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Table of Contents
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
 
FORM
10-Q
 
 
(MARK ONE)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 2, 2021
OR
 
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
                    
to
                    
Commission file number
0-26946
 
 
INTEVAC, INC.
(Exact name of registrant as specified in its charter)
 
 
 
Delaware
 
94-3125814
(State or other jurisdiction of
incorporation or organization)
 
(IRS Employer
Identification No.)
3560 Bassett Street
Santa Clara, California 95054    
(Address of principal executive office, including Zip Code)
Registrant’s telephone number, including area code: (408)
986-9888
 
 
Securities registered pursuant to Section 12(b) of the Act:
 
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
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    ☒  
Yes
    ☐  No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    ☒  Yes    ☐  No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in
Rule 12b-2
of the Exchange Act:
 
Large accelerated filer
 
☐
  
Accelerated filer
 
☒
Non-accelerated
filer
 
☐
  
Smaller reporting company
 
☒
    
Emerging growth company
 
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2
of the Act).    ☐  Yes    ☒  No
On November 2, 2021,
24,590,904
 shares of the Registrant’s Common Stock, $0.001 par value, were outstanding.
 
 
 
Table of Contents
INTEVAC, INC.
INDEX
 
No.
      
Page
 
  
Item 1.
  Financial Statements (unaudited)   
  Condensed Consolidated Balance Sheets      3  
  Condensed Consolidated Statements of Operations      4  
  Condensed Consolidated Statements of Comprehensive Income (Loss)      5  
  Condensed Consolidated Statements of Cash Flows      6  
  Notes to Condensed Consolidated Financial Statements      7  
Item 2.
  Management’s Discussion and Analysis of Financial Condition and Results of Operations      22  
Item 3.
  Quantitative and Qualitative Disclosures About Market Risk      30  
Item 4.
  Controls and Procedures      30  
  
Item 1.
  Legal Proceedings      31  
Item 1A.
  Risk Factors      31  
Item 2.
  Unregistered Sales of Equity Securities and Use of Proceeds      37  
Item 3.
  Defaults upon Senior Securities      37  
Item 4.
  Mine Safety Disclosures      37  
Item 5.
  Other Information      38  
Item 6.
  Exhibits      38  
     39  
 
2
Table of Contents
PART I. FINANCIAL INFORMATION
 
Item 1.
Financial Statements
INTEVAC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
 
    
October 2,

2021
   
January 2,

2021
 
              
    
(Unaudited)
 
    
(In thousands, except par value)
 
ASSETS
 
     
Current assets:
                
Cash and cash equivalents
   $ 33,696     $ 29,341  
Short-term investments
     11,137       14,839  
Trade and other accounts receivable, net of allowances of $0 at both October 2, 2021 and at January 2, 2021
     13,470       28,646  
Inventories
     22,453       21,689  
Prepaid expenses and other current assets
     1,981       1,893  
    
 
 
   
 
 
 
Total current assets
     82,737       96,408  
Long-term investments
     5,825       5,388  
Restricted cash
     786       787  
Property, plant and equipment, net
     9,209       11,004  
Operating lease
right-of-use-assets
     6,382       8,165  
Deferred income taxes and other long-term assets
     5,554       5,486  
    
 
 
   
 
 
 
Total assets
   $ 110,493     $ 127,238  
    
 
 
   
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
     
Current liabilities:
                
Current operating lease liabilities
   $ 3,047     $ 2,853  
Accounts payable
     4,659       4,259  
Accrued payroll and related liabilities
     5,657       7,679  
Other accrued liabilities
     2,649       3,631  
    
 
 
   
 
 
 
Total current liabilities
     16,012       18,422  
Noncurrent liabilities:
 
Noncurrent operating lease liabilities
     4,476       6,803  
Other long-term liabilities
     450       457  
    
 
 
   
 
 
 
Total noncurrent liabilities
     4,926       7,260  
Stockholders’ equity:
 
Common stock, $0.001 par value
     25       24  
Additional
paid-in
capital
     198,117       193,173  
Treasury stock, 5,087 shares at both October 2, 2021 and at January 2, 2021
     (29,551 )      (29,551 ) 
Accumulated other comprehensive income
     557       640  
Accumulated deficit
     (79,593 )      (62,730 ) 
    
 
 
   
 
 
 
Total stockholders’ equity
     89,555       101,556  
    
 
 
   
 
 
 
Total liabilities and stockholders’ equity
   $ 110,493     $ 127,238  
    
 
 
   
 
 
 
Note: Amounts as of January 2, 2021 are derived from the January 2, 2021 audited consolidated financial statements.
See accompanying notes to the condensed consolidated financial statements.
 
3
Table of Contents
INTEVAC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 
    
Three Months Ended
   
Nine Months Ended
 
              
    
October 2,

2021
   
September 26,

2020
   
October 2,

2021
   
September 26,

2020
 
                          
    
(Unaudited)
 
    
(In thousands, except per share amounts)
 
         
Net revenues:
                                
Systems and components
   $ 11,700     $ 15,027     $ 35,410     $ 51,589  
Technology development
     3,093       6,538       9,437       17,659  
    
 
 
   
 
 
   
 
 
   
 
 
 
Total net revenues
     14,793       21,565       44,847       69,248  
Cost of net revenues:
                                
Systems and components
     7,120       8,389       25,708       29,969  
Technology development
     2,146       3,876       7,450       10,403  
    
 
 
   
 
 
   
 
 
   
 
 
 
Total cost of net revenues
     9,266       12,265       33,158       40,372  
    
 
 
   
 
 
   
 
 
   
 
 
 
Gross profit
     5,527       9,300       11,689       28,876  
Operating expenses:
                                
Research and development
     3,743       3,603       11,262       10,594  
Selling, general and administrative
     5,752       5,845       17,208       17,426  
    
 
 
   
 
 
   
 
 
   
 
 
 
Total operating expenses
     9,495       9,448       28,470       28,020  
    
 
 
   
 
 
   
 
 
   
 
 
 
Income (loss) from operations
     (3,968 )      (148 )      (16,781 )      856  
Interest income and other income (expense), net
     25       8       75       212  
    
 
 
   
 
 
   
 
 
   
 
 
 
Income (loss) before provision for income taxes
     (3,943 )      (140 )      (16,706 )      1,068  
Provision for income taxes
     290       217       157       1,125  
    
 
 
   
 
 
   
 
 
   
 
 
 
Net loss
   $ (4,233 )    $ (357 )    $ (16,863 )    $ (57 ) 
    
 
 
   
 
 
   
 
 
   
 
 
 
         
Net loss per share:
                                
Basic and Diluted
   $ (0.17 )    $ (0.02 )    $ (0.69 )    $ (0.00 ) 
         
Weighted average common shares outstanding:
                                
Basic and Diluted
     24,522       23,771       24,265       23,605  
See accompanying notes to the condensed consolidated financial statements.
 
4
Table of Contents
INTEVAC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
 
    
Three Months Ended
   
Nine Months Ended
 
              
    
October 2,

2021
   
September 26,

2020
   
October 2,

2021
   
September 26,

2020
 
                          
    
(Unaudited)
(In thousands)
 
         
Net loss
   $ (4,233 )    $ (357 )    $ (16,863 )    $ (57 ) 
    
 
 
   
 
 
   
 
 
   
 
 
 
Other comprehensive income (loss), before tax
                                
Change in unrealized net gain on
available-for-sale
investments
     (7 )      (24 )      (36 )      29  
Foreign currency translation gains (losses)
     (7 )      124       (47 )      49  
    
 
 
   
 
 
   
 
 
   
 
 
 
Other comprehensive income (loss), before tax
     (14 )      100       (83 )      78  
Income tax (expense) benefit related to items in other comprehensive income (loss)
     —         —         —         —    
    
 
 
   
 
 
   
 
 
   
 
 
 
Other comprehensive income (loss), net of tax
     (14 )      100       (83 )      78  
    
 
 
   
 
 
   
 
 
   
 
 
 
Comprehensive income (loss)
   $ (4,247 )    $ (257 )    $ (16,946 )    $ 21  
    
 
 
   
 
 
   
 
 
   
 
 
 
See accompanying notes to the condensed consolidated financial statements.
 
5
INTEVAC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
    
Nine months ended
 
    
October 2,

2021
   
September 26,

2020
 
              
    
(Unaudited)
(In thousands)
 
     
Operating activities
                
Net loss
   $ (16,863 )    $ (57 ) 
Adjustments to reconcile net loss to net cash and cash equivalents provided by (used in) operating activities:
                
Depreciation and amortization
     2,568       2,645  
Net amortization (accretion) of investment premiums and discounts
     88       (9 ) 
Equity-based compensation
     2,872       2,186  
Straight-line rent adjustment and amortization of lease incentives
     (350 )      (224 ) 
Deferred income taxes
     (36 )      516  
Changes in operating assets and liabilities
     11,681       2,714  
    
 
 
   
 
 
 
Total adjustments
     16,823       7,828  
    
 
 
   
 
 
 
Net cash and cash equivalents provided by (used in) operating activities
     (40 )      7,771  
Investing activities
                
Purchases of investments
     (13,214 )      (17,071 ) 
Proceeds from sales and maturities of investments
     16,355       17,950  
Purchases of leasehold improvements and equipment
     (773 )      (2,329 ) 
    
 
 
   
 
 
 
Net cash and cash equivalents provided by (used in) investing activities
     2,368       (1,450 ) 
Financing activities
                
Net proceeds from issuance of common stock
     2,618       1,865  
Common stock repurchases
     —         (393 ) 
Taxes paid related to net share settlement
     (545 )      (364 ) 
    
 
 
   
 
 
 
Net cash and cash equivalents provided by financing activities
     2,073       1,108  
Effect of exchange rate changes on cash
     (47 )      49  
    
 
 
   
 
 
 
Net increase in cash, cash equivalents and restricted cash
     4,354       7,478  
Cash, cash equivalents and restricted cash at beginning of period
     30,128       20,554  
    
 
 
   
 
 
 
Cash, cash equivalents and restricted cash at end of period
   $ 34,482     $ 28,032  
    
 
 
   
 
 
 
     
Non-cash
investing and financing activity
                
Additions to
right-of-use-assets
obtained from new operating lease liabilities
   $ —       $ 128  
    
 
 
   
 
 
 
See accompanying notes to the condensed consolidated financial statements.
 
6
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 
1.
Description of Business and Basis of Presentation
Description of Business
Intevac, Inc. (together with its subsidiaries “Intevac,” the “Company” or “we”) is a provider of vacuum deposition equipment for a wide variety of thin-film applications, and a leading provider of digital night-vision technologies and products to the defense industry. The Company leverages its core capabilities in high-volume manufacturing of small substrates to provide process manufacturing equipment solutions to the hard disk drive (“HDD”), display cover panel (“DCP”), photovoltaic (“PV”) solar cell and advanced semiconductor packaging (“ASP”) industries. Intevac also provides sensors, cameras and systems for government applications such as night vision. Intevac’s customers include manufacturers of hard disk media, DCPs and solar cells as well as the U.S. government and its agencies, allies and contractors. Intevac reports two segments: Thin-film Equipment (“TFE”) and Photonics.
Basis of Presentation
In the opinion of management, the unaudited interim condensed consolidated financial statements of Intevac included herein have been prepared on a basis consistent with the January 2, 2021 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments, necessary to fairly present the information set forth therein. Intevac’s results of operations for the three and nine months ended October 2, 2021 are not necessarily indicative of future operating results.
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates.
COVID-19
Update
The COVID-19
outbreak, which was declared a global pandemic by the World Health Organization in March 2020, has impacted all countries in which we operate. The impact of
COVID-19,
including changes in consumer behavior, pandemic fears, and market downturns as well as restrictions on business and individual activities has created significant volatility in the global economy and led to reduced economic activity. There have been extraordinary actions taken by federal, state, and local public health and governmental authorities to contain the spread of
COVID-19
and although many restrictions that were in place have eased in many localities, some areas that had previously eased restrictions have reverted to more stringent limitations. There remains significant uncertainty concerning the magnitude of the impact and the duration of the
COVID-19
pandemic. Given that, we are unable to predict the ultimate impact it may have on our business, future operations, financial position or cash flows. The extent that our operations will continue to be impacted by the
COVID-19
pandemic will depend on future developments, including any new potential waves of the virus, new strains of the virus, and the success of vaccination programs, all of which are highly uncertain and cannot be accurately predicted. However, we are monitoring the progression of the pandemic and its potential effect on our financial position, results of operations, and cash flows.
 
7
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
2.
Revenue
The following tables represent a disaggregation of revenue from contracts with customers for the three and nine months ended October 2, 2021 and September 26, 2020 along with the reportable segment for each category.
Major Products and Service Lines
 
     
           
     
           
     
           
     
           
     
           
     
           
     
           
     
           
 
TFE
  
Three Months Ended October 2, 2021
    
Three Months Ended September 26, 2020
 
               
    
(In thousands)
 
    
HDD
    
DCP
    
PV
    
ASP
    
Total
    
HDD
    
PV
    
Total
 
                                                         
Systems, upgrades and spare parts
  
$
6,495
 
  
$
—  
 
  
$
61
 
  
$
—  
 
  
$
6,556
 
  
$
7,601
 
  
$
131
 
  
$
7,732
 
Field service
  
 
1,424
 
  
 
—  
 
  
 
18
 
  
 
—  
 
  
 
1,442
 
  
 
1,635
 
  
 
—  
 
  
 
1,635
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
Total TFE net revenues
  
$
7,919
 
  
$
—  
 
  
$
79
 
  
$
—  
 
  
$
7,998
 
  
$
9,236
 
  
$
131
 
  
$
9,367
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
 
                                                                                                                                                 
    
Nine Months Ended October 2, 2021
    
Nine Months Ended September 26, 2020
 
               
    
(In thousands)
 
    
HDD
    
DCP
    
PV
    
ASP
    
Total
    
HDD
    
PV
    
Total
 
                                                         
Systems, upgrades and spare parts
  
$
14,034
 
  
$
3
 
  
$
219
 
  
$
3,850
 
  
$
18,106
 
  
$
29,189
 
  
$
400
 
  
$
29,589
 
Field service
  
 
4,425
 
  
 
14
 
  
 
60
 
  
 
—  
 
  
 
4,499
 
  
 
4,334
 
  
 
2
 
  
 
4,336
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
Total TFE net revenues
  
$
18,459
 
  
$
17
 
  
$
279
 
  
$
3,850
 
  
$
22,605
 
  
$
33,523
 
  
$
402
 
  
$
33,925
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
 
    
Three Months Ended
    
Nine Months Ended
 
               
Photonics
  
October 2,

2021
    
September 26,

2020
    
October 2,

2021
    
September 26,

2020
 
                             
    
(In thousands)
 
Products:
                                   
Military products
   $ 3,343      $ 4,947      $ 11,552      $ 15,758  
Commercial products
     100        139        278        257  
Repair and other services
     259        574        975        1,649  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total Photonics product net revenues
     3,702        5,660        12,805        17,664  
Technology development:
                                   
Firm Fixed Price (“FFP”)
     1,571        5,482        4,919        15,374  
Cost Plus Fixed Fee (“CPFF”)
     1,522        1,056        4,518        2,285  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total technology development net revenues
     3,093        6,538        9,437        17,659  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total Photonics net revenues
   $ 6,795      $ 12,198      $ 22,242      $ 35,323  
    
 
 
    
 
 
    
 
 
    
 
 
 
Primary Geographical Markets
 
     
                          
     
                          
     
                          
     
                          
     
                          
     
                          
 
    
Three Months Ended
    
Three Months Ended
 
                                           
    
October 2, 2021
    
September 26, 2020
 
               
    
(In thousands)
 
    
TFE
    
Photonics
    
Total
    
TFE
    
Photonics
    
Total
 
United States
  
$
220
 
  
$
6,738
 
  
$
6,958
 
  
$
1,764
 
  
$
12,079
 
  
$
13,843
 
Asia
  
 
7,778
 
  
 
—  
 
  
 
7,778
 
  
 
7,536
 
  
 
—  
 
  
 
7,536
 
Europe
  
 
—  
 
  
 
57
 
  
 
57
 
  
 
67
 
  
 
119
 
  
 
186
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
Total net revenues
  
$
7,998
 
  
$
6,795
 
  
$
14,793
 
  
$
9,367
 
  
$
12,198
 
  
$
21,565
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
 
                                                                                                                                                                         
    
Nine Months Ended
    
Nine Months Ended
 
               
    
October 2, 2021
    
September 26, 2020
 
                                           
    
(In thousands)
 
    
TFE
    
Photonics
    
Total
    
TFE
    
Photonics
    
Total
 
United States
  
$
2,708
 
  
$
22,069
 
  
$
24,777
 
  
$
2,596
 
  
$
35,060
 
  
$
37,656
 
Asia
  
 
16,047
 
  
 
—  
 
  
 
16,047
 
  
 
31,262
 
  
 
—  
 
  
 
31,262
 
Europe
  
 
3,850
 
  
 
173
 
  
 
4,023
 
  
 
67
 
  
 
263
 
  
 
330
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
Total net revenues
  
$
22,605
 
  
$
22,242
 
  
$
44,847
 
  
$
33,925
 
  
$
35,323
 
  
$
69,248
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
 
8
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
Timing of Revenue Recognition
 
                                                                                                                   
    
Three Months Ended
    
Three Months Ended
 
               
    
October 2, 2021
    
September 26, 2020
 
               
    
(In thousands)
 
    
TFE
    
Photonics
    
Total
    
TFE
    
Photonics
    
Total
 
Products transferred at a point in time
  
$
7,998
 
  
$
259
 
  
$
8,257
 
  
$
9,367
 
  
$
574
 
  
$
9,941
 
Products and services transferred over time
  
 
—  
 
  
 
6,536
 
  
 
6,536
 
  
 
—  
 
  
 
11,624
 
  
 
11,624
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
    
$
7,998
 
  
$
6,795
 
  
$
14,793
 
  
$
9,367
 
  
$
12,198
 
  
$
21,565
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
 
                                                                                                                   
    
Nine Months Ended
    
Nine Months Ended
 
               
    
October 2, 2021
    
September 26, 2020
 
               
    
(In thousands)
 
    
TFE
    
Photonics
    
Total
    
TFE
    
Photonics
    
Total
 
Products transferred at a point in time
  
$
22,605
 
  
$
574
 
  
$
23,179
 
  
$
33,925
 
  
$
1,649
 
  
$
35,574
 
Products and services transferred over time
  
 
—  
 
  
 
21,668
 
  
 
21,668
 
  
 
—  
 
  
 
33,674
 
  
 
33,674
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
    
$
22,605
 
  
$
22,242
 
  
$
44,847
 
  
$
33,925
 
  
$
35,323
 
  
$
69,248
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
 
The following table reflects the changes in our contract assets, which we classify as accounts receivable, unbilled or retainage, and our contract liabilities, which we classify as deferred revenue and customer advances, for the nine months ended October 2, 2021:
 
    
October 2,

2021
    
January 2,

2021
    
Nine Months

Change
 
                      
    
(In thousands)
 
TFE:
                          
Contract assets:
                          
Accounts receivable, unbilled
   $ —        $ 369      $ (369 ) 
    
 
 
    
 
 
    
 
 
 
Contract liabilities:
                          
Deferred revenue
   $ 197      $ 482      $ (285 ) 
Customer advances
     24        33        (9 ) 
    
 
 
    
 
 
    
 
 
 
     $ 221      $ 515      $ (294 ) 
    
 
 
    
 
 
    
 
 
 
       
Photonics:
                          
Contract assets:
                          
Accounts receivable, unbilled
   $ 1,493      $ 5,439      $ (3,946 ) 
Retainage
     87        126        (39 ) 
    
 
 
    
 
 
    
 
 
 
     $ 1,580      $ 5,565      $ (3,985 ) 
    
 
 
    
 
 
    
 
 
 
Contract liabilities:
                          
Deferred revenue
   $ 550      $ 779      $ (229 ) 
    
 
 
    
 
 
    
 
 
 
Accounts receivable, unbilled in our TFE segment represents a contract asset for revenue that has been recognized in advance of billing the customer. For our system and certain upgrade sales, our TFE customers generally pay in three installments, with a portion of the system price billed upon receipt of an order, a portion of the price billed upon shipment, and the balance of the price due upon completion of installation and acceptance of the system at the customer’s factory. Accounts receivable, unbilled in our TFE segment generally represents the balance of the system price that is due upon completion of installation and acceptance, less the amount that has been deferred as revenue for the performance of the installation tasks. During the nine months ended October 2, 2021, contract assets in our TFE segment decreased by $369,000 primarily due to the recognition of revenue for the installation portion of revenue for one system that completed installation and acceptance.
 
9
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
Customer advances in our TFE segment generally represent a contract liability for amounts billed to the customer prior to transferring goods. The Company has elected to use the practical expedient to disregard the effect of the time value of money in a significant financing component when its payment terms are less than one year. These contract advances are liquidated when revenue is recognized. Deferred revenue in our TFE segment generally represents a contract liability for amounts billed to a customer for completed systems at the customer site that are undergoing installation and acceptance testing where transfer of control has not yet occurred, as Intevac does not yet have a demonstrated history of meeting the acceptance criteria upon the customer’s receipt of product. During the nine months ended October 2, 2021, we recognized revenue in our TFE segment of $33,000 and $296,000 that was included in customer advances and deferred revenue, respectively, at the beginning of the period.
Accounts receivable, unbilled in our Photonics segment represents a contract asset for revenue that has been recognized in advance of billing the customer, which is common for contracts in the defense industry. In our Photonics segment, amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals (e.g., monthly) or upon achievement of contractual milestones. Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. Our contracts with the U.S. government may also contain retainage provisions. Retainage represents a contract asset for the portion of the contract price earned by us for work performed but held for payment by the U.S. government as a form of security until satisfactory completion of the contract. The retainage is billable upon completion of the contract performance and approval of final indirect expense rates by the government. During the nine months ended October 2, 2021, contract assets in our Photonics segment decreased by $4.0 million primarily due to the billing of contractual milestones, offset in part by the accrual of revenue for incurred costs under FFP and CPFF contracts.
Deferred revenue in our Photonics segment generally represents a contract liability for amounts billed to the customer upon achievement of contractual milestones. These amounts are liquidated when revenue is recognized. During the nine months ended October 2, 2021, we recognized revenue in our Photonics segment of $779,000 that was included in deferred revenue at the beginning of the period.
On October 2, 2021, we had $44.9 million of remaining performance obligations, which we also refer to as backlog. Backlog at October 2, 2021 consisted of $16.9 million of TFE backlog and $27.9 million of Photonics backlog. We expect to recognize approximately 38% of our remaining performance obligations as revenue in 2021, 40% in 2022, 21% in 2023 and 1% in 2024.
 
3.
Inventories
Inventories are stated at the lower of average cost or net realizable value and consist of the following:
 
    
October 2,
    
January 2,
 
    
2021
    
2021
 
               
    
(In thousands)
 
Raw materials
   $ 11,262      $ 9,999  
Work-in-progress
     6,929        4,832  
Finished goods
     4,262        6,858  
    
 
 
    
 
 
 
     $ 22,453      $ 21,689  
    
 
 
    
 
 
 
Finished goods inventory at October 2, 2021 included one VERTEX SPECTRA system for DCP at a customer’s factory previously under evaluation for which the evaluation period has ended but the tool is being considered for another application at that site. Finished goods inventory at January 2, 2021 included one VERTEX SPECTRA system for DCP under evaluation at a customer’s factory and one MATRIX PVD system for advanced semiconductor packaging under evaluation at a customer’s factory.
 
4.
Equity-Based Compensation
At October 2, 2021, Intevac had equity-based awards outstanding under the 2020 Equity Incentive Plan and the 2012 Equity Incentive Plan (together, the “Plans”) and the 2003 Employee Stock Purchase Plan (the “ESPP”). Intevac’s stockholders approved all of these plans. The Plans permit the grant of incentive or
non-statutory
stock options, performance-based stock options (“PSOs”), restricted stock, stock appreciation rights, restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”) and performance shares.
 
10
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
The ESPP provides that eligible employees may purchase Intevac’s common stock through payroll deductions at a price equal to 85% of the lower of the fair market value at the entry date of the applicable offering period or at the end of each applicable purchase interval. Offering periods are generally two years in length, and consist of a series of
six-month
purchase intervals. Eligible employees may join the ESPP at the beginning of any
six-month
purchase interval. Under the terms of the ESPP, employees can choose to have up to 50% of their base earnings withheld to purchase Intevac common stock (not to exceed $25,000 per year).
Equity-based Compensation Expense
The effect of recording equity-based compensation for the three and nine months ended October 2, 2021 and September 26, 2020 was as follows:
 
    
Three Months Ended
    
Nine Months Ended
 
               
    
October 2,

2021
    
September 26,

2020
    
October 2,

2021
    
September 26,

2020
 
                             
    
(In thousands)
 
Equity-based compensation by type of award:
                                   
Stock options
   $ 27      $ 47      $ 159      $ 411  
RSUs
     673        495        1,872        1,311  
ESPP awards
     185        316        841        464  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total equity-based compensation
   $ 885      $ 858      $ 2,872      $ 2,186  
    
 
 
    
 
 
    
 
 
    
 
 
 
Stock Options and ESPP
The fair value of stock options and ESPP awards is estimated at the grant date using the Black-Scholes option valuation model. The determination of fair value of stock options and ESPP awards on the date of grant using an option-pricing model is affected by Intevac’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards and actual employee stock option exercise behavior. Intevac accounts for forfeitures as they occur, rather than estimating expected forfeitures. Option activity as of October 2, 2021 and changes during the nine months ended October 2, 2021 were as follows:
 
    
Shares
    
Weighted-Average

Exercise Price
 
               
Options outstanding at January 2, 2021
     1,814,467      $ 6.66  
Options granted
     —        $ —    
Options cancelled and forfeited
     (211,042 )     $ 7.47  
Options exercised
     (73,744 )     $ 5.89  
    
 
 
          
Options outstanding at October 2, 2021
     1,529,681      $ 6.57  
    
 
 
          
Options exercisable at October 2, 2021
     1,317,356      $ 6.78  
Intevac issued 434,054 shares of common stock under the ESPP during the nine months ended October 2, 2021.
Intevac estimated the weighted-average fair value of stock options and employee stock purchase rights using the following weighted-average assumptions:
 
                                                                 
    
Three Months Ended
    
Nine Months Ended
 
                             
    
October 2,
2021
    
September 26,
2020
    
October 2,
2021
    
September 26,
2020
 
                             
Stock Options:
                                   
Weighted-average fair value of grants per share
  
$
—  
 
  
$
—  
 
  
$
—  
 
  
$
1.82
 
Expected volatility
  
 
—  
 
  
 
—  
 
  
 
—  
 
  
 
46.04
% 
Risk-free interest rate
  
 
—  
 
  
 
—  
 
  
 
—  
 
  
 
0.44
% 
Expected term of options (in years)
  
 
—  
 
  
 
—  
 
  
 
—
  
 
4.39
 
Dividend yield
  
 
—  
 
  
 
—  
 
  
 
—  
 
  
 
None
 
 
11
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
                                                                 
    
Three Months Ended
   
Nine Months Ended
 
                          
    
October 2,
2021
   
September 26,
2020
   
October 2,
2021
   
September 26,
2020
 
                          
Stock Purchase Rights:
                                
Weighted-average fair value of grants per share
  
$
2.43
 
 
$
2.20
 
 
$
2.59
 
 
$
2.20
 
Expected volatility
  
 
64.94
% 
 
 
51.72
% 
 
 
60.88
% 
 
 
51.49
% 
Risk-free interest rate
  
 
0.07
% 
 
 
0.12
% 
 
 
0.08
% 
 
 
0.14
% 
Expected term of purchase rights (in years)
  
 
0.75
 
 
 
1.26
 
 
 
0.91
 
 
 
1.24
 
Dividend yield
  
 
None
 
 
 
None
 
 
 
None
 
 
 
None
 
The computation of the expected volatility assumptions used in the Black-Scholes calculations for new stock option grants and ESPP purchase rights is based on the historical volatility of Intevac’s stock price, measured over a period equal to the expected term of the stock option grant or purchase right. The risk-free interest rate is based on the yield available on U.S. Treasury Strips with an equivalent remaining term. The expected term of employee stock options represents the weighted-average period that the stock options are expected to remain outstanding and was determined based on historical experience of similar awards, giving consideration to the contractual terms of the equity-based awards and vesting schedules. The expected term of purchase rights represents the period of time remaining in the current offering period. The dividend yield assumption is based on Intevac’s history of not paying dividends and the assumption of not paying dividends in the future.
RSUs
RSU activity as of October 2, 2021 and changes during the nine months ended October 2, 2021 were as follows:
 
    
Shares
    
Weighted-Average

Grant Date

Fair Value
 
               
Non-vested
RSUs at January 2, 2021
     901,634      $ 5.30  
Granted
     590,931      $ 6.18  
Vested
     (301,305 )     $ 6.07  
Cancelled and forfeited
     (82,529 )     $ 4.66  
    
 
 
          
Non-vested
RSUs at October 2, 2021
     1,108,731      $ 5.60  
    
 
 
          
Time-based RSUs are converted into shares of Intevac common stock upon vesting on a
one-for-one
basis. Time-based RSUs typically are scheduled to vest over four years. Vesting of time-based RSUs is subject to the grantee’s continued service with Intevac. The compensation expense related to these awards is determined using the fair market value of Intevac common stock on the date of the grant, and the compensation expense is recognized over the vesting period.
In May 2021, we granted 126,320 performance-based restricted stock units (“PRSUs”) to members of our senior management. The number of PRSUs that will vest is determined by our common stock achieving a certain Total Shareholder Return (“TSR”) for the Company, relative to the TSR of a specified peer group over a measurement period of two years from the time of grant. The fair value of each PRSU award was estimated on the date of grant using a Monte Carlo simulation. PRSU activity is included in the above RSU tables. At the end of the performance measurement period, the Compensation Committee of the Board of Directors (the “Compensation Committee”) will determine the achievement against the performance objectives. Depending on the Company’s TSR relative to the peer group TSR, the actual number of shares that will be vested for each PRSU grant can range from zero to 200% of the initial grant.
Intevac estimated the weighted-average fair value of PRSUs using the following weighted-average assumptions:
 
    
Nine Months Ended
 
    
October 2, 2021
 
Weighted-average fair value of grants per share
   $ 7.65  
Expected volatility
     56.26 % 
Risk-free interest rate
     0.15 % 
Dividend yield
     None  
 
12
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
In May 2020, we granted 109,465 PRSUs to members of our senior management. The PRSUs were issued collectively in four separate tranches with individual
one-year
performance periods beginning in May 2020, 2021, 2022 and 2023, respectively. Vesting of the PRSUs is based on the performance of our common stock relative to the performance of a specified peer group. The fair value of each PRSU award was estimated on the date of grant using a Monte Carlo simulation. PRSU activity is included in the above RSU tables. At the end of each performance measurement period, the Compensation Committee will determine the achievement against the performance objectives. Any earned PRSU awards will vest 100% after the end of the applicable performance measurement period. The first performance measurement period ended in May 2021 and the metric was not achieved and 27,366 PRSUs were cancelled.
Intevac estimated the weighted-average fair value of PRSUs using the following weighted-average assumptions:
 
    
Nine Months Ended
 
    
September 26, 2020
 
Weighted-average fair value of grants per share
   $ 3.16  
Expected volatility
     46.7 % 
Risk-free interest rate
     0.25 % 
Dividend yield
     None  
 
5.
Warranty
Intevac provides for the estimated cost of warranty when revenue is recognized. Intevac’s warranty is subject to contract terms and, for its HDD manufacturing, DCP manufacturing, solar cell manufacturing and advanced semiconductor packaging manufacturing systems, the warranty typically ranges between 12 and 24 months from customer acceptance. During this warranty period any defective
non-consumable
parts are replaced and installed at no charge to the customer. Intevac uses estimated repair or replacement costs along with its historical warranty experience to determine its warranty obligation. The provision for the estimated future costs of warranty is based upon historical cost and product performance experience. Intevac exercises judgment in determining the underlying estimates.
On the condensed consolidated balance sheets, the short-term portion of the warranty provision is included in other accrued liabilities, while the long-term portion is included in other long-term liabilities. The expense associated with product warranties issued or adjusted is included in cost of net revenues on the condensed consolidated statements of operations.
The following table displays the activity in the warranty provision account for the three and nine months ended October 2, 2021 and September 26, 2020:
 
    
Three Months Ended
    
Nine Months Ended
 
                             
    
October 2,

2021
    
September 26,

2020
    
October 2,

2021
    
September 26,

2020
 
                             
    
(In thousands)
 
Opening balance
   $ 572      $ 662      $ 480      $ 1,022  
Expenditures incurred under warranties
     (148 )       (89 )       (564 )       (398 ) 
Accruals for product warranties issued during the reporting period
     80        39        553        198  
Adjustments to previously existing warranty accruals
     106        (57 )       141        (267 ) 
    
 
 
    
 
 
    
 
 
    
 
 
 
Closing balance
   $ 610      $ 555      $ 610      $ 555  
    
 
 
    
 
 
    
 
 
    
 
 
 
The following table displays the balance sheet classification of the warranty provision account at October 2, 2021 and at January 2, 2021:
 
    
October 2,

2021
    
January 2,

2021
 
               
    
(In thousands)
 
Other accrued liabilities
   $ 542      $ 405  
Other long-term liabilities
     68        75  
    
 
 
    
 
 
 
Total warranty provision
   $ 610      $ 480  
    
 
 
    
 
 
 
 
13
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
6.
Guarantees
Officer and Director Indemnifications
As permitted or required under Delaware law and to the maximum extent allowable under that law, Intevac has certain obligations to indemnify its current and former officers and directors for certain events or occurrences while the officer or director is, or was, serving at Intevac’s request in such capacity. These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The maximum potential amount of future payments Intevac could be required to make under these indemnification obligations is unlimited; however, Intevac has a director and officer insurance policy that mitigates Intevac’s exposure and enables Intevac to recover a portion of any future amounts paid. As a result of Intevac’s insurance policy coverage, Intevac believes the estimated fair value of these indemnification obligations is not material.
Other Indemnifications
As is customary in Intevac’s industry, many of Intevac’s contracts provide remedies to certain third parties such as defense, settlement, or payment of judgments for intellectual property claims related to the use of its products. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial.
Letters of Credit
As of October 2, 2021, we had letters of credit and bank guarantees outstanding totaling $786,000, including the standby letter of credit outstanding under the Santa Clara, California facility lease and various other guarantees with our bank. These letters of credit and bank guarantees are collateralized by $786,000 of restricted cash.
 
7.
Cash, Cash Equivalents and Investments
Cash and cash equivalents, short-term investments and long-term investments consist of:
 
    
October 2, 2021
 
                             
    
Amortized Cost
    
Unrealized
Holding

Gains
    
Unrealized
Holding

Losses
    
Fair Value
 
                             
    
(In thousands)
 
Cash and cash equivalents:
                                   
Cash
   $ 28,749      $ —        $ —        $ 28,749  
Money market funds
     4,447        —          —          4,447  
Municipal bonds
     500        —          —          500  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total cash and cash equivalents
   $ 33,696      $ —        $ —        $ 33,696  
Short-term investments:
                                   
Certificates of deposit
   $ 6,299      $ 3      $ —        $ 6,302  
Commercial paper
     400        —          —          400  
Corporate bonds and medium-term notes
     2,919        1        —          2,920  
Municipal bonds
     515        —          —          515  
U.S. treasury and agency securities
     1,000        —          —          1,000  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total short-term investments
   $ 11,133      $ 4      $ —        $ 11,137  
Long-term investments:
                                   
Asset backed securities
   $ 480      $ —        $ —        $ 480  
Certificates of deposit
     500        —          1        499  
Corporate bonds and medium-term notes
     2,541        1        1        2,541  
Municipal bonds
     145        —          1        144  
U.S. treasury and agency securities
     2,161        —          —          2,161  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total long-term investments
   $ 5,827      $ 1      $ 3      $ 5,825  
    
 
 
    
 
 
    
 
 
    
 
 
 
Total cash, cash equivalents, and investments
   $ 50,656      $ 5      $ 3      $ 50,658  
    
 
 
    
 
 
    
 
 
    
 
 
 
 
14
Table of Contents
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
    
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 and agency 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 and agency 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  
    
 
 
    
 
 
    
 
 
    
 
 
 
The contractual maturities of
available-for-sale
securities at October 2, 2021 are presented in the following table.
 
    
October 2, 2021
 
    
Amortized

Cost
    
Fair Value
 
               
    
(In thousands)
 
Due in one year or less
   $ 16,080      $ 16,084  
Due after one through three years
     5,827        5,825  
    
 
 
    
 
 
 
     $ 21,907      $ 21,909  
    
 
 
    
 
 
 
The following table provides the fair market value of Intevac’s investments with unrealized losses that are not deemed to be other-than temporarily impaired as of October 2, 2021.
 
    
October 2, 2021
 
    
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)
 
Certificates of deposit
   $ 499      $ 1      $ —        $ —    
Corporate bonds and medium-term notes
     1,944        1        —          —    
Municipal bond
     145        1        —          —    
    
 
 
    
 
 
    
 
 
    
 
 
 
     $ 2,588      $ 3      $ —        $ —    
    
 
 
    
 
 
    
 
 
    
 
 
 
 
15
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
All prices for the fixed maturity securities including U.S. Treasury and agency securities, certificates of deposit, commercial paper, corporate bonds and municipal bonds are received from independent pricing services utilized by Intevac’s outside investment manager. This investment manager performs a review of the pricing methodologies and inputs utilized by the independent pricing services for each asset type priced by the vendor. In addition, on at least an annual basis, the investment manager conducts due diligence visits and interviews with each pricing vendor to verify the inputs utilized for each asset class. The due diligence visits include a review of the procedures performed by each vendor to ensure that pricing evaluations are representative of the price that would be received for a security in an orderly sale. Any pricing where the input is based solely on a broker price is deemed to be a Level 3 price. Intevac uses the pricing data obtained from its outside investment manager as the primary input to make its assessments and determinations as to the ultimate valuation of the above-mentioned securities and has not made, during the periods presented, any material adjustments to such inputs.
The following table represents the fair value hierarchy of Intevac’s
available-for-sale
securities measured at fair value on a recurring basis as of October 2, 2021.
 
    
Fair Value Measurements

at October 2, 2021
 
                      
    
Total
    
Level 1
    
Level 2
 
                      
    
(In thousands)
 
Recurring fair value measurements:
                          
Available-for-sale
securities
                          
Money market funds
   $ 4,447      $ 4,447      $ —    
U.S. treasury and agency securities
     3,161        3,161        —    
Asset backed securities
     480        —          480  
Certificates of deposit
     6,801        —          6,801  
Commercial paper
     400        —          400  
Corporate bonds and medium-term notes
     5,461        —          5,461  
Municipal bonds
     1,159        —          1,159  
    
 
 
    
 
 
    
 
 
 
Total recurring fair value measurements
   $ 21,909      $ 7,608      $ 14,301  
    
 
 
    
 
 
    
 
 
 
 
8.
Derivative Instruments
The Company uses foreign currency forward contracts to mitigate variability in gains and losses generated from the
re-measurement
of certain monetary assets and liabilities denominated in foreign currencies and to offset certain operational exposures from the impact of changes in foreign currency exchange rates. These derivatives are carried at fair value with changes recorded in interest income and other income (expense), net in the condensed consolidated statements of operations. Changes in the fair value of these derivatives are largely offset by
re-measurement
of the underlying assets and liabilities. Cash flows from such derivatives are classified as operating activities. The derivatives have original maturities of approximately 30 days.
The following table summarizes the Company’s outstanding derivative instruments on a gross basis as recorded in its condensed consolidated balance sheets as of October 2, 2021 and January 2, 2021:
 
    
Notional Amounts
    
Derivative Liabilities
 
Derivative Instrument
  
October 2

2021
    
January 2,

2021
    
October 2,

2021
    
January 2,

2021
 
                             
                  
Balance

Sheet

Line
   
Fair

Value
    
Balance

Sheet

Line
   
Fair

Value
 
                                         
                  
(In thousands)
              
Undesignated Hedges:
                                                   
Forward Foreign Currency Contracts
   $ 811      $ 983       
(a
 
)
  		  $ 2       
(a
 
)
  		  $ 3  
    
 
 
    
 
 
            
 
 
            
 
 
 
Total Hedges
   $ 811      $ 983              $ 2              $ 3  
    
 
 
    
 
 
            
 
 
            
 
 
 
 
(a)
Other accrued liabilities
 
16
INTEVAC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)
 
9.
Equity
Condensed Consolidated Statement of Changes in Equity
The changes in stockholders’ equity by component for the three and nine months ended October 2, 2021 and September 26, 2020, are as follows (in thousands):
 
    
Three months ended October 2, 2021
 
    
Common
Stock and
Additional
Paid-in

Capital
   
Treasury
Stock
   
Accumulated
Other
Comprehensive
Income
   
Accumulated
Deficit
   
Total
Stockholders’
Equity
 
                                
Balance at July 3, 2021
   $ 196,088     $ (29,551 )    $ 571     $ (75,360 )    $ 91,748  
Common stock issued under employee plans
     1,182       —         —         —         1,182  
Shares withheld for net share settlement of RSUs
     (13 )      —         —         —         (13 ) 
Equity-based compensation expense
     885       —         —         —         885  
Net loss
     —         —         —         (4,233 )      (4,233 ) 
Other comprehensive loss
     —         —         (14 )      —         (14 ) 
    
 
 
   
 
 
   
 
 
   
 
 
   
 
 
 
Balance at October 2, 2021
   $ 198,142     $ (29,551 )    $ 557     $ (79,593 )    $ 89,555  
    
 
 
   
 
 
   
 
 
   
 
 
   
 
 
 
 
    
Nine months ended October 2, 2021
 
    
Common
Stock and
Additional
Paid-in

Capital
   
Treasury
Stock
   
Accumulated
Other
Comprehensive
Income
   
Accumulated
Deficit
   
Total
Stockholders’
Equity
 
                                
Balance at January 2, 2021
   $ 193,197     $ (29,551 )    $ 640     $ (62,730 )    $ 101,556  
Common stock issued under employee plans
     2,618       —         —         —         2,618  
Shares withheld for net share settlement of RSUs
     (545 )      —         —         —         (545 ) 
Equity-based compensation expense
     2,872       —         —         —         2,872  
Net loss
     —         —         —         (16,863 )      (16,863 ) 
Other comprehensive loss
     —         —         (83 )      —         (83 )