
Machinery and equipment |
23,818 | 46,846 | ||||||
33,665 | 63,169 | |||||||
Less accumulated depreciation and amortization |
28,906 | 52,165 | ||||||
Total property, plant and equipment, net |
$ | 4,759 | $ | 11,004 | ||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
United States |
$ | 4,385 | $ | 10,678 | ||||
Asia |
374 | 326 | ||||||
Net property, plant & equipment |
$ | 4,759 | $ | 11,004 | ||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Deferred income taxes |
$ | 5,310 | $ | 5,335 | ||||
Prepaid expenses |
139 | 151 | ||||||
$ | 5,449 | $ | 5,486 | |||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Other taxes payable |
$ | 1,318 | $ | 935 | ||||
Litigation settlement |
1,000 | — | ||||||
Income taxes payable |
370 | 263 | ||||||
Restructuring |
347 | — | ||||||
Accrued product warranties |
301 | 405 | ||||||
Other |
264 | 734 | ||||||
Deferred revenue |
65 | 1,261 | ||||||
Total other accrued liabilities |
$ | 3,665 | $ | 3,598 | ||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Restructuring |
$ | 318 | $ | — | ||||
Accrued product warranties |
45 | 75 | ||||||
Employer payroll taxes |
— | 382 | ||||||
Total other long-term liabilities |
$ | 363 | $ | 457 | ||||
January 1, 2022 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(in thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | 102,494 | $ | — | $ | — | $ | 102,494 | ||||||||
Money market funds |
234 | — | — | 234 | ||||||||||||
Total cash and cash equivalents |
$ | 102,728 | $ | — | $ | — | $ | 102,728 | ||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | 4,300 | $ | — | $ | — | $ | 4,300 | ||||||||
Commercial paper |
400 | — | — | 400 | ||||||||||||
Corporate bonds and medium-term notes |
2,916 | — | 3 | 2,913 | ||||||||||||
Municipal bonds |
700 | — | — | 700 | ||||||||||||
U.S. treasury securities |
1,910 | — | 2 | 1,908 | ||||||||||||
Total short-term investments |
$ | 10,226 | $ | — | $ | 5 | $ | 10,221 | ||||||||
Long-term investments: |
||||||||||||||||
Asset backed securities |
$ | 2,040 | $ | — | $ | 3 | $ | 2,037 | ||||||||
Certificates of deposit |
500 | — | 3 | 497 | ||||||||||||
Corporate bonds and medium-term notes |
1,521 | — | 6 | 1,515 | ||||||||||||
Municipal bonds |
145 | — | 1 | 144 | ||||||||||||
U.S. treasury securities |
3,246 | — | 12 | 3,234 | ||||||||||||
Total long-term investments |
$ | 7,452 | $ | — | $ | 25 | $ | 7,427 | ||||||||
Total cash, cash equivalents, and investments |
$ | 120,406 | $ | — | $ | 30 | $ | 120,376 | ||||||||
January 2, 2021 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(in thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | 24,729 | $ | — | $ | — | $ | 24,729 | ||||||||
Money market funds |
3,612 | — | — | 3,612 | ||||||||||||
Certificates of deposit |
1,000 | — | — | 1,000 | ||||||||||||
Total cash and cash equivalents |
$ | 29,341 | $ | — | $ | — | $ | 29,341 | ||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | 6,450 | $ | 2 | $ | — | $ | 6,452 | ||||||||
Commercial paper |
500 | — | — | 500 | ||||||||||||
Corporate bonds and medium-term notes |
2,929 | 6 | — | 2,935 | ||||||||||||
Municipal bonds |
400 | — | — | 400 | ||||||||||||
U.S. treasury securities |
4,527 | 25 | — | 4,552 | ||||||||||||
Total short-term investments |
$ | 14,806 | $ | 33 | $ | — | $ | 14,839 | ||||||||
Long-term investments: |
||||||||||||||||
Certificates of deposit |
$ | 500 | $ | — | $ | — | $ | 500 | ||||||||
Corporate bonds and medium-term notes |
3,474 | 4 | — | 3,478 | ||||||||||||
U.S. treasury securities |
1,409 | 1 | — | 1,410 | ||||||||||||
Total long-term investments |
$ | 5,383 | $ | 5 | $ | — | $ | 5,388 | ||||||||
Total cash, cash equivalents, and investments |
$ | 49,530 | $ | 38 | $ | — | $ | 49,568 | ||||||||
Amortized Cost |
Fair Value |
|||||||
(in thousands) |
||||||||
Due in one year or less |
$ | 10,460 | $ | 10,455 | ||||
Due after one through five years |
7,452 | 7,427 | ||||||
$ | 17,912 | $ | 17,882 | |||||
January 1, 2022 |
||||||||||||||||
In Loss Position for Less than 12 Months |
In Loss Position for Greater than 12 Months |
|||||||||||||||
Fair Value |
Gross Unrealized Losses |
Fair Value |
Gross Unrealized Losses |
|||||||||||||
(In thousands) |
||||||||||||||||
Asset backed securities |
$ | 2,037 | $ | 3 | $ | — | $ | — | ||||||||
Certificates of deposit |
1,497 | 3 | — | — | ||||||||||||
Corporate bonds and medium-term notes |
3,424 | 9 | — | — | ||||||||||||
Municipal bond |
464 | 1 | — | — | ||||||||||||
U.S. treasury securities |
4,642 | 14 | — | — | ||||||||||||
$ | 12,064 | $ | 30 | $ | — | $ | — | |||||||||
Fair Value Measurements at January 1, 2022 |
||||||||||||
Total |
Level 1 |
Level 2 |
||||||||||
(in thousands) |
||||||||||||
Recurring fair value measurements: |
||||||||||||
Money market funds |
$ | 234 | $ | 234 | $ | — | ||||||
U.S. treasury securities |
5,142 | 5,142 | — | |||||||||
Asset backed securities |
2,037 | — | 2,037 | |||||||||
Certificates of deposit |
4,797 | — | 4,797 | |||||||||
Commercial paper |
400 | — | 400 | |||||||||
Corporate bonds and medium-term notes |
4,428 | — | 4,428 | |||||||||
Municipal bonds |
844 | — | 844 | |||||||||
Total recurring fair value measurements |
$ | 17,882 | $ | 5,376 | $ | 12,506 | ||||||
Notional Amounts |
Derivative Assets |
Derivative Liabilities |
||||||||||||||||||||||
Derivative Instrument |
January 1, 2022 |
January 2, 2021 |
January 1, 2022 |
January 2, 2021 |
||||||||||||||||||||
Balance Sheet Line |
Fair Value |
Balance Sheet Line |
Fair Value |
|||||||||||||||||||||
(in thousands) |
||||||||||||||||||||||||
Undesignated Hedges: |
||||||||||||||||||||||||
Forward Foreign Currency Contracts |
$ | 815 | 983 | a |
$ | 1 | b |
$ | 3 | |||||||||||||||
Total Hedges |
$ | 815 | 983 | $ | 1 | $ | 3 | |||||||||||||||||
a | Other current assets |
b | Other accrued liabilities |
2021 |
2020 |
|||||||
(in thousands, except per share amounts) |
||||||||
Shares of common stock repurchased |
— | 98 | ||||||
Cost of stock repurchased |
$ | — | $ | 393 | ||||
Average price paid per share |
$ | — | $ | 3.97 |
2021 |
2020 |
|||||||
Federal: |
||||||||
Current |
$ | — | $ | (915 | ) | |||
Deferred |
— | — | ||||||
— | (915 | ) | ||||||
State: |
||||||||
Current |
4 | 4 | ||||||
Deferred |
— | — | ||||||
4 | 4 | |||||||
Foreign: |
||||||||
Current |
546 | 1,705 | ||||||
Deferred |
25 | 917 | ||||||
571 | 2,622 | |||||||
Total |
$ | 575 | $ | 1,711 | ||||
Income taxes on discontinued operations |
$ | — | $ | — | ||||
Income taxes on continuing operations |
$ | 575 | $ | 1,711 |
2021 |
2020 |
|||||||
U.S |
$ | (22,694 | ) | $ | (14,784 | ) | ||
Foreign |
212 | 6,060 | ||||||
$ | (22,482 | ) | $ | (8,724 | ) | |||
Effective tax rate |
(2.6 | %) | (19.6 | %) | ||||
January 1, 2022 |
January 2, 2021 |
|||||||
Deferred tax assets: |
||||||||
Vacation, warranty and other accruals |
$ | 627 | $ | 651 | ||||
Intangible amortization |
282 | 551 | ||||||
Purchased technology |
17 | 14 | ||||||
Inventory valuation |
1,653 | 1,101 | ||||||
Equity-based compensation |
1,343 | 1,494 | ||||||
Lease liability |
1,659 | — | ||||||
Net operating loss, research and other tax credit carryforwards |
53,684 | 55,322 | ||||||
Other |
22 | 30 | ||||||
59,287 | 59,163 | |||||||
Valuation allowance for deferred tax assets |
(52,703 | ) | (52,088 | ) | ||||
Total deferred tax assets |
6,584 | 7,075 | ||||||
January 1, 2022 |
January 2, 2021 |
|||||||
Deferred tax liabilities: |
||||||||
Depreciation and amortization |
(201 | ) | (341 | ) | ||||
ROU asset |
(1,073 | ) | — | |||||
Unbilled revenue |
— | (1,399 | ) | |||||
Total deferred tax liabilities |
(1,274 | ) | (1,740 | ) | ||||
Net deferred tax assets |
$ | 5,310 | $ | 5,335 | ||||
As reported on the consolidated balance sheets: |
||||||||
Non-current deferred tax assets |
$ | 5,310 | $ | 5,335 | ||||
2021 |
2020 |
|||||||
Income tax at the federal statutory rate |
$ | (4,721 | ) | $ | (1,832 | ) | ||
State income taxes, net of federal benefit |
4 | 4 | ||||||
Change in valuation allowance: |
||||||||
U.S |
94 | 40 | ||||||
Foreign |
— | — | ||||||
Effect of foreign operations taxed at various rates |
48 | (235 | ) | |||||
Research tax credits |
(1,135 | ) | (1,306 | ) | ||||
Effect of tax rate changes, permanent differences and adjustments of prior deferrals |
6,285 | 4,461 | ||||||
Unrecognized tax benefits |
— | 579 | ||||||
Total income tax expense on continuing operations |
$ | 575 | $ | 1,711 | ||||
2021 |
2020 |
|||||||
Beginning balance |
$ | 7,327 | $ | 7,683 | ||||
Additions based on tax positions related to the current year |
24 | 589 | ||||||
Decreases for tax positions of prior years |
(6,622 | ) | — | |||||
Lapse of statute of limitations |
(11 | ) | (945 | ) | ||||
Ending balance |
$ | 718 | $ | 7,327 | ||||
January 1, 2022 |
January 2, 2021 |
|||||||
(in thousands) |
||||||||
Assets: |
||||||||
Operating lease ROU assets |
$ | 4,520 | $ | 8,165 | ||||
Liabilities: |
||||||||
Current operating lease liabilities |
$ | 3,119 | $ | 2,853 | ||||
Noncurrent operating lease liabilities |
3,675 | 6,803 | ||||||
$ | 6,794 | $ | 9,656 | |||||
2021 |
2020 |
|||||||
(in thousands) |
||||||||
Operating lease cost |
$ | 2,944 | $ | 2,942 | ||||
Short-term lease cost |
98 | 93 | ||||||
Total lease cost |
$ | 3,042 | $ | 3,035 | ||||
Continuing Operations |
Discontinued Operations |
Total |
||||||||||
(in thousands) |
||||||||||||
2022 |
$ | 1,805 | $ | 1,661 | $ | 3,466 | ||||||
2023 |
1,577 | 1,710 | 3,287 | |||||||||
2024 |
256 | 286 | 542 | |||||||||
Total lease payments |
$ | 3,638 | $ | 3,657 | 7,295 | |||||||
Less: Interest |
(242 | ) | (259 | ) | (501 | ) | ||||||
Present value of lease liabilities |
$ | 3,396 | $ | 3,398 | 6,794 | |||||||
January 1, 2022 |
January 2, 2021 |
|||||||
Weighted-average remaining lease term (in years) |
2.11 | 3.09 | ||||||
Weighted-average discount rate |
6.40 | % | 6.39 | % |
2021 |
2020 |
|||||||
(in thousands) |
||||||||
Operating cash outflows from operating leases |
$ | 3,382 | $ | 3,332 | ||||
|
|
|
|
|||||
ROU asset impairment expense (reported in discontinued operations) |
$ | 1,246 | $ | — | ||||
|
|
|
|
|||||
ROU assets obtained in exchange for new operating lease liabilities |
$ | — | $ | 128 | ||||
|
|
|
|
2021 |
2020 |
|||||||
(in thousands) |
||||||||
Beginning balance |
$ | 480 | $ | 1,022 | ||||
Expenditures incurred under warranties |
(622 | ) | (493 | ) | ||||
Expenditures incurred under warranties included in discontinued operations |
(89 | ) | (19 | ) | ||||
Accruals for product warranties |
502 | 237 | ||||||
Accruals for product warranties included in discontinued operations |
122 | 43 | ||||||
Adjustments to previously existing warranty accruals |
31 | (306 | ) | |||||
Adjustments to previously existing warranty accruals included in discontinued operations |
(31 | ) | (4 | ) | ||||
Sale of Photonics division |
(47 | ) | — | |||||
|
|
|
|
|||||
Ending balance |
$ | 346 | $ | 480 | ||||
|
|
|
|
Employee Termination Costs |
Other Exit Costs |
Total |
||||||||||
(in thousands) |
||||||||||||
Balance at December 28, 2019 |
$ | — | $ | — | $ | — | ||||||
Provision for restructuring charges under the 2020 Cost Reduction Plan |
103 | — | 103 | |||||||||
Cash payments made |
(103 | ) | — | (103 | ) | |||||||
|
|
|
|
|
|
|||||||
Balance at January 2, 2021 |
$ | — | $ | — | $ | — | ||||||
Provision for restructuring charges under the 2021 Cost Reduction Plan |
319 | — | 319 | |||||||||
Cash payments made |
(319 | ) | — | (319 | ) | |||||||
Provision for restructuring charges associated with Photonics sale (a) |
693 | 1,911 | 2,604 | |||||||||
Cash payments made |
(96 | ) | — | (96 | ) | |||||||
Non-cash utilization |
(239 | )(b) | (1,246 | )(c) | (1,485 | ) | ||||||
|
|
|
|
|
|
|||||||
Balance at January 1, 2022 |
$ | 358 | (d) | $ | 665 | $ | 1,023 | |||||
|
|
|
|
|
|
Item 9. |
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure |
Item 9A. |
Controls and Procedures |
Item 9B. |
Other Information |
Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
Item 10. |
Directors, Executive Officers and Corporate Governance |
Item 11. |
Executive Compensation |
Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
Item 14. |
Principal Accountant Fees and Services |
Item 15. |
Exhibits and Financial Statement Schedules |
(1) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed July 23, 2007 |
(2) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed March 15, 2012 |
(3) | Previously filed as an exhibit to the Registration Statement on Form S-1 (No. 33-97806) |
(4) | Previously filed as an exhibit to the Company’s Form 10-K filed February 12, 2020 |
(5) | Previously filed as an exhibit to the Company’s Form 10-Q filed May 3, 2011 |
(6) | Previously filed as an exhibit to the Company’s Definitive Proxy Statement filed April 7, 2020. |
(7) | Previously filed as an exhibit to the Company’s Definitive Proxy Statement filed April 11, 2018 |
(8) | Previously filed as an exhibit to the Company’s Form 10-Q filed May 1, 2012 |
(9) | Previously filed as an exhibit to the Company’s Form 10-Q filed July 30, 2019 |
(10) | Previously filed as an exhibit to the Company’s Form 10-Q filed April 29, 2014 |
(11) | Previously filed as an exhibit to the Registration Statement on Form S-8 filed May 14, 2020 (No. 33-238262) |
(12) | Previously filed as an exhibit to the Company’s Form 10-Q filed August 3, 2021 |
(13) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed January 20, 2022 |
(14) | Previously filed as an exhibit to the Company’s Form 10-K filed March 14, 2008 |
(15) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed February 1, 2022 |
(16) | Previously filed as an exhibit to the Company’s Form 10-Q filed October 28, 2014 |
(17) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed October 31, 2014 |
(18) | Previously filed as an exhibit to the Company’s Form 10-Q filed May 1, 2018 |
(19) | Previously filed as an exhibit to the Company’s Report on Form 8-K filed January 3, 2022 |
(20) | Previously filed as an exhibit to the Company’s Definitive Proxy Statement filed April 14, 2021 |
(P) | Paper exhibit. |
+ | Management compensatory plan or arrangement |
INTEVAC, INC. |
/s/ JAMES MONIZ |
James Moniz |
Executive Vice President, Finance and Administration |
Chief Financial Officer, Secretary and Treasurer |
Signature |
Title |
Date | ||
/s/ NIGEL D. HUNTON |
President, |
February 17, 2022 | ||
(Nigel D. Hunton) |
Chief Executive Officer and Director (Principal Executive Officer) |
|||
/s/ JAMES MONIZ |
Executive Vice President, Finance and |
February 17, 2022 | ||
(James Moniz) |
Administration, Chief Financial Officer, Secretary and Treasurer (Principal Financial and Accounting Officer) |
|||
/s/ DAVID S. DURY |
Chairman of Board |
February 17, 2022 | ||
(David S. Dury) |
||||
/s/ KEVIN D. BARBER |
Director |
February 17, 2022 | ||
(Kevin D. Barber) |
||||
/s/ DOROTHY D. HAYES |
Director |
February 17, 2022 | ||
(Dorothy D. Hayes) |
||||
/s/ STEPHEN A. JAMISON |
Director |
February 17, 2022 | ||
(Stephen A. Jamison) |
||||
/s/ MICHELE F. KLEIN |
Director |
February 17, 2022 | ||
(Michele F. Klein) |
||||
/s/ MARK P. POPOVICH |
Director |
February 17, 2022 | ||
(Mark P. Popovich) |
||||
/s/ THOMAS M. ROHRS |
Director |
February 17, 2022 | ||
(Thomas M. Rohrs) |
Exhibit 10.10
LEASE ASSIGNMENT AGREEMENT
THIS LEASE ASSIGNMENT AGREEMENT (this Agreement) is dated as of December 30, 2021 (the Effective Date), by and between INTEVAC, INC., a Delaware corporation (Assignor) and EOTECH, LLC, a Michigan limited liability company (Assignee), with reference to the following facts and circumstances:
A. Assignor entered into that certain Lease dated March 20, 2014 (the Building 3 Lease) between HGIT Bassett Campus LP (Landlord), successor-in-interest to M West Propco X, LLC, as landlord, and Assignor, as tenant, regarding certain Premises described therein commonly known as 3548 Bassett Street, Santa Clara, California (the Building 3 Premises).
B. Assignor entered into that certain Lease dated March 20, 2014 (the Building 1 & 2 Lease) between Landlord and Assignor regarding certain Premises described therein consisting primarily of two (2) buildings commonly known as 3560 Bassett Street, Santa Clara, California (the Building 2 Premises) and 3580 Bassett Street, Santa Clara, California (the Building 1 Premises).
C. Intevac Photonics, Inc., a Delaware corporation (Seller), Assignor and Assignee have entered into (i) that certain Asset Purchase Agreement dated on or about the date hereof (the APA) pursuant to which Seller and Assignor have agreed to sell and transfer to Assignee a portion of the assets of Seller and Assignor and (ii) that certain Transition Services Agreement dated on or about the date hereof (the TSA) to facilitate the provision of certain ongoing services on a transitional basis in accordance with transactions contemplated by the APA. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the APA.
D. Pursuant to the APA, Assignor has agreed to assign to Assignee all of Assignors right, title and interest in and to (i) the Building 3 Lease and the Building 3 Premises and (ii) the Building 1 & 2 Lease as to the Building 1 Premises only (collectively, the Transferred Premises) in accordance with an subject to the terms, provisions and conditions in this Agreement. As used herein, the term Transferred Leases shall mean, collectively, the Building 3 Lease and the Building 1 & 2 Lease as to the Building 1 Premises only.
E. In connection with the assignment of the Transferred Leases as to the Transferred Premises, Assignor may provide certain transition services to Assignee pursuant to the TSA which may require continued access to the Transferred Premises by Assignor from and after the Effective Date.
NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:
1. Assignment and Assumption. Effective as of the Effective Date, Assignor hereby assigns to Assignee, and Assignee hereby accepts from Assignor, all of Assignors right, title and interest in, under and to the Transferred Leases as to the Transferred Premises, excluding the Outside Area (as defined in the Building 1 & 2 Lease) and the Building 2 Premises (for which Assignor shall remain solely liable), but including the non-exclusive right to use the Common Area (as defined in
the Transferred Leases), subject to the limitations and reservations contained herein. Also effective as of the Effective Date, Assignee accepts this Agreement and assumes and agrees to keep, perform and fulfill, as a direct obligation to Landlord and for the benefit of Assignor, all of the terms, covenants, conditions and obligations required to be kept, performed and fulfilled by the Tenant under the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 below) and Building 2 Premises) from and after the Effective Date, including, without limitation, all obligations with respect to the surrender of the Transferred Premises under the Transferred Leases and the removal of any personal property, alterations, cabling and equipment from the Transferred Premises, including, without, limitation removal of any Purchased Assets from the Transferred Premises and the Building 1 & 2 Outside Areas (as defined below), in all cases, only to the extent required by the Transferred Leases.
2. Building 1 & 2 Outside Areas. In connection with the assignment of the Transferred Leases as to the Transferred Premises, Assignor hereby grants to Assignee the non-exclusive right, together with Assignor and its agents, employees, contractors, subtenants, successors and assigns, to use and access the Outside Area, as defined in the Building 1 & 2 Lease (the Building 1 & 2 Outside Areas) for the purpose of operating, maintaining, repairing, replacing and removing any equipment and personal property that constitutes Purchased Assets pursuant to the APA (the Transferred Equipment). Such use of the Building 1 & 2 Outside Areas shall be subject to Assignees compliance with the applicable terms and conditions of the Building 1 & 2 Lease, including, without limitation, Section 15.17 thereof and the obligation to decommission, remove and surrender such Transferred Equipment at the expiration or earlier termination of the Building 1 & 2 Lease, to the extent required by Landlord under the Building 1 & 2 Lease (if at all). Assignor and Assignee shall reasonably cooperate with each other to facilitate the operation, maintenance and repair of their respective equipment and personal property in the Building 1 & 2 Outside Areas through the remaining term of the Building 1 & 2 Lease and shall use commercially reasonable efforts to avoid unreasonable interference with the other partys use of the Building 1 & 2 Outside Areas.
3. Retained Rights. Notwithstanding anything to the contrary contained herein, Assignor and its agents, contractors, engineers and employees (Assignors Representatives) shall have the right to access and use the Transferred Premises to the extent necessary to accommodate the activities and transition services contemplated under the APA and the TSA, which access may be restricted or limited by Assignee in Assignees sole discretion to the extent required to comply with privacy and security requirements related to Assignees governmental contracts. All such access and use of the Transferred Premises by Assignor and Assignors Representatives and work performed in connection therewith shall be subject to the terms and conditions of the APA and the TSA and Assignor shall use commercially reasonable efforts to avoid unreasonably interference with Assignees use of the Transferred Premises in connection therewith. For purposes of the foregoing and the continued shared use of the Building 1 & 2 Outside Areas as set forth above, Assignor and Assignee agree that the release and waivers of subrogation set forth Section 9.3 of each of the Transferred Leases shall apply as between Assignor and Assignee.
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4. Responsibilities Under Leases.
A. Assignor shall be responsible for the payment of all rents and other amounts and the performance of all obligations required under the Transferred Leases to be paid or performed by Assignor for any period prior to the Effective Date, including, without limitation, any and all indemnity obligations of Assignor accrued with respect to facts or circumstances first occurring prior to the Effective Date.
B. Assignee shall be responsible for the payment of all rents and other amounts and the performance of all obligations required under the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and the Building 2 Premises) to be paid or performed for any period on or after the Effective Date, including, without limitation, any and all indemnity obligations of the Tenant under the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and Building 2 Premises) accruing with respect to facts or circumstances first occurring on or after the Effective Date.
C. Subject to the other terms and conditions of this Agreement, to the extent that Assignor has made payments or performed obligations pursuant to the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and the Building 2 Premises) that relate to periods on or after the Effective Date and to the extent that Assignee has made payments or performed obligations pursuant to the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and Building 2 Premises) that relate to periods prior to the Effective Date, such amounts and obligations shall be prorated as of the Effective Date and the party with a net obligation to the other shall promptly pay such amount on or after the Effective Date.
5. Covenants of Assignee.
A. From and after the Effective Date, Assignee shall (i) pay all rent and perform all other payment obligations pursuant to this Agreement that are due pursuant to the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and Building 2 Premises) directly to Landlord, and (ii) render performance of all other obligations which have been assumed pursuant to this Agreement that are due pursuant to the Transferred Leases as to the Transferred Premises (excluding the Outside Area (except as provided in Section 2 above) and Building 2 Premises) directly to Landlord.
B. Assignee shall provide to Landlord such insurance and insurance certificates required of the Tenant under the Transferred Leases as to the Transferred Premises (excluding the Outside Area and Building 2 Premises) from and after the Effective Date and shall cause Assignor to be named as an additional insured on any policy of insurance carried by Assignee pursuant to the Transferred Leases (or which is carried by Assignee and relates to the Transferred Premises) upon which Assignee is a named insured. Assignee shall deliver to Assignor certificates of insurance, copies of policies and evidence of renewal at the same times and in the same manner that such items are required to be provided to Landlord under the Transferred Leases.
C. Unless Assignee obtains Landlords agreement to release Assignor from any further liability under the Transferred Leases, Assignee shall not (i) waive or amend any term or
-3-
condition of the Transferred Leases, (ii) exercise any election, option, right or remedy under the Transferred Leases (including, without limitation, any right to extend or renew a Transferred Lease under Exhibit D attached thereto), (iii) grant any consent or approval under the Transferred Leases, (iv) improve or otherwise alter any of the Transferred Premises, or (v) assign, sublease, mortgage, pledge or encumber any interest in or under this Agreement, the Transferred Leases or the Transferred Premises, in each case to the extent the same increases the obligations of the Tenant under the Transferred Leases, without in each such case having obtained the prior written consent of Assignor, which consent shall not be unreasonably withheld (but which consent may be conditioned upon Assignees provision of adequate security for the performance of Assignees obligations under this Agreement and the Transferred Leases). Unless Assignee obtains Landlords agreement to release Assignor from any further liability under the Transferred Leases, Assignee may not in any event amend the Transferred Leases to increase the rent or other sums payable thereunder, to extend the term thereof or to expand the premises subject thereto. Assignee may not terminate the Building 1 & 2 Lease without Assignors prior written consent, which may be withheld in Assignors sole and absolute discretion unless Landlord agrees in writing that such termination does not affect Assignors rights and obligations with respect to the Building 1 Premises.
D. Assignee shall promptly deliver to Assignor copies of all notices of default given or received by Assignee to or from the Landlord under the Transferred Leases.
6. Default. In the event that Assignee fails to pay any sum or perform any obligation to be paid or performed by Assignee under this Agreement or the Transferred Leases, then, in addition to all other rights and remedies provided at law and in equity, Assignor shall have the following remedies to which Assignor may resort cumulatively or alternatively:
A. Right to Cure. If Assignee fails to pay any sum or perform any obligation on its part to be performed under the terms of the Transferred Leases or this Agreement, Assignor may make such payment or perform such obligation without waiving or releasing Assignee from its obligations. Assignor shall be entitled (but not required) to take such action at such time as is necessary to avoid the occurrence of an event of tenants default under the Transferred Leases.
B. Additional Remedies at Law. If and to the extent this Agreement is characterized as a sublease for purposes of determining Assignors rights and remedies against Assignee, (i) Assignor shall have the remedy described in California Civil Code Section 1951.4 (which provides that a lessor may continue a lease in effect after the lessees breach and abandonment and recover rent as it becomes due, if the lessee has the right to sublet or assign, subject only to reasonable limitations), and (ii) Assignor shall have the right to recover damages in accordance with the provisions of California Civil Code Section 1951.2, including the right to recover the worth at the time of the award of the amount by which the unpaid rent which would have been earned after termination until the time of the award exceeds the amount of rental loss that Assignee proves could have been reasonably avoided.
7. Miscellaneous. Should any provision of this Agreement prove to be invalid or illegal, such invalidity or illegality shall in no way affect, impair or invalidate any other provision hereof, and such remaining provisions shall remain in full force and effect. Time is of the essence of this Agreement. The captions used in this Agreement are for convenience only and shall not be
-4-
considered in the construction or interpretation of any provision hereof. The language in all parts of this Agreement shall in all cases be construed as a whole according to its fair meaning and not strictly for or against either Assignor or Assignee, both of whom were represented by counsel in connection with the negotiation and preparation of this Agreement. The terms shall, will, and agree are mandatory. The term may is permissive. When a party is required to do something by this Agreement, it shall do so at its sole cost and expense without right of reimbursement from the other party unless a provision of this Agreement expressly requires reimbursement.
8. Brokerage Commissions. Each party hereto (i) represents to the others that it has not had any dealings with any real estate brokers, leasing agents or salesmen, or incurred any obligations for the payment of real estate brokerage commissions or finders fees which would be earned or due and payable by reason of the execution of this Agreement, and (ii) agrees to indemnify, defend and hold harmless the other parties from any claim for any such commission or fees which result from the actions of the indemnifying party.
9. Notices. Except for legal process which may also be served as provided by law or as provided herein, all notices, demands, requests, consents and other communications (Notices) which may be given or are required to be given by any party under this Agreement to the others shall be in writing and shall be deemed given to and received by the party intended to receive such Notice (i) when hand delivered, (ii) on the date on which the United States Post Office certifies delivery or refusal to accept delivery of such Notice which shall have been deposited, postage prepaid, to the United States mail, certified return receipt requested, properly addressed to the address specified herein, or (iii) on the date of delivery sent to the address specified herein by reputable overnight courier (e.g., Federal Express or other comparable service), as evidenced by such couriers records. All such Notices to Assignor and Assignee at the following addresses, provided, that, any party may change its address by notifying the other of such change in writing:
If to Assignor:
Intevac, Inc.
3560 Bassett Street
Santa Clara, CA 95054
Attn: James Moniz
Email: jmoniz@intevac.com
with a mandatory copy to:
Wilson Sonsini Goodrich & Rosati, P.C.
650 Page Mill Road
Palo Alto, CA 94304
Attn: Melissa Hollatz
Email: mhollatz@wsgr.com
-5-
If to Assignee:
EOTECH, LLC
2145 Crooks Rd., Ste. 210
Troy, MI 48084
Attn: Joseph Caradonna
Email: joe@crscompanies.com
with a mandatory copy to:
Bodman PLC
201 West Big Beaver Rd, Suite 500
Troy, Michigan 48084
Attn: Stephen P. Dunn
Email: sdunn@bodmanlaw.com
10. Entire Agreement. This Agreement, together with the APA and the TSA, constitute the entire Agreement among Assignor and Assignee regarding the Transferred Leases and the Transferred Premises, and there are no binding agreements or representations between the parties except as expressed herein. Assignee acknowledges that neither Assignor nor any party acting on behalf of Assignor has made any legally binding representation as to any matter except those expressly set forth herein, and Assignee agrees that it may not reasonably rely on any representation made by, or purportedly made by, Assignor or any party acting on behalf of Assignor unless such representation is expressly set forth in this Agreement. There are no oral agreements among Assignor and Assignee affecting this Agreement, and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements and understandings, if any, between Assignor and Assignee with respect to the subject matter of this Agreement. This Agreement shall not be legally binding until it is executed by Assignor and Assignee. No subsequent change or addition to this Agreement shall be binding unless in writing and signed by the party sought to be bound thereby.
11. Counterparts. For the convenience of the parties, this Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same document.
12. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California.
13. Authority. Each party hereto represents and warrants to the other parties that (i) the person or persons executing this Agreement on behalf of such party is duly authorized to execute this Agreement on behalf of such party, and (ii) such party has the right, power and authority to execute and deliver this document to the other parties and to perform its obligations as set forth herein.
-6-
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement through their duly authorized representatives as of the date first above written.
ASSIGNOR: | ||
INTEVAC, INC., a Delaware corporation | ||
By: |
/s/ Wendell Blonigan | |
Name: |
Wendell Blonigan | |
Title: |
Chief Executive Officer |
ASSIGNEE: | ||
EOTECH, LLC, a Michigan limited liability company | ||
By: |
/s/ Joseph L. Caradonna | |
Name: |
Joseph L. Caradonna | |
Title: |
Manager |
Exhibit 10.29
PROFESSIONAL SERVICES AGREEMENT
This Professional Services Agreement (hereinafter referred to as Agreement), dated January 04, 2022 (the Effective Date), is made by and between lntevac, Inc., with its principal a place of business at 3560 Bassett Street, Santa Clara, California 95054-2704 (lntevac), and Tim Justyn, (including its employees, agents or subcontractors) with its principal place of business at 18173 Knuth Road, Los Gatos, CA 95033 (Consultant). lntevac desires the services of Consultant as an independent consultant, and Consultant desires to perform such services. lntevac and Consultant each a Party and collectively the Parties.
In consideration of the mutual covenants contained herein, the Parties agree as follows:
1. | Statement of Work |
Commencing on the Effective Date, Consultant shall perform the services, as defined below, for lntevac or as specifically directed by the authorized representative(s) of lntevac.
The Consultant will provide the following services (Services): Support transitioning of Photonics to EOTech.
2. | Payment |
In consideration for such Services, and subject to the terms and conditions of this Agreement, lntevac will (i) pay Consultant $153.85 per hour for consulting Services furnished by the Consultant under this Agreement, and (ii) reimburse Consultant for all reasonable and authorized expenses not to exceed $0.00 as described herein ((i) and (ii) collectively Fees). Regarding 2(ii) above, lntevac will only reimburse expenses incurred, and approved, for services rendered under this Agreement that are accompanied by itemized statements and include copies of actual bills, receipts, invoices or other evidence of expenses. Consultant shall not incur any expense on behalf of lntevac except upon the prior written approval of lntevac.
The maximum total amount of Fees payable under this Agreement is $32,000.00, and Consultant shall invoice lntevac on a monthly basis for all work performed and expenses incurred herein. Consultants monthly invoice shall contain a written summary of all authorized expenses, work performed and the associated time expended in that month. All invoices should be addressed to the attention of Accounts Payable.
All Invoices submitted by Consultant for Services and expenses shall be in the form prescribed by lntevac and shall be subject to approval by responsible technical and accounting personnel of lntevac prior to payment. lntevac will review each monthly invoice submitted and reserves the right to reject any invoice that does not adequately describe the service provided by Consultant. lntevac will issue payments within thirty (30) days from actual receipt of Consultants invoice by lntevac.
Consultant shall not be reimbursed for time spent during travel for Services rendered under this Agreement, except to the extent that work is actually performed during travel periods. Consultant shall comply with lntevacs travel policies except as otherwise agreed by lntevac in writing. Consultant shall permit audit of Consultants compliance with the terms of this Agreement by lntevacs internal audit staff or such other representative(s) as lntevac shall designate. Any consulting work and related expenses that are not in accord with applicable laws, regulations, lntevac Standards of Conduct pursuant to Section 10, and other terms of this Agreement, will not be reimbursed.
lntevacs sole liability to Consultant shall be the Fees as expressly set forth in this Agreement. lntevac makes no representations as to the scope or cost of Consultants services, other than as set forth in this Agreement, and shall have no liability whatsoever for any costs in excess of the amounts as authorized by this Agreement.
3. | Inventions and Data Developed under This Agreement |
The term Invention as used in this Agreement means any invention, discovery, improvement, design, idea or suggestion, whether or not patentable, conceived and/or first actually reduced to practice by Consultant, its employees, agents or subcontractors, alone or jointly with others, in the course of or as a result of any work performed for lntevac under this Agreement.
The term Data as used in this Agreement means any writings, sound recordings, pictorial reproductions, drawings, or other graphic representations, and works of any similar nature, whether or not copyrightable, which are prepared by Consultant, its employees, agents or subcontractors, alone or jointly with others, in the course of or as a result of any work performed for lntevac under this Agreement. Without further consideration, all Inventions and Data developed by Consultant under this Agreement are and shall remain the property of lntevac, its successors or assigns, or its nominees, whether or not lntevac obtains patent or copyright protection thereon, and regardless of whether such Invention or Data was developed solely by Consultant.
Consultant shall, without further consideration, promptly disclose all Inventions and Data to lntevac or its nominees. Consultant shall assist lntevac and its nominees to procure and/or maintain patents, copyrights and trade secrets throughout the world on said Inventions and Data, and to record the existence of the right, title and interest to said Inventions and Data in lntevac, its successors or assigns, or its nominees at lntevacs expense, in every proper way, including signing papers.
lntevac shall have the sole right to any Consultant Inventions or Data developed under this Agreement, including the right to own or use any such developments, inclusions or recommendations in lntevac products without restriction and without further compensation to Consultant for such use or ownership. These rights to use and own shall extend to any Inventions or Data developed under this Agreement by Consultants employees, agents and subcontractors.
4. | Confidential Treatment Information |
Consultant, its employees, agents and subcontractors shall not, either during or after the term of this Agreement, directly or indirectly publish or disclose to any third party any information (including but not limited to subject inventions or subject data) pertaining in any way to the business of lntevac, its customers or suppliers which is developed, acquired, derived or learned from association with lntevac, unless lntevac gives written authorization to do so. Such information shall not be used apart from lntevac business without the written approval of lntevac. The prohibition against disclosure to others shall not apply to information after it is clearly disclosed to the public by lntevac in writing.
Drawings, sketches and any other tangible material made or obtained by Consultant, its employees, agents or subcontractors at or for lntevac shall be promptly turned over to lntevac, and shall not be removed from lntevacs premises without written permission of lntevac. If written permission is given to remove any such material, the material shall be promptly returned to lntevac upon completion of the work for lntevac or at any earlier time requested by lntevac.
5. | Term and Termination |
This Agreement shall expire on June 30, 2022. Notwithstanding the foregoing, lntevac may terminate this Agreement without cause at any time for any reason by providing written notice thereof to Consultant.
lntevac may immediately suspend or terminate performance under this Agreement if, in its sole judgment, it believes that Consultant may have, i) engaged in any illegal or unethical conduct, ii) engaged in any activity, employment or business arrangement which conflicts with the Consultants obligations hereunder, or with the interests of lntevac, or iii) materially breached any other of its obligations under this Agreement.
Consultant may terminate this Agreement without cause upon providing ten (10) day written notice to lntevac.
The obligations contained in this Agreement shall continue after termination or expiration. lntevacs sole obligation after termination, however, shall be to pay earned and unpaid Fees, as shall be due and owing for lawful consulting Services requested by lntevac and rendered prior to such termination.
6. | Conflicts of Interest |
During the term of this Agreement, Consultant shall not perform any work which might constitute a conflict of interest. Consultant represents and warrants that Consultant has disclosed in writing to lntevac all other clients and any work which may represent a conflict of interest with respect to the work to be performed for lntevac under this Agreement. Consultant shall during the term hereof advise lntevac prior to entering into any agreement with any other entity or performing any other work which may result in such a conflict of interest, and further shall during the term hereof not enter into any such agreement or perform any other such work without the prior written approval of lntevacs Contracts Department Head, or its assigned delegate.
7. | Information Provided |
With reference to any information provided by Consultant to lntevac, Consultant warrants the following:
i) Consultant has the lawful right to transfer such information to lntevac, without breach of any law, regulation, contract obligation, or duty of employment, and that lntevac may use such information without incurring any liability or obligation to any other person or entity, and ii) that any information provided to lntevac which may have been obtained directly by Consultant or from any other person or entity was, to the best of Consultants knowledge, properly obtained and not in violation of any law, regulation, contract obligation, or duty of employment. Consultant shall indemnify, defend, and hold harmless lntevac and its employees, officers and directors from any damages and claims arising out of or related to any gross negligent breach by Consultant of any of the above, (a) Consultant provides information under this Agreement on a best efforts basis with no guarantee of accuracy, and Consultant shall have no liability whatsoever to lntevac for any errors and omissions in performance hereunder, and (b) Consultant shall have no liability for any aforesaid information disclosed to lntevac as to which Consultant has made a full and complete written disclosure to, and obtained prior written approval for such disclosure from, lntevacs Contracts Department Head and/or Chief Financial Officer of the circumstances regarding Consultants acquisition of such information.
8. | Conformance with Applicable Laws |
Consultant represents and warrants that (i) Consultant is familiar with and will continue to be familiar with all current laws and regulations relating to gratuities, bribery, kickbacks, conflicts of interest, classified information and lobbying activity (as that term is generally defined in the Federal Regulation of Lobbying Act, 2 USC 261, et seq.); (ii) no principal or relative of any principal of Consultant is a U.S. Government official other than as expressly disclosed in writing by Consultant prior to the effective date of this Agreement; and (iii) no U.S. Government official has or owns any beneficial interest in Consultant, nor in any of compensation that will be paid to Consultant by lntevac, under this Agreement; and (iv) if Consultants Services extend outside the United States for any reason, (A) it understands the
Organization for Economic Co-operation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (Convention), has read and understood the Guidance Note and agrees to comply with the Convention; and (B) it will not, directly, or indirectly, in connection with this Agreement and the business resulting therefrom, offer, pay, promise to pay, or authorize the giving of money or anything of value to any government official (as defined in the U.S. Foreign Corrupt Practices Act, as amended (FCPA)), to any political party or official thereof or to any candidate for political office, or to any person, while knowing or being aware of a high probability that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to any government official, to any political party or official thereof, or to any candidate to political office, for the purpose of (a) influencing any act or decision of such official, political party, party official, or candidate in his or its official capacity, including a decision to fail to perform his or its official functions; or (b) inducing such official, political party, party official, or candidate to use his or its influence with the government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, in order to assist lntevac in obtaining or retaining business for or with, or directing business to lntevac.
Consultant shall strictly comply with all applicable statutes and regulations in the conduct of Consultants work for lntevac,.
PROHIBITED DISCRIMINATION. This contractor and subcontractor shall abide by the requirements of 29 CFR Part 471, Appendix A to Subpart A (Appendix A is available at www.dol.gov/olms/regs/compliance/E013496.htm}, 41 CFR 60-1.4(a), 60-300.S(a) and 60-741.S(a). These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their race, color, religion, sex, sexual orientation, gender identity, national origin, or for inquiring about, discussing, or disclosing information about compensation. Moreover, these regulations require that covered prime contractors and subcontractors take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, disability or veteran status.
9. | Export Law Compliance |
Consultant represents and warrants that, except as allowed under applicable U.S. Government export laws and regulations, no technical data, hardware, software, technology, or other information furnished to it hereunder shall be disclosed or exported to any foreign person, firm, or country, including foreign persons employed by or associated with Consultant. Furthermore, Consultant shall not allow any re-export of any technical data, hardware, software, technology, or other information furnished, without first complying with all applicable U.S. Government export laws and regulations. Prior to exporting any technical data, hardware, software, technology, or other information furnished hereunder, Consultant shall obtain the advance written approval of lntevac.
10. | Standards of Conduct |
Consultant has read, understands, and shall comply, with lntevacs Standards of Conduct, which can be accessed on lntevacs website at https://www.intevac.com. Consultant shall report to lntevac all contacts with U.S. Government employees and officials during which lntevac matters are discussed.
11. | Reporting of Violations |
Consultant shall report to lntevac any request made by an lntevac employee to obtain any information or perform any other act under this Agreement in a manner which would violate any i) applicable law or regulation, ii) contract obligation or duty of employment, or iii) lntevac Standards of Conduct. Consultant is requested similarly to report to lntevacs Human Resources Manager or Contracts Department Head any observed violation of law or regulation by lntevac personnel. All such reports will be handled on a confidential basis and may be made anonymously, if desired.
12. | Limitation of Liability |
INTEVAC SHALL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, PUNITIVE, OR EXEMPLARY DAMAGES IN ANY WAY ARISING OUT OF THIS AGREEMENT INCLUDING BUT NOT LIMITED TO ANY LOSS OF PROFITS, REVENUES OR GOODWILL, WHETHER BASED ON CONTRACT, TORT OR ANY OTHER LEGAL THEORY EVEN IF SUCH DAMAGES ARE FORSEEABLE AND WHETHER OR NOT BUYER HAS BEEN ADVISED OF THE POSSIBILITY THEREOF. EXCEPT FOR INTEVACS OBLIGATION TO PAY CONSULTANT FOR FEES APPROVED UNDER THIS AGREEMENT, INTEVACS MAXIMUM AGGREGATE LIABILITY FOR ALL CLAIMS OF ANY KIND UNDER THIS AGREEMENT WILL NOT EXCEED THE TOTAL PAYMENTS MADE TO CONSULTANT UNDER THIS AGREEMENT IN THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE DATE THE CLAIM AROSE.
13. | Indemnification |
Where Consultant will perform work or services on lntevacs premises, Consultant shall indemnify and hold harmless lntevac and its affiliates from any claims brought by Consultant and its employees, third party subcontractors, agents, or consultants (collectively referred to as Consultants Personnel), for property damage, injury to person or wrongful death that occurs while Consultants Personnel are working on lntevacs premises, regardless of the actual cause or proximate cause of the injury. Consultant shall flow down this indemnification requirement to all subcontractors it retains to work on lntevacs premises.
14. | Miscellaneous |
Independent Contractor: Consultant shall be deemed as, and at all times act as, an independent contractor and not as an employee, agent or partner of lntevac.
No employee, agent or subcontractor of Consultant, who is not made a party to this Agreement or Non-Disclosure Agreement with lntevac, shall be permitted to have access to the premises, data, documents, property, or personnel of lntevac.
If, in connection with this Agreement, Consultant performs services for any subsidiary or affiliate of lntevac or has access to the premises, data, property, or personnel of any subsidiary or affiliate of lntevac, the term lntevac as used herein shall include each such subsidiary or affiliate of lntevac.
This Agreement contains the entire understanding of the Parties hereto with respect to the subject matter hereof, and supersedes all prior representations, warranties, understandings, and agreements, written and oral. It may not be modified except by written agreement executed by the Parties hereto. Consultant waives any and all provisions of law construing agreements against the drafting Party.
No waiver of any term or provision of this Agreement shall imply a subsequent waiver of the same or any other provision hereof, nor shall it constitute a continuing waiver.
This Agreement will be governed by and construed in accordance with the laws of the State of California, USA Any suit or action under this Agreement must be brought in the United States Federal District Court located in San Jose or in the Superior Court for the State of California, located in Santa Clara County, California, USA Each Party agrees and submits to the personal jurisdiction and venue of such courts.
In the event any term or provision hereof is held to be invalid or unenforceable by final judgment of any court of competent jurisdiction, such term or provision shall there upon be severed from this Agreement and the remainder of the terms and provisions hereof shall remain in full force and effect.
Sections 3, 4, 7, 9, 12, 13 & 14 shall survive the expiration or termination of this Agreement.
BY EXECUTION HEREOF CONSULTANT ACKNOWLEDGES THAT CONSULTANT HAS FULLY READ AND UNDERSTOOD THIS AGREEMENT INCLUDING THE INTEVACS STANDARDS OF CONDUCT
AND AGREES TO ADHERE STRICTLY TO THE TERMS AND CONDITIONS CONTAINED THEREIN. CONSULTANT FURTHER ACKNOWLEDGES THAT THIS AGREEMENT REQUIRES STRICT COMPLIANCE WITH ALL APPLICABLE LAWS AND REGULATIONS AS WELL AS THE AVOIDANCE OF CONFLICTS OF INTEREST RELATING TO THE WORK TO BE PERFORMED.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement.
CONSULTANT
Date: January 4, 2022 |
/s/ TIMOTHY JUSTYN | |||
Timothy Justyn | ||||
Consultant |
INTEVAC, INC.
Date: January 4, 2022 |
/s/ SCOTT SEELY | |||
Scott Seely | ||||
Senior Director Contracts |
Exhibit 21.1
SUBSIDIARIES OF THE REGISTRANT
1. |
Intevac Photonics, Inc. Delaware |
2. |
Intevac Pacific Group Holdings Ltd. Pte Singapore |
3. |
Lotus Technologies, Inc. Santa Clara, California |
4. |
IRPC, Inc. Santa Clara, California |
5. |
Solar Implant Technologies, Inc. California |
6. |
Intevac Foreign Sales Corporation Barbados |
7. |
Intevac Asia Private Limited Singapore |
8. |
Intevac Malaysia Sdn Bhd Malaysia |
9. |
Intevac Limited Hong Kong |
10. |
Intevac (Shenzhen) Co. Ltd. China |
11. |
IVAC Co. Ltd. Korea |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-258132, 333-238262, 333-232730, 333-226262, 333-219405, 333-212647, 333-205368, 333-197700, 333-190250, 333-181929, 333-175979, 333-160596, 333-134422, 333-109260, and 333-106960) of Intevac, Inc. of our reports dated February 17, 2022 relating to the consolidated financial statements and internal control over financial reporting, which appear in this Annual Report on Form 10-K.
/s/ BPM LLP
San Jose, California
February 17, 2022
Exhibit 31.1
Certifications
I, Nigel D. Hunton, certify that:
1. | I have reviewed this Annual Report on Form 10-K of Intevac, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: February 17, 2022
/s/ Nigel D. Hunton |
Nigel D. Hunton |
President, Chief Executive Officer and Director |
Exhibit 31.2
Certifications
I, James Moniz, certify that:
1. | I have reviewed this Annual Report on Form 10-K of Intevac, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: February 17, 2022
/s/ James Moniz |
James Moniz |
Executive Vice President, Finance and Administration Chief Financial Officer, Secretary and Treasurer |
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Nigel D. Hunton, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Annual Report of Intevac, Inc. on Form 10-K for the period ended January 1, 2022 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-K fairly presents in all material respects the financial condition and results of operations of Intevac, Inc.
Date: February 17, 2022
/s/ Nigel D. Hunton |
Nigel D. Hunton |
President, Chief Executive Officer and Director |
I, James Moniz, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Annual Report of Intevac, Inc. on Form 10-K for the period ended January 1, 2022 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-K fairly presents in all material respects the financial condition and results of operations of Intevac, Inc.
Date: February 17, 2022
/s/ James Moniz |
James Moniz |
Executive Vice President, Finance and Administration Chief Financial Officer, Secretary and Treasurer |
A signed original of this written statement required by Section 906 has been provided to Intevac, Inc. and will be retained by Intevac, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.