Delaware
|
94-3008334
|
(State
or Other Jurisdiction of Incorporation or
Organization)
|
(I.R.S.
Employer Identification Number)
|
Page
|
|||||
|
|||||
|
June
30,
|
December
31,
|
|||||||
2007
|
2006
(1)
|
|||||||
(unaudited)
|
||||||||
ASSETS
|
||||||||
Current
Assets:
|
||||||||
Cash
and cash equivalents
|
$ |
28,259
|
$ |
32,804
|
||||
Short-term
marketable securities
|
12,492
|
5,853
|
||||||
Accounts
receivable, net
|
8,336
|
8,491
|
||||||
Inventories
|
6,957
|
8,295
|
||||||
Other
current assets
|
3,440
|
600
|
||||||
Total
current assets
|
59,484
|
56,043
|
||||||
Property
and equipment, net
|
28,127
|
28,744
|
||||||
Goodwill
|
34,976
|
34,976
|
||||||
Other
purchased intangible assets
|
2,059
|
2,856
|
||||||
Long-term
marketable securities
|
6,697
|
3,666
|
||||||
Other
assets
|
760
|
1,663
|
||||||
Total
assets
|
$ |
132,103
|
$ |
127,948
|
||||
LIABILITIES
|
||||||||
Current
Liabilities:
|
||||||||
Accounts
payable
|
$ |
5,694
|
$ |
2,995
|
||||
Accrued
compensation and benefits
|
1,943
|
2,417
|
||||||
Accrued
commissions
|
638
|
1,100
|
||||||
Other
accrued expenses
|
500
|
500
|
||||||
Total
current liabilities
|
8,775
|
7,012
|
||||||
Commitments
|
||||||||
STOCKHOLDERS'
EQUITY
|
||||||||
Common
stock, par value
|
29
|
29
|
||||||
Additional
paid-in capital
|
131,539
|
128,735
|
||||||
Accumulated
other comprehensive loss
|
(154 | ) | (96 | ) | ||||
Accumulated
deficit
|
(8,086 | ) | (7,732 | ) | ||||
Total
stockholders' equity
|
123,328
|
120,936
|
||||||
Total
liabilities and stockholders' equity
|
$ |
132,103
|
$ |
127,948
|
||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Net
revenues
|
$ |
19,764
|
$ |
19,411
|
$ |
38,404
|
$ |
39,416
|
||||||||
Cost
of revenues
|
8,118
|
8,225
|
15,381
|
15,722
|
||||||||||||
Gross
margin
|
11,646
|
11,186
|
23,023
|
23,694
|
||||||||||||
Operating
expenses:
|
||||||||||||||||
Research
and development
|
6,143
|
4,835
|
11,885
|
9,914
|
||||||||||||
Selling,
general and administrative
|
6,061
|
5,982
|
12,231
|
11,657
|
||||||||||||
Amortization
of purchased intangible assets
|
357
|
481
|
797
|
993
|
||||||||||||
Total
operating expenses
|
12,561
|
11,298
|
24,913
|
22,564
|
||||||||||||
Income
(loss) from operations
|
(915 | ) | (112 | ) | (1,890 | ) |
1,130
|
|||||||||
Interest
income and other, net
|
607
|
421
|
1,181
|
763
|
||||||||||||
Income
(loss) before provision (benefit) for income taxes
|
(308 | ) |
309
|
(709 | ) |
1,893
|
||||||||||
Provision
(benefit) for income taxes
|
(226 | ) |
28
|
(355 | ) |
71
|
||||||||||
Net
income (loss)
|
$ | (82 | ) | $ |
281
|
$ | (354 | ) | $ |
1,822
|
||||||
Basic
net income (loss) per share
|
$ | (0.00 | ) | $ |
0.01
|
$ | (0.01 | ) | $ |
0.07
|
||||||
Shares
used to compute basic per share amounts
|
28,674
|
28,081
|
28,660
|
27,983
|
||||||||||||
Diluted
net income (loss) per share
|
$ | (0.00 | ) | $ |
0.01
|
$ | (0.01 | ) | $ |
0.06
|
||||||
Shares
used to compute diluted per share amounts
|
28,674
|
28,938
|
28,660
|
28,868
|
||||||||||||
Six
Months Ended
|
||||||||
June
30,
|
||||||||
2007
|
2006
|
|||||||
Cash
flows from operating activities
|
||||||||
Net
income (loss)
|
$ | (354 | ) | $ |
1,822
|
|||
Adjustments
to reconcile net income (loss) to cash flows provided by operating
activities:
|
||||||||
Depreciation
and amortization
|
960
|
976
|
||||||
Share-based
compensation expense
|
2,364
|
2,500
|
||||||
Amortization
of purchased intangible assets
|
797
|
993
|
||||||
Deferred
margins
|
-
|
(1,963 | ) | |||||
Write-downs
for inventories
|
572
|
195
|
||||||
Other
non-cash items
|
(91 | ) | (107 | ) | ||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
162
|
170
|
||||||
Inventories
|
766
|
(5,979 | ) | |||||
Other
current assets
|
(2,840 | ) |
274
|
|||||
Other
assets
|
903
|
68
|
||||||
Accounts
payable
|
2,699
|
2,575
|
||||||
Accrued
compensation and benefits
|
(936 | ) |
508
|
|||||
Other
accrued expenses
|
-
|
(731 | ) | |||||
Net
cash provided by operating activities
|
5,002
|
1,301
|
||||||
Cash
flows provided by (used in) investing activities:
|
||||||||
Purchases
of marketable securities
|
(16,213 | ) | (4,073 | ) | ||||
Sales
and maturities of marketable securities
|
6,600
|
16,728
|
||||||
Purchase
of property and equipment
|
(348 | ) | (642 | ) | ||||
Net
cash provided by (used in) investing activities
|
(9,961 | ) |
12,013
|
|||||
Cash
flows provided by financing activities:
|
||||||||
Proceeds
from exercise of common stock options
|
440
|
2,494
|
||||||
Net
cash provided by financing activities
|
440
|
2,494
|
||||||
Effect
of exchange rate fluctuations on cash and cash equivalents
|
(26 | ) | (12 | ) | ||||
Increase
(decrease) in cash and cash equivalents
|
(4,545 | ) |
15,796
|
|||||
Cash
and cash equivalents at beginning of year
|
32,804
|
21,028
|
||||||
Cash
and cash equivalents at end of period
|
$ |
28,259
|
$ |
36,824
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Net
income (loss)
|
$ | (82 | ) | $ |
281
|
$ | (354 | ) | $ |
1,822
|
||||||
Unrealized
gain (loss) on marketable securities, net
|
(34 | ) |
11
|
(32 | ) |
39
|
||||||||||
Cumulative
translation adjustments
|
(12 | ) | (10 | ) | (26 | ) | (12 | ) | ||||||||
Comprehensive
net income (loss)
|
$ | (128 | ) | $ |
282
|
$ | (412 | ) | $ |
1,849
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Risk-free
interest rate
|
4.96 | % | 5.04 | % | 4.71 | % | 4.94 | % | ||||||||
Expected
volatility
|
0.58
|
0.68
|
0.60
|
0.68
|
||||||||||||
Expected
life (years)
|
4.35
|
4.39
|
4.35
|
4.39
|
||||||||||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Cost
of revenues
|
$ |
13
|
$ |
15
|
$ |
31
|
$ |
25
|
||||||||
Research
and development
|
422
|
556
|
954
|
1,033
|
||||||||||||
Selling,
general and administrative
|
777
|
865
|
1,379
|
1,442
|
||||||||||||
Pre-tax
stock-based compensation expense
|
1,212
|
1,436
|
2,364
|
2,500
|
||||||||||||
Income
tax
|
-
|
-
|
-
|
-
|
||||||||||||
Net
stock-based compensation expense
|
$ |
1,212
|
$ |
1,436
|
$ |
2,364
|
$ |
2,500
|
Weighted
Average
|
||||||||||||||||||||
Remaining
|
Aggregate
|
|||||||||||||||||||
Options
Available
|
Number
of
|
Weighted
Average
|
Contratual
Term
|
Intrinsic
|
||||||||||||||||
Options
|
for
Grant
|
Shares
|
Exercise
Price
|
(in
years)
|
Value
|
|||||||||||||||
Outstanding
at December 31, 2006
|
1,640,010
|
3,713,477
|
$ |
11.47
|
5.39
|
$ |
11,718,444
|
|||||||||||||
Granted
|
(572,900 | ) |
572,900
|
10.15
|
||||||||||||||||
Exercised
|
-
|
(26,499 | ) |
5.20
|
||||||||||||||||
Cancelled
|
51,174
|
(51,174 | ) |
13.36
|
||||||||||||||||
Outstanding
at March 31, 2007
|
1,118,284
|
4,208,704
|
$ |
11.31
|
5.38
|
$ |
4,085,919
|
|||||||||||||
Granted
|
(104,000 | ) |
104,000
|
10.42
|
||||||||||||||||
Exercised
|
-
|
(48,675 | ) |
6.21
|
||||||||||||||||
Cancelled
|
55,456
|
(55,456 | ) |
11.73
|
||||||||||||||||
Outstanding
at June 30, 2007
|
1,069,740
|
4,208,573
|
$ |
11.34
|
5.19
|
$ |
7,512,282
|
|||||||||||||
Exercisable
at June 30, 2007
|
2,537,675
|
$ |
11.90
|
4.63
|
$ |
5,628,361
|
||||||||||||||
Options
Outstanding
|
Options
Exercisable
|
|||||||||||||||||||||
Weighted
Average
|
||||||||||||||||||||||
Remaining
|
Weighted
|
Weighted
|
||||||||||||||||||||
Contratual
Term
|
Average
|
Average
|
||||||||||||||||||||
Range
of Exercise Prices
|
Number
|
(in
years)
|
Exercise
Price
|
Number
|
Exercise
Price
|
|||||||||||||||||
$0.88 - $8.25 |
847,055
|
4.71
|
$ |
5.96
|
743,823
|
$ |
5.75
|
|||||||||||||||
$8.31 - $9.43 |
919,137
|
4.87
|
9.00
|
636,887
|
9.02
|
|||||||||||||||||
$9.45 - $10.21 |
952,700
|
6.53
|
10.04
|
156,248
|
9.74
|
|||||||||||||||||
$10.29 - $16.65 |
1,077,498
|
5.59
|
13.81
|
588,534
|
14.81
|
|||||||||||||||||
$19.38 - $27.00 |
412,183
|
2.81
|
24.15
|
412,183
|
24.15
|
|||||||||||||||||
Total
|
4,208,573
|
5.19
|
$ |
11.34
|
2,537,675
|
$ |
11.90
|
June
30,
|
December
31,
|
|||||||
2007
|
2006
|
|||||||
Work-in-process
|
$ |
1,988
|
$ |
1,226
|
||||
Finished
goods
|
4,969
|
7,069
|
||||||
Total
|
$ |
6,957
|
$ |
8,295
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Net
income (loss)
|
$ | (82 | ) | $ |
281
|
$ | (354 | ) | $ |
1,822
|
||||||
Weighted
average shares of common stock outstanding
|
28,674
|
28,081
|
28,660
|
27,983
|
||||||||||||
Net
income (loss) per share - basic
|
$ | (0.00 | ) | $ |
0.01
|
$ | (0.01 | ) | $ |
0.07
|
||||||
Shares
used in computing basic net income (loss) per share
|
28,674
|
28,081
|
28,660
|
27,983
|
||||||||||||
Dilutive
effect of stock options
|
-
|
857
|
-
|
885
|
||||||||||||
Shares
used in computing diluted net income (loss) per share
|
28,674
|
28,938
|
28,660
|
28,868
|
||||||||||||
Net
income (loss) per share - diluted
|
$ | (0.00 | ) | $ |
0.01
|
$ | (0.01 | ) | $ |
0.06
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Revenues:
|
||||||||||||||||
United
States
|
$ |
5,233
|
$ |
4,843
|
$ |
11,002
|
$ |
9,599
|
||||||||
Singapore
|
3,583
|
3,311
|
6,303
|
6,452
|
||||||||||||
China
|
3,102
|
2,028
|
6,104
|
3,822
|
||||||||||||
Other
Asia Pacific
|
2,943
|
2,455
|
5,355
|
5,601
|
||||||||||||
Taiwan
|
2,338
|
3,702
|
4,381
|
7,036
|
||||||||||||
Europe,
Middle East and Africa
|
1,992
|
2,107
|
4,328
|
5,042
|
||||||||||||
The
Americas - excluding United States
|
573
|
965
|
931
|
1,864
|
||||||||||||
Total
|
$ |
19,764
|
$ |
19,411
|
$ |
38,404
|
$ |
39,416
|
||||||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Net
revenues
|
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||
Cost
of revenues
|
41.1
|
42.4
|
40.1
|
39.9
|
||||||||||||
Gross
margin
|
58.9
|
57.6
|
59.9
|
60.1
|
||||||||||||
Operating
expenses:
|
||||||||||||||||
Research
and development
|
31.1
|
24.9
|
30.9
|
25.2
|
||||||||||||
Selling,
general and administrative
|
30.7
|
30.8
|
31.8
|
29.6
|
||||||||||||
Amortization
of purchased intangible assets
|
1.8
|
2.5
|
2.1
|
2.5
|
||||||||||||
Total
operating expenses
|
63.6
|
58.2
|
64.8
|
57.3
|
||||||||||||
Income
(loss) from operations
|
(4.7 | ) | (0.6 | ) | (4.9 | ) |
2.8
|
|||||||||
Interest
income and other, net
|
3.1
|
2.2
|
3.1
|
1.9
|
||||||||||||
Income
(loss) before provision (benefit) for income taxes
|
(1.6 | ) |
1.6
|
(1.8 | ) |
4.7
|
||||||||||
Provision
(benefit) for income taxes
|
(1.1 | ) |
0.1
|
(0.9 | ) |
0.2
|
||||||||||
Net
income (loss)
|
(0.5 | )% | 1.5 | % | (0.9 | )% | 4.5 | % | ||||||||
Six
Months Ended
|
||||||||
June
30,
|
||||||||
2007
|
2006
|
|||||||
Net
cash provided by operating activities
|
$ |
5,002
|
$ |
1,301
|
||||
Net
cash provided by (used in) investing activities
|
(9,961 | ) |
12,013
|
|||||
Net
cash provided by financing activities
|
440
|
2,494
|
||||||
Effect
of exchange rate fluctuations on cash and cash equivalents
|
(26 | ) | (12 | ) |
Payments
due in
|
||||||||||||
Less
than
|
1-3
|
|||||||||||
Total
|
1
Year
|
Years
|
||||||||||
Operating
leases - facilities and equipment
|
$ |
159
|
$ |
99
|
$ |
60
|
||||||
Software
licenses
|
4,433
|
3,566
|
867
|
|||||||||
Inventory
purchase commitments
|
6,146
|
6,146
|
-
|
|||||||||
Total
cash obligations
|
$ |
10,738
|
$ |
9,811
|
$ |
927
|
Other circumstances that can affect our operating results include: |
·
|
the
timing of significant orders, order cancellations and
reschedulings,
|
·
|
the
loss of a significant customer(s),
|
·
|
introduction
of products and technologies by our
competitors,
|
·
|
the
availability of production capacity at the fabrication facilities
that
manufacture our products,
|
·
|
our
significant customers could lose market share that may affect our
business,
|
·
|
integration
of our product functionality into our customers’
products,
|
·
|
our
ability to develop, introduce and market new products and technologies
on
a timely basis,
|
·
|
unexpected
issues that may arise with devices in
production
|
·
|
shifts
in our product mix toward lower margin
products,
|
·
|
changes
in our pricing policies or those of our competitors or suppliers,
including decreases in unit average selling prices of our
products,
|
·
|
the
availability and cost of materials to our
suppliers,
|
·
|
general
economic conditions, and
|
·
|
political
climate.
|
·
|
the
reduction, delay or cancellation of orders from one or more of
our
significant customers;
|
·
|
the
selection of competing products or in-house design by one or more
of our
current customers;
|
·
|
the
loss of one or more of our current customers;
or
|
·
|
a
failure of one or more of our current customers to pay our
invoices.
|
·
|
potentially
dilutive issuances of equity
securities,
|
·
|
large
acquisition-related write-offs,
|
·
|
the
incurrence of debt and contingent liabilities or amortization expenses
related to other intangible assets,
|
·
|
difficulties
in the assimilation of operations, personnel, technologies, products
and
the information systems of the acquired
companies,
|
·
|
diversion
of management’s attention from other business
concerns,
|
·
|
risks
of entering geographic and business markets in which we have no
or limited
prior experience, and
|
·
|
potential
loss of key employees of acquired
organizations.
|
·
|
difficulties
in managing distributors,
|
·
|
difficulties
in staffing and managing foreign subsidiary and branch
operations,
|
·
|
political
and economic instability,
|
·
|
foreign
currency exchange fluctuations,
|
·
|
difficulties
in accounts receivable collections,
|
·
|
potentially
adverse tax consequences,
|
·
|
timing
and availability of export
licenses,
|
·
|
changes
in regulatory requirements, tariffs and other
barriers,
|
·
|
difficulties
in obtaining governmental approvals for telecommunications and
other
products, and
|
·
|
the
burden of complying with complex foreign laws and
treaties.
|
Name
|
Votes
For
|
Votes
Withheld
|
||
Michael
J. Salameh
|
25,897,184
|
118,050
|
||
D.
James Guzy
|
24,294,996
|
1,720,238
|
||
John
H. Hart
|
25,881,334
|
133,900
|
||
Robert
H. Smith
|
25,602,486
|
412,748
|
||
Thomas
Riordan
|
25,896,684
|
118,550
|
||
Patrick
Verderico
|
25,897,084
|
118,150
|
For
|
25,990,897
|
|||
Against
|
19,276
|
|||
Abstain
|
5,061
|
|||
Total
Shares Voted
|
26,015,234
|
|||
Exhibit
|
||
Number
|
Description
|
|
|
||
|
Exhibit
|
||
Number
|
Description
|
|
|
||
|