##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
      Form
    10-K/A
 (Amendment
    No. 1)
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year Ended
    December 30, 2006o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number 1-33403
      SIPEX CORPORATION
 (Exact name of registrant as
    specified in its charter)
  Delaware

04-6135748(State of
    Incorporation)

(IRS employer
    identification number)233 South Hillview Drive,
    Milpitas, California(Address of principal
    executive offices)

95035(Zip Code)   Registrants telephone number, including area code:
 (408) 934-7500
  Securities registered pursuant to Section 12(b) of the
    Act:
 None
 Securities registered pursuant to Section 12(g) of the
    Act:
 Common Stock, par value $0.01 per share
  Name of exchange on which registered:
 The Nasdaq Capital Market
   o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  o o þ
  Rule 12b-2  o þ
  1-for-2




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##### 



TABLE OF
    CONTENTS
  PagePART IIIItem 10.

Directors,
    Executive Officers and Corporate Governance


3Item 11.

Executive
    Compensation


8Item 12.

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


21Item 13.

Certain
    Relationships, Related Transactions and Director
    Independence


24Item 14.

Principal
    Accounting Fees and Services


26PART IVSignatures


27Exhibits
    Index


28EXHIBIT 31.3EXHIBIT 31.4EXHIBIT 32.3EXHIBIT 32.4   2




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##### Table of Contents



EXPLANATORY
    NOTE
  Form 10-K Form 10-K Form 10-K:
  Item 10.
    Directors, Executive Officers and Corporate GovernanceItem 11.
    Executive CompensationItem 12.
    Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder MattersItem 13.
    Certain Relationships, Related Transactions and Director
    IndependenceItem 14.
    Principal Accounting Fees and Services      Item 10.
    Directors,
    Executive Officers and Corporate Governances:  Directors
    Year Nomineeor DirectorNominee or

First Became

Class of



Year TermDirectors Name

a Director

Director

Position(s) Held

Will Expire

AgeCONTINUING DIRECTORS:Thomas Redfern

2003

I

Director


2007



66John Arnold

2004

I

Director


2007



52Brian Hilton

2004

II

Chairman of the Board


2008



64Ralph Schmitt

2005

II

Director and
    Chief Executive Officer


2008



46Dan Casey

2006

III

Director


2009



51Pierre Guilbault

2006

III

Director


2009



53Alan Krock

2006

III

Director


2009



46   Mr. Redfern
 3




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##### Table of Contents



Mr. Arnold
  Mr. Hilton
  Mr. Schmitt
  Mr. Casey
  Mr. Guilbault
  Mr. Krock
    Executive
    Officers
   4




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##### Table of Contents



Section 16
    (A) Beneficial Ownership Reporting Compliance
      Corporate
    Governance
  Director
    Independence
    Committees
    of the Board of Directors and Meetings Held
      Corporate GovernanceName of Directors

Compensation

and Nominating

AuditThomas Redfern

ü

üJohn Arnold



Chair

ChairBrian Hilton

Chair

ü

üRalph SchmittDan CaseyPierre Guilbault

ObserverAlan Krock





üNumber of Meetings Held in 2006

23

1

15   Compensation
    Committee
   5




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##### Table of Contents



Corporate
    Governance and Nominating Committee
      Audit
    Committee
    Regulation S-K, Regulation S-K,
  Form 10-K
  Policy
    for Director Recommendations and Nominations
   6




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##### Table of Contents




    The candidates name, home and business contact information
    Detailed biographical data and relevant qualifications
    A signed letter from the candidate confirming his or her
    willingness to serve
    Information regarding any relationships between the candidate
    and Sipex within the last three years        
    The current size and composition of the board of directors and
    the needs of the board of directors and the respective
    committees of the board of directors
    Such factors as judgment, independence, character and integrity,
    age, area of expertise, diversity of experience, length of
    service and potential conflicts of interest    
    The highest personal and professional ethics and integrity
    Proven achievement and competence in the nominees field
    and the ability to exercise sound business judgment
    Skills that are complementary to those of the existing board
    The ability to assist and support management and make
    significant contributions to Sipexs success
    An understanding of the fiduciary responsibilities that is
    required of a member of the board and the commitment of time and
    energy necessary to diligently carry out those responsibilities    Code of
    Business Conduct and Ethics
   7




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##### Table of Contents



Form 8-K
  Item 11.
    Executive
    Compensation  Compensation
    Discussion and Analysis  Introduction      
    Ralph Schmitt, Chief Executive Officer
    Clyde R. Wallin, Senior Vice President of Finance, Chief
    Financial Officer and Secretary
    Ed Lam, Senior Vice President of Marketing and Business
    Development
    Lee Cleveland, Senior Vice President of Engineering
    Rick Hawron, Senior Vice President of Worldwide Sales.
    Mr. Hawrons employment was terminated on
    January 19, 2007.  Compensation
    Philosophy
        (a)
    Base salaries  the fixed component of executive
    compensation, set according to the individuals role and
    skills against typical market practices for like positions at
    similar companies. We consider practices to reflect the
    typical market practices if they are within a range
    of the median to the
    75th
    percentile of market data for companies in our industry, local
    market, and of similar size. Base salaries are reviewed annually
    and adjusted with consideration given to the individuals
    performance and the affordability of pay increases to our
    company.(b)
    Variable short-term compensation/Annual Bonus  a plan
    that rewards company, group or team
    and/or
    individual performance based on the successful achievement of
    established financial and operating performance measures
    (profitability and operating profit improvement, revenue growth,
    gross margin improvement) tied to our Annual Operating Plan (our
    annual financial plan and budget) goals and objectives,
    succession planning and development and recruitment and employee
    retention. Overall profitability of Sipex, however, is the
    primary determinant of whether, and how much, any bonuses are
    paid to executives. 8




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##### Table of Contents



(c)
    Long-term compensation/Equity/Stock Options  stock
    option grants, under the long term component of executive
    compensation, are designed to incentivize and reward executive
    officers and key employees for delivering value to our
    stockholders over a longer period of time. As is typical in our
    industry, we place more emphasis on the equity component of the
    executive compensation.(d)
    Benefits  a comprehensive benefits program including
    cost sharing for medical and dental plans, company paid life and
    disability insurance, a flexible 401(k) Tax Deferred Saving Plan
    including company match and an Employee Stock Purchase Plan. The
    benefits provided to our executives are the same as those made
    available to all Sipex employees.(e)
    Severance arrangements and change in control
    agreements/provisions  are in place to provide a
    reasonable level of post-termination compensation to mitigate
    the risk of involuntary termination or changes in control of
    Sipex, so that executives are encouraged to focus on the
    business at hand.(f)
    Other special compensation or arrangements  are not
    emphasized at Sipex. Facts and circumstances may warrant certain
    payments such as housing and relocation for key individuals if
    it is in the Sipexs best interests in attracting or
    retaining that executive.      Corporate
    Governance
  Compensation
    Committee Authority
    
    To annually review and approve annual base salaries, annual
    incentive bonus, including the specific goals and amount, equity
    compensation, employment agreements, severance arrangements, and
    change in control provisions, and any other benefits,
    compensation or arrangements, for the CEO and the other
    executive officers. In doing so, the Compensation Committee may
    consider as appropriate factors such as financial and operating
    performance, the alignment of the interests of the executive
    officers and our stockholders, the performance of our common
    stock and our ability to attract and retain qualified
    individuals.
    To annually make recommendations about compensation issues to
    the board of directors for final review and approval, including
    approval by a majority of the independent directors of the board
    of directors. In doing so, the Compensation Committee makes
    regular reports to the board of directors.
    To act, in its discretion, as administrator of our existing
    employee benefit plans and any future employee benefit plans
    adopted and approved by our board of directors and stockholders,
    and if appropriate, make recommendations to the board of
    directors with respect to incentive compensation plans. 9




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##### Table of Contents




    To review and approve the compensation policy for the directors
    of Sipex, subject to the approval by the full board of directors
    and to approve the fees members of the Compensation Committee
    are entitled to receive for their service as Compensation
    Committee members.
    To prepare a report (to be included in our proxy statement and
    annual report on
    Form 10-K)
    which describes: (a) the criteria on which compensation
    paid to the CEO for the last completed fiscal year was based;
    (b) the relationship of such compensation to Sipexs
    performance; and (c) the Compensation Committees
    executive compensation policies applicable to our named
    executive officers.
    To review and reassess the adequacy of the Compensation
    Committee Charter annually and recommend any proposed changes to
    the board of directors for approval as well as review its own
    performance annually.
    To retain and terminate, with sole authority, any compensation
    consultant to be used by Sipex to assist in the evaluation of
    CEO or executive officer compensation. The Compensation
    Committee has sole authority to approve the consultants
    fees and other retention terms and also has authority to obtain
    advice and assistance from internal or external legal,
    accounting or other advisors. The Compensation Committee did not
    retain the assistance of a compensation consultant in exercising
    its duties in 2006.      Compensation
    Review Process
      Managements
    Role in Compensation Decisions
     10




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##### Table of Contents



Sources
    of Competitive Data
    
    San Francisco Bay Area companies  444 companies
    reported
    Semiconductor companies  136 companies reported
    Companies with $49.9 to $100.0 million in
    revenues  127 companies reported    Elements
    of Executive Compensation and Decisions Made in
    2006
  Base
    Salary Adjustments
  th
      Cash
    Incentives and Total Cash Compensation
    nd
  
    Revenue improvement each quarter (10%)
    Spending  less than $19M (10%) 11




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##### Table of Contents




    Fab transition deliverables (20%)
    Complete financial restatement (20%)
    Secure cash alternative (15%)
    New company strategy documented and established (5%)
    Inventory reduction per the Annual Plan (5%)
    Introduction of new products per the Annual Plan (5%)
    Quality metrics per the Annual Plan (5%)
    Information technology deliverables per the Annual Plan (5%)        Target Bonus as %


Target Bonus AmountExecutive

of Salary


($)

Amount Paid Out ($)Schmitt


50%


$200,000 (voluntarily
    reduced to $100,000)

$
65,000Wallin


40%


$80,000

$
52,000Lam


40%


$58,000

$
37,700Cleveland


40%


$80,000

$
52,000Hawron


40%


$90,000

$
58,500       Equity
    Grants
  built-in-value pay-for-performance
   12




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##### Table of Contents



in-the-money
  1 48 th
      .
  Executive
    Benefits and Perquisites
      Employment
    Agreements and Post Employment Termination Benefits
      Mr. Schmitt, June 7, 2005
 13




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##### Table of Contents



Mr. Wallin, April 5, 2004
        
    material change in the executives position at Sipex
    material reduction to the executives base salary or
    benefits and perquisites
    required relocation by more than 50 miles from Sipexs
    headquarters  Mr. Lam, August 24, 2005
      Mr. Cleveland, August 13, 2004
    Mr. Hawron
     14




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##### Table of Contents



Accounting
    and Tax Considerations    gross-up
  performance-based
  Compensation
    Committee Report
  Form 10-K,
    15




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##### Table of Contents



Executive
    Compensation
  Summary
    Compensation Table
    Change inPension Valueand NonqualifiedNon-Equity


DeferredStock


Option


Incentive Plan


Compensation


All OtherSalary


Bonus2


Awards


Awards3


Compensation


Earnings4


Compensation5


TotalName and Principle Position

Year


($)


($)


($)


($)


($)


($)


($)


($)Ralph Schmitt


2006


$
400,000


$
65,000






$
275,280










$



$
740,280President & CEORay Wallin


2006


$
222,428


$
52,000






$
276,289










$
909


$
551,626Chief Financial OfficerEd Lam


2006


$
287,000


$
37,700






$
143,632










$
6,071


$
474,404Sr. VP, Marketing &
    Business DevelopmentLee Cleveland


2006


$
229,327


$
52,000






$
376,244










$
2,466


$
660,038Sr. VP, EngineeringRichard
    Hawron1


2006


$
235,000


$
58,500






$
183,137










$
45,957


$
522,595VP, World Wide Sales     1
    Mr. Hawrons employment with us terminated on
    January 19, 2007.2
    Represents the short-term incentive awards earned under The 2nd
    Half 2005 Bonus Program payout performance.3
    This column represents the dollar amount recognized for
    financial statement reporting purposes with respect to the 2006
    fiscal year for the fair value options granted in 2006 as well
    as prior fiscal years, in accordance with SFAS 123R.
    Pursuant to the SEC rules, the amounts shown exclude the impact
    of estimated forfeitures related to service-based vesting
    conditions.4
    This column represents the sum of the change in pension value
    and non-qualified deferred compensation earnings in 2006 for
    each of the named executives. Nonqualified plans are not
    available to our executives.5
    See the All Other Compensation Table below for additional
    information. Primarily represents employer contributions to the
    401(k) plan and a housing allowance for Mr. Hawron.  All
    Other Compensation Table
    Paymentsrelating toOther


EmployeeName of Executive

Benefits1


Savings
    Plan2


TotalRay Wallin

$



$
909


$
909Chief Financial OfficerEd Lam

$



$
6,071


$
6,071Sr. VP, Marketing &
    Business DevelopmentLee Cleveland

$



$
2,466


$
2,466Sr. VP, EngineeringRichard Hawron

$
40,187


$
5,770


$
45,957VP, World Wide Sales     1
    
    This amount represents housing allowance provided to
    Mr. Hawron. No other supplemental executive perquisites are
    offered to our executives. 16




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##### Table of Contents



2
    
    This column reports company matching contributions to the named
    executives 401(k) savings account of 1.5% of pay up to the
    limitations imposed under IRS rules.  Grants of
    Plan-Based Awards in 2006
    All OtherAll Other


OptionStock


Awards:


ExerciseEstimated Future Payouts


Estimated Future Payouts


Awards:


Number of


or BaseUnder Non-Equity


Under Equity


Number of


Securities


Price ofIncentive Plan Awards


Incentive Plan Awards


Shares of


Underlying


OptionGrant

Threshold


Target


Maximum


Threshold


Target


Maximum


Stock or


Options


AwardsName

Date

($)


($)


($)


(#)


(#)


(#)


Units (#)


(#)1


($/Sh)Ralph Schmitt

None


































President & CEORay Wallin

1/17/2006






























62,500


$
4.15Chief Financial Officer

12/4/2006






























25,000


$
8.50Ed Lam

12/4/2006






























25,000


$
8.50Sr. VP, Marketing &
    Business DevelopmentLee Cleveland

12/4/2006






























25,000


$
8.50Sr. VP, EngineeringRichard Hawron

N/A


































VP, World Wide Sales     1
    
    The value of a stock option award
    is based on the fair value as of the grant date of such award
    determined pursuant to FAS 123R. The exercise price for all
    options granted to the named executive officers is 100% of the
    fair market value of the shares on the grant date. Regardless of
    the value placed on a stock option on the grant date, the actual
    value of the option will depend on the market value of Sipex
    common stock at such date in the future when the option is
    exercised. The proceeds to be paid to the individual following
    this exercise do not include the option exercise price.  Outstanding
    Equity Awards at 2006 Fiscal Year-End
    17




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##### Table of Contents



Option AwardsEquity IncentivePlan Awards:Number of

Number of

Number ofSecurities

Securities

SecuritiesUnderlying

Underlying

Underlying

OptionUnexercised

Unexercised

Unexercised

Exercise


OptionGrant


Options

Options

Unearned Options

Price


ExpirationName

Date


(#) Exercisable

(#) Unexercisable

(#)

($)


DateRalph Schmitt
    President & CEO


6/27/2005


187,500

312,500



$
3.40


6/27/2015Ray Wallin
    Chief Financial Officer


12/20/2004


12,500

12,500



$
8.80


12/20/20149/6/2005
2,3

35,000

50,000



$
3.80


4/5/20141/17/2006




62,500



$
4.15


1/17/201612/4/2006




25,000



$
8.50


12/4/2016Total





47,500

150,000Ed Lam
    Sr. VP, Marketing & Business Development


9/19/2005
2

66,406

146,094



$
4.00


9/19/201512/4/2006




25,000



$
8.50


12/4/2016Total





66,406

171,094Lee Cleveland
    Sr. VP, Engineering


9/6/2005
2,3

75,000

25,000



$
3.80


9/2/201312/4/2006




25,000



$
8.50


12/4/20169/6/2005
2,3

25,000

25,000



$
3.80


12/9/2014Total





100,000

75,000Richard
    Hawron1VP, World Wide Sales


2/2/2004


25,000

25,000



$
17.22


2/2/201410/19/2005


35,673

14,327



$
3.50


10/19/20159/6/2005
2

12,500

12,500



$
3.80


12/17/2014Total





73,173

51,827     1
    
    Mr. Hawrons employment with us terminated on
    January 19, 2007.2
    
    These grants were made as a part of the Option Reprice Program
    that took place in September of 2005.3
    
    Mr. Wallins award vests 25% one year from grant, then
    1/48th per month. Grant is fully vested on April 5, 2008.
    Mr. Clevelands grant vests similarly and is fully
    vested respectively on September 2, 2007 and
    December 9, 2008.  1 48 th 1 48 th
 18




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##### Table of Contents



Option
    Exercises and Stock Vested in Fiscal 2006
    Option AwardsNumber of Shares


Value RealizedAcquired on Exercise


on
    Exercise1Name of Executive

(#)


($)Ray Wallin
    Chief Financial Officer


15,000


$
75,000     1
    
    The value realized equals the difference between the option
    exercise price and the fair market value of Sipex common stock
    on the date of exercise, multiplied by the number of shares for
    which the option was exercised.  Pension
    Benefits in Fiscal 2006
    Nonqualified
    Deferred Compensation in Fiscal 2006
    Other
    Potential Post-Employment Payments
      Termination
    Scenarios
  Ralph Schmitt

President & CEOChange







Involuntary

Involuntaryin
    Control1

Voluntary

Death

Disability

With Cause

Without Cause

RetirementSeverance2

$400,000









$400,000

Intrinsic Value of Accelerated
    Equity3

$1,943,750











Intrinsic Value of Current
    Exercisable
    Equity4

$1,166,250

$1,166,250

$1,166,250

$1,166,250



$1,166,250

$1,166,250Health
    Benefits5

$16,653









$16,653

Total Benefit to
    Employee6

$3,526,653

$1,166,250

$1,166,250

$1,166,250



$1,582,903

$1,166,250Total Termination
    Benefits

$2,360,403









$416,653

     1
    
    Change in Control and all
    terminations are assumed to occur on 12/31/2006.2
    
    Represents 12 months of base
    salary. 19




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##### Table of Contents



3
    
    Value of unvested options
    accelerated 100% upon involuntary termination within
    12 months of CIC at 12/31/06 @ $9.62/share price. Options
    are exercisable for 12 months following termination.4
    
    Current value of shares owned as of
    12/31/06 @ $9.62/share price (direct and indirect ownership).5
    
    Represents current monthly COBRA
    rates which are paid by the employer through the term of the
    severance award (12 months).6
    
    Total termination benefits are the
    total benefit to employees less the intrinsic value of current
    exercisable equity.  Ray Wallin

Chief Financial OfficerChange







Involuntary

Involuntaryin
    Control1

Voluntary

Death

Disability

With Cause

Without Cause

RetirementSeverance2

$112,500









$112,500

Intrinsic Value of Accelerated
    Equity3

$671,125











Intrinsic Value of Current
    Exercisable
    Equity4

$213,950

$213,950

$213,950

$213,950

$213,950

$213,950

$213,950Health
    Benefits5

$8,327









$8,327

Total Benefit to
    Employee

$1,005,902

$213,950

$213,950

$213,950

$213,950

$334,777

$213,950Total Termination
    Benefits6

$791,952









$120,827

     1
    
    Change in Control and all
    terminations are assumed to occur on 12/31/2006.2
    
    Represents 6 months of base
    salary.3
    
    Value of unvested options
    accelerated 100% upon involuntary termination for Good Reason in
    connection with CIC at 12/31/06 @ $9.62/share price and are
    exercisable for the earlier of the term of the option or
    12 months from the date of termination.4
    
    Current value of shares owned as of
    12/31/06 @ $9.62/share price (direct and indirect ownership).5
    
    Represents current monthly COBRA
    rates which are paid by the employer through the term of the
    severance award (6 months).6
    
    Total termination benefits are the
    total benefit to employees less the intrinsic value of current
    exercisable equity.  Ed Lam

Sr. VP, Marketing & Business DevelopmentChange







Involuntary

Involuntaryin
    Control1

Voluntary

Death

Disability

With Cause

Without Cause

RetirementSeverance2

$287,000









$287,000

Intrinsic Value of Accelerated
    Equity3

$424,524











Intrinsic Value of Current
    Exercisable
    Equity4

$373,202

$373,202

$373,202

$373,202



$373,202

$373,202Health
    Benefits5

$16,653









$16,653

Total Benefit to
    Employee

$1,101,379

$373,202

$373,202

$373,202



$676,855

$373,202Total Termination
    Benefits6

$728,177









$303,653

     1
    
    Change in Control and all
    terminations are assumed to occur on 12/31/2006.2
    
    Represents 12 months of base
    salary.3
    
    Value of unvested options 50% of
    which are accelerated upon involuntary termination and CIC at
    12/31/06 @ $9.62/share price. Options are exercisable for
    12 months following the termination.4
    
    Current value of shares owned as of
    12/31/06 @ $9.62/share price (direct and indirect ownership).5
    
    Represents current monthly COBRA
    rates which are paid by the employer through the term of the
    severance award (12 months).6
    
    Total termination benefits are the
    total benefit to employees less the intrinsic value of current
    exercisable equity.  Non-management
    Directors Compensation for Fiscal 2006
   20




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##### Table of Contents



Annual Cash Retainer

$28,000Additional Audit Committee Chair
    Retainer

$10,000Additional Audit Committee Retainer

$4,000Additional Compensation Committee
    Chair Retainer

$2,000New Director Stock Option Grant

22,500 stock options vesting
    one-fourth on each anniversary date of the grantAnnual Stock Option Grant

10,000 stock options vesting
    quarterly over 1 year     Change inPensionValue andNonqualifiedFees Earned








Non-Equity


Deferredor Paid


Stock


Option


Incentive Plan


Compensation


All OtherName

in
    Cash1
    ($)


Awards2
    ($)


Awards3
    ($)


Compensation2
    ($)


Earnings2


Compensation4
    ($)


TotalJoe Consoli

$
35,500






$
42,961














$
78,461Brian Hilton

$
32,500






$
27,888














$
60,388John D. Arnold

$
35,000






$
41,738














$
76,738Thomas Redfern

$
29,000






$
38,494














$
67,494Lionel Olmer

$
29,500






$
56,863














$
86,363Douglas McBurnie

$
28,000






$
108,565














$
136,565]Alan Krock

$
14,000






$
11,736














$
25,736Pierre Guilbault

$
14,000






$
11,736














$
25,736Dan Casey

$
14,000






$
11,736














$
25,736     1
    
    This column reports the amount of cash compensation earned in
    2006 for board and committee service.2
    
    No stock awards or Non-Equity Incentive Plan compensation were
    made in 2006. Sipex does not provide any retirement or other
    benefits/perquisites to its non-employee board members (other
    than direct business expense reimbursement).3
    
    This column represents the dollar amount recognized for
    financial statement reporting purposes with respect to the 2006
    fiscal year for the fair value of stock options previously
    granted to the directors. The fair value was estimated using the
    Black-Scholes option-pricing model in accordance with
    SFAS 123R.4
    
    No other compensation was provided.      Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters   21




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##### Table of Contents



Total Amountand Nature ofBeneficial


Percent ofName and Address of Beneficial Owner**

Ownership


Class


NoteAlonim Investments, Inc.
    237 Hymus Blvd.
    Montreal (Pointe-Claire)
    Quebec H9R 5C7 Canada


11,366,384



52.9%


Based solely on information
    provided in a Form 4 filed with the SEC on December 21,
    2006, Alonim Investments, Inc. had sole dispositive power of
    8,567,876 shares, and sole voting power of
    8,567,876 shares. Also includes 2,798,508 shares
    issuable upon conversion of 5.5% Redeemable Convertible Senior
    Notes due 2026 held by an affiliate of Alonim Investments,
    Rodfre Holdings, LLC.  However, note that if all other note
    holders of our 5.5% Redeemable Convertible Senior Notes due 2026
    converted the notes and warrants of 3,218,284 shares
    issuable upon conversion, the Alonim Investment, Inc. percent of
    class would be 46.0%.Pequot Capital Management, Inc.
    500 Nyala Farm Road
    Westport, CT 06880


1,161,929



6.2%


Based solely on information
    provided in a Schedule 13G filed with the SEC on February 14,
    2007, Pequot Capital Management, Inc. had sole dispositive power
    of 1,161,929 shares, and sole voting power of
    1,161,929 shares.Wasatch Advisors, Inc.
    150 Social Hall Avenue, 4th Floor
    Salt Lake City, UT 84111


949,845



5.1%


Based solely on information
    provided in a Schedule 13G filed with the SEC on February 14,
    2005, Wasatch Advisors, Inc. had sole dispositive power of
    949,845 shares, and sole voting power of 949,845 shares.Dimensional Fund Advisors,
    L.P.
    1299 Ocean Avenue, 11th Floor
    Santa Monica, CA 90401


820,835



4.4%


Based solely on information
    provided in a Schedule 13G/A filed with the SEC on February 9,
    2007, Dimensional Fund Advisors, L.P. had sole  dispositive
    power of 820,835 shares, and sole voting power of
    820,835 shares.Ralph Schmitt


239,583



1.3%


Includes 239,583 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Douglas M. McBurnie


142,500



*


Based on information provided in a
    Form 4 filed with the SEC on November 2, 2002. Also
    includes 135,000 shares issuable pursuant to options which
    are exercisable prior to February 28, 2007.Lee Cleveland


108,200



*


Based on information provided in a
    Form 3 filed with the SEC on October 1, 2005. Also
    includes 100,000 shares issuable pursuant to stock options
    which are exercisable prior to February 28, 2007.Richard Hawron


53,000



*


Includes 53,000 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Edward Lam


88,541



*


Includes 88,541 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Clyde R. Wallin


83,333



*


Includes 83,333 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007. 22




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##### Table of Contents



Total Amountand Nature ofBeneficial


Percent ofName and Address of Beneficial Owner**

Ownership


Class


NoteLionel H. Olmer


47,986



*


Based on information provided in a
    Form 4 filed with the SEC on September 27, 2000. Also
    includes 46,986 shares issuable pursuant to stock options
    which are exercisable prior to April 12, 2007.Joel Camarda


46,875



*


Includes 46,875 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Joseph Consoli


36,250



*


Includes 36,250 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.John Arnold


29,564



*


Based on information provided in a
    Form 4 filed with the SEC on March 2, 2004. Also
    includes 26,564 shares issuable pursuant to stock options
    which are exercisable prior to February 28, 2007.Brian Hilton


21,876



*


Includes 21,876 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Thomas P. Redfern


19,064



*


Includes 19,064 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Lamar Schaeffer


12,500



*


Includes 12,200 shares
    issuable pursuant to stock options which are exercisable prior
    to February 28, 2007.Alan F. Krock


2,500



*


Includes 2,500 shares issuable
    pursuant to stock options which are exercisable prior to
    February 28, 2007.Daniel G. Casey


2,500



*


Includes 2,500 shares issuable
    pursuant to stock options which are exercisable prior to
    February 28, 2007.Pierre Guilbault


2,500



*


Includes 2,500 shares issuable
    pursuant to stock options which are exercisable prior to
    February 28, 2007.All directors and executive
    officers as a group
    (16 persons)


936,772



4.8%     *
    Less than 1% of Common Stock**
    Unless otherwise indicated, to the knowledge of Sipex, each
    listed above has sole voting and investment power with respect
    to the shares and maintains a mailing address at: c/o Sipex
    Corporation, 233 South Hillview Drive, Milpitas, CA 95035.  Securities
    Authorized for Issuance under Equity Compensation
    Plans
   23




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##### Table of Contents



(a)


(b)


(c)Number of securitiesremaining availableNumber of securities


Weighted-average


for future issuanceto be issued upon


exercise price of


under equityexercise of outstanding


outstanding


compensation plansoptions, warrants


options, warrants


(excluding securitiesPlan category

and rights


and rights


reflected in column (a)Equity compensation plans approved
    by security holders


1,818,790


$
7.80



929,540Equity compensation plans not
    approved by stockholders


1,941,788


$
4.08



Total


3,760,578


$
5.88



929,540     Item 13.
    Certain
    Relationships, Related Transactions and Director
    Independence  Future
    Electronics Inc.
         24




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##### Table of Contents



Director
    Independence
   25




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##### Table of Contents



Item 14.Principal
    Accounting Fees and Services  Fees Paid
    to Deloitte & Touche LLP
    2006


2005Audit
    fees(1)

$
2,491


$
1,911Audit related
    fees(2)






Tax
    fees(3)






20All other
    fees(4)






129Total

$
2,491


$
2,060     (1)
    
    Audit fees were for professional services rendered in connection
    with the audit of our annual financial statements and the review
    of our quarterly financial statements.(2)
    
    Deloitte & Touche LLP did not perform any audit related
    services in 2006 and 2005.(3)
    
    Deloitte & Touche LLP did not perform tax consulting
    services in 2006. The fees for 2005 related to tax consulting in
    connection with the Silan deal in 2005.(4)
    
    All other fees were for professional services rendered other
    than audit, audit-related or tax fees. For 2006,
    Deloitte & Touche LLP did not perform other services.
    The fees for 2005 primarily related to our internal
    investigation.    Independent
    Auditor
      Policy on
    Audit Committee Pre-Approval of Audit and Permissible Non-Audit
    Services of Independent Auditors
   26




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##### Table of Contents



SIGNATURES      
    27




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##### Table of Contents



EXHIBIT INDEX  ExhibitNumber

Description3
.1

Restated Certificate of
    Incorporation of Sipex Corporation dated March 20, 2007
    (previously filed on March 30, 2007 as an exhibit to the
    Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).3
.2

Bylaws (incorporated herein by
    reference from the Companys Registration Statement on
    Form 8-A
    file with the Securities and Exchange Commission on
    October 28, 2003).3
.3

Certificate of Amendment of Bylaws
    of Sipex Corporation (previously filed as Exhibit 3.2 to
    the Companys Current Report on
    Form 8-K
    filed on December 5, 2006 and incorporated herein by
    reference).4
.2

Form of Indemnification Agreement
    for directors and officers (previously filed as Exhibit 4.2
    to the Companys Registration Statement on
    Form S-1,
    File
    No. 333-1328,
    and incorporated herein by reference).4
.4

Indenture dated May 16, 2006
    (filed as Exhibit 4.1 to the Companys Current Report
    on
    Form 8-K
    filed on May 22, 2006, and incorporated herein by
    reference).10
.1**

1996 Incentive Stock Option Plan
    (previously filed as Exhibit 10.5 to the Companys
    Registration Statement on
    Form S-1,
    File
    No. 333-1328,
    and incorporated herein by reference).10
.2**

1996 Employee Stock Purchase Plan,
    as amended (previously filed as Appendix A to the
    Companys Definitive Notice and Proxy Statement on
    April 29, 2004, and incorporated herein by reference).10
.3**

1997 Incentive Stock Option Plan
    (previously filed as Appendix A to the Companys
    definitive Proxy Statement for the Special Meeting In Lieu Of
    Annual Meeting Of Shareholders held May 30, 1997, and
    incorporated herein by reference).10
.4**

Sipex Corporation 1999 Stock Plan
    (previously filed as Appendix A to the Companys
    Definitive Proxy Statement on Schedule 14A,
    No. 1000-27897,
    and incorporated herein by reference).10
.5**

2000 Non-Qualified Stock Option
    Plan (previously filed as an exhibit to the Companys
    Annual Report on
    Form 10-K
    for the year ended December 31, 2000, and incorporated
    herein by reference).10
.6**

2006 Equity Incentive Plan
    (previously filed as Appendix C to the Companys
    Definitive Notice and Proxy Statement on October 24, 2006,
    and incorporated herein by reference).10
.7

Worldwide Authorized Distributor
    Market Price Agreement dated July 22, 1993, by and between
    the Company and Future Electronics Incorporated (previously
    filed as an Exhibit to the Companys Annual report on
    Form 10-K
    for the year ended December 31, 2002, and incorporated
    herein by reference).10
.8

Amendment dated October 1,
    2002 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.1 to the
    Companys Quarterly Report of
    Form 10-Q
    for the quarter ended July 1, 2006, and incorporated herein
    by reference).10
.9

Addendum A dated
    February 7, 2003 to Worldwide Authorized Distributor Market
    Price Agreement dated July 22, 1993, by and between the
    Company and Future Electronics Incorporated (previously filed as
    an Exhibit to the Companys Annual report on
    Form 10-K
    for the year ended December 31, 2002, and incorporated
    herein by reference).10
.10*

Amendment dated August 26,
    2003 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.2 to the
    Companys Quarterly Report of
    Form 10-Q
    for the quarter ended July 1, 2006, and incorporated herein
    by reference).10
.11

Amendment dated September 15,
    2003 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.3 to the
    Companys Quarterly Report of
    Form 10-Q
    for the quarter ended July 1, 2006, and incorporated herein
    by reference). 28




---



##### Table of Contents



ExhibitNumber

Description10
.12

Amendment dated April 25,
    2006 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.4 to the
    Companys Quarterly Report of
    Form 10-Q
    for the quarter ended July 1, 2006, and incorporated herein
    by reference).10
.13

Amendment dated September 27,
    2006 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed on October 3, 2006, and incorporated herein by
    reference).10
.14

Amendment dated November 1,
    2006 to Worldwide Authorized Distributor Market Price Agreement
    dated July 22, 1993, by and between the Company and Future
    Electronics Inc. (previously filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed on November 7, 2006, and incorporated herein by
    reference).10
.15**

Letter agreement as of
    6/7/05
    concerning the terms of the newly appointed Chief Executive
    Officer Ralph Schmitt (previously filed as Exhibit 99.2 to
    the Companys
    Form 8-K
    filed on June 30, 2005, and incorporated herein by
    reference).10
.16

Loan and Security Agreement as of
    7/21/05,
    with Silicon Valley Bank (previously filed as Exhibit 99.1
    to the Companys
    Form 8-K
    filed on
    7/25/05, and
    incorporated herein by reference).10
.17**

Bonus plan as of August 29,
    2005, for an executive bonus plan for the remainder of 2005 for
    certain of its officers (previously filed as Exhibit 99.1
    to the Companys
    Form 8-K
    filed on September 2, 2005, and incorporated herein by
    reference).10
.18**

Separation Agreement and General
    Release as of
    9/2/05 with
    Joseph T. Rauschmayer, Senior Vice President of Operations
    (previously filed as Exhibit 10.1 to the Companys
    Form 8-K
    filed on September 2, 2005, and incorporated herein by
    reference).10
.19**

Separation Agreement and General
    Release as of April 26, 2005 with Kevin Plouse (previously
    filed as Exhibit 10.1 to the Companys
    Form 8-K
    filed on September 15, 2005, and incorporated herein by
    reference).10
.20**

Letter agreement as of
    September 12, 2005 with Mr. Edward Lam joining Sipex
    as the new Senior Vice President of Marketing and Business
    Development (previously filed as Exhibit 10.1 to the
    Companys
    Form 8-K
    filed on September 23, 2005, and incorporated herein by
    reference).10
.21**

Letter agreement as of
    October 7, 2005 with Joel Camarda joining Sipex as Senior
    Vice President of Operations (previously filed as
    Exhibit 10.1 to the Companys
    Form 8-K
    filed on October 12, 2005, and incorporated herein by
    reference).10
.22

Amendment No. 1 dated
    October 7, 2005, to the Loan and Security Agreement with
    Silicon Valley Bank, dated July 21, 2005 (previously filed
    as Exhibit 10.1 to the Companys
    Form 8-K
    filed on October 12, 2005, and incorporated herein by
    reference).10
.23

Amendment No. 2 dated
    November 12, 2005 to the Loan and Security Agreement with
    Silicon Valley Bank, dated July 12, 2005 (previously filed
    as Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    filed on
    11/16/05,
    and incorporated herein by reference).10
.24

Amendment No. 3 dated
    January 19, 2006 to the Loan and Security Agreement with
    Silicon Valley Bank, dated July 12, 2005 (previously filed
    as Exhibit 10.4 to the Companys Current Report on
    Form 8-K
    filed on
    1/25/06, and
    incorporated herein by reference).10
.25

Amendment No. 4 dated
    May 18, 2006 to the Loan and Security Agreement with
    Silicon Valley Bank, dated July 12, 2005, (previously filed
    as Exhibit 10.4 to Companys Current Report on
    Form 8-K
    filed on
    5/22/06, and
    incorporated herein by reference).10
.26

Amendment No. 5 dated
    August 1, 2006 to Loan and Security Agreement between Sipex
    Corporation and Silicon Valley Bank, dated July 12, 2005
    (previously filed as Exhibit 10.1 to the Companys
    Current Report on
    Form 8-K
    filed
    8/7/06, and
    incorporated herein by reference).10
.27

Amendment No. 6 dated
    September 28, 2006 to Loan and Security Agreement between
    Sipex Corporation and Silicon Valley Bank, dated July 12,
    2005 (previously filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed
    10/4/06, and
    incorporated herein by reference). 29




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##### Table of Contents



ExhibitNumber

Description10
.28*

Master Agreement between Sipex,
    Hangzhou Silan Microelectronics Co. Ltd. and Hangzhou Silan
    Integrated Circuit Co., Ltd., dated as of February 27, 2006
    (previously filed as Exhibit 10.1 to the Company Current
    Report on
    Form 8-K/A
    filed on July 26, 2006, and incorporated herein by
    reference).10
.29

Agreement for Purchase and Sale of
    Real Property dated March 9, 2006, by and between Sipex
    Corporation and Mission West Properties, L.P. (previously filed
    as Exhibit 10.1 to the Company Current Report on
    Form 8-K
    filed on March 13, 2006, and incorporated herein by
    reference).10
.30

Standard Form Lease for 233
    Hillview dated March 9, 2006, by and between Sipex
    Corporation and Mission West Properties, L.P. (previously filed
    as Exhibit 10.2 to the Company Current Report on
    Form 8-K
    filed on March 13, 2006, and incorporated herein by
    reference).10
.31

Securities Purchase Agreement,
    dated as of May 16, 2006, by and among Sipex and the Buyers
    listed on the Schedule of Buyers (previously filed as
    Exhibit 10.1 to Companys Current Report on
    Form 8-K
    filed on
    5/22/06, and
    incorporated herein by reference).10
.32

Amendment No. 1 dated
    May 24, 2006 to Securities Purchase Agreement, dated as of
    May 16, 2006 by and among Sipex and the Buyers listed on
    the Schedule of Buyers (previously filed as Exhibit 10.1 to
    the Companys Current Report on
    Form 8-K
    filed on May 30, 2006, and incorporated herein by
    reference).10
.33

Registration Rights Agreement,
    dated as of May 16, 2006, by and among Sipex and the Buyers
    listed on the Schedule of Buyers (previously filed as
    Exhibit 10.2 to Companys Current Report on
    Form 8-K
    filed on
    5/22/06, and
    incorporated herein by reference).10
.34

Warrant Agent Agreement, dated as
    of May 16, 2006, between Sipex and Wells Fargo Bank,
    National Association, as Warrant Agent (which includes the Form
    of Warrant) (previously filed as Exhibit 10.1 to
    Companys Current Report on
    Form 8-K
    filed on
    5/22/06, and
    incorporated herein by reference).10
.35

Separation Agreement and General
    Release as of January 15, 2007 with Rick Hawron (previously
    filed as Exhibit 10.1 to the Companys
    Form 8-K
    filed on January 19, 2007, and incorporated herein by
    reference).10
.36

Securities Purchase Agreement,
    dated as of March 29, 2007, by and between Sipex and Rodfre
    Holdings LLC (previously filed on March 30, 2007 as an
    exhibit to the Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).12
.1

Computation of Ratio of Earnings
    to Fixed Cost Charges (previously filed on March 30, 2007
    as an exhibit to the Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).21
.1

Subsidiaries of the Company
    (previously filed as an exhibit to the Companys Annual
    report on
    Form 10-K
    for the year ended December 31, 2000, and incorporated
    herein by reference).23
.1

Consent of Independent Registered
    Public Accounting Firm (previously filed on March 30, 2007
    as an exhibit to the Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).31
.1

Certification of Chief Executive
    Officer pursuant to Section 302(a) of the Sarbanes-Oxley
    Act of 2002 (previously filed on March 30, 2007 as an
    exhibit to the Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).31
.2

Certification of Chief Financial
    Officer pursuant to Section 302(a) of the Sarbanes-Oxley
    Act of 2002 (previously filed on March 30, 2007 as an
    exhibit to the Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).31
.3

Certification of Chief Executive
    Officer pursuant to Section 302(a) of the
    Sarbanes-Oxley
    Act of 2002.31
.4

Certification of Chief Financial
    Officer pursuant to Section 302(a) of the
    Sarbanes-Oxley
    Act of 2002.32
.1

Certification of Chief Executive
    Officer pursuant to 18 U.S.C section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    (previously filed on March 30, 2007 as an exhibit to the
    Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference). 30




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##### Table of Contents



ExhibitNumber

Description32
.2

Certification of Chief Financial
    Officer pursuant to 18 U.S.C section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    (previously filed on March 30, 2007 as an exhibit to the
    Companys Annual Report on
    Form 10-K
    for the year ended December 30, 2006, and incorporated
    herein by reference).32
.3

Certification of Chief Executive
    Officer pursuant to 18 U.S.C section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32
.4

Certification of Chief Financial
    Officer pursuant to 18 U.S.C section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.     *
    
    Confidential treatment as to certain portions has been requested
    pursuant to
    Rule 24b-2
    promulgated under the Securities Exchange Act of 1934, as
    amended.**
    
    The Exhibits identified above with a double asterisk (**) are
    management contracts or compensatory plans or arrangements. 31