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Delaware
(State or other jurisdiction of
incorporation or organization)
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13-3711155
(I.R.S. Employer
Identification No.)
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Large accelerated filer
o
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Accelerated filer
ý
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Non-accelerated filer
o
(Do not check if a smaller
reporting company)
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Smaller reporting company
o
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Page
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Part I
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Part II
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Part III
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Part IV
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•
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customer demand for and adoption of our products;
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•
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market and competitive conditions in our industry, the semiconductor industry and the economy as a whole;
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•
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the timing and success of new technologies and product introductions by our competitors and by us;
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•
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our ability to work efficiently with our customers on their qualification of our new technologies and products;
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•
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our ability to deliver reliable, cost-effective products that meet our customers’ testing requirements in a timely manner;
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•
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our ability to transition to new product architectures to solve next-generation semiconductor test and measurement challenges, and to bring new products into volume production on time and at acceptable yields and cost;
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•
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our ability to implement measures for enabling efficiencies and supporting growth in our design, applications, manufacturing and other operational activities;
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•
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the reduction, rescheduling or cancellation of orders by our customers;
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•
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our ability to collect accounts receivables owed by our customers;
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•
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our product and customer sales mix and geographical sales mix;
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•
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a reduction in the price or the profitability of our products due to competitive pressures or other factors;
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•
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the timely availability or the cost of components and materials utilized in our products;
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•
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our ability to efficiently optimize manufacturing capacity and production yields as necessary to meet customer demand and ramp variable production volumes at our manufacturing facilities;
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•
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our ability to protect our intellectual property against infringement and continue our investment in research and development and design activities;
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•
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any disruption in the operation of our manufacturing facilities; and
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•
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the timing of and return on our investments in research and development.
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Fiscal 2016
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Fiscal 2015
|
|
Fiscal 2014
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|||
Intel
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30.1
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%
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19.6
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%
|
|
19.7
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%
|
Samsung
|
*
|
|
|
14.6
|
|
|
*
|
|
SK hynix
|
*
|
|
|
14.3
|
|
|
16.9
|
|
Micron
|
*
|
|
|
11.7
|
|
|
15.0
|
|
Total revenues attributable to customers greater than 10%
|
30.1
|
%
|
|
60.2
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%
|
|
51.6
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%
|
*
|
Less than 10% of revenues.
|
•
|
collaborate with customers to understand their future requirements;
|
•
|
design innovative and performance-enhancing product architectures, technologies and features that differentiate our products from those of our competitors;
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•
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in some cases engage with third parties who have particular expertise in order to complete one or more aspects of the design and manufacturing process;
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•
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qualify with the customer(s) the new product, or an existing product incorporating new technology;
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•
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transition our products to new manufacturing technologies;
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•
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offer our products for sale at competitive price levels while maintaining our gross-margins within our financial model;
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•
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identify emerging technological trends in our target markets;
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•
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maintain effective marketing strategies;
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•
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respond effectively to technological changes or product announcements by others; and
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•
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adjust to changing market conditions quickly and cost-effectively.
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•
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cause lower than anticipated yields and lengthen delivery schedules;
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•
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cause delays in product shipments;
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•
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cause delays in new product introductions;
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•
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cause us to incur warranty expenses;
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•
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result in increased costs and diversion of development resources;
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•
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cause us to incur increased charges due to unusable inventory;
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•
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require design modifications; or
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•
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decrease market acceptance or customer satisfaction with these products.
|
•
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compliance with a wide variety of foreign laws and regulations;
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•
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legal uncertainties regarding taxes, tariffs, quotas, export controls, export licenses and other trade barriers;
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•
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political and economic instability or foreign conflicts that involve or affect the countries of our customers;
|
•
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difficulties in collecting accounts receivable and longer accounts receivable payment cycles;
|
•
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difficulties in staffing and managing personnel, distributors and representatives;
|
•
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reduced protection for intellectual property rights in some countries;
|
•
|
currency exchange rate fluctuations, which could affect the value of our assets denominated in local currency, as well as the price of our products relative to locally produced products;
|
•
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seasonal fluctuations in purchasing patterns in other countries; and
|
•
|
fluctuations in freight rates and transportation disruptions.
|
•
|
our means of protecting our proprietary rights will be adequate;
|
•
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patents will be issued from our pending or future applications;
|
•
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our existing or future patents will be sufficient in scope or strength to provide any meaningful protection or commercial advantage to us;
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•
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our patents or other intellectual property will not be invalidated, circumvented or successfully challenged in the United States or foreign countries; or
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•
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others will not misappropriate our proprietary technologies or independently develop similar technologies, duplicate our products or design around any of our patents or other intellectual property, or attempt to manufacture and sell infringing products in countries that do not strongly enforce intellectual property rights.
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•
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whether the combined businesses will perform as expected;
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•
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the possibility that we paid more for the acquisition of Cascade Microtech than the value we will derive from the acquisition; and
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•
|
the reduction of our cash available for operations and other uses and the incurrence of indebtedness to finance the acquisition.
|
•
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variations in our operating results;
|
•
|
our forecasts and financial guidance for future periods;
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•
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announcements of technological innovations, new products or product enhancements, new product adoptions at semiconductor customers or significant agreements by us or by our competitors;
|
•
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reports regarding our ability to bring new products into volume production efficiently;
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•
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the gain or loss of significant orders or customers;
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•
|
changes in the estimates of our operating results or changes in recommendations by any securities analysts that elect to follow our common stock;
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•
|
rulings on litigations and proceedings;
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•
|
seasonality, principally due to our customers' purchasing cycles;
|
•
|
market and competitive conditions in our industry, the entire semiconductor industry and the economy as a whole;
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•
|
recruitment or departure of key personnel; and
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•
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announcements of mergers and acquisition transactions and the ability to successfully integrate the business activities of the acquired/merged company.
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•
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establish a classified board of directors so that not all members of our board are elected at one time;
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•
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provide that directors may only be removed “for cause” and only with the approval of 66.7% of our stockholders;
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•
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require super-majority voting to amend some provisions in our certificate of incorporation and bylaws;
|
•
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authorize the issuance of “blank check” preferred stock that our board could issue to increase the number of outstanding shares and to discourage a takeover attempt;
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•
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limit the ability of our stockholders to call special meetings of stockholders;
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•
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prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders;
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•
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provide that the board of directors is expressly authorized to make, alter or repeal our bylaws; and
|
•
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establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at stockholder meetings.
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Location
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|
Principal Use
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|
Square
Footage
|
|
Ownership
|
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Livermore, California, United States
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|
Corporate headquarters, sales, marketing, administration, product design, manufacturing, service and repair, distribution, research and development
|
|
168,636
|
|
|
Leased
|
Beaverton, Oregon, United States
|
|
Sales, marketing, administration, product design, manufacturing, service and repair, distribution, research and development
|
|
98,946
|
|
|
Leased
|
Carlsbad, California, United States
|
|
Product design, administration, manufacturing, service and repair, distribution, research and development
|
|
30,876
|
|
|
Leased
|
San Jose, California, United States
|
|
Administration, product design, manufacturing, service and repair, distribution, research and development
|
|
23,680
|
|
|
Leased
|
St. Paul, Minnesota, United States
|
|
Marketing and design
|
|
9,122
|
|
|
Leased
|
Thiendorf, Germany
|
|
Sales, marketing, manufacturing, administration, service and repair, distribution, sales, research and development
|
|
44,713
|
|
|
Leased
|
Munich, Germany
|
|
Manufacturing, service and repair, distribution, sales, research and development
|
|
10,656
|
|
|
Leased
|
Singapore
|
|
Sales, administration, product design, service, and field service
|
|
30,088
|
|
|
Leased
|
Jubei City, Hsinchu, Taiwan
|
|
Sales office, administration, product design, field service and repair center
|
|
20,430
|
|
|
Leased
|
Bundang, South Korea
|
|
Sales office, administration, product design, field service, and repair center
|
|
15,310
|
|
|
Leased
|
Yokohama City, Japan
|
|
Sales office, administration, marketing, product design, research and development, field service, and repair center, manufacturing and distribution
|
|
15,210
|
|
|
Leased
|
Tokyo, Japan
|
|
Sales and service
|
|
1,862
|
|
|
Leased
|
Hiroshima, Japan
|
|
Repair center
|
|
1,615
|
|
|
Leased
|
Suzhou, China
|
|
Sales, marketing, administration, manufacturing, product design, service and repair, distribution, research and development
|
|
15,177
|
|
|
Leased
|
Shanghai, China
|
|
Sales and service
|
|
1,865
|
|
|
Leased
|
Fiscal 2016
|
High
|
|
Low
|
||||
First Quarter
|
$
|
9.33
|
|
|
$
|
6.34
|
|
Second Quarter
|
9.09
|
|
|
6.51
|
|
||
Third Quarter
|
10.86
|
|
|
8.72
|
|
||
Fourth Quarter
|
$
|
11.95
|
|
|
$
|
8.65
|
|
Fiscal 2015
|
High
|
|
Low
|
||||
First Quarter
|
$
|
10.26
|
|
|
$
|
7.55
|
|
Second Quarter
|
9.51
|
|
|
7.97
|
|
||
Third Quarter
|
9.20
|
|
|
5.93
|
|
||
Fourth Quarter
|
$
|
9.13
|
|
|
$
|
6.49
|
|
|
Cumulative Total Return
|
||||||||||||||||||||||
|
December 31,
2011 |
|
December 31,
2012 |
|
December 31,
2013 |
|
December 31,
2014 |
|
December 31,
2015 |
|
December 31,
2016 |
||||||||||||
FormFactor, Inc.
|
$
|
100.00
|
|
|
$
|
90.12
|
|
|
$
|
118.77
|
|
|
$
|
169.96
|
|
|
$
|
177.87
|
|
|
$
|
221.34
|
|
S&P 500
|
100.00
|
|
|
116.00
|
|
|
153.58
|
|
|
174.60
|
|
|
177.01
|
|
|
198.18
|
|
||||||
RDG Semiconductor Composite
|
100.00
|
|
|
101.55
|
|
|
137.33
|
|
|
170.90
|
|
|
153.05
|
|
|
206.30
|
|
|
Fiscal
2016 (1)(2)(7)(8) |
|
Fiscal
2015 (3) |
|
Fiscal
2014 (1)(2) |
|
Fiscal
2013 (1)(2)(4) |
|
Fiscal
2012 (1)(2)(5)(6) |
||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
383,881
|
|
|
$
|
282,358
|
|
|
$
|
268,530
|
|
|
$
|
231,533
|
|
|
$
|
178,535
|
|
Gross profit
|
102,682
|
|
|
85,738
|
|
|
77,439
|
|
|
42,284
|
|
|
25,331
|
|
|||||
Net loss
|
(6,557
|
)
|
|
(1,523
|
)
|
|
(19,185
|
)
|
|
(57,683
|
)
|
|
(35,546
|
)
|
|||||
Basic and diluted net loss per share
|
$
|
(0.10
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(1.06
|
)
|
|
$
|
(0.7
|
)
|
Consolidated Balance Sheets Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and marketable securities
|
$
|
108,905
|
|
|
$
|
187,589
|
|
|
$
|
163,837
|
|
|
$
|
151,091
|
|
|
$
|
165,788
|
|
Working capital
|
172,002
|
|
|
214,437
|
|
|
196,412
|
|
|
173,881
|
|
|
194,125
|
|
|||||
Total assets
|
618,982
|
|
|
342,723
|
|
|
344,243
|
|
|
340,708
|
|
|
395,682
|
|
|||||
Term loan, net of current portion
|
125,475
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Capital leases, net of current portion
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
340
|
|
|||||
Total stockholders' equity
|
$
|
401,056
|
|
|
$
|
294,681
|
|
|
$
|
289,436
|
|
|
$
|
294,086
|
|
|
$
|
339,258
|
|
Number of employees
|
1,571
|
|
|
958
|
|
|
907
|
|
|
961
|
|
|
1,021
|
|
(1)
|
Fiscal 2016, 2015, 2014, 2013 and 2012 net losses include restructuring charges, net of
$7.3 million
, $0.6 million, $2.7 million, $4.7 million and $2.9 million, respectively, relating to our global restructuring and reorganization actions. See Note 6—
Restructuring Charges
of the Notes to the Consolidated Financial Statements.
|
(2)
|
Fiscal 2016, 2014, 2013 and 2012 net losses include impairment charges of
$12.4 million
, $1.2 million, $0.8 million and $0.4 million, respectively. See Note 7—
Impairment of Long-lived Assets
of the Notes to the Consolidated Financial Statements.
|
(3)
|
Fiscal 2015 includes the following: a) a $1.5 million gain from a business interruption insurance claim relating to a factory fire at a customer. See Note-18,
Business Interruption Insurance Claim Recovery
of the Notes to the Consolidated Financial Statements, and b) a $1.0 million net gain from the sale of intellectual property.
|
(4)
|
Fiscal 2013 net loss includes $0.3 million attributable to loss on sale of a subsidiary.
|
(5)
|
Fiscal 2012 includes a $25.5 million tax benefit from the release of deferred tax asset valuation allowances due to deferred tax liabilities established on the acquired identifiable intangible assets from our acquisition of MicroProbe.
|
(6)
|
Fiscal 2012 includes the following as a result of the MicroProbe acquisition: $19.8 million in revenue, $5.4 million in the amortization of intangibles expense, $2.6 million release of pre-existing backlog, $0.2 million charge for step-up depreciation on the fair value of fixed assets, resulting in a $6.4 million net loss. As part of the MicroProbe Acquisition, a patent lawsuit was settled with a benefit of $3.3 million.
|
(7)
|
Fiscal 2016 includes a $44.0 million tax benefit from the release of deferred tax asset valuation allowances due to deferred tax liabilities established on the acquired identifiable intangible assets from our acquisition of Cascade Microtech. See Note 14—
Income Taxes
of the Notes to the Consolidated Financial Statements.
|
(8)
|
Fiscal 2016 includes the following as a result of the Cascade Microtech acquisition: $82.6 million in revenue, $27.8 million in the amortization of intangibles expense and $7.6 million charge for inventory-related step-up amortization, resulting in a $36.4 million loss.
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
Fiscal 2014
|
|||
Revenues
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of revenues
|
73.3
|
|
|
69.6
|
|
|
71.2
|
|
Gross profit
|
26.7
|
|
|
30.4
|
|
|
28.8
|
|
Operating expenses:
|
|
|
|
|
|
|||
Research and development
|
15.0
|
|
|
15.6
|
|
|
15.9
|
|
Selling, general and administrative
|
19.1
|
|
|
16.0
|
|
|
19.0
|
|
Restructuring and impairment charges, net
|
5.1
|
|
|
0.2
|
|
|
1.5
|
|
Total operating expenses
|
39.2
|
|
|
31.8
|
|
|
36.4
|
|
Operating loss
|
(12.5
|
)
|
|
(1.4
|
)
|
|
(7.6
|
)
|
Interest income, net
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
Other income (expense), net
|
(0.7
|
)
|
|
0.9
|
|
|
0.1
|
|
Loss before income taxes
|
(13.1
|
)
|
|
(0.4
|
)
|
|
(7.4
|
)
|
Provision (benefit) from income taxes
|
(11.4
|
)
|
|
0.1
|
|
|
(0.3
|
)
|
Net loss
|
(1.7
|
)%
|
|
(0.5
|
)%
|
|
(7.1
|
)%
|
|
Fiscal 2016
|
|
Fiscal 2015
|
||||
|
(In thousands)
|
||||||
Probe Cards
|
$
|
337,970
|
|
|
$
|
282,358
|
|
Systems
|
45,911
|
|
|
—
|
|
||
Total
|
$
|
383,881
|
|
|
$
|
282,358
|
|
|
Fiscal
2016
|
|
% of
Revenues
|
|
Fiscal
2015
|
|
% of
Revenues
|
||||||
|
(In thousands, except percentages)
|
||||||||||||
United States
|
$
|
127,641
|
|
|
33.3
|
%
|
|
$
|
66,051
|
|
|
23.4
|
%
|
South Korea
|
65,508
|
|
|
17.1
|
|
|
71,120
|
|
|
25.2
|
|
||
Taiwan
|
57,331
|
|
|
14.9
|
|
|
61,711
|
|
|
21.9
|
|
||
Europe
|
49,445
|
|
|
12.9
|
|
|
25,542
|
|
|
9.0
|
|
||
Asia-Pacific (1)
|
43,659
|
|
|
11.4
|
|
|
31,389
|
|
|
11.1
|
|
||
Japan
|
38,650
|
|
|
10.0
|
|
|
26,418
|
|
|
9.4
|
|
||
Rest of the world
|
1,647
|
|
|
0.4
|
|
|
127
|
|
|
—
|
|
||
Total Revenues
|
$
|
383,881
|
|
|
100.0
|
%
|
|
$
|
282,358
|
|
|
100.0
|
%
|
(1)
|
Asia-Pacific includes all countries in the region except Taiwan, South Korea, and Japan, which are disclosed separately.
|
|
Fiscal 2016
|
||||||||||||||
|
Probe Cards
|
|
Systems
|
|
Corporate and Other
|
|
Total
|
||||||||
Gross profit
|
$
|
121,407
|
|
|
$
|
23,925
|
|
|
$
|
(42,650
|
)
|
|
$
|
102,682
|
|
Gross margin
|
35.9
|
%
|
|
52.1
|
%
|
|
—
|
%
|
|
26.7
|
%
|
|
Fiscal 2015
|
||||||||||||||
|
Probe Cards
|
|
Systems
|
|
Corporate and Other
|
|
Total
|
||||||||
Gross profit
|
$
|
99,199
|
|
|
$
|
—
|
|
|
$
|
(13,461
|
)
|
|
$
|
85,738
|
|
Gross margin
|
35.1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
30.4
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Gross profit
|
$
|
102,682
|
|
|
$
|
85,738
|
|
Gross margin
|
26.7
|
%
|
|
30.4
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Research and development
|
$
|
57,453
|
|
|
$
|
44,184
|
|
% of revenues
|
15.0
|
%
|
|
15.6
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Selling, general and administrative
|
$
|
73,444
|
|
|
$
|
45,090
|
|
% of revenues
|
19.1
|
%
|
|
16.0
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Restructuring and impairment charges, net
|
$
|
19,692
|
|
|
$
|
567
|
|
% of revenues
|
5.1
|
%
|
|
0.2
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Interest income, net
|
$
|
327
|
|
|
$
|
285
|
|
% of revenues
|
0.1
|
%
|
|
0.1
|
%
|
||
|
|
|
|
||||
Other income (expense), net
|
$
|
(2,615
|
)
|
|
$
|
2,547
|
|
% of revenues
|
(0.7
|
)%
|
|
0.9
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
||||
|
(In thousands, except percentages)
|
||||||
Provision (benefit) from income taxes
|
$
|
(43,638
|
)
|
|
$
|
252
|
|
Effective tax rate
|
86.9
|
%
|
|
(19.8
|
)%
|
|
Fiscal
|
|
% of
|
|
Fiscal
|
|
% of
|
|
Change
|
|||||||||||
|
2015
|
|
Revenues
|
|
2014
|
|
Revenues
|
|
$
|
|
%
|
|||||||||
|
(In thousands, except percentages)
|
|||||||||||||||||||
Revenues by Market:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Foundry and Logic
|
$
|
145,839
|
|
|
51.7
|
%
|
|
$
|
142,360
|
|
|
53.0
|
%
|
|
$
|
3,479
|
|
|
2.4
|
%
|
DRAM
|
125,512
|
|
|
44.4
|
|
|
110,800
|
|
|
41.3
|
|
|
14,712
|
|
|
13.3
|
|
|||
Flash
|
11,007
|
|
|
3.9
|
|
|
15,370
|
|
|
5.7
|
|
|
(4,363
|
)
|
|
(28.4
|
)
|
|||
Total revenues
|
$
|
282,358
|
|
|
100.0
|
%
|
|
$
|
268,530
|
|
|
100.0
|
%
|
|
$
|
13,828
|
|
|
5.1
|
%
|
|
Fiscal
2015
|
|
% of
Revenues
|
|
Fiscal
2014
|
|
% of
Revenues
|
||||||
|
(In thousands, except percentages)
|
||||||||||||
South Korea
|
$
|
71,120
|
|
|
25.2
|
%
|
|
$
|
52,677
|
|
|
19.6
|
%
|
North America
|
66,178
|
|
|
23.4
|
|
|
75,393
|
|
|
28.1
|
|
||
Taiwan
|
61,711
|
|
|
21.9
|
|
|
49,395
|
|
|
18.4
|
|
||
Asia-Pacific (1)
|
31,389
|
|
|
11.1
|
|
|
34,705
|
|
|
12.9
|
|
||
Japan
|
26,418
|
|
|
9.4
|
|
|
25,683
|
|
|
9.6
|
|
||
Europe
|
25,542
|
|
|
9.0
|
|
|
30,677
|
|
|
11.4
|
|
||
Total Revenues
|
$
|
282,358
|
|
|
100.0
|
%
|
|
$
|
268,530
|
|
|
100.0
|
%
|
(1)
|
Asia-Pacific includes all countries in the region except Taiwan, South Korea, and Japan, which are disclosed separately.
|
•
|
South Korea revenues increased driven primarily by a combination of market share increases at a major South Korean customer based on the adoption of our SmartMatrix product for DRAM applications and increased Foundry and Logic product shipments related to mobile processor demand;
|
•
|
North America revenues decreased driven primarily by a shift of Foundry and Logic product shipments for personal computer processors to customers’ test facilities in Europe;
|
•
|
Taiwan revenues increased driven primarily by a combination of increased Foundry and Logic product shipments and an increase in commodity or personal computer DRAM demand;
|
•
|
Asia-Pacific revenues decreased driven primarily by reduced sales of our SmartMatrix DRAM products;
|
•
|
Europe revenues decreased driven primarily due to reduced mobile processor related product demand, partially offset by a shift of Foundry and Logic product shipments for personal computer processors to customers’ test facilities in Europe; and
|
•
|
Japan revenues were relatively flat year over year.
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Gross profit
|
$
|
85,738
|
|
|
$
|
77,439
|
|
Gross margin
|
30.4
|
%
|
|
28.8
|
%
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Research and development
|
$
|
44,184
|
|
|
$
|
42,725
|
|
% of revenues
|
15.6
|
%
|
|
15.9
|
%
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Selling, general and administrative
|
$
|
45,090
|
|
|
$
|
51,385
|
|
% of revenues
|
16.0
|
%
|
|
19.0
|
%
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Restructuring and impairment charges, net
|
$
|
567
|
|
|
$
|
3,887
|
|
% of revenues
|
0.2
|
%
|
|
1.5
|
%
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Interest income, net
|
$
|
285
|
|
|
$
|
302
|
|
% of revenues
|
0.1
|
%
|
|
0.1
|
%
|
||
|
|
|
|
||||
Other income (expense), net
|
$
|
2,547
|
|
|
$
|
161
|
|
% of revenues
|
0.9
|
%
|
|
0.1
|
%
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||
|
(In thousands, except percentages)
|
||||||
Provision (benefit) from income taxes
|
$
|
252
|
|
|
$
|
(910
|
)
|
Effective tax rate
|
(19.8
|
)%
|
|
4.5
|
%
|
|
Fiscal
2016
|
|
Fiscal
2015
|
|
Fiscal
2014
|
||||||
|
(In thousands)
|
||||||||||
Net cash provided by operating activities
|
$
|
17,423
|
|
|
$
|
36,122
|
|
|
$
|
17,659
|
|
Net cash (used in) provided by investing activities
|
(206,318
|
)
|
|
1,129
|
|
|
37,339
|
|
|||
Net cash provided by (used in) financing activities
|
$
|
143,614
|
|
|
$
|
(4,792
|
)
|
|
$
|
2,542
|
|
|
Payments Due In Fiscal Years
|
||||||||||||||||||||||||||
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
After 2021
|
|
Total
|
||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
Operating leases
|
$
|
6,279
|
|
|
$
|
5,789
|
|
|
$
|
4,882
|
|
|
$
|
3,581
|
|
|
$
|
3,236
|
|
|
$
|
15,734
|
|
|
$
|
39,501
|
|
Purchase obligations
|
33,696
|
|
|
4,550
|
|
|
515
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,761
|
|
|||||||
Senior secured term loan facility-principal payments (1)
|
13,125
|
|
|
26,250
|
|
|
41,250
|
|
|
50,625
|
|
|
8,125
|
|
|
—
|
|
|
139,375
|
|
|||||||
Senior secured term loan facility-interest payments (2)
|
2,828
|
|
|
2,400
|
|
|
1,739
|
|
|
821
|
|
|
41
|
|
|
—
|
|
|
7,829
|
|
|||||||
Total
|
$
|
55,928
|
|
|
$
|
38,989
|
|
|
$
|
48,386
|
|
|
$
|
55,027
|
|
|
$
|
11,402
|
|
|
$
|
15,734
|
|
|
$
|
225,466
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
The following documents are filed as part of this Annual Report on Form 10-K:
|
(b)
|
Financial Statement Schedules:
|
(c)
|
Exhibits:
|
|
|
|
|
Incorporated by Reference
|
|
|
|
|
|||||||||
Exhibit
Number
|
|
Exhibit Description
|
|
Form
|
|
File No
|
|
Date of
First Filing
|
|
Exhibit
Number
|
|
Filed
Herewith
|
|||||
2.01***
|
|
|
Agreement and Plan of Merger, dated February 3, 2016, by and among Cascade Microtech, Inc., FormFactor, Inc. and Cardinal Merger Subsidiary, Inc.
|
|
8-K
|
|
|
000-50307
|
|
|
2/9/2016
|
|
|
2.1
|
|
|
|
3.01
|
|
|
Amended and Restated Certificate of Incorporation of the Registrant as filed with the Delaware Secretary of State on June 17, 2003
|
|
S-1
|
|
|
333-109815
|
|
|
10/20/2003
|
|
|
3.01
|
|
|
|
3.02
|
|
|
Amended and Restated Bylaws of the Registrant
|
|
8-K
|
|
|
000-50307
|
|
|
7/22/2016
|
|
|
3.2
|
|
|
|
4.01
|
|
|
Specimen Common Stock Certificate
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/28/2002
|
|
|
4.01
|
|
|
|
10.01
|
|
|
Credit Agreement among FormFactor, Inc. as Borrower, the Guarantors that are from time to time parties thereto, HSBC Bank USA, National Association, as Administrative Agent, Lead Lender, Co-Lead Arranger, Sole Bookrunner, Syndication Agent and Lender, the Lenders that are from time to time parties thereto, and Silicon Valley Bank, as Co-Lead Arranger and Documentation Agent, dated as of June 24, 2016
|
|
8-K
|
|
|
000-50307
|
|
|
6/28/2016
|
|
|
10.1
|
|
|
|
10.02+
|
|
|
Form of Indemnity Agreement
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/28/2002
|
|
|
10.01
|
|
|
|
10.03+
|
|
|
Form of Change of Control Severance Agreement
|
|
10-K
|
|
|
000-50307
|
|
|
3/14/2005
|
|
|
10.48
|
|
|
|
10.04+
|
|
|
1996 Stock Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.03
|
|
|
|
10.05+
|
|
|
Incentive Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.04
|
|
|
|
10.06+
|
|
|
Management Incentive Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.05
|
|
|
|
10.07+
|
|
|
2002 Equity Incentive Plan, as amended, and forms of plan agreements
|
|
10-Q
|
|
|
000-50307
|
|
|
5/4/2011
|
|
|
10.06
|
|
|
|
10.08+
|
|
|
2002 Employee Stock Purchase Plan, as amended
|
|
10-Q
|
|
|
000-50307
|
|
|
8/7/2007
|
|
|
10.01
|
|
|
|
10.09+
|
|
|
Key Employee Bonus Plan, as amended
|
|
10-Q
|
|
|
000-50307
|
|
|
5/7/2007
|
|
|
10.01
|
|
|
|
10.10+
|
|
|
Equity Incentive Plan, as amended and restated effective April 18, 2012, and forms of plan agreements
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.09
|
|
|
|
10.11+
|
|
|
Employee Stock Purchase Plan, as amended and restated April 18, 2012
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.1
|
|
|
|
10.12
|
|
|
Pacific Corporate Center Lease (Building 1) by and between Greenville Holding Company LLC (successor to Greenville Investors, L.P.) ("Greenville") and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.18
|
|
|
|
10.13
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 1) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.18.1
|
|
|
|
10.14
|
|
|
Pacific Corporate Center Lease (Building 2) by and between Greenville and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.19
|
|
|
|
10.15
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 2) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.19.1
|
|
|
|
10.16
|
|
|
Pacific Corporate Center Lease (Building 3) by and between Greenville and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.20
|
|
|
|
10.17+
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 3) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.20.1
|
|
|
|
10.18
|
|
|
Third Amendment, dated December 19, 2016, between FormFactor, Inc. and MOHR PCC, LP, to Pacific Corporate Center Leases (Buildings 1, 2 and 3), dated May 3, 2001, by and between Greenville Investors, L.P. and FormFactor, Inc., as amended
|
|
8-K
|
|
|
000-50307
|
|
|
12/23/2016
|
|
|
10.2
|
|
|
|
10.19+
|
|
|
Pacific Corporate Center Lease by and between Greenville and the Registrant dated September 7, 2004., as amended by First Amendment to Building 6 Lease dated August 16, 2006
|
|
10-Q
|
|
|
000-50307
|
|
|
11/7/2006
|
|
|
10.01
|
|
|
|
10.20
|
|
|
Second Amendment, dated December 19, 2016, between FormFactor, Inc. and MOHR PCC, LP, to Pacific Corporate Center Lease, dated October 5, 2004, by and between Greenville Investors, L.P. and FormFactor, Inc., as amended
|
|
8-K
|
|
|
000-50307
|
|
|
12/23/2016
|
|
|
10.1
|
|
|
|
10.21
|
|
|
Lease Agreements I and II between Amberjack, Ltd. And Cascade Microtech, Inc. dated August 20, 1997, and Amendment No. 2 to Lease Agreement I dated July 23, 1998, and Amendment No. 2 to Lease Agreement II dated April 12, 1999.
|
|
8-K
|
|
|
333-47100
|
|
|
10/2/2000
|
|
|
10.9
|
|
|
|
10.22
|
|
|
Third Amendment dated August 11, 2006 to Lease Agreement I dated August 20, 1997 between Amberjack, LTD. and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
11/9/2006
|
|
|
10.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
|
|
|||||||||
Exhibit
Number
|
|
Exhibit Description
|
|
Form
|
|
File No
|
|
Date of
First Filing
|
|
Exhibit
Number
|
|
Filed
Herewith
|
|||||
10.23
|
|
|
Third Amendment dated August 11, 2006 to Lease Agreement II dated August 20, 1997 between Amberjack, LTD. and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
11/9/2006
|
|
|
10.3
|
|
|
|
10.24
|
|
|
Assignment, Assumption and Amendment of Lease dated as of September 22, 2011 by and among Cascade Microtech, Inc. and R&D Sockets, Inc.
|
|
8-K
|
|
|
000-51072
|
|
|
9/26/2011
|
|
|
10.1
|
|
|
|
10.25
|
|
|
Rental Agreement by and between Cascade Microtech Dresden GmbH and Süss Grundstücksverwaltungs GbR dated as of June 17, 2011.
|
|
10-Q
|
|
|
000-51072
|
|
|
8/10/2011
|
|
|
10.3
|
|
|
|
10.26
|
|
|
Lease dated April 2, 1999 between Spieker Properties, L.P. and Cascade Microtech, Inc.
|
|
8-K
|
|
|
333-47100
|
|
|
10/2/2000
|
|
|
10.8
|
|
|
|
10.27
|
|
|
First amendment to Lease dated January 10, 2007, between Nimbus Center LLC (as successor in interest to Spieker Properties, L.P.) and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.1
|
|
|
|
10.28
|
|
|
Second amendment to Lease dated February 25, 2013, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/8/2013
|
|
|
10.2
|
|
|
|
10.29
|
|
|
Third amendment to Lease dated January 23, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.2
|
|
|
|
10.30
|
|
|
Fourth amendment to Lease dated March 31, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.3
|
|
|
|
10.31
|
|
|
Fifth amendment to Lease dated September 24, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-K
|
|
|
000-51072
|
|
|
3/72016
|
|
|
10.22
|
|
|
|
10.32
|
|
|
Sixth amendment to Lease dated July 8, 2015, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-K
|
|
|
000-51072
|
|
|
3/72016
|
|
|
10.23
|
|
|
|
10.33+
|
|
|
Employment Offer Letter, dated August 29, 2012 to Mike Slessor
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.19+
|
|
|
|
10.34+
|
|
|
Tax withholding reimbursement letter between Mike Slessor and the Registrant dated December 30, 2013
|
|
10-K
|
|
|
000-50307
|
|
|
3/6/2015
|
|
|
10.2
|
|
|
|
10.35+
|
|
|
CEO Change of Control and Severance Agreement, dated April 28, 2016 by and between Mike Slessor and the Registrant
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
10.36+
|
|
|
Change of Control and Severance Agreement, dated April 28, 2016 by and between Michael Ludwig and the Registrant
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
21.01
|
|
|
List of Registrant's subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
23.01
|
|
|
Consent of Independent Registered Public Accounting Firm - KPMG
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
24.01
|
|
|
Power of Attorney (included on the signature page of this Form 10-K)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
31.01
|
|
|
Certification of Chief Executive Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
31.02
|
|
|
Certification of Chief Financial Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
32.01*
|
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.INS**
|
|
|
XBRL Instance Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.SCH**
|
|
|
XBRL Taxonomy Extension Schema Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.CAL**
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.DEF**
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.LAB**
|
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.PRE**
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
*
|
This exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
|
**
|
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.
|
***
|
Confidential treatment has been requested for portions of this document. The schedules, exhibits, and annexes to this exhibit have been omitted in reliance on Item 601(b)(2) of Regulation S-K and will be furnished supplementally to the SEC upon request.
|
+
|
Indicates a management contract or compensatory plan or arrangement.
|
|
FORMFACTOR, INC.
|
|
||
|
By:
|
|
/s/ MICHAEL M. LUDWIG
|
|
|
|
|
Michael M. Ludwig
Chief Financial Officer
(Principal Financial Officer and Principal
Accounting Officer)
|
|
|
Signature
|
Title
|
Date
|
|
|
|
|
|
|
|
Principal Executive Officer:
|
|
|
|
|
/s/ MICHAEL D. SLESSOR
|
Chief Executive Officer and Director
|
|
March 15, 2017
|
|
Michael D. Slessor
|
|||
|
Principal Financial Officer and Principal
Accounting Officer:
|
|
|
|
|
/s/ MICHAEL M. LUDWIG
|
Chief Financial Officer
|
|
March 15, 2017
|
|
Michael M. Ludwig
|
|
Signature
|
Title
|
|
Date
|
|
|
|
|
|
|
Additional Directors:
|
|
|
|
|
|
|
|
|
|
/s/ LOTHAR MAIER
|
Director
|
|
March 15, 2017
|
|
Lothar Maier
|
|||
|
|
|
|
|
|
/s/ EDWARD ROGAS, JR
|
Director
|
March 15, 2017
|
|
|
Edward Rogas, Jr
|
|||
|
|
|
|
|
|
/s/ KELLEY STEVEN-WAISS
|
Director
|
March 15, 2017
|
|
|
Kelley Steven-Waiss
|
|||
|
|
|
|
|
|
/s/ MICHAEL W. ZELLNER
|
Director
|
March 15, 2017
|
|
|
Michael W. Zellner
|
|||
|
|
|
|
|
|
/s/ RAYMOND LINK
|
Director
|
March 15, 2017
|
|
|
Raymond Link
|
|||
|
|
|
|
|
|
/s/ RICHARD DELATEUR
|
Director
|
March 15, 2017
|
|
|
Richard DeLateur
|
|||
|
|
|
|
|
|
/s/ THOMAS ST. DENNIS
|
Director
|
March 15, 2017
|
|
|
Thomas St. Dennis
|
|
December 31, 2016
|
|
December 26, 2015
|
||||
|
(In thousands, except share
and per share data)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
101,408
|
|
|
$
|
146,264
|
|
Marketable securities
|
7,497
|
|
|
41,325
|
|
||
Accounts receivable, net
|
70,225
|
|
|
36,725
|
|
||
Inventories, net
|
59,806
|
|
|
27,223
|
|
||
Restricted cash
|
106
|
|
|
—
|
|
||
Refundable income taxes
|
1,391
|
|
|
—
|
|
||
Prepaid expenses and other current assets
|
14,276
|
|
|
6,481
|
|
||
Total current assets
|
254,709
|
|
|
258,018
|
|
||
Restricted cash
|
1,082
|
|
|
435
|
|
||
Property, plant and equipment, net
|
42,663
|
|
|
23,853
|
|
||
Goodwill
|
188,010
|
|
|
30,731
|
|
||
Intangibles, net
|
126,608
|
|
|
25,552
|
|
||
Deferred tax assets
|
3,310
|
|
|
3,281
|
|
||
Other assets
|
2,600
|
|
|
853
|
|
||
Total assets
|
$
|
618,982
|
|
|
$
|
342,723
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
34,075
|
|
|
$
|
18,072
|
|
Accrued liabilities
|
30,184
|
|
|
21,507
|
|
||
Current portion of term loan
|
12,701
|
|
|
—
|
|
||
Income taxes payable
|
442
|
|
|
110
|
|
||
Deferred revenue
|
5,305
|
|
|
3,892
|
|
||
Total current liabilities
|
82,707
|
|
|
43,581
|
|
||
Long-term income taxes payable
|
1,315
|
|
|
1,069
|
|
||
Term loan, less current portion
|
125,475
|
|
|
—
|
|
||
Deferred tax liabilities
|
3,703
|
|
|
—
|
|
||
Deferred rent and other liabilities
|
4,726
|
|
|
3,392
|
|
||
Total liabilities
|
217,926
|
|
|
48,042
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value:
|
|
|
|
||||
10,000,000 shares authorized; no shares issued and outstanding at December 31, 2016 and December 26, 2015
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value:
|
|
|
|
||||
250,000,000 shares authorized; 70,907,847 and 58,088,969 shares issued and outstanding at December 31, 2016 and December 26, 2015, respectively
|
71
|
|
|
58
|
|
||
Additional paid-in capital
|
833,341
|
|
|
718,904
|
|
||
Accumulated other comprehensive loss
|
(3,740
|
)
|
|
(2,222
|
)
|
||
Accumulated deficit
|
(428,616
|
)
|
|
(422,059
|
)
|
||
Total stockholders' equity
|
401,056
|
|
|
294,681
|
|
||
Total liabilities and stockholders' equity
|
$
|
618,982
|
|
|
$
|
342,723
|
|
|
Fiscal Year Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
|
(In thousands, except per share data)
|
||||||||||
Revenues
|
$
|
383,881
|
|
|
$
|
282,358
|
|
|
$
|
268,530
|
|
Cost of revenues
|
281,199
|
|
|
196,620
|
|
|
191,091
|
|
|||
Gross profit
|
102,682
|
|
|
85,738
|
|
|
77,439
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research and development
|
57,453
|
|
|
44,184
|
|
|
42,725
|
|
|||
Selling, general and administrative
|
73,444
|
|
|
45,090
|
|
|
51,385
|
|
|||
Restructuring and impairment charges, net
|
19,692
|
|
|
567
|
|
|
3,887
|
|
|||
Total operating expenses
|
150,589
|
|
|
89,841
|
|
|
97,997
|
|
|||
Operating loss
|
(47,907
|
)
|
|
(4,103
|
)
|
|
(20,558
|
)
|
|||
Interest income, net
|
327
|
|
|
285
|
|
|
302
|
|
|||
Other income (expense), net
|
(2,615
|
)
|
|
2,547
|
|
|
161
|
|
|||
Loss before income taxes
|
(50,195
|
)
|
|
(1,271
|
)
|
|
(20,095
|
)
|
|||
Provision (benefit) from income taxes
|
(43,638
|
)
|
|
252
|
|
|
(910
|
)
|
|||
Net loss
|
$
|
(6,557
|
)
|
|
$
|
(1,523
|
)
|
|
$
|
(19,185
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic and diluted
|
$
|
(0.10
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.34
|
)
|
Weighted-average number of shares used in per share calculations:
|
|
|
|
|
|
||||||
Basic and diluted
|
64,941
|
|
|
57,850
|
|
|
55,908
|
|
|
Fiscal Year Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
|
(In thousands)
|
||||||||||
Net loss
|
$
|
(6,557
|
)
|
|
$
|
(1,523
|
)
|
|
$
|
(19,185
|
)
|
Other comprehensive loss, net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(2,042
|
)
|
|
(397
|
)
|
|
(1,502
|
)
|
|||
Unrealized gains (losses) on available-for-sale marketable securities
|
29
|
|
|
(64
|
)
|
|
(10
|
)
|
|||
Unrealized gains on derivative instruments
|
495
|
|
|
—
|
|
|
—
|
|
|||
Other comprehensive loss, net of tax
|
(1,518
|
)
|
|
(461
|
)
|
|
(1,512
|
)
|
|||
Comprehensive loss
|
$
|
(8,075
|
)
|
|
$
|
(1,984
|
)
|
|
$
|
(20,697
|
)
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Accumulated Deficit
|
|
Total
|
|||||||||||||
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|||||||||||||||||||
|
(In thousands, except shares)
|
|||||||||||||||||||||
Balances, December 28, 2013
|
54,649,600
|
|
|
$
|
55
|
|
|
$
|
695,631
|
|
|
$
|
(249
|
)
|
|
$
|
(401,351
|
)
|
|
$
|
294,086
|
|
Issuance of common stock pursuant to vesting of restricted stock units, net of stock withheld
|
1,282,442
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Issuance of common stock under the Employee Stock Purchase Plan
|
586,386
|
|
|
1
|
|
|
2,811
|
|
|
—
|
|
|
—
|
|
|
2,812
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
13,234
|
|
|
—
|
|
|
—
|
|
|
13,234
|
|
|||||
Components of other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Change in unrealized gain (loss) on marketable securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
|||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,502
|
)
|
|
—
|
|
|
(1,502
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,185
|
)
|
|
(19,185
|
)
|
|||||
Balances, December 27, 2014
|
56,518,428
|
|
|
57
|
|
|
711,676
|
|
|
(1,761
|
)
|
|
(420,536
|
)
|
|
289,436
|
|
|||||
Issuance of common stock pursuant to exercise of options for cash
|
24,607
|
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|||||
Issuance of common stock pursuant to vesting of restricted stock units, net of stock withheld
|
1,993,603
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Issuance of common stock under the Employee Stock Purchase Plan
|
565,493
|
|
|
—
|
|
|
3,206
|
|
|
—
|
|
|
—
|
|
|
3,206
|
|
|||||
Purchase and retirement of common stock
|
(1,013,162
|
)
|
|
(1
|
)
|
|
(8,210
|
)
|
|
—
|
|
|
—
|
|
|
(8,211
|
)
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
12,023
|
|
|
—
|
|
|
—
|
|
|
12,023
|
|
|||||
Components of other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Change in unrealized gain (loss) on marketable securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
(64
|
)
|
|
—
|
|
|
(64
|
)
|
|||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(397
|
)
|
|
—
|
|
|
(397
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,523
|
)
|
|
(1,523
|
)
|
|||||
Balances, December 26, 2015
|
58,088,969
|
|
|
58
|
|
|
718,904
|
|
|
(2,222
|
)
|
|
(422,059
|
)
|
|
294,681
|
|
|||||
Issuance of common stock pursuant to exercise of options for cash
|
232,190
|
|
|
—
|
|
|
2,003
|
|
|
—
|
|
|
—
|
|
|
2,003
|
|
|||||
Issuance of common stock pursuant to vesting of restricted stock units, net of stock withheld
|
1,579,218
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Issuance of common stock under the Employee Stock Purchase Plan
|
557,281
|
|
|
1
|
|
|
3,740
|
|
|
—
|
|
|
—
|
|
|
3,741
|
|
|||||
Issuance of common stock pursuant to Cascade Microtech acquisition
|
10,450,189
|
|
|
10
|
|
|
97,069
|
|
|
—
|
|
|
—
|
|
|
97,079
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
11,625
|
|
|
—
|
|
|
—
|
|
|
11,625
|
|
|||||
Components of other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Change in unrealized gain (loss) on marketable securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|
—
|
|
|
29
|
|
|||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,042
|
)
|
|
—
|
|
|
(2,042
|
)
|
|||||
Unrealized Gain (loss) on derivative instruments, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|
—
|
|
|
495
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,557
|
)
|
|
(6,557
|
)
|
|||||
Balances, December 31, 2016
|
70,907,847
|
|
|
$
|
71
|
|
|
$
|
833,341
|
|
|
$
|
(3,740
|
)
|
|
$
|
(428,616
|
)
|
|
$
|
401,056
|
|
FORMFACTOR, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||||||
|
Fiscal Year Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
|
(In thousands)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(6,557
|
)
|
|
$
|
(1,523
|
)
|
|
$
|
(19,185
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
46,798
|
|
|
23,771
|
|
|
30,491
|
|
|||
(Accretion) amortization of discount on investments
|
(31
|
)
|
|
(10
|
)
|
|
208
|
|
|||
Stock-based compensation expense
|
10,722
|
|
|
11,575
|
|
|
13,279
|
|
|||
Amortization of debt issuance costs
|
307
|
|
|
—
|
|
|
—
|
|
|||
Deferred income tax (benefit) provision
|
(45,022
|
)
|
|
(14
|
)
|
|
230
|
|
|||
Provision for doubtful accounts receivable
|
15
|
|
|
18
|
|
|
1
|
|
|||
Provision for excess and obsolete inventories
|
6,631
|
|
|
6,493
|
|
|
7,127
|
|
|||
Acquired inventory step-up amortization
|
10,022
|
|
|
—
|
|
|
—
|
|
|||
(Gain) loss on disposal and write-off of long-lived assets
|
361
|
|
|
(1,009
|
)
|
|
(10
|
)
|
|||
Impairment of long-lived assets
|
12,400
|
|
|
8
|
|
|
1,219
|
|
|||
Non-cash restructuring
|
964
|
|
|
500
|
|
|
600
|
|
|||
Foreign currency transaction (gains) losses
|
(77
|
)
|
|
(275
|
)
|
|
2,489
|
|
|||
Gain on derivative instruments
|
(51
|
)
|
|
—
|
|
|
—
|
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(6,847
|
)
|
|
8,261
|
|
|
(15,949
|
)
|
|||
Inventories
|
(11,733
|
)
|
|
(8,167
|
)
|
|
(11,975
|
)
|
|||
Prepaid expenses and other current assets
|
(3,292
|
)
|
|
173
|
|
|
(822
|
)
|
|||
Refundable income taxes
|
126
|
|
|
782
|
|
|
—
|
|
|||
Other assets
|
(248
|
)
|
|
250
|
|
|
25
|
|
|||
Accounts payable
|
3,433
|
|
|
(2,036
|
)
|
|
4,155
|
|
|||
Accrued liabilities
|
786
|
|
|
(333
|
)
|
|
7,765
|
|
|||
Income taxes payable
|
(1,127
|
)
|
|
19
|
|
|
(1,511
|
)
|
|||
Deferred rent and other liabilities
|
126
|
|
|
52
|
|
|
248
|
|
|||
Deferred revenues
|
(283
|
)
|
|
(2,413
|
)
|
|
(726
|
)
|
|||
Net cash provided by operating activities
|
17,423
|
|
|
36,122
|
|
|
17,659
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Acquisition of property, plant and equipment
|
(11,521
|
)
|
|
(8,640
|
)
|
|
(5,670
|
)
|
|||
Acquisition of Cascade Microtech, net of cash acquired
|
(228,031
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale of subsidiary
|
47
|
|
|
53
|
|
|
115
|
|
|||
Proceeds from sale of intellectual property and property, plant and equipment
|
53
|
|
|
1,200
|
|
|
1,114
|
|
|||
Purchases of marketable securities
|
(10,587
|
)
|
|
(66,234
|
)
|
|
(31,693
|
)
|
|||
Proceeds from maturities of marketable securities
|
44,500
|
|
|
74,750
|
|
|
73,473
|
|
|||
Change in restricted cash
|
(779
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash (used in) provided by investing activities
|
(206,318
|
)
|
|
1,129
|
|
|
37,339
|
|
|||
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuances of common stock
|
5,745
|
|
|
3,418
|
|
|
2,813
|
|
|||
Purchase and retirement of common stock
|
—
|
|
|
(8,210
|
)
|
|
—
|
|
|||
Proceeds from term loan debt
|
150,000
|
|
|
—
|
|
|
—
|
|
|||
Payments on term loan debt
|
(10,625
|
)
|
|
—
|
|
|
—
|
|
|||
Payments of term loan debt issuance costs
|
(1,506
|
)
|
|
—
|
|
|
—
|
|
|||
Payments made on capital leases
|
—
|
|
|
—
|
|
|
(271
|
)
|
|||
Net cash provided by (used in) financing activities
|
143,614
|
|
|
(4,792
|
)
|
|
2,542
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
425
|
|
|
(135
|
)
|
|
(2,796
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
(44,856
|
)
|
|
32,324
|
|
|
54,744
|
|
|||
Cash and cash equivalents, beginning of year
|
146,264
|
|
|
113,940
|
|
|
59,196
|
|
|||
Cash and cash equivalents, end of year
|
$
|
101,408
|
|
|
$
|
146,264
|
|
|
$
|
113,940
|
|
|
|
|
|
|
|
FORMFACTOR, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||||||
|
|
|
|
|
|
||||||
|
Fiscal Year Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
|
(In thousands)
|
||||||||||
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Fair value of stock issued in connection with the acquisition of Cascade Microtech
|
$
|
97,080
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Changes in accounts payable and accrued liabilities related to property, plant and equipment purchases
|
$
|
(732
|
)
|
|
$
|
361
|
|
|
$
|
(122
|
)
|
|
|
|
|
|
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Income and property taxes paid, net
|
$
|
3,667
|
|
|
$
|
27
|
|
|
$
|
950
|
|
Cash paid for interest
|
$
|
2,110
|
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
Level 1 valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets;
|
•
|
Level 2 inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices near the reporting date in markets that are less active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
|
•
|
Level 3 valuations are based on unobservable inputs to the valuation methodology and include our own data about assumptions market participants would use in pricing the asset or liability based on the best information available under the circumstances.
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
Fiscal 2014
|
|||
Intel
|
30.1
|
%
|
|
19.6
|
%
|
|
19.7
|
%
|
Samsung
|
*
|
|
|
14.6
|
|
|
*
|
|
SK hynix
|
*
|
|
|
14.3
|
|
|
16.9
|
|
Micron
|
*
|
|
|
11.7
|
|
|
15.0
|
|
Total revenues attributable to customers greater than 10%
|
30.1
|
%
|
|
60.2
|
%
|
|
51.6
|
%
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Balance at beginning of year
|
$
|
1,116
|
|
|
$
|
1,592
|
|
Warranty reserve from acquisition-Cascade Microtech
|
795
|
|
|
—
|
|
||
Accruals
|
5,254
|
|
|
2,536
|
|
||
Settlements
|
(4,193
|
)
|
|
(3,012
|
)
|
||
Balance at end of year
|
$
|
2,972
|
|
|
$
|
1,116
|
|
|
Balance at Beginning of Year
|
|
Additions
|
|
Reductions
|
|
Balance at End of Year
|
||||||||
Fiscal year ended December 27, 2014
|
$
|
265
|
|
|
$
|
5
|
|
|
$
|
(4
|
)
|
|
$
|
266
|
|
Fiscal year ended December 26, 2015
|
266
|
|
|
20
|
|
|
(2
|
)
|
|
284
|
|
||||
Fiscal year ended December 31, 2016
|
$
|
284
|
|
|
$
|
62
|
|
|
$
|
(48
|
)
|
|
$
|
298
|
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net loss used in computing basic and diluted net loss per share
|
$
|
(6,557
|
)
|
|
$
|
(1,523
|
)
|
|
$
|
(19,185
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average shares used in computing basic net loss per share
|
64,941
|
|
|
57,850
|
|
|
55,908
|
|
|||
Add potentially dilutive securities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted-average shares used in computing basic and diluted net loss per share
|
64,941
|
|
|
57,850
|
|
|
55,908
|
|
|
Fiscal Years Ended
|
|||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
|||
Options to purchase common stock
|
2,198
|
|
|
2,320
|
|
|
2,874
|
|
Restricted stock units
|
3,113
|
|
|
2,578
|
|
|
—
|
|
Employee stock purchase plan
|
10
|
|
|
8
|
|
|
28
|
|
Total potentially dilutive securities
|
5,321
|
|
|
4,906
|
|
|
2,902
|
|
|
|
December 31, 2016
|
|
December 26, 2015
|
||||
Unrealized loss on marketable securities, net of tax of $364 in fiscal 2016 and $428 in fiscal 2015, respectively
|
|
$
|
(454
|
)
|
|
$
|
(483
|
)
|
Cumulative translation adjustments
|
|
(3,781
|
)
|
|
(1,739
|
)
|
||
Unrealized gains on derivative instruments
|
|
495
|
|
|
—
|
|
||
Accumulated other comprehensive loss
|
|
$
|
(3,740
|
)
|
|
$
|
(2,222
|
)
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
||||||||
U.S. Treasuries
|
$
|
7,504
|
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
7,497
|
|
|
$
|
7,504
|
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
7,497
|
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
||||||||
U.S. Treasuries
|
$
|
18,896
|
|
|
$
|
1
|
|
|
$
|
(44
|
)
|
|
$
|
18,853
|
|
Agency securities (Federal)
|
22,484
|
|
|
—
|
|
|
(12
|
)
|
|
22,472
|
|
||||
|
$
|
41,380
|
|
|
$
|
1
|
|
|
$
|
(56
|
)
|
|
$
|
41,325
|
|
|
December 31, 2016
|
|
December 26, 2015
|
||||||||||||
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
||||||||
Due in one year or less
|
$
|
7,504
|
|
|
$
|
7,497
|
|
|
$
|
33,882
|
|
|
$
|
33,871
|
|
Due after one year to five years
|
—
|
|
|
—
|
|
|
7,498
|
|
|
7,454
|
|
||||
|
$
|
7,504
|
|
|
$
|
7,497
|
|
|
$
|
41,380
|
|
|
$
|
41,325
|
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Asset retirement obligation beginning balance
|
$
|
919
|
|
|
$
|
903
|
|
Initial amount recorded for new asset retirement obligation
|
34
|
|
|
10
|
|
||
Initial amount recorded for new asset retirement obligation upon acquisition of Cascade Microtech
|
165
|
|
|
—
|
|
||
Currency translation
|
11
|
|
|
6
|
|
||
Asset retirement obligation ending balance
|
$
|
1,129
|
|
|
$
|
919
|
|
Other accrued liabilities, current
|
$
|
165
|
|
|
$
|
212
|
|
Deferred rent and other liabilities, non-current
|
964
|
|
|
707
|
|
||
|
$
|
1,129
|
|
|
$
|
919
|
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Raw materials
|
$
|
27,402
|
|
|
$
|
12,996
|
|
Work-in-progress
|
20,390
|
|
|
12,492
|
|
||
Finished goods
|
12,014
|
|
|
1,735
|
|
||
|
$
|
59,806
|
|
|
$
|
27,223
|
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Machinery and equipment
|
$
|
169,056
|
|
|
$
|
150,983
|
|
Computer equipment and software
|
30,640
|
|
|
27,951
|
|
||
Furniture and fixtures
|
6,060
|
|
|
5,380
|
|
||
Leasehold improvements
|
72,954
|
|
|
67,121
|
|
||
Sub-total
|
278,710
|
|
|
251,435
|
|
||
Less: Accumulated depreciation and amortization
|
(241,943
|
)
|
|
(232,005
|
)
|
||
Net long-lived assets
|
36,767
|
|
|
19,430
|
|
||
Construction-in-progress
|
5,896
|
|
|
4,423
|
|
||
Total
|
$
|
42,663
|
|
|
$
|
23,853
|
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Accrued compensation and benefits
|
$
|
16,516
|
|
|
$
|
12,286
|
|
Accrued indirect and other taxes
|
3,634
|
|
|
2,189
|
|
||
Accrued commissions
|
792
|
|
|
366
|
|
||
Accrued warranty
|
2,972
|
|
|
1,116
|
|
||
Deferred rent
|
160
|
|
|
325
|
|
||
Accrued restructuring
|
434
|
|
|
2
|
|
||
Other accrued expenses
|
5,676
|
|
|
5,223
|
|
||
|
$
|
30,184
|
|
|
$
|
21,507
|
|
|
|
Amount
|
||
Cash and cash equivalents
|
|
$
|
40,681
|
|
Accounts receivable
|
|
27,112
|
|
|
Inventory
|
|
38,315
|
|
|
Prepaid expenses and other current assets
|
|
6,249
|
|
|
Property, plant and equipment
|
|
19,875
|
|
|
Other long-term assets
|
|
818
|
|
|
Deferred revenue
|
|
(1,829
|
)
|
|
Accounts payable and accrued liabilities
|
|
(23,370
|
)
|
|
Deferred tax liabilities
|
|
(48,993
|
)
|
|
Other long-term liabilities
|
|
(960
|
)
|
|
Total tangible assets acquired and liabilities assumed
|
|
57,898
|
|
|
Intangible assets
|
|
149,753
|
|
|
Goodwill
|
|
158,141
|
|
|
Total acquisition price
|
|
$
|
365,792
|
|
|
|
Amount
|
|
Weighted Average Useful Life (in years)
|
||
Developed technologies
|
|
$
|
91,100
|
|
|
4.7
|
Customer relationships
|
|
23,053
|
|
|
6.8
|
|
Order backlog
|
|
15,600
|
|
|
0.5
|
|
Trade names
|
|
7,600
|
|
|
3.5
|
|
In-process research and development
|
|
12,400
|
|
|
|
|
Total intangible assets
|
|
$
|
149,753
|
|
|
|
|
|
Twelve Months Ended
|
||||||
|
|
December 31, 2016
|
|
December 26, 2015
|
||||
Revenues
|
|
$
|
455,713
|
|
|
$
|
426,336
|
|
Net loss
|
|
(20,641
|
)
|
|
(15,469
|
)
|
||
Net loss per share - basic
|
|
$
|
(0.27
|
)
|
|
$
|
(0.23
|
)
|
Net loss per share - diluted
|
|
$
|
(0.27
|
)
|
|
$
|
(0.23
|
)
|
|
December 31, 2016
|
||
Senior secured term loan
|
$
|
139,375
|
|
Less debt issuance costs
|
(1,199
|
)
|
|
Total debt less debt issuance costs
|
$
|
138,176
|
|
|
Employee
Severance and Benefits |
|
Property and Equipment Impairment
|
|
Contract
Termination and Other Costs |
|
Stock-based Compensation
|
|
Total
|
||||||||||
Accrual at December 28, 2013
|
$
|
138
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
138
|
|
Restructuring charges
|
2,068
|
|
|
600
|
|
|
—
|
|
|
—
|
|
|
2,668
|
|
|||||
Asset impairments
|
—
|
|
|
(600
|
)
|
|
—
|
|
|
—
|
|
|
(600
|
)
|
|||||
Cash payments
|
(1,620
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,620
|
)
|
|||||
Non-cash settlements
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Accrual at December 27, 2014
|
584
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
584
|
|
|||||
Restructuring charges
|
59
|
|
|
—
|
|
|
500
|
|
|
—
|
|
|
559
|
|
|||||
Cash payments
|
(641
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(641
|
)
|
|||||
Non-cash settlements
|
—
|
|
|
—
|
|
|
(500
|
)
|
|
—
|
|
|
(500
|
)
|
|||||
Accrual at December 26, 2015
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Restructuring charges
|
6,220
|
|
|
—
|
|
|
104
|
|
|
964
|
|
|
7,288
|
|
|||||
Cash payments
|
(5,892
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,892
|
)
|
|||||
Non-cash settlements
|
—
|
|
|
—
|
|
|
|
|
|
(964
|
)
|
|
(964
|
)
|
|||||
Accrual at December 31, 2016
|
$
|
330
|
|
|
$
|
—
|
|
|
$
|
104
|
|
|
$
|
—
|
|
|
$
|
434
|
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
Impairment of long-lived assets:
|
|
|
|
|
|
||||||
Assets held for sale
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
191
|
|
Assets to be disposed of other than by sale
|
12,400
|
|
|
8
|
|
|
1,028
|
|
|||
Total
|
$
|
12,400
|
|
|
$
|
8
|
|
|
$
|
1,219
|
|
|
|
|
|
Fiscal Years Ended
|
||||||
Derivatives Not Designated as Hedging Instruments
|
|
Location of Gain (Loss) Recognized
on Derivatives |
|
December 31, 2016
|
|
December 26, 2015
|
||||
Foreign exchange forward contracts
|
|
Other income (expense), net
|
|
$
|
139
|
|
|
$
|
(310
|
)
|
•
|
Level 1—Quoted prices in active markets for identical assets or liabilities;
|
•
|
Level 2—Inputs, other than the quoted prices in active markets, such as quoted prices for similar assets or liabilities, quoted prices near the reporting date in markets that are less active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
|
•
|
Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Assets:
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
19,350
|
|
|
$
|
—
|
|
|
$
|
19,350
|
|
Marketable securities
|
|
|
|
|
|
||||||
U.S. Treasuries
|
—
|
|
|
7,497
|
|
|
7,497
|
|
|||
Foreign exchange derivative contracts
|
—
|
|
|
1,137
|
|
|
1,137
|
|
|||
Interest rate swap derivative contracts
|
—
|
|
|
838
|
|
|
838
|
|
|||
Total
|
$
|
19,350
|
|
|
$
|
9,472
|
|
|
$
|
28,822
|
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Assets:
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
82,935
|
|
|
$
|
—
|
|
|
$
|
82,935
|
|
Marketable securities
|
|
|
|
|
|
||||||
U.S. Treasuries
|
—
|
|
|
18,853
|
|
|
18,853
|
|
|||
Agency securities (Federal)
|
—
|
|
|
22,472
|
|
|
22,472
|
|
|||
Total
|
$
|
82,935
|
|
|
$
|
41,325
|
|
|
$
|
124,260
|
|
|
|
Intangible Assets, Gross Amount
|
|
Accumulated Amortization
|
|
Intangible Assets, Net
|
|
Weight Average Useful Life
|
|||||||||||||||||||||||||
Other Intangible Assets (1)
|
|
December 26, 2015
|
|
Additions/Disposals
|
|
December 31, 2016
|
|
December 26, 2015
|
|
Expense, net
|
|
December 31, 2016
|
|
December 26, 2015
|
December 31, 2016
|
|
December 31, 2016
|
||||||||||||||||
Existing developed technologies
|
|
$
|
52,200
|
|
|
$
|
90,501
|
|
|
$
|
142,701
|
|
|
$
|
39,581
|
|
|
$
|
16,550
|
|
|
$
|
56,131
|
|
|
$
|
12,619
|
|
$
|
86,569
|
|
|
4.4
|
Trade name
|
|
4,388
|
|
|
7,533
|
|
|
11,921
|
|
|
1,409
|
|
|
1,580
|
|
|
2,989
|
|
|
2,979
|
|
8,932
|
|
|
4.0
|
||||||||
Customer relationships
|
|
17,000
|
|
|
22,869
|
|
|
39,869
|
|
|
7,046
|
|
|
3,808
|
|
|
10,854
|
|
|
9,954
|
|
29,015
|
|
|
5.8
|
||||||||
Backlog
|
|
—
|
|
|
15,581
|
|
|
15,581
|
|
|
—
|
|
|
13,489
|
|
|
13,489
|
|
|
—
|
|
2,092
|
|
|
0.2
|
||||||||
Total finite-lived intangible assets
|
|
73,588
|
|
|
136,484
|
|
|
210,072
|
|
|
48,036
|
|
|
35,427
|
|
|
83,463
|
|
|
25,552
|
|
126,608
|
|
|
|
||||||||
IPR&D-addition (2)
|
|
—
|
|
|
12,400
|
|
|
12,400
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
12,400
|
|
|
|
||||||||
Total intangible assets
|
|
73,588
|
|
|
148,884
|
|
|
222,472
|
|
|
48,036
|
|
|
35,427
|
|
|
83,463
|
|
|
25,552
|
|
139,008
|
|
|
|
||||||||
IPR&D-disposal (2)
|
|
—
|
|
(12,400
|
)
|
|
(12,400
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
(12,400
|
)
|
|
|
|||||||||||||
Total intangible assets
|
|
$
|
73,588
|
|
|
$
|
136,484
|
|
|
$
|
210,072
|
|
|
$
|
48,036
|
|
|
$
|
35,427
|
|
|
$
|
83,463
|
|
|
$
|
25,552
|
|
$
|
126,608
|
|
|
|
(1)
|
Excludes fully amortized intangible assets.
|
(2)
|
In the fourth quarter of fiscal 2016, we recorded an impairment charge of $12.4 million relating to an in-process research and development intangible asset acquired as part of our acquisition of Cascade Microtech. See Note 7,
Impairment of Long-lived Assets
, to the Notes to Consolidated Financial Statements for further details.
|
Fiscal Year
|
|
Amount
|
||
2017
|
|
$
|
30,672
|
|
2018
|
|
28,303
|
|
|
2019
|
|
25,639
|
|
|
2020
|
|
23,570
|
|
|
2021
|
|
12,915
|
|
|
and thereafter
|
|
5,509
|
|
|
Total
|
|
$
|
126,608
|
|
|
|
Probe Cards
|
|
Systems
|
|
Total
|
||||||
|
|
(in thousands)
|
||||||||||
Goodwill, gross, as of December 27, 2014 and December 26, 2015
|
|
$
|
30,731
|
|
|
$
|
—
|
|
|
$
|
30,731
|
|
Additions-Cascade Microtech
|
|
141,751
|
|
|
16,390
|
|
|
158,141
|
|
|||
Foreign currency translation
|
|
—
|
|
|
(862
|
)
|
|
(862
|
)
|
|||
Balance as of December 31, 2016
|
|
$
|
172,482
|
|
|
$
|
15,528
|
|
|
$
|
188,010
|
|
|
|
Operating
Leases |
||
Fiscal years:
|
|
|
||
2017
|
|
$
|
6,279
|
|
2018
|
|
5,789
|
|
|
2019
|
|
4,882
|
|
|
2020
|
|
3,581
|
|
|
2021
|
|
3,236
|
|
|
Thereafter
|
|
15,734
|
|
|
Total
|
|
$
|
39,501
|
|
|
Payments Due In Fiscal Years
|
||||||||||||||||||||||
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Purchase obligations
|
$
|
33,696
|
|
|
$
|
4,550
|
|
|
$
|
515
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
38,761
|
|
Senior secured term loan facility-principal payments (1)
|
13,125
|
|
|
26,250
|
|
|
41,250
|
|
|
50,625
|
|
|
8,125
|
|
|
139,375
|
|
||||||
Senior secured term loan facility-interest payments (2)
|
2,828
|
|
|
2,400
|
|
|
1,739
|
|
|
821
|
|
|
41
|
|
|
7,829
|
|
||||||
Total
|
$
|
49,649
|
|
|
$
|
33,200
|
|
|
$
|
43,504
|
|
|
$
|
51,446
|
|
|
$
|
8,166
|
|
|
$
|
185,965
|
|
|
Outstanding Options
|
|
|
|||||||||
|
Number of
Shares |
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Life in Years |
|
Aggregate
Intrinsic Value |
|||||
Outstanding at December 26, 2015
|
2,320,195
|
|
|
$
|
9.40
|
|
|
|
|
|
|
|
Options granted
|
152,276
|
|
|
4.42
|
|
|
|
|
|
|
||
Options exercised
|
(232,190
|
)
|
|
8.63
|
|
|
|
|
|
|
||
Options canceled
|
(42,250
|
)
|
|
9.87
|
|
|
|
|
|
|
||
Outstanding at December 31, 2016
|
2,198,031
|
|
|
$
|
9.13
|
|
|
2.02
|
|
$
|
4,825,647
|
|
Vested and expected to vest at December 31, 2016
|
2,171,229
|
|
|
$
|
9.14
|
|
|
1.97
|
|
$
|
4,735,512
|
|
Exercisable at December 31, 2016
|
1,767,871
|
|
|
$
|
9.48
|
|
|
1.14
|
|
$
|
3,305,020
|
|
|
Number of
Shares |
|
Weighted
Average Grant Date Fair Value |
|||
Restricted stock units at December 28, 2013
|
2,929,639
|
|
|
$
|
5.88
|
|
Granted
|
1,900,000
|
|
|
6.52
|
|
|
Vested
|
(1,282,442
|
)
|
|
6.30
|
|
|
Canceled
|
(297,151
|
)
|
|
6.17
|
|
|
Restricted stock units at December 27, 2014
|
3,250,046
|
|
|
6.07
|
|
|
Granted
|
1,540,250
|
|
|
8.64
|
|
|
Vested
|
(1,993,603
|
)
|
|
6.00
|
|
|
Canceled
|
(218,555
|
)
|
|
6.36
|
|
|
Restricted stock units at December 26, 2015
|
2,578,138
|
|
|
7.63
|
|
|
Granted
|
2,296,210
|
|
|
8.20
|
|
|
Vested
|
(1,579,218
|
)
|
|
6.60
|
|
|
Canceled
|
(182,509
|
)
|
|
6.44
|
|
|
Restricted stock units at December 31, 2016
|
3,112,621
|
|
|
$
|
8.65
|
|
|
Fiscal Years Ended
|
||||||||||
|
December 31,
2016 |
|
December 26,
2015 |
|
December 27,
2014 |
||||||
Stock-based compensation expense included in:
|
|
|
|
|
|
||||||
Cost of revenues
|
$
|
2,518
|
|
|
$
|
2,651
|
|
|
$
|
2,433
|
|
Research and development
|
3,329
|
|
|
3,490
|
|
|
3,529
|
|
|||
Selling, general and administrative
|
4,875
|
|
|
5,434
|
|
|
7,317
|
|
|||
Total stock-based compensation
|
10,722
|
|
|
11,575
|
|
|
13,279
|
|
|||
Tax effect on stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total stock-based compensation, net of tax
|
$
|
10,722
|
|
|
$
|
11,575
|
|
|
$
|
13,279
|
|
|
Fiscal Years Ended
|
|||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
|||
Employee Stock Purchase Plan:
|
|
|
|
|
|
|||
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Expected volatility
|
45.43
|
%
|
|
51.78
|
%
|
|
41.71
|
%
|
Risk-free interest rate
|
0.43
|
%
|
|
0.12
|
%
|
|
0.09
|
%
|
Expected life (in years)
|
0.8
|
|
|
0.7
|
|
|
0.7
|
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
United States
|
$
|
(50,947
|
)
|
|
$
|
(3,069
|
)
|
|
$
|
(23,230
|
)
|
Foreign
|
752
|
|
|
1,798
|
|
|
3,135
|
|
|||
|
$
|
(50,195
|
)
|
|
$
|
(1,271
|
)
|
|
$
|
(20,095
|
)
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
Current provision (benefit):
|
|
|
|
|
|
||||||
Federal
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
(983
|
)
|
State
|
120
|
|
|
72
|
|
|
(386
|
)
|
|||
Foreign
|
1,804
|
|
|
198
|
|
|
234
|
|
|||
|
1,924
|
|
|
267
|
|
|
(1,135
|
)
|
|||
Deferred provision (benefit):
|
|
|
|
|
|
||||||
Federal
|
(42,150
|
)
|
|
—
|
|
|
—
|
|
|||
State
|
(2,165
|
)
|
|
—
|
|
|
—
|
|
|||
Foreign
|
(1,247
|
)
|
|
(15
|
)
|
|
225
|
|
|||
|
(45,562
|
)
|
|
(15
|
)
|
|
225
|
|
|||
Total provision (benefit) from income taxes
|
$
|
(43,638
|
)
|
|
$
|
252
|
|
|
$
|
(910
|
)
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
U.S. statutory federal tax rate
|
$
|
(17,568
|
)
|
|
$
|
(445
|
)
|
|
$
|
(7,033
|
)
|
State taxes and credits, net of Federal benefit
|
(975
|
)
|
|
17
|
|
|
(186
|
)
|
|||
Amortization of stock-based compensation
|
1,256
|
|
|
907
|
|
|
686
|
|
|||
Research and development credits
|
(1,654
|
)
|
|
(1,872
|
)
|
|
(1,183
|
)
|
|||
Foreign taxes at rates different than the U.S.
|
504
|
|
|
(66
|
)
|
|
(84
|
)
|
|||
Other permanent differences
|
2,048
|
|
|
238
|
|
|
(972
|
)
|
|||
Change in valuation allowance
|
(27,120
|
)
|
|
1,457
|
|
|
7,886
|
|
|||
Other
|
(129
|
)
|
|
16
|
|
|
(24
|
)
|
|||
Total
|
$
|
(43,638
|
)
|
|
$
|
252
|
|
|
$
|
(910
|
)
|
|
Fiscal Years Ended
|
||||||
|
December 31, 2016
|
|
December 26, 2015
|
||||
Tax credits
|
$
|
33,486
|
|
|
$
|
30,968
|
|
Inventory reserve
|
13,863
|
|
|
14,010
|
|
||
Unrealized investment gains
|
—
|
|
|
20
|
|
||
Other reserves and accruals
|
10,593
|
|
|
5,953
|
|
||
Non-statutory stock options
|
6,206
|
|
|
4,936
|
|
||
Depreciation and amortization
|
7,719
|
|
|
13,440
|
|
||
Net operating loss carryforwards
|
118,482
|
|
|
119,327
|
|
||
Gross deferred tax assets
|
190,349
|
|
|
188,654
|
|
||
Valuation allowance
|
(150,581
|
)
|
|
(176,196
|
)
|
||
Total deferred tax assets
|
39,768
|
|
|
12,458
|
|
||
Acquired intangibles & fixed assets
|
(39,801
|
)
|
|
(9,177
|
)
|
||
Unrealized investment gains
|
(289
|
)
|
|
—
|
|
||
Tax on undistributed earnings
|
(71
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
(40,161
|
)
|
|
(9,177
|
)
|
||
Net deferred tax assets (liabilities)
|
$
|
(393
|
)
|
|
$
|
3,281
|
|
Description
|
|
Balance at
Beginning of Year |
|
Additions
|
|
Reduction
|
|
Balance at
End of Year |
||||||||
Allowance against deferred tax assets
|
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2016
|
|
$
|
176,196
|
|
|
$
|
—
|
|
|
$
|
(25,615
|
)
|
|
$
|
150,581
|
|
Year ended December 31, 2015
|
|
187,759
|
|
|
—
|
|
|
(11,563
|
)
|
|
176,196
|
|
||||
Year ended December 31, 2014
|
|
$
|
180,913
|
|
|
$
|
6,846
|
|
|
$
|
—
|
|
|
$
|
187,759
|
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
Unrecognized tax benefit beginning balance
|
$
|
17,033
|
|
|
$
|
16,333
|
|
|
$
|
16,972
|
|
Additions based on tax positions related to the current year
|
614
|
|
|
667
|
|
|
498
|
|
|||
Additions based on tax position from prior year
|
450
|
|
|
163
|
|
|
324
|
|
|||
Reductions for tax positions of prior years
|
—
|
|
|
(18
|
)
|
|
(1,109
|
)
|
|||
Reductions to unrecognized tax benefits due to lapse of the applicable statute of limitations
|
(119
|
)
|
|
(112
|
)
|
|
(352
|
)
|
|||
Unrecognized tax benefit ending balance
|
$
|
17,978
|
|
|
$
|
17,033
|
|
|
$
|
16,333
|
|
|
Fiscal 2016
|
||||||||||||||
|
Probe Cards
|
|
Systems
|
|
Corporate and Other
|
|
Total
|
||||||||
Revenues
|
$
|
337,970
|
|
|
$
|
45,911
|
|
|
$
|
—
|
|
|
$
|
383,881
|
|
Gross profit
|
$
|
121,407
|
|
|
$
|
23,925
|
|
|
$
|
(42,650
|
)
|
|
$
|
102,682
|
|
Gross margin
|
35.9
|
%
|
|
52.1
|
%
|
|
—
|
%
|
|
26.7
|
%
|
||||
Operating income (loss)
|
$
|
49,382
|
|
|
$
|
8,968
|
|
|
$
|
(106,257
|
)
|
|
$
|
(47,907
|
)
|
|
Fiscal 2015
|
||||||||||||||
|
Probe Cards
|
|
Systems
|
|
Corporate and Other
|
|
Total
|
||||||||
Revenues
|
$
|
282,358
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
282,358
|
|
Gross profit
|
$
|
99,199
|
|
|
$
|
—
|
|
|
$
|
(13,461
|
)
|
|
$
|
85,738
|
|
Gross margin
|
35.1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
30.4
|
%
|
||||
Operating income (loss)
|
$
|
39,964
|
|
|
$
|
—
|
|
|
$
|
(44,067
|
)
|
|
$
|
(4,103
|
)
|
|
Fiscal Years Ended
|
|||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
|||
United States
|
33.3
|
%
|
|
23.4
|
%
|
|
28.1
|
%
|
South Korea
|
17.1
|
|
|
25.2
|
|
|
19.6
|
|
Taiwan
|
14.9
|
|
|
21.9
|
|
|
18.4
|
|
Europe
|
12.9
|
|
|
9.0
|
|
|
11.4
|
|
Asia-Pacific (1)
|
11.4
|
|
|
11.1
|
|
|
12.9
|
|
Japan
|
10.0
|
|
|
9.4
|
|
|
9.6
|
|
Rest of the world
|
0.4
|
|
|
—
|
|
|
—
|
|
Total Revenues
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Fiscal Years Ended
|
||||||||||
|
December 31, 2016
|
|
December 26, 2015
|
|
December 27, 2014
|
||||||
Foundry & Logic
|
$
|
237,591
|
|
|
$
|
145,839
|
|
|
$
|
142,360
|
|
DRAM
|
86,910
|
|
|
125,512
|
|
|
110,800
|
|
|||
Flash
|
13,469
|
|
|
11,007
|
|
|
15,370
|
|
|||
Systems
|
45,911
|
|
|
—
|
|
|
—
|
|
|||
Total revenues
|
$
|
383,881
|
|
|
$
|
282,358
|
|
|
$
|
268,530
|
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
Fiscal 2014
|
|||
Intel
|
30.1
|
%
|
|
19.6
|
%
|
|
19.7
|
%
|
Samsung
|
*
|
|
|
14.6
|
|
|
*
|
|
SK hynix
|
*
|
|
|
14.3
|
|
|
16.9
|
|
Micron
|
*
|
|
|
11.7
|
|
|
15.0
|
|
Total revenues attributable to customers greater than 10%
|
30.1
|
%
|
|
60.2
|
%
|
|
51.6
|
%
|
|
December 31, 2016
|
|
December 26, 2015
|
||||
United States
|
$
|
323,369
|
|
|
$
|
77,257
|
|
Europe
|
30,903
|
|
|
655
|
|
||
Asia-Pacific (1)
|
1,709
|
|
|
689
|
|
||
South Korea
|
733
|
|
|
1,128
|
|
||
Japan
|
510
|
|
|
295
|
|
||
Singapore
|
57
|
|
|
112
|
|
||
Total
|
$
|
357,281
|
|
|
$
|
80,136
|
|
|
Fiscal Quarters Ended
|
||||||||||||||||||||||||||||||
|
Dec. 31,
2016 (3) |
|
Sep. 24,
2016 |
|
June. 25, 2016 (1) (2)
|
|
March 26,
2016 |
|
Dec. 26,
2015 |
|
Sep. 26,
2015 (5) |
|
June. 27, 2015
|
|
March 28,
2015 (4) |
||||||||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||||||||||||||
Revenues
|
$
|
123,888
|
|
|
$
|
123,299
|
|
|
$
|
83,083
|
|
|
$
|
53,611
|
|
|
$
|
71,782
|
|
|
$
|
65,862
|
|
|
$
|
73,885
|
|
|
$
|
70,829
|
|
Cost of revenues
|
83,613
|
|
|
96,111
|
|
|
57,656
|
|
|
43,819
|
|
|
50,591
|
|
|
47,407
|
|
|
50,582
|
|
|
48,040
|
|
||||||||
Gross profit
|
40,275
|
|
|
27,188
|
|
|
25,427
|
|
|
9,792
|
|
|
21,191
|
|
|
18,455
|
|
|
23,303
|
|
|
22,789
|
|
||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Research and development
|
18,218
|
|
|
17,253
|
|
|
11,133
|
|
|
10,849
|
|
|
11,236
|
|
|
10,645
|
|
|
11,217
|
|
|
11,086
|
|
||||||||
Selling, general and administrative
|
23,890
|
|
|
23,008
|
|
|
14,030
|
|
|
12,516
|
|
|
10,719
|
|
|
11,108
|
|
|
11,381
|
|
|
11,882
|
|
||||||||
Restructuring and impairment charges, net
|
12,697
|
|
|
85
|
|
|
6,910
|
|
|
—
|
|
|
(3
|
)
|
|
59
|
|
|
8
|
|
|
503
|
|
||||||||
Total operating expenses
|
54,805
|
|
|
40,346
|
|
|
32,073
|
|
|
23,365
|
|
|
21,952
|
|
|
21,812
|
|
|
22,606
|
|
|
23,471
|
|
||||||||
Operating income (loss)
|
(14,530
|
)
|
|
(13,158
|
)
|
|
(6,646
|
)
|
|
(13,573
|
)
|
|
(761
|
)
|
|
(3,357
|
)
|
|
697
|
|
|
(682
|
)
|
||||||||
Interest income, net
|
59
|
|
|
52
|
|
|
88
|
|
|
117
|
|
|
70
|
|
|
65
|
|
|
65
|
|
|
85
|
|
||||||||
Other income (expense), net
|
(946
|
)
|
|
(1,042
|
)
|
|
(302
|
)
|
|
(314
|
)
|
|
(36
|
)
|
|
982
|
|
|
100
|
|
|
1,501
|
|
||||||||
Income (loss) before income taxes
|
(15,417
|
)
|
|
(14,148
|
)
|
|
(6,860
|
)
|
|
(13,770
|
)
|
|
(727
|
)
|
|
(2,310
|
)
|
|
862
|
|
|
904
|
|
||||||||
Provision (benefit) for income taxes
|
26
|
|
|
50
|
|
|
(43,744
|
)
|
|
30
|
|
|
(108
|
)
|
|
215
|
|
|
24
|
|
|
121
|
|
||||||||
Net income (loss)
|
$
|
(15,443
|
)
|
|
$
|
(14,198
|
)
|
|
$
|
36,884
|
|
|
$
|
(13,800
|
)
|
|
$
|
(619
|
)
|
|
$
|
(2,525
|
)
|
|
$
|
838
|
|
|
$
|
783
|
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
$
|
(0.22
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
0.62
|
|
|
$
|
(0.24
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
Diluted
|
$
|
(0.22
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
0.61
|
|
|
$
|
(0.24
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
Weighted average number of shares used in per share calculations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
70,807
|
|
|
70,502
|
|
|
59,572
|
|
|
58,431
|
|
|
58,128
|
|
|
58,209
|
|
|
58,109
|
|
|
56,594
|
|
||||||||
Diluted
|
70,807
|
|
|
70,502
|
|
|
59,988
|
|
|
58,431
|
|
|
58,128
|
|
|
58,209
|
|
|
59,094
|
|
|
58,838
|
|
(1)
|
In the second quarter of fiscal 2016, we recorded
$5.4 million
of severance charges and
$0.7 million
of stock-based compensation expense relating to the acceleration of certain equity-based awards of certain executives of Cascade Microtech who were terminated upon our acquisition of Cascade Microtech and in accordance with their contractual change of control agreements. See Note 6,
Restructuring Charges
, to the Notes to Consolidated Financial Statements for further details.
|
(2)
|
In the second quarter of fiscal 2016, we recorded an income tax benefit of
$43.7 million
primarily due to the release of valuation allowance of our deferred tax assets in connection with our acquisition of Cascade Microtech. See Note 14,
Income Taxes
, to the Notes to Consolidated Financial Statements for further details.
|
(3)
|
In the fourth quarter of fiscal 2016, we recorded an impairment charge of
$12.4 million
relating to an in-process research and development intangible asset acquired as part of our acquisition of Cascade Microtech. See Note 7,
Impairment of Long-lived Assets
, to the Notes to Consolidated Financial Statements for further details.
|
(4)
|
In the first quarter of fiscal 2015, we recorded a
$1.5 million
gain from a business interruption insurance claim relating to a factory fire at a customer. See Note 18,
Business Interruption Insurance Claim Recovery
, to the Notes to Consolidated Financial Statements for further details.
|
(5)
|
In the third quarter of fiscal 2015, we recorded a
$1.0 million
net gain from the sale of intellectual property.
|
|
|
|
|
Incorporated by Reference
|
|
|
|
|
|||||||||
Exhibit
Number |
|
Exhibit Description
|
|
Form
|
|
File No
|
|
Date of
First Filing |
|
Exhibit
Number |
|
Filed
Herewith |
|||||
2.01***
|
|
|
Agreement and Plan of Merger, dated February 3, 2016, by and among Cascade Microtech, Inc., FormFactor, Inc. and Cardinal Merger Subsidiary, Inc.
|
|
8-K
|
|
|
000-50307
|
|
|
2/9/2016
|
|
|
2.1
|
|
|
|
3.01
|
|
|
Amended and Restated Certificate of Incorporation of the Registrant as filed with the Delaware Secretary of State on June 17, 2003
|
|
S-1
|
|
|
333-109815
|
|
|
10/20/2003
|
|
|
3.01
|
|
|
|
3.02
|
|
|
Amended and Restated Bylaws of the Registrant
|
|
8-K
|
|
|
000-50307
|
|
|
7/22/2016
|
|
|
3.2
|
|
|
|
4.01
|
|
|
Specimen Common Stock Certificate
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/28/2002
|
|
|
4.01
|
|
|
|
10.01
|
|
|
Credit Agreement among FormFactor, Inc. as Borrower, the Guarantors that are from time to time parties thereto, HSBC Bank USA, National Association, as Administrative Agent, Lead Lender, Co-Lead Arranger, Sole Bookrunner, Syndication Agent and Lender, the Lenders that are from time to time parties thereto, and Silicon Valley Bank, as Co-Lead Arranger and Documentation Agent, dated as of June 24, 2016
|
|
8-K
|
|
|
000-50307
|
|
|
6/28/2016
|
|
|
10.1
|
|
|
|
10.02+
|
|
|
Form of Indemnity Agreement
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/28/2002
|
|
|
10.01
|
|
|
|
10.03+
|
|
|
Form of Change of Control Severance Agreement
|
|
10-K
|
|
|
000-50307
|
|
|
3/14/2005
|
|
|
10.48
|
|
|
|
10.04+
|
|
|
1996 Stock Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.03
|
|
|
|
10.05+
|
|
|
Incentive Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.04
|
|
|
|
10.06+
|
|
|
Management Incentive Option Plan, and form of option grant
|
|
S-1
|
|
|
333-86738
|
|
|
4/22/2002
|
|
|
10.05
|
|
|
|
10.07+
|
|
|
2002 Equity Incentive Plan, as amended, and forms of plan agreements
|
|
10-Q
|
|
|
000-50307
|
|
|
5/4/2011
|
|
|
10.06
|
|
|
|
10.08+
|
|
|
2002 Employee Stock Purchase Plan, as amended
|
|
10-Q
|
|
|
000-50307
|
|
|
8/7/2007
|
|
|
10.01
|
|
|
|
10.09+
|
|
|
Key Employee Bonus Plan, as amended
|
|
10-Q
|
|
|
000-50307
|
|
|
5/7/2007
|
|
|
10.01
|
|
|
|
10.10+
|
|
|
Equity Incentive Plan, as amended and restated effective April 18, 2012, and forms of plan agreements
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.09
|
|
|
|
10.11+
|
|
|
Employee Stock Purchase Plan, as amended and restated April 18, 2012
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.1
|
|
|
|
10.12
|
|
|
Pacific Corporate Center Lease (Building 1) by and between Greenville Holding Company LLC (successor to Greenville Investors, L.P.) ("Greenville") and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.18
|
|
|
|
10.13
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 1) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.18.1
|
|
|
|
10.14
|
|
|
Pacific Corporate Center Lease (Building 2) by and between Greenville and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.19
|
|
|
|
10.15
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 2) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.19.1
|
|
|
|
10.16
|
|
|
Pacific Corporate Center Lease (Building 3) by and between Greenville and the Registrant dated May 3, 2001
|
|
S-1/A
|
|
|
333-86738
|
|
|
6/10/2003
|
|
|
10.20
|
|
|
|
10.17+
|
|
|
First Amendment to Pacific Corporate Center Lease (Building 3) by and between Greenville and the Registrant dated January 31, 2003
|
|
S-1/A
|
|
|
333-86738
|
|
|
5/7/2003
|
|
|
10.20.1
|
|
|
|
10.18
|
|
|
Third Amendment, dated December 19, 2016, between FormFactor, Inc. and MOHR PCC, LP, to Pacific Corporate Center Leases (Buildings 1, 2 and 3), dated May 3, 2001, by and between Greenville Investors, L.P. and FormFactor, Inc., as amended
|
|
8-K
|
|
|
000-50307
|
|
|
12/23/2016
|
|
|
10.2
|
|
|
|
10.19+
|
|
|
Pacific Corporate Center Lease by and between Greenville and the Registrant dated September 7, 2004., as amended by First Amendment to Building 6 Lease dated August 16, 2006
|
|
10-Q
|
|
|
000-50307
|
|
|
11/7/2006
|
|
|
10.01
|
|
|
|
10.20
|
|
|
Second Amendment, dated December 19, 2016, between FormFactor, Inc. and MOHR PCC, LP, to Pacific Corporate Center Lease, dated October 5, 2004, by and between Greenville Investors, L.P. and FormFactor, Inc., as amended
|
|
8-K
|
|
|
000-50307
|
|
|
12/23/2016
|
|
|
10.1
|
|
|
|
10.21
|
|
|
Lease Agreements I and II between Amberjack, Ltd. And Cascade Microtech, Inc. dated August 20, 1997, and Amendment No. 2 to Lease Agreement I dated July 23, 1998, and Amendment No. 2 to Lease Agreement II dated April 12, 1999.
|
|
8-K
|
|
|
333-47100
|
|
|
10/2/2000
|
|
|
10.9
|
|
|
|
10.22
|
|
|
Third Amendment dated August 11, 2006 to Lease Agreement I dated August 20, 1997 between Amberjack, LTD. and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
11/9/2006
|
|
|
10.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
|
|
|||||||||
Exhibit
Number |
|
Exhibit Description
|
|
Form
|
|
File No
|
|
Date of
First Filing |
|
Exhibit
Number |
|
Filed
Herewith |
|||||
10.23
|
|
|
Third Amendment dated August 11, 2006 to Lease Agreement II dated August 20, 1997 between Amberjack, LTD. and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
11/9/2006
|
|
|
10.3
|
|
|
|
10.24
|
|
|
Assignment, Assumption and Amendment of Lease dated as of September 22, 2011 by and among Cascade Microtech, Inc. and R&D Sockets, Inc.
|
|
8-K
|
|
|
000-51072
|
|
|
9/26/2011
|
|
|
10.1
|
|
|
|
10.25
|
|
|
Rental Agreement by and between Cascade Microtech Dresden GmbH and Süss Grundstücksverwaltungs GbR dated as of June 17, 2011.
|
|
10-Q
|
|
|
000-51072
|
|
|
8/10/2011
|
|
|
10.3
|
|
|
|
10.26
|
|
|
Lease dated April 2, 1999 between Spieker Properties, L.P. and Cascade Microtech, Inc.
|
|
8-K
|
|
|
333-47100
|
|
|
10/2/2000
|
|
|
10.8
|
|
|
|
10.27
|
|
|
First amendment to Lease dated January 10, 2007, between Nimbus Center LLC (as successor in interest to Spieker Properties, L.P.) and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.1
|
|
|
|
10.28
|
|
|
Second amendment to Lease dated February 25, 2013, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/8/2013
|
|
|
10.2
|
|
|
|
10.29
|
|
|
Third amendment to Lease dated January 23, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.2
|
|
|
|
10.30
|
|
|
Fourth amendment to Lease dated March 31, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-Q
|
|
|
000-51072
|
|
|
5/9/2014
|
|
|
10.3
|
|
|
|
10.31
|
|
|
Fifth amendment to Lease dated September 24, 2014, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-K
|
|
|
000-51072
|
|
|
3/72016
|
|
|
10.22
|
|
|
|
10.32
|
|
|
Sixth amendment to Lease dated July 8, 2015, between Nimbus Center LLC and Cascade Microtech, Inc.
|
|
10-K
|
|
|
000-51072
|
|
|
3/72016
|
|
|
10.23
|
|
|
|
10.33+
|
|
|
Employment Offer Letter, dated August 29, 2012 to Mike Slessor
|
|
10-K
|
|
|
000-50307
|
|
|
3/13/2013
|
|
|
10.19+
|
|
|
|
10.34+
|
|
|
Tax withholding reimbursement letter between Mike Slessor and the Registrant dated December 30, 2013
|
|
10-K
|
|
|
000-50307
|
|
|
3/6/2015
|
|
|
10.2
|
|
|
|
10.35+
|
|
|
CEO Change of Control and Severance Agreement, dated April 28, 2016 by and between Mike Slessor and the Registrant
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
10.36+
|
|
|
Change of Control and Severance Agreement, dated April 28, 2016 by and between Michael Ludwig and the Registrant
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
21.01
|
|
|
List of Registrant's subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
23.01
|
|
|
Consent of Independent Registered Public Accounting Firm - KPMG
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
24.01
|
|
|
Power of Attorney (included on the signature page of this Form 10-K)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
31.01
|
|
|
Certification of Chief Executive Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
31.02
|
|
|
Certification of Chief Financial Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
32.01*
|
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.INS**
|
|
|
XBRL Instance Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.SCH**
|
|
|
XBRL Taxonomy Extension Schema Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.CAL**
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.DEF**
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.LAB**
|
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
101.PRE**
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
X
|
*
|
This exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
|
**
|
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.
|
***
|
Confidential treatment has been requested for portions of this document. The schedules, exhibits, and annexes to this exhibit have been omitted in reliance Item 601(b)(2) of Regulation S-K and will be furnished supplementally to the SEC upon request.
|
+
|
Indicates a management contract or compensatory plan or arrangement.
|
1.
|
Definitions
. The following terms referred to in this Agreement shall have the following meanings.
|
(i)
|
the consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into or exchanged for voting securities of the surviving entity) more than sixty percent (60%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or
|
(ii)
|
(A) any approval by the shareholders of the Company of a plan of complete liquidation of the Company, other than as a result of insolvency or (B) the consummation of the sale or disposition (or the last in a series of sales or dispositions) by the Company of all or substantially all of the Company’s assets, other than a sale or disposition to a wholly-owned direct or indirect subsidiary of the Company and other than a sale or disposition
|
(iii)
|
any “
person
” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becoming the “
beneficial owner
” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 40% or more of the total voting power represented by the Company’s then outstanding voting securities; or
|
(iv)
|
during any period of two consecutive years after the Effective Date, Incumbent Directors cease for any reason to constitute a majority of the Board.
|
2.
|
Term of Agreement
. This Agreement shall be in effect for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “
Term
”);
provided, however
, that the Term shall automatically be extended for one additional year unless, not later than 90 days prior to the scheduled expiration of the then-current Term, the Company or Employee shall have given notice not to extend the Term; and
provided further
that if a Change of Control shall have occurred during the Term, this Agreement shall remain in effect until 12 months following such Change of Control to give effect to its provisions.
|
3.
|
At-Will Employment
. The Company and the Employee acknowledge that the Employee’s employment is and shall continue to be at-will, as defined under applicable law. If the Employee’s employment terminates for any reason, the Employee shall not be entitled to any payments, benefits, damages, awards or compensation other than as provided by this Agreement, or as may otherwise be established under the Company’s then existing employee benefit plans or policies at the time of termination.
|
4.
|
Change of Control and Severance Benefits; Non-solicitation
.
|
(a)
|
Involuntary Termination Following Change of Control
. If the Employee’s employment with the Company terminates as a result of an Involuntary Termination at any time within
|
(i)
|
Cash Severance Payments
. Employee shall receive an aggregate amount equal to one times the sum of (A) the Employee’s annual base salary in effect on the date of termination plus (B) the greater of (x) the Employee’s annual target bonus amount for the year of termination assuming a 100% payout on all objectives under the Company’s bonus plan in effect on the date of termination or (y) such annual target bonus amount times the average rate of annual bonus paid to each executive officer (compared to such officer’s target bonus) covered under a change of control severance agreement substantially similar to this Agreement averaged over the two most recently completed fiscal years preceding the date of termination. The Company shall pay the foregoing amount to the Employee in a lump sum within 60 days following the Employee’s Separation from Service.
|
(ii)
|
Health Benefits Continuation
. The Company shall pay to the Employee the product of: (A) the Company’s monthly COBRA premium in effect on the date of Separation from Service under the Company’s group health plan for the type of coverage in effect under such plan (e.g., family coverage) for the Employee on the date of Separation from Service, and (B) 12, which shall be paid in a lump sum within 60 days following the Employee’s Separation from Service.
|
(iii)
|
Equity Acceleration
. The vesting and exercisability of each option, restricted stock award, restricted stock unit or other stock based award, including any cash-based award that was substituted or assumed for any stock-based award at the time of the Change in Control (each, an “
Equity Award
”) shall be automatically accelerated in full and the forfeiture provisions and/or Company right of repurchase of each Equity Award shall automatically lapse in full.
|
(iv)
|
Forfeiture upon Breach of Covenants
. Notwithstanding any of the foregoing, if the Employee materially breaches his or her obligations under paragraph (e) or (f) of this Article 4, from and after the date of such breach, the Employee will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the CIC Severance Benefits.
|
(b)
|
Other Involuntary Termination
. If Employee’s employment with the Company terminates as a result of an Involuntary Termination at any time during the Term other than within twelve (12) months following a Change of Control, then Employee shall be entitled to receive from the Company the following benefits (the “
Severance Benefits
”), contingent upon the Employee’s delivery of a signed release reasonably satisfactory to the Company (the “
Release
”) within 45 days from Employee’s Separation from Service (the “
Release Deadline
”) and non-revocation of such Release within the time period specified therein.
|
(v)
|
Cash Severance Payments
. Employee shall receive an aggregate amount equal to (A) one times the Employee’s annual base salary in effect on the date of termination plus (B) a pro-rated annual bonus (pro-rated through the
|
(vi)
|
Health Benefits Continuation
. The Company shall pay to the Employee the product of: (A) the Company’s monthly COBRA premium in effect on the date of Separation from Service under the Company’s group health plan for the type of coverage in effect under such plan (e.g., family coverage) for the Employee on the date of Separation from Service, and (B) 12, which shall be paid in a lump sum within 60 days following the Employee’s Separation from Service.
|
(vii)
|
Equity Acceleration
. Employee will become immediately vested in an additional number of shares of Company common stock under all of Employees outstanding Equity Awards as if Employee had continued in employment for twelve (12) additional months following Employee’s Separation from Service;
provided
that with respect to any performance-based Equity Award for which the performance period has not ended as of the date of termination (a “Performance Award”) but for which the initial vesting date would occur within 12 months following Employee’s Separation from Service, such Performance Award shall remain outstanding and, upon determination of the amount earned for such performance period, the earned amount of the Performance Period shall be subject to the foregoing 12-month acceleration provision (from the date of termination) and, if applicable, shall be settled within two and one-half months following the year in which Employee’s Separation from Service occurs. Further, Employee will have twelve (12) months following Employee’s Separation from Service to exercise any vested stock options not to exceed the expiration date of such options.
|
(c)
|
Other Termination.
If the Employee’s employment with the Company terminates other than as a result of an Involuntary Termination, then the Employee shall not be entitled to receive the CIC Severance Benefits or Severance Benefits, as applicable, but may be eligible for those benefits (if any) as may then be established under the Company’s then existing severance and benefits plans and policies.
|
(d)
|
Accrued Wages and Vacation; Expenses
. Without regard to the reason for, or the timing of, Employee’s termination of employment: (i) the Company shall pay the Employee any unpaid base salary due for periods prior to the date of termination; (ii) the Company shall pay the Employee all of the Employee’s accrued and unused vacation through the date of termination; and (iii) following submission of proper expense reports by the Employee, the Company shall reimburse the Employee for all expenses reasonably and necessarily incurred by the Employee in connection with the business of the Company prior to the date of termination. These payments shall be made promptly upon termination and within the period of time mandated by law.
|
(e)
|
Non-solicitation.
In consideration of the benefits and protections conferred under this Agreement, Employee agrees that for the Non-solicit Period (as defined below), the Employee shall not either directly or indirectly solicit, induce, recruit or encourage any of the Company’s Personnel (as defined below) to leave their employment, or take away such Personnel, or attempt to solicit, induce, recruit, encourage or take away such Personnel, either for the Employee or for any other person or entity. “
Personnel
” means any of the Company’s employees, excluding the Employee’s administrative assistant. “
Non-solicit Period
” means the period commencing on the date of a Change of Control and ending 12 months thereafter.
|
(f)
|
Confidentiality
. In consideration of the benefits and protections conferred under this Agreement, the Employee agrees that he or she will continue to abide by the confidentiality provisions in the Company’s Employment, Confidential Information and Invention Assignment Agreement, as executed by the Employee.
|
5.
|
Limitation on Benefits
.
|
(a)
|
Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Employee under any other employer plan or agreement (such payments or benefits are collectively referred to as the “
Benefits
”) would be subject to the excise tax (the “
Excise Tax
”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “
Code
”), the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in Employee retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if Employee received all of the Benefits (such reduced amount is hereinafter referred to as the “
Limited Benefit Amount
”). The Company shall reduce or eliminate the Benefits, by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the “
Determination
” (as hereinafter defined).
|
(b)
|
A determination as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public accounting firm or valuation firm designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation to the Company and Employee within 30 days of the date of termination of Employee’s employment.
|
6.
|
Successors
.
|
(a)
|
Company’s Successors
. Any successor to the Company (whether direct or indirect) to all or substantially all of the Company’s business and/or assets shall assume the Company’s obligations under this Agreement and agree (either expressly or by operation of law) to perform the Company’s obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “
Company
” shall include any successor to the Company’s business and/or assets.
|
(b)
|
Employee’s Successors
. Without the written consent of the Company, Employee shall not assign or transfer this Agreement or any right or obligation under this Agreement to any other person or entity. Notwithstanding the foregoing, the terms of this Agreement and all rights of Employee hereunder shall inure to the benefit of, and be enforceable by,
|
7.
|
Notices
.
|
(a)
|
General
. Notices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of the Employee, mailed notices shall be addressed to him or her at the home address that he or she most recently communicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters, and all notices shall be directed to the attention of its General Counsel, or to the Chief Financial Officer if the notice to the Company is from the General Counsel.
|
(b)
|
Notice of Termination
. Any termination by the Company or by the Employee shall be communicated by a notice of termination to the other party hereto given in accordance with this Article.
|
8.
|
Arbitration
.
|
(a)
|
Any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, shall be settled by binding arbitration to be held in San Francisco, California, in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “
Rules
”). The arbitrator(s) may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction.
|
(b)
|
The arbitrator(s) shall apply California law to the merits of any dispute or claim, without reference to conflicts of law rules. The arbitral proceedings shall be governed by federal arbitration law and by the Rules, without reference to state arbitration law. Employee hereby consents to the personal jurisdiction of the state and federal courts located in California for any action or proceeding arising from or relating to this Agreement or relating to any arbitration in which the parties are participants.
|
(c)
|
EMPLOYEE HAS READ AND UNDERSTANDS THIS ARTICLE, WHICH DISCUSSES ARBITRATION. EMPLOYEE UNDERSTANDS THAT SUBMITTING ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, CONSTITUTES A WAIVER OF EMPLOYEE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE FOLLOWING CLAIMS:
|
i.
|
ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND DEFAMATION.
|
ii.
|
ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE SECTION 201, et seq.;
|
iii.
|
ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
|
9.
|
Miscellaneous Provisions
.
|
(a)
|
Section 409A
. It is intended, and this Agreement will be so construed, that any amounts payable under this Agreement shall either be exempt from or comply with the provisions of Section 409A of the Code and the treasury regulations relating thereto so as not to subject the Employee to the payment of interest and/or any tax penalty that may be imposed under Section 409A of the Code. Employee acknowledges and agrees that the Company has made no representation to Employee as to the tax treatment of the compensation and benefits provided pursuant to this Agreement and that Employee is solely responsible for all taxes due with respect to such compensation and benefits. In addition, to the extent (i) any payments to which Employee becomes entitled under this Agreement in connection with Employee's termination of employment with the Company constitutes deferred compensation subject to Section 409A and (ii) Employee is deemed at the time of such termination of employment to be a “specified” employee under Section 409A, then to the extent required to avoid adverse tax treatment under Section 409A to Employee, such payment or payments shall not be made or commence until the date which is more than six (6) months after the Employee's Separation from Service or, if earlier, the date of death of the Employee. If the condition of providing a Release by the Employee could cause the payment of any amount or provision of any Benefit subject to such release to be paid or provided in either of two taxable years of the Employee, then to the extent required to avoid adverse tax treatment under Section 409A to Employee, such amount or benefit shall be paid or provided in the later such taxable year.
|
(b)
|
No Duty to Mitigate
. The Employee shall not be required to mitigate the amount of any payment contemplated by this Agreement, nor shall any such payment be reduced by any earnings that the Employee may receive from any other source.
|
(c)
|
Waiver
. No provision of this Agreement may be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by the Employee and by an authorized officer of the Company other than the Employee. No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time.
|
(d)
|
Integration
. This Agreement represents the entire agreement and understanding between the parties as to the subject matter herein and supersede all prior or contemporaneous agreements, whether written or oral.
|
(e)
|
Choice of Law
. The validity, interpretation, construction and performance of this Agreement shall be governed by the internal substantive laws, but not the conflicts of law rules, of the State of California.
|
(f)
|
Severability
. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect.
|
(g)
|
Withholding Taxes
. All payments made pursuant to this Agreement shall be subject to withholding of applicable income and employment taxes.
|
(h)
|
Counterparts
. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.
|
(i)
|
|
FormFactor, Inc.
|
|
Michael Slessor
|
|
|
|
By: /s/ JASON COHEN
|
|
/s/ MICHAEL SLESSOR
|
Name: Jason Cohen
|
|
|
Title: Vice President and
General Counsel
|
|
|
1.
|
Definitions
. The following terms referred to in this Agreement shall have the following meanings.
|
(i)
|
the consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into or exchanged for voting securities of the surviving entity) more than sixty percent (60%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or
|
(ii)
|
(A) any approval by the shareholders of the Company of a plan of complete liquidation of the Company, other than as a result of insolvency or (B) the consummation of the sale or disposition (or the last in a series of sales or dispositions) by the Company of all or substantially all of the Company’s assets, other than a sale or disposition to a wholly-owned direct or indirect subsidiary of the Company and other than a sale or disposition
|
(iii)
|
any “
person
” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becoming the “
beneficial owner
” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 40% or more of the total voting power represented by the Company’s then outstanding voting securities; or
|
(iv)
|
during any period of two consecutive years after the Effective Date, Incumbent Directors cease for any reason to constitute a majority of the Board.
|
2.
|
Term of Agreement
. This Agreement shall be in effect for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “
Term
”);
provided, however
, that the Term shall automatically be extended for one additional year unless, not later than 90 days prior to the scheduled expiration of the then-current Term, the Company or Employee shall have given notice not to extend the Term; and
provided further
that if a Change of Control shall have occurred during the Term, this Agreement shall remain in effect until 12 months following such Change of Control to give effect to its provisions.
|
3.
|
At-Will Employment
. The Company and the Employee acknowledge that the Employee’s employment is and shall continue to be at-will, as defined under applicable law. If the Employee’s employment terminates for any reason, the Employee shall not be entitled to any payments, benefits, damages, awards or compensation other than as provided by this Agreement, or as may otherwise be established under the Company’s then existing employee benefit plans or policies at the time of termination.
|
4.
|
Change of Control and Severance Benefits; Non-solicitation
.
|
(a)
|
Involuntary Termination Following Change of Control
. If the Employee’s employment with the Company terminates as a result of an Involuntary Termination at any time within twelve (12) months after a Change of Control, then the Employee shall be entitled to receive from the Company the following benefits (the “
Severance Benefits
”), contingent upon the Employee’s delivery of a signed release reasonably satisfactory to the Company (the “
Release
”) within 45 days from the Employee’s Separation from Service (the “
Release Deadline
”) and non-revocation of such Release within the time period specified therein.
|
(i)
|
Cash Severance Payments
. Employee shall receive an aggregate amount equal to one times the sum of (A) the Employee’s annual base salary in effect on the date of termination plus (B) the greater of (x) the Employee’s annual target bonus amount for the year of termination assuming a 100% payout on all objectives under the Company’s bonus plan in effect on the date of termination or (y) such annual target bonus amount times the average rate of annual bonus paid to each executive officer (compared to such officer’s target bonus) covered under a change of control severance agreement substantially similar to this Agreement averaged over the two most recently completed fiscal years preceding the date of termination. The Company shall pay the foregoing amount to the Employee in a lump sum within 60 days following the Employee’s Separation from Service.
|
(ii)
|
Health Benefits Continuation
. The Company shall pay to the Employee the product of: (A) the Company’s monthly COBRA premium in effect on the date of Separation from Service under the Company’s group health plan for the type of coverage in effect under such plan (e.g., family coverage) for the Employee on the date of Separation from Service, and (B) 12, which shall be paid in a lump sum within 60 days following the Employee’s Separation from Service.
|
(iii)
|
Equity Acceleration
. The vesting and exercisability of each option, restricted stock award, restricted stock unit or other stock based award, including any cash-based award that was substituted or assumed for any stock-based award at the time of the Change in Control (each, an “
Equity Award
”) shall be automatically accelerated in full and the forfeiture provisions and/or Company right of repurchase of each Equity Award shall automatically lapse in full.
|
(iv)
|
Forfeiture upon Breach of Covenants
. Notwithstanding any of the foregoing, if the Employee materially breaches his or her obligations under paragraph (e) or (f) of this Article 4, from and after the date of such breach, the Employee will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefits.
|
(b)
|
Other Termination in Connection with a Change of Control.
If the Employee’s employment with the Company terminates other than as a result of an Involuntary Termination at any time within twelve (12) months after a Change of Control, then the Employee shall not be entitled to receive the Severance Benefits, but may be eligible for those benefits (if any) as may then be established under the Company’s then existing severance and benefits plans and policies.
|
(c)
|
Termination Apart from a Change of Control
. If the Employee’s employment with the Company terminates for any or no reason other than within twelve (12) months following a Change of Control, then the Employee shall not be entitled to receive the Severance Benefits, but may be eligible for those benefits (if any) as may then be established under the Company’s then existing severance and benefits plans and policies at the time of such termination.
|
(d)
|
Accrued Wages and Vacation; Expenses
. Without regard to the reason for, or the timing of, Employee’s termination of employment: (i) the Company shall pay the Employee any unpaid base salary due for periods prior to the date of termination; (ii) the Company shall pay the Employee all of the Employee’s accrued and unused vacation through the date of termination; and (iii) following submission of proper expense reports by the Employee, the Company shall reimburse the Employee for all expenses reasonably and necessarily incurred by the Employee in connection with the business of the Company prior to the date of termination. These payments shall be made promptly upon termination and within the period of time mandated by law.
|
(e)
|
Non-solicitation.
In consideration of the benefits and protections conferred under this Agreement, Employee agrees that for the Non-solicit Period (as defined below), the Employee shall not either directly or indirectly solicit, induce, recruit or encourage any of the Company’s Personnel (as defined below) to leave their employment, or take away such Personnel, or attempt to solicit, induce, recruit, encourage or take away such Personnel, either for the Employee or for any other person or entity. “
Personnel
” means any of the Company’s employees, excluding the Employee’s administrative assistant. “
Non-solicit Period
” means the period commencing on the date of a Change of Control and ending 12 months thereafter.
|
(f)
|
Confidentiality
. In consideration of the benefits and protections conferred under this Agreement, the Employee agrees that he or she will continue to abide by the confidentiality provisions in the Company’s Employment, Confidential Information and Invention Assignment Agreement, as executed by the Employee.
|
5.
|
Limitation on Benefits
.
|
(a)
|
Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Employee under any other employer plan or agreement (such payments or benefits are collectively referred to as the “
Benefits
”) would be subject to the excise tax (the “
Excise Tax
”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “
Code
”), the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in Employee retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if Employee received all of the Benefits (such reduced amount is hereinafter referred to as the “
Limited Benefit Amount
”). The Company shall reduce or eliminate the Benefits, by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the “
Determination
” (as hereinafter defined).
|
(b)
|
A determination as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public accounting firm or valuation firm designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation
|
6.
|
Successors
.
|
(a)
|
Company’s Successors
. Any successor to the Company (whether direct or indirect) to all or substantially all of the Company’s business and/or assets shall assume the Company’s obligations under this Agreement and agree (either expressly or by operation of law) to perform the Company’s obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “
Company
” shall include any successor to the Company’s business and/or assets.
|
(b)
|
Employee’s Successors
. Without the written consent of the Company, Employee shall not assign or transfer this Agreement or any right or obligation under this Agreement to any other person or entity. Notwithstanding the foregoing, the terms of this Agreement and all rights of Employee hereunder shall inure to the benefit of, and be enforceable by, Employee’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
|
7.
|
Notices
.
|
(a)
|
General
. Notices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of the Employee, mailed notices shall be addressed to him or her at the home address that he or she most recently communicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters, and all notices shall be directed to the attention of its General Counsel, or to the Chief Financial Officer if the notice to the Company is from the General Counsel.
|
(b)
|
Notice of Termination
. Any termination by the Company or by the Employee shall be communicated by a notice of termination to the other party hereto given in accordance with this Article.
|
8.
|
Arbitration
.
|
(a)
|
Any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, shall be settled by binding arbitration to be held in San Francisco, California, in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “
Rules
”). The arbitrator(s) may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction.
|
(b)
|
The arbitrator(s) shall apply California law to the merits of any dispute or claim, without reference to conflicts of law rules. The arbitral proceedings shall be governed by federal arbitration law and by the Rules, without reference to state arbitration law. Employee hereby consents to the personal jurisdiction of the state and federal courts located in California for any action or proceeding arising from or relating to this Agreement or relating to any arbitration in which the parties are participants.
|
(c)
|
EMPLOYEE HAS READ AND UNDERSTANDS THIS ARTICLE, WHICH DISCUSSES ARBITRATION. EMPLOYEE UNDERSTANDS THAT SUBMITTING ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH
|
i.
|
ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND DEFAMATION.
|
ii.
|
ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE SECTION 201, et seq.;
|
iii.
|
ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
|
9.
|
Miscellaneous Provisions
.
|
(a)
|
Section 409A
. It is intended, and this Agreement will be so construed, that any amounts payable under this Agreement shall either be exempt from or comply with the provisions of Section 409A of the Code and the treasury regulations relating thereto so as not to subject the Employee to the payment of interest and/or any tax penalty that may be imposed under Section 409A of the Code. Employee acknowledges and agrees that the Company has made no representation to Employee as to the tax treatment of the compensation and benefits provided pursuant to this Agreement and that Employee is solely responsible for all taxes due with respect to such compensation and benefits. In addition, to the extent (i) any payments to which Employee becomes entitled under this Agreement in connection with Employee's termination of employment with the Company constitutes deferred compensation subject to Section 409A and (ii) Employee is deemed at the time of such termination of employment to be a “specified” employee under Section 409A, then to the extent required to avoid adverse tax treatment under Section 409A to Employee, such payment or payments shall not be made or commence until the date which is more than six (6) months after the Employee's Separation from Service or, if earlier, the date of death of the Employee. If the condition of providing a Release by the Employee could cause the payment of any amount or provision of any Benefit subject to such release to be paid or provided in either of two taxable years of the Employee, then to the extent required to avoid adverse tax treatment under Section 409A to Employee, such amount or benefit shall be paid or provided in the later such taxable year.
|
(b)
|
No Duty to Mitigate
. The Employee shall not be required to mitigate the amount of any payment contemplated by this Agreement, nor shall any such payment be reduced by any earnings that the Employee may receive from any other source.
|
(c)
|
Waiver
. No provision of this Agreement may be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by the Employee and by an authorized officer of the Company other than the Employee. No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time.
|
(d)
|
Integration
. This Agreement represents the entire agreement and understanding between the parties as to the subject matter herein and supersede all prior or contemporaneous agreements, whether written or oral.
|
(e)
|
Choice of Law
. The validity, interpretation, construction and performance of this Agreement shall be governed by the internal substantive laws, but not the conflicts of law rules, of the State of California.
|
(f)
|
Severability
. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect.
|
(g)
|
Withholding Taxes
. All payments made pursuant to this Agreement shall be subject to withholding of applicable income and employment taxes.
|
(h)
|
Counterparts
. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.
|
(i)
|
|
FormFactor, Inc.
|
|
Michael Ludwig
|
|
|
|
By: /s/ MICHAEL SLESSOR
|
|
/s/ MICHAEL LUDWIG
|
Name: Michael Slessor
|
|
|
Title: Chief Executive Officer
|
|
|
SUBSIDIARY NAME
|
|
JURISDICTION OF ORGANIZATION
|
FormFactor Germany GmbH
|
Germany
|
|
FormFactor International, Inc.
|
Delaware, United States
|
|
FormFactor, K.K.
|
Japan
|
|
FormFactor Korea, Inc.
|
South Korea
|
|
FormFactor Singapore Pte. Ltd.
|
Singapore
|
|
Astria Semiconductor Holdings, Inc
|
Delaware, United States
|
|
Micro-Probe Incorporated
|
California, United States
|
|
Microprobe HongKong Limited
|
Hong Kong
|
|
Microprobe Technology (Suzhou) Limited
|
People's Republic of China
|
|
Cascade Microtech Inc.
|
Oregon, United States
|
|
Cascade Microtech GmbH
|
Germany
|
|
Cascade Microtech Japan, K.K
|
Japan
|
|
Cascade Microtech Singapore Pte, Ltd
|
Singapore
|
|
Cascade Microtech Taiwan Co., Ltd
|
Taiwan
|
|
Cascade International Trading (Shanghai) Co., Ltd
|
People's Republic of China
|
|
Advanced Temperature Test Systems GmbH
|
Germany
|
1.
|
I have reviewed the Annual Report on Form 10-K of FormFactor, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal 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 registrant's 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
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(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(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 registrant's 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 registrant's internal control over financial reporting.
|
Date:
|
March 15, 2017
|
/s/ MICHAEL D. SLESSOR
|
|
|
Michael D. Slessor
Chief Executive Officer
(Principal Executive Officer and Director)
|
1.
|
I have reviewed the Annual Report on Form 10-K of FormFactor, Inc.;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal 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 registrant's 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 registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(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 registrant's 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 registrant's internal control over financial reporting.
|
Date:
|
March 15, 2017
|
/s/ MICHAEL M. LUDWIG
|
|
|
Michael M. Ludwig
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|
(1)
|
the annual report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the annual report fairly presents, in all material respects, the financial condition and results of operations of FormFactor, Inc. for the periods presented therein.
|
Date:
|
March 15, 2017
|
/s/ MICHAEL D. SLESSOR
|
|
|
Michael D. Slessor
Chief Executive Officer
(Principal Executive Officer and Director)
|
|
|
|
Date:
|
March 15, 2017
|
/s/ MICHAEL M. LUDWIG
|
|
|
Michael M. Ludwig
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|