þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the fiscal year ended December 31, 2004 | ||
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the transition period from to |
Delaware
|
04-2742817 | |
(State or other jurisdiction of
incorporation or organization) |
(IRS employer
identification no.) |
|
25 Frontage Road, Andover,
Massachusetts (Address of principal executive offices) |
01810
(Zip code) |
1
Modular Power Converters |
2
Configurable Products |
Factorized Power Architecture |
3
Accessory Power System Components |
Customer Specific Products |
European Union Restriction of Hazardous Substances (RoHS) |
4
Telecommunications:
|
Military/ Defense: | ||
Central Office Systems
|
Secure Communications Equipment | ||
Fiber Optic Systems
|
Unmanned Airborne/ Remotely Piloted Vehicles | ||
Cellular Telecommunications
|
Aircraft/Weapons Test Equipment | ||
Microwave Communications
|
Ruggedized Computers | ||
ATM Switches
|
Electronic Warfare Equipment | ||
Paging Equipment
|
Reconnaissance/Targeting Systems | ||
Broadcast Equipment
|
Global Positioning Systems | ||
Remote Telemetry Equipment
|
Missile Defense Systems | ||
Cable Head End Equipment
|
Radio/ Telemetry Systems | ||
Power Amplifiers
|
NBC Detection Equipment |
5
Information Technology:
RAID Systems
Parallel Processors
Data Storage Systems
Network Servers
Enterprise Servers
File Servers
Optical Switches
6
7
8
Our future success depends upon our ability to develop and market leading-edge, cost effective products. |
Our future operating results are dependent on the growth in our customers businesses. |
Our conversion of second-generation products to the FasTrak platform may not progress as planned. |
Our revenues may not increase enough to offset the expense of additional capacity. |
We rely on third-party suppliers and subcontractors for components and assemblies and, therefore, cannot control their availability or quality. |
9
We are exposed to economic, political and other risks through our foreign sales and distributors. |
Our ability to successfully implement our business strategy may be limited if we do not retain our key personnel. |
We may be unable to adequately protect our proprietary rights, which may limit our ability to compete effectively. |
Our revenues and operating results have been negatively impacted by the general business slowdown, and our outlook going forward remains highly uncertain. |
10
Compliance with the European Union Restriction of Hazardous Substances (RoHS) may not proceed as planned. |
| Suppliers cannot meet the new requirements or meet the specified deadlines, and the Company may not be able to meet the demand for its products, or it may negatively affect delivery times. | |
| Customers mandate that their suppliers comply with the RoHS directive at an earlier date than July 1, 2006, and the Company may not be able to meet their requirements. | |
| Customers mandate that they will not accept RoHS directive compliant product, and such requirements could significantly increase the cost of maintaining business with these customers. | |
| The redesign of products may not proceed as planned, or may be determined to not be feasible for certain products. | |
| The modification of manufacturing processes may require the additional investment in equipment, which will increase operating expenses. | |
| The conversion over to compliant materials could result in excess supplies of raw materials that are no longer needed for non-compliant products. Additional inventory reserves could be required for such excess materials. |
ITEM 2 | PROPERTIES |
ITEM 3 | LEGAL PROCEEDINGS |
11
ITEM 4 | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
ITEM 5 | MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS |
2003 | High | Low | ||||||
First Quarter
|
$ | 8.93 | $ | 5.55 | ||||
Second Quarter
|
10.40 | 5.50 | ||||||
Third Quarter
|
12.64 | 8.58 | ||||||
Fourth Quarter
|
12.43 | 9.50 |
12
2004
High
Low
$
13.98
$
10.62
19.20
12.28
18.59
9.93
13.57
8.54
Maximum | ||||||||||||||||
Number (or | ||||||||||||||||
Approximate | ||||||||||||||||
Total Number of | Dollar Value) of | |||||||||||||||
Total | Shares (or Units) | Shares (or Units) | ||||||||||||||
Number | Purchased as | that May Yet be | ||||||||||||||
of Shares | Part of Publicly | Purchased Under | ||||||||||||||
(or Units) | Average Price Paid | Announced Plans | the Plans or | |||||||||||||
Period | Purchased | per Share (or Unit) | or Programs | Programs | ||||||||||||
October 1 31, 2004
|
54,400 | $ | 8.87 | 54,400 | $ | 24,920,000 | ||||||||||
November 1 30, 2004
|
| | | $ | 24,920,000 | |||||||||||
December 1 31, 2004
|
| | | $ | 24,920,000 | |||||||||||
Total
|
54,400 | $ | 8.87 | 54,400 | $ | 24,920,000 | ||||||||||
ITEM 6 | SELECTED FINANCIAL DATA |
13
Year Ended December 31, | ||||||||||||||||||||
Statement of Operations Data | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||
(In thousands except per share data) | ||||||||||||||||||||
Net revenues
|
$ | 171,580 | $ | 151,421 | $ | 152,591 | $ | 195,910 | $ | 257,583 | ||||||||||
(Loss) income from operations
|
(4,035 | ) | (25,703 | ) | (24,502 | ) | (5,017 | ) | 46,010 | |||||||||||
Net (loss) income
|
(3,723 | ) | (19,535 | ) | (15,942 | ) | (559 | ) | 33,920 | |||||||||||
Net (loss) income per share-basic
|
(.09 | ) | (.47 | ) | (.38 | ) | (.01 | ) | .80 | |||||||||||
Net (loss) income per share-diluted
|
(.09 | ) | (.47 | ) | (.38 | ) | (.01 | ) | .78 | |||||||||||
Weighted average shares-basic
|
42,022 | 41,896 | 42,337 | 42,342 | 42,276 | |||||||||||||||
Weighted average shares-diluted
|
42,022 | 41,896 | 42,337 | 42,342 | 43,265 | |||||||||||||||
Cash dividends per share
|
$ | .08 | | | | |
At December 31, | ||||||||||||||||||||
Balance Sheet Data | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Working capital
|
$ | 148,419 | $ | 141,547 | $ | 153,167 | $ | 153,478 | $ | 146,692 | ||||||||||
Total assets
|
244,882 | 251,464 | 278,445 | 289,622 | 294,113 | |||||||||||||||
Long-term debt
|
| | | | | |||||||||||||||
Total liabilities
|
24,259 | 24,806 | 30,412 | 24,785 | 31,192 | |||||||||||||||
Stockholders equity
|
220,623 | 226,658 | 248,033 | 264,837 | 262,921 |
ITEM 7 | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
14
Year Ended December 31, | ||||||||||||
2004 | 2003 | 2002 | ||||||||||
Net revenues
|
100.0 | % | 100.0 | % | 100.0 | % | ||||||
Gross margin
|
36.9 | % | 25.8 | % | 24.8 | % | ||||||
Selling, general and administrative expenses
|
24.0 | % | 27.3 | % | 27.4 | % | ||||||
Research and development expenses
|
15.3 | % | 15.5 | % | 13.4 | % | ||||||
Loss before income taxes
|
(1.4 | )% | (16.4 | )% | (16.5 | )% |
15
16
17
Increase | ||||||||||||
2004 | 2003 | (Decrease) | ||||||||||
Interest income
|
$ | 1,764 | $ | 1,514 | $ | 250 | ||||||
Minority interest in net income of subsidiaries
|
(527 | ) | (512 | ) | (15 | ) | ||||||
Foreign currency gains
|
268 | 607 | (339 | ) | ||||||||
Other than temporary decline in Scipher plc, investment
|
(70 | ) | (470 | ) | 400 | |||||||
Loss on disposal of equipment
|
(47 | ) | (356 | ) | 309 | |||||||
Other
|
244 | 29 | 215 | |||||||||
$ | 1,632 | $ | 812 | $ | 820 | |||||||
18
Increase | ||||||||||||
2003 | 2002 | (Decrease) | ||||||||||
Interest income
|
$ | 1,514 | $ | 2,360 | $ | (846 | ) | |||||
Foreign currency gains
|
607 | 526 | 81 | |||||||||
Minority interest in net income of subsidiaries
|
(512 | ) | (169 | ) | (343 | ) | ||||||
Other than temporary decline in Scipher plc, investment
|
(470 | ) | (1,985 | ) | 1,515 | |||||||
Loss on disposal of equipment
|
(356 | ) | (1,446 | ) | 1,090 | |||||||
Other
|
29 | 110 | (81 | ) | ||||||||
$ | 812 | $ | (604 | ) | $ | 1,416 | ||||||
19
20
Payments Due by Period | ||||||||||||||||||||
More Than | ||||||||||||||||||||
Contractual Obligations | Total | Year 1 | Years 2 4 | Years 5 7 | 7 Years | |||||||||||||||
Operating leases
|
$ | 2,889 | $ | 1,405 | $ | 1,296 | $ | 188 | $ | | ||||||||||
Purchase obligations
|
3,036 | 276 | 828 | 828 | 1,104 | |||||||||||||||
Total
|
$ | 5,925 | $ | 1,681 | $ | 2,124 | $ | 1,016 | $ | 1,104 | ||||||||||
ITEM 7(a) | QUALITATIVE AND QUANTITATIVE DISCLOSURE ABOUT MARKET RISK |
21
ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
FINANCIAL STATEMENTS
|
||||
Report of Independent Registered Public Accounting Firm
|
23 | |||
Consolidated Balance Sheets as of December 31, 2004 and 2003
|
24 | |||
Consolidated Statements of Operations For the Years Ended
December 31, 2004, 2003 and 2002
|
25 | |||
Consolidated Statements of Cash Flows For the Years Ended
December 31, 2004, 2003 and 2002
|
26 | |||
Consolidated Statements of Stockholders Equity For the
Years Ended December 31, 2004, 2003 and 2002
|
27 | |||
Notes to the Consolidated Financial Statements
|
28 | |||
Schedule
(Refer to Item 15)
|
48 |
22
23
/s/ Ernst & Young LLP
Table of Contents
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
Table of Contents
2004
2003
2002
(In thousands, except per share
amounts)
$
171,580
$
151,421
$
152,591
108,292
112,409
114,772
63,288
39,012
37,819
41,112
41,270
41,838
26,211
23,445
20,483
67,323
64,715
62,321
(4,035
)
(25,703
)
(24,502
)
1,632
812
(604
)
(2,403
)
(24,891
)
(25,106
)
1,320
(5,356
)
(9,164
)
$
(3,723
)
$
(19,535
)
$
(15,942
)
$
(.09
)
$
(.47
)
$
(.38
)
42,022
41,896
42,337
$
.08
Table of Contents
2004
2003
2002
(In thousands)
$
(3,723
)
$
(19,535
)
$
(15,942
)
20,898
22,397
21,887
1,002
800
376
527
512
169
70
470
1,985
47
356
1,446
(1,051
)
1,167
100
5
(26
)
273
(191
)
96
(2,939
)
15,110
6,857
15,882
19,432
17,829
(75,357
)
(95,033
)
(41,816
)
63,619
78,073
36,802
(5,022
)
(5,797
)
(10,770
)
9,636
6
(2,414
)
(2,839
)
(566
)
(19,168
)
(25,596
)
(6,714
)
2,344
775
251
(3,371
)
(1,088
)
(2,562
)
(1,408
)
(2,115
)
(1,787
)
(1,157
)
(45
)
(196
)
(69
)
(5,446
)
(8,147
)
9,889
41,723
49,870
39,981
$
36,277
$
41,723
$
49,870
$
(784
)
$
103
$
887
(4,095
)
8,364
10,559
1,858
7,144
(9,343
)
31
1
2,064
(98
)
(56
)
2,904
149
(446
)
(214
)
$
(2,939
)
$
15,110
$
6,857
$
1,307
$
(12,020
)
$
(4,733
)
Table of Contents
Accumulated
Class B
Additional
Other
Total
Common
Common
Paid-In
Retained
Comprehensive
Treasury
Stockholders
Stock
Stock
Capital
Earnings
Income
Stock
Equity
$
119
$
369
$
145,359
$
219,340
$
40
$
(100,390
)
$
264,837
251
251
96
96
(1,408
)
(1,408
)
(15,942
)
(15,942
)
82
82
117
117
(15,743
)
119
369
145,706
203,398
239
(101,798
)
248,033
2
773
775
(2,562
)
(2,562
)
(19,535
)
(19,535
)
(96
)
(96
)
43
43
(19,588
)
119
371
146,479
183,863
186
(104,360
)
226,658
2
2,342
2,344
(1,088
)
(1,088
)
(3,371
)
(3,371
)
(3,723
)
(3,723
)
(243
)
(243
)
46
46
(3,920
)
$
119
$
373
$
148,821
$
176,769
$
(11
)
$
(105,448
)
$
220,623
Table of Contents
1.
DESCRIPTION OF BUSINESS
2.
SIGNIFICANT ACCOUNTING POLICIES
Table of Contents
Table of Contents
2004
2003
2002
$
(3,723
)
$
(19,535
)
$
(15,942
)
42,022
41,896
42,337
42,022
41,896
42,337
$
(.09
)
$
(.47
)
$
(.38
)
Table of Contents
Table of Contents
2004
2003
2002
$
(3,723
)
$
(19,535
)
$
(15,942
)
(1,887
)
(2,875
)
(5,657
)
$
(5,610
)
$
(22,410
)
$
(21,599
)
$
(.09
)
$
(.47
)
$
(.38
)
$
(.13
)
$
(.53
)
$
(.51
)
Table of Contents
Table of Contents
3.
SHORT-TERM INVESTMENTS
Gross
Gross
Estimated
Unrealized
Unrealized
Fair
Cost
Gains
Losses
Value
$
47,639
$
1
$
(320
)
$
47,320
30,075
(24
)
30,051
$
77,714
$
1
$
(344
)
$
77,371
$
40,476
$
136
$
(66
)
$
40,546
18,000
18,000
8,500
8,500
$
66,976
$
136
$
(66
)
$
67,046
Estimated
Cost
Fair Value
$
2,000
$
2,000
10,254
10,225
65,460
65,146
$
77,714
$
77,371
Table of Contents
4.
INVENTORIES
December 31,
2004
2003
$
27,212
$
23,232
2,568
2,108
4,293
4,791
34,073
30,131
(7,844
)
(8,051
)
$
26,229
$
22,080
5.
PROPERTY, PLANT AND EQUIPMENT
December 31,
2004
2003
$
2,089
$
2,089
40,554
40,302
173,494
172,311
5,423
5,354
956
81
222,516
220,137
155,515
137,771
$
67,001
$
82,366
6.
INVESTMENTS
Table of Contents
7.
GOODWILL AND OTHER INTANGIBLE ASSETS
December 31,
2004
2003
$
5,362
$
4,988
2,390
1,993
$
2,972
$
2,995
Year
$
333
312
292
282
281
Table of Contents
8.
PRODUCT WARRANTIES
$
1,268
301
(527
)
$
1,042
9.
STOCKHOLDERS EQUITY
Common Stock
Table of Contents
10.
OTHER INCOME (EXPENSE), NET
2004
2003
2002
$
1,764
$
1,514
$
2,360
(527
)
(512
)
(169
)
268
607
526
(70
)
(470
)
(1,985
)
(47
)
(356
)
(1,446
)
244
29
110
$
1,632
$
812
$
(604
)
11.
EMPLOYEE BENEFIT PLANS
Stock Options
Table of Contents
2004
2003
2002
3,809,603
4,552,749
3,774,920
63,880
112,620
1,053,377
(595,046
)
(707,144
)
(234,474
)
(243,087
)
(148,622
)
(41,074
)
3,035,350
3,809,603
4,552,749
2,385,819
2,653,481
2,345,760
$
18.28
$
18.84
$
21.37
$
13.58
$
8.93
$
9.70
$
22.55
$
23.29
$
20.81
$
9.65
$
5.21
$
6.08
$
18.04
$
18.28
$
18.84
$
19.44
$
19.31
$
20.93
$
5.98-54.50
$
5.98-54.50
$
1.83-54.50
$
10.00-18.09
$
5.98-11.59
$
6.01-16.46
$
5.98-17.63
$
1.83-11.00
$
1.83-16.37
3,213,559
2,683,793
2,096,541
Range of Exercise Prices
$5.98-$12.06
$12.29-$16.43
$16.46-$28.25
$28.44-$54.50
1,030,539
790,984
826,700
387,127
3.94
2.91
3.72
2.94
$
9.50
$
15.23
$
21.44
$
39.26
716,350
584,247
728,685
356,537
$
10.46
$
15.44
$
21.77
$
39.27
Table of Contents
401(k) Plan
Stock Bonus Plan
12.
INCOME TAXES
December 31,
2004
2003
$
8,341
$
8,656
3,148
3,235
1,965
1,477
1,539
1,509
879
700
824
795
322
459
187
332
509
982
17,714
18,145
(7,213
)
(4,199
)
10,501
13,946
(9,596
)
(12,795
)
(1,165
)
(1,233
)
(416
)
(732
)
(11,177
)
(14,760
)
$
(676
)
$
(814
)
Table of Contents
2004
2003
2002
$
(3,311
)
$
(24,357
)
$
(24,403
)
908
(534
)
(703
)
$
(2,403
)
$
(24,891
)
$
(25,106
)
2004
2003
2002
$
1,075
$
248
$
(10,331
)
185
60
1,320
248
(10,331
)
(5,604
)
1,167
$
1,320
$
(5,356
)
$
(9,164
)
2004
2003
2002
(35.0
)%
(35.0
)%
(35.0
)%
(1.8
)
(3.5
)
0.1
5.5
0.6
0.5
2.1
(1.5
)
(1.7
)
1.6
1.0
(0.4
)
82.5
16.9
54.9
%
(21.5
)%
(36.5
)%
Table of Contents
13.
COMMITMENTS AND CONTINGENCIES
Year
$
1,405
786
352
158
188
Table of Contents
14.
SEGMENT INFORMATION
Table of Contents
15.
QUARTERLY RESULTS OF OPERATIONS (Unaudited)
First
Second
Third
Fourth
Total
$
42,521
$
45,374
$
43,048
$
40,637
$
171,580
15,000
17,380
16,231
14,677
63,288
(1,190
)
61
(572
)
(2,022
)
(3,723
)
(.03
)
.00
(.01
)
(.05
)
(.09
)
First
Second
Third
Fourth
Total
$
37,740
$
38,693
$
35,877
$
39,111
$
151,421
8,907
10,537
8,587
10,981
39,012
(6,629
)
(5,958
)
(7,120
)
172
(19,535
)
(.16
)
(.14
)
(.17
)
.00
(.47
)
Table of Contents
ITEM 9 | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
ITEM 9A | CONTROLS AND PROCEDURES |
(a) | Evaluation of disclosure controls and procedures. |
(b) | Management Report on Internal Control Over Financial Reporting |
45
(c) | Inherent Limitations on Effectiveness of Controls |
(d) | Change in Internal Control Over Financial Reporting |
(e) | Report of Independent Registered Public Accounting Firm |
46
47
Vicor Corporation
/s/ Ernst & Young LLP
March 11, 2005
Table of Contents
ITEM 9B | OTHER INFORMATION |
ITEM 10 | DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT |
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 |
ITEM 15 | EXHIBITS AND FINANCIAL STATEMENTS |
48
Exhibits
Description of Document
3
.1
Restated Certificate of Incorporation, dated February 28,
1990(1)
3
.2
Certificate of Ownership and Merger Merging Westcor Corporation,
a Delaware Corporation, into Vicor Corporation, a Delaware
Corporation, dated December 3, 1990(1)
3
.3
Certificate of Amendment of Restated Certificate of
Incorporation, dated May 10, 1991(1)
3
.4
Certificate of Amendment of Restated Certificate of
Incorporation, dated June 23, 1992(1)
3
.5
Bylaws, as amended(1)
4
.1
Specimen Common Stock Certificate(2)
10
.1
1984 Stock Option Plan of the Company, as amended(2)
10
.2
1993 Stock Option Plan(3)
10
.3
1998 Stock Option and Incentive Plan(4)
10
.4
Amended and Restated 2000 Stock Option and Incentive Plan(5)
10
.5
Form of Non-Qualified Stock Option under the Vicor Corporation
Amended and Restated 2000 Stock Option and Incentive Plan(6)
10
.6
Sales Incentive Plan(7)
21
.1
Subsidiaries of the Company(7)
23
.1
Consent of Independent Registered Public Accounting Firm(7)
31
.1
Certification of Chief Executive Officer pursuant to
Rule 13a-14(a) of the Securities Exchange Act of 1934(7)
31
.2
Certification of Chief Financial Officer pursuant to
Rule 13a-14(a) of the Securities Exchange Act of 1934(7)
32
.1
Certification of Chief Executive Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002(7)
32
.2
Certification of Chief Financial Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002(7)
(1) | Filed as an exhibit to the Companys Annual Report on Form 10-K filed on March 29, 2001 and incorporated herein by reference. |
(2) | Filed as an exhibit to the Companys Registration Statement on Form 10, as amended, under the Securities Exchange Act of 1934 (File No. 0-18277), and incorporated herein by reference. |
(3) | Filed as an exhibit to the Companys Registration Statement on Form S-8, as amended, under the Securities Act of 1933 (No. 33-65154), and incorporated herein by reference. |
(4) | Filed as an exhibit to the Companys Registration Statement on Form S-8, as amended, under the Securities Act of 1933 (No. 333-61177), and incorporated herein by reference. |
(5) | Filed as an exhibit to the Companys Proxy Statement for use in connection with its 2002 Annual Meeting of Stockholders, which was filed on April 29, 2002, and incorporated herein by reference. |
(6) | Filed as an exhibit to the Companys Quarterly Report on Form 10-Q filed on November 4, 2004 and incorporated herein by reference. |
(7) | Filed herewith. |
49
(Credit) Charge
Balance at
to Costs and
Other Charges,
Balance at
Description
Beginning of Period
Expenses
Deductions(1)
End of Period
$
807,000
$
(217,000
)
$
(122,000
)
$
468,000
$
648,000
$
161,000
$
(2,000
)
$
807,000
$
1,460,000
$
218,000
$
(1,030,000
)
$
648,000
(1) | Reflects uncollectible accounts written off, net of recoveries. |
(Credit) Charge | ||||||||||||||||
Balance at | to Costs and | Other Charges, | Balance at | |||||||||||||
Description | Beginning of Period | Expenses | Deductions(2) | End of Period | ||||||||||||
2004
|
||||||||||||||||
Inventory reserves
|
$ | 8,051,000 | $ | 1,079,000 | $ | (1,286,000 | ) | $ | 7,844,000 | |||||||
2003
|
||||||||||||||||
Inventory reserves
|
$ | 7,562,000 | $ | 1,966,000 | $ | (1,477,000 | ) | $ | 8,051,000 | |||||||
2002
|
||||||||||||||||
Inventory reserves
|
$ | 8,870,000 | $ | 1,192,000 | $ | (2,500,000 | ) | $ | 7,562,000 |
(2) | Reflects amounts associated with inventory that have been discarded or sold. |
50
Vicor Corporation
By:
/s/ Mark A. Glazer
Mark A. Glazer
Chief Financial Officer
Signature
Title
Date
/s/ Patrizio Vinciarelli
President, Chief Executive Officer
and Chairman of the Board
(Principal Executive Officer)
March 11, 2005
/s/ Mark A. Glazer
Chief Financial Officer
(Principal Financial Officer
and Principal Accounting Officer)
March 11, 2005
/s/ Estia J. Eichten
Director
March 11, 2005
/s/ David T. Riddiford
Director
March 11, 2005
/s/ Jay M. Prager
Director
March 11, 2005
/s/ Barry Kelleher
Director
March 11, 2005
/s/ M. Michael Ansour
Director
March 11, 2005
/s/ Samuel Anderson
Director
March 11, 2005
51
Exhibit 10.6
VICOR CORPORATION
SALES INCENTIVE PLAN
REGIONAL SALES MANAGEMENT
I. OBJECTIVES:
A. To encourage participants to meet or exceed Vicor's sales goals within established expense standards.
B. To compensate participants in proportion to their sales accomplishments and margin contribution.
II. PRINCIPAL PROVISIONS:
A. Term
The term of this plan is usually from January 1 through December 31, of each year.
B. Modification
This plan may be modified by the Senior Vice President of Sales as business situations, events and, circumstances warrant.
C. Eligibility
All Sales management personnel who are directly responsible for the management of Bookings from and Billings to customers of Vicor, unless otherwise excluded.
a.) New or transferred members of this plan will participate on a pro-rata basis starting the first full calendar quarter of participation in the plan. Calendar quarters are defined in the annual Vicor Fiscal Calendar.
b.) Participants who resign or are terminated for cause from Vicor within a quarterly incentive period will terminate all participation in the plan, retroactive to the beginning of that period.
c.) Participants terminated by Vicor without cause, transferred or retired, will be considered for incentive on a pro-rata basis within an incentive period at the time determination of sales incentive is made.
III. INCENTIVE:
A. Sales incentive will be granted at the rate of 2% of "Net Billings Delta" times the Gross Margin as calculated, by sales territory at the end of each incentive period.
a.) Each participant will be given a Quarterly Billings Plan approved by the Senior Vice President of Sales. This will be based on the previous year's net sales billed, less exclusions.
1.) Assume 1995 Net Billings of $7,000K
2.) 1996 Quarterly Billings goal is $1,750K
3.) Q1 1996 Net Billings are $2,250K, Gross Margin is 45% $2,250 - $1,750K = $500K x (.02 x .45) = $4,500 incentive Q2 Billings are $1,500K No commission would be paid, ($250K) would be carried forward and added to Q3 Q3 1996 Billings, $3,000K, net, Gross Margin is 47% $3,000K - $1,750K - $250K = $1,000K $1,000K x (.02 x .47) = $9,400
IV. DEFINITIONS:
A. Billings Plan - the amount of Net Billings in a territory during the plan year, normally similar to the previous year's Billings, divided by four, will establish the base quarterly quota for the incentive year.
B. Net Billings Delta - the difference between the year's actual net Quarterly Billings and the Billings Plan.
C. Territory - a geographical area or major account(s) and designated locations established by Vicor. Territories may only be revised by the Senior Vice President of Sales.
D. Contingencies:
a.) Sales resulting from very little or no effort on the part of the participant may be classified as a "windfall" and may be excluded in whole, in part, or not at all, at the discretion of the Senior Vice President of Sales.
b.) Consideration may be given to a participant whose goal is unattainable due to unforeseen circumstances outside of the participant's control. Requests for adjustments must be made in writing to the Senior Vice President of Sales within five days after the end of each incentive period.
c.) In general, no Billings Plan will be less than $1,000,000 annually.
V. MAXIMUM INCENTIVE:
A. In no case will a Quarterly incentive exceed 100% of a participant's base quarterly salary.
VI. EXCLUSIONS:
A. Shipments to Vicor licensees and other customers as may be designated, are excluded from this plan.
VICOR CORPORATION
SALES INCENTIVE PLAN
SALES AND MARKETING MANAGEMENT
I. OBJECTIVES:
A. To encourage participants who significantly contribute to Vicor's sales growth to support Vicor's sales goals within established expense standards.
II. PRINCIPAL PROVISION:
A. Term
The term of this plan is usually from January 1 through December 31, of each year.
B. Modification
This plan may be modified by the President, as business situations, events and circumstances warrant.
C. Eligibility
At the discretion of the President. Generally, managers who have participants in the Sales Incentive Plan reporting to them.
III. INCENTIVE:
Incentive will be based on the formula outlined below:
The incentive for the manager will be his/her salary divided by the sum of the salaries of those sales persons reporting to said manager plus his/her salary times the sum of all the aforesaid sales managers' incentive compensation.
An example based on the foregoing could be:
Incentive = $12,632
This assumes an $80K salary, five sales persons making $60K and an incentive of $60K paid to the five sales managers.
IV. MAXIMUM PAYMENT:
A. In no case will a Quarterly payment exceed 100% of a participant's
base quarterly salary.
.
.
.
Exhibit 21.1
SUBSIDIARIES OF THE COMPANY
Name State or jurisdiction of incorporation ---- -------------------------------------- Picor Corporation Delaware, USA VLT, Inc. California, USA Vicor GmbH Germany VICR Securities Corporation Massachusetts, USA Vicor France SARL France Vicor Italy SRL Italy Vicor Hong Kong Ltd. Hong Kong Vicor U.K. Ltd. United Kingdom Vicor B.V. Netherlands Vicor Japan Company, Ltd. Japan Vicor Development Corporation Delaware, USA Aegis Power Systems, Inc. Delaware, USA Mission Power Systems, Inc. Delaware, USA Northwest Power Integration, Inc. Delaware, USA Converpower Corporation Delaware, USA Freedom Power Systems, Inc. Delaware, USA |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the reference to our firm under the caption "Selected Financial Data" and to the incorporation by reference in the following Registration Statements:
(1) Registration Statement (Form S-8, No. 33-37491) pertaining to the 1984 Stock Option Plan of Vicor Corporation,
(2) Registration Statement (Form S-8, No. 33-65154) pertaining to the 1993 Stock Option Plan of Vicor Corporation,
(3) Registration Statement (Form S-8, No. 333-61177) pertaining to the 1998 Stock Option and Incentive Plan of Vicor Corporation, and
(4) Registration Statement (Form S-8, No. 333-99423) pertaining to the Amended and Restated 2000 Stock Option and Incentive Plan of Vicor Corporation;
of our reports dated March 11, 2005, with respect to the consolidated financial statements and schedule of Vicor Corporation, Vicor Corporation management's assessment of the effectiveness of internal control over financial reporting, and the effectiveness of internal control over financial reporting of Vicor Corporation, included in this Annual Report (Form 10-K) for the year ended December 31, 2004.
/s/Ernst & Young LLP Boston, Massachusetts March 11, 2005 |
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 control 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; and | |
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 |
a) All significant deficiencies and material weaknesses in the design or operation of internal control 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. |
/s/ Patrizio Vinciarelli | |
|
|
Patrizio Vinciarelli | |
Chief Executive Officer |
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 control 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; and | |
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 |
a) All significant deficiencies and material weaknesses in the design or operation of internal control 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. |
/s/ Mark A. Glazer | |
|
|
Mark A. Glazer | |
Chief Financial Officer |
(1) The Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and | |
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Patrizio Vinciarelli | |
|
|
Patrizio Vinciarelli | |
President, Chairman of the Board and | |
Chief Executive Officer |
(1) The Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and | |
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Mark A, Glazer | |
|
|
Mark A. Glazer | |
Chief Financial Officer |