UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 (Mark one)
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the Fiscal Year Ended December 31, 2008
 Or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from

to
 Commission File Number: 0-22248
 ULTRATECH, INC.
  Delaware
(State or other jurisdiction of 
incorporation or organization)
    
    94-3169580
(I.R.S. Employer
Identification No.)3050 Zanker Road 
San Jose, California
(Address of principal executive offices)
    
    95134
(Zip Code)
 (408) 321-8835
 None
 Common Stock, $0.001 Par Value Per Share
 o þ
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




---



##### 



PART I
 
 ITEM 1. BUSINESS
  The Company
  Lithography
   Laser Anneal Technology
    - 2 -




---



##### 



General Background
         - 3 -




---



##### 



Products
  ®
        - 4 -




---



##### 



MinimumFeature SizeProduct Line
    
    Wavelength
    
    
    (microns)1X Steppers:1000 Series:Star 100
    
    i-line, gh-line
    
    
    0.8 - 1.0NanoTech
    
    i-line, gh-line
    
    
    1.0 - 2.0Prisma-ghi
    
    ghi-line
    
    
    2.0 - 4.0AP200
    
    ghi-line
    
    
2.0AP300
    
    ghi-line
    
    
2.0Laser Processing:LSA100A
    
    NA
    
    NA
 Research, Development and Engineering
    Sales and Service
    - 5 -




---



##### 



Manufacturing
     Competition
   - 6 -




---



##### 



Advanced Packaging
   Laser Processing
   Intellectual Property Rights
   - 7 -




---



##### 



Environmental Regulations
  Customers, Applications and Markets
       - 8 -




---



##### 



Backlog
  Employees
  Information Available on Our Website
 www.ultratech.com
 
 ITEM 1A. RISK FACTORS
  The current global financial and economic crisis could result in the cancellation, deferral or
rescheduling of orders by our customers as well as changes in projection of new business.
   - 9 -




---



##### 



Our sales cycle is typically lengthy and involves a significant commitment of capital by
our customers, which has subjected us, and is likely to continue to subject us, to delays in
customer acceptances of our products and other risks, any of which could adversely impact our
results of operations by, among other things, delaying recognition of revenue with respect to those
orders and resulting in increased installation, qualification and similar costs.
  
    
    competitive pressures, including pricing pressures, from companies that have competing products;
    
    changes in customer product needs; and
    
    strategic actions taken by our competitors.
 The semiconductor industry historically has been highly cyclical and has experienced
periods of oversupply, which has in turn affected the market for semiconductor equipment such as
ours and which can adversely affect our results of operations during such periods.
  We currently spend, and expect to continue to spend, significant resources to develop,
introduce and commercialize our laser processing systems and AP wafer stepper products, and we may
not be successful in achieving or increasing sales of these products.
   We operate in a highly competitive industry in which customers are required to invest
substantial resources in each product, which makes it difficult to achieve significant sales to a
particular customer once another vendors equipment has been purchased by that customer.
   - 10 -




---



##### 



We sell our products primarily to a limited number of customers and to customers in a
limited number of industries, which subjects us to increased risks related to the business
performance of our customers, and therefore their need for our products, and the business cycles of
the markets into which we sell.
   - 11 -




---



##### 



We rely on a limited number of outside suppliers and subcontractors to manufacture
certain components and subassemblies, and on single or a limited group of outside suppliers for
certain materials for our products, which could result in a potential inability to obtain an
adequate supply of required components due to the suppliers failure or inability to provide such
components in a timely manner, or at all, and reduced control over pricing and timely delivery of
components and materials, any of which could adversely affect our results of operations.
   Our industry is subject to rapid technological change and product innovation, which
could result in our technologies and products being replaced by those of our competitors, which
would adversely affect our business and results of operations.
   - 12 -




---



##### 



We may not be successful in protecting our intellectual property rights or we could be
found to have infringed the intellectual property rights of others, either of which could weaken
our competitive position and adversely affect our results of operations.
     - 13 -




---



##### 



A substantial portion of our sales are outside of the United States, which subjects us
to risks related to customer service, installation, foreign economic and political stability,
uncertain regulatory and tax rules, and foreign exchange rate fluctuations, all of which make it
more difficult to operate our business.
   Our investment portfolio may become impaired by further deterioration of the capital markets.
    - 14 -




---



##### 



We are dependent on our key personnel, especially Mr. Zafiropoulo our Chief Executive Officer,
and our business and results of operations would be adversely affected if we were to lose our key
employees.
  Changes in financial accounting standards or policies in the past have affected, and in
the future may, affect, our reported results of operations.
   Our equity incentive plans, certain provisions of our Certificate of Incorporation and
Bylaws, and Delaware law may discourage third parties from pursuing a change of control transaction
with us.
  We use hazardous substances in the operation of our business, and any failure on our part to
comply with applicable regulations or to appropriately control the use, disposal or storage of such
substances could subject us to significant liabilities.
   - 15 -




---



##### 



Our stock price has experienced significant volatility in the past and we expect this to
continue in the future as a result of many factors, some of which could be unrelated to our
operating performance, and such volatility can have a major impact on the number of shares subject
to outstanding stock options and restricted stock units that are included in calculating our
earnings per share.
   Our results of operations and business could be adversely affected by wars and other
military action, as well as terrorist attacks and threats and government responses thereto,
especially if any such actions were directed at us or our facilities or customers.
  If we acquire companies, products, or technologies, we may face risks associated with
those acquisitions.
  Our long-term expenses reduction programs may result in an increase in short-term
expenses.
 Accounting for Costs Associated with Exit or Disposal Activities
 If earthquakes or other catastrophic events occur, our business may be harmed.
   - 16 -




---



##### 



ITEM 1B. UNRESOLVED STAFF COMMENTS
  
 ITEM 2. PROPERTIES
    
 ITEM 3. LEGAL PROCEEDINGS
    
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  Executive Officers of the Registrant
  Name
    
    Age
    
    Position with the CompanyArthur W. Zafiropoulo
    
    
    69
    
    
    Chairman of the Board of Directors, Chief Executive Officer and PresidentBruce R. Wright
    
    
    60
    
    
    Senior Vice President, Finance, Chief Financial Officer and SecretaryScott Jewler
    
    
    43
    
    
    Senior Vice President, Sales and Marketing
  - 17 -




---



##### 



- 18 -




---



##### 



PART II
 
 ITEM 5.
    
    MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
  Fiscal 2008Fiscal Quarter Ended
    
    
    March 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Market Price: High
    
    
    
    $
    11.54
    
    
    $
    17.20
    
    
    $
    17.00
    
    
    $
    15.10Low
    
    
    
    $
    8.67
    
    
    $
    9.46
    
    
    $
    11.54
    
    
    $
    9.00
 Fiscal 2007Fiscal Quarter Ended
    
    
    March 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Market Price: High
    
    
    
    $
    14.37
    
    
    $
    14.71
    
    
    $
    16.78
    
    
    $
    14.94Low
    
    
    
    $
    11.75
    
    
    $
    12.00
    
    
    $
    12.25
    
    
    $
    10.79
     Stock Performance Graph
   - 19 -




---



##### 



Comparison of Cumulative Total Returns(1)(2)(3)
 
 
 (1)
    
    The graph covers the period from December 31, 2003 to December 31, 2008.(2)
    
    No cash dividends have been declared on our common stock.(3)
    
    Stockholder returns over the indicated period should not be considered indicative of future stockholder returns. Notwithstanding anything to the contrary set forth in any of our previous filings under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, which
might incorporate our future filings under those statutes, the preceding Stock Performance Graph
will not be incorporated by reference into any of those prior filings, nor will such report or
graph be incorporated by reference into any our future filings under those statutes.
  - 20 -




---



##### 



ITEM 6. SELECTED FINANCIAL DATA
 In thousands, except per share data and percentage information
    
    2008(c)
    
    
    2007(b)
    
    
    2006(a)
    
    
    2005
    
    
    2004Operations:Net sales
    
    $
    131,747
    
    
    $
    112,310
    
    
    $
    119,633
    
    
    $
    122,366
    
    
    $
    109,892Gross profit
    
    
    64,374
    
    
    
    48,859
    
    
    
    46,024
    
    
    
    52,047
    
    
    
    52,693Gross profit as a percentage of net sales
    
    
    49
    %
    
    
    44
    %
    
    
    38
    %
    
    
    43
    %
    
    
    48
    %Operating income (loss)
    
    
    9,135
    
    
    
    (5,767
    )
    
    
    (14,371
    )
    
    
    (4,875
    )
    
    
    (2,429
    )Income (loss) before income taxes and cumulative
effect of a change in accounting principle
    
    
    12,185
    
    
    
    (758
    )
    
    
    (8,014
    )
    
    
    (522
    )
    
    
    1,069Pre-tax income (loss) as a percentage of net sales
    
    
    9.2
    %
    
    
    (0.7
    %)
    
    
    (6.7
    %)
    
    
    (0.4
    %)
    
    
    1.0
    %Provision for income taxes
    
    
    408
    
    
    
    286
    
    
    
    954
    
    
    
    699
    
    
    
    445Income (loss) before cumulative effect of a change in
accounting principle
    
    
    11,777
    
    
    
    (1,044
    )
    
    
    (8,968
    )
    
    
    (1,221
    )
    
    
    624Cumulative effect of the adoption of FIN 47
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,122
    )
    
    
    Net income (loss)
    
    
    11,777
    
    
    
    (1,044
    )
    
    
    (8,968
    )
    
    
    (2,343
    )
    
    
    624Income (loss) before cumulative effect of a change in
accounting principle per share  basic
    
    
    0.50
    
    
    
    (0.04
    )
    
    
    (0.38
    )
    
    
    (0.05
    )
    
    
    0.03Cumulative effect of the adoption of FIN 47 per share  basic
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.05
    )
    
    
    Net income (loss) per share  basic
    
    
    0.50
    
    
    
    (0.04
    )
    
    
    (0.38
    )
    
    
    (0.10
    )
    
    
    0.03Number of shares used in per share computation  basic
    
    
    23,524
    
    
    
    23,354
    
    
    
    23,764
    
    
    
    23,964
    
    
    
    23,733Income (loss) before cumulative effect of a change in
accounting principle per share  diluted
    
    
    0.50
    
    
    
    (0.04
    )
    
    
    (0.38
    )
    
    
    (0.05
    )
    
    
    0.03Cumulative effect of the adoption of FIN 47 per share  diluted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.05
    )
    
    
    Net income (loss) per share  diluted
    
    
    0.50
    
    
    
    (0.04
    )
    
    
    (0.38
    )
    
    
    (0.10
    )
    
    
    0.03Number of shares used in per share computation  diluted
    
    
    23,665
    
    
    
    23,354
    
    
    
    23,764
    
    
    
    23,964
    
    
    
    23,733Balance sheet:Cash, cash equivalents and short-term investments
    
    $
    158,498
    
    
    $
    131,998
    
    
    $
    78,090
    
    
    $
    141,067
    
    
    $
    151,627Working capital
    
    
    184,189
    
    
    
    161,855
    
    
    
    104,951
    
    
    
    165,181
    
    
    
    169,621Total assets
    
    
    229,191
    
    
    
    218,641
    
    
    
    216,050
    
    
    
    222,309
    
    
    
    230,546Long-term obligations
    
    
    6,687
    
    
    
    7,534
    
    
    
    7,580
    
    
    
    7,805
    
    
    
    5,338Stockholders equity
    
    
    193,423
    
    
    
    177,400
    
    
    
    174,108
    
    
    
    188,950
    
    
    
    193,290
  - 21 -




---



##### 



Quarterly Data
 Unaudited, in thousands, except per share data
    
    1st
    
    
    2nd
    
    
    3rd
    
    
    4th2008Net sales
    
    $
    31,136
    
    
    $
    32,061
    
    
    $
    34,437
    
    
    $
    34,113Gross profit
    
    
    15,364
    
    
    
    15,185
    
    
    
    16,718
    
    
    
    17,107Operating income
    
    
    881
    
    
    
    1,726
    
    
    
    2,859
    
    
    
    3,669Net income
    
    
    1,952
    
    
    
    2,584
    
    
    
    3,302
    
    
    
    3,939Net income (loss) per sharebasic
    
    
    0.08
    
    
    
    0.11
    
    
    
    0.14
    
    
    
    0.17Number of shares used in per share computationbasic
    
    
    23,456
    
    
    
    23,488
    
    
    
    23,558
    
    
    
    23,589Net income (loss) per sharediluted
    
    
    0.08
    
    
    
    0.11
    
    
    
    0.14
    
    
    
    0.17Number of shares used in per share computationdiluted
    
    
    23,473
    
    
    
    23,823
    
    
    
    23,865
    
    
    
    23,7322007Net sales
    
    $
    27,368
    
    
    $
    30,011
    
    
    $
    25,188
    
    
    $
    29,743Gross profit
    
    
    10,800
    
    
    
    13,176
    
    
    
    10,361
    
    
    
    14,522Operating income (loss)
    
    
    (4,466
    )
    
    
    (221
    )
    
    
    (2,646
    )
    
    
    1,566Net income (loss)
    
    
    (3,245
    )
    
    
    1,020
    
    
    
    (884
    )
    
    
    2,065Net income (loss) per sharebasic
    
    
    (0.14
    )
    
    
    0.04
    
    
    
    (0.04
    )
    
    
    0.09Number of shares used in per share computationbasic
    
    
    23,285
    
    
    
    23,368
    
    
    
    23,394
    
    
    
    23,413Net income (loss) per sharediluted
    
    
    (0.14
    )
    
    
    0.04
    
    
    
    (0.04
    )
    
    
    0.09Number of shares used in per share computationdiluted
    
    
    23,285
    
    
    
    23,467
    
    
    
    23,394
    
    
    
    23,514
 
 (a)
    
    Operating loss in 2006 includes $2.0 million of stock-based
compensation expenses and a charge of $1.9 million related to certain
exit activities (of which $0.1 million relating to the acceleration of
restricted stock units and options is included in stock-based
compensation expenses). Refer to Notes 5 and 12 of our consolidated
financial statements herein for further disclosures related to these
items.(b)
    
    Operating loss in 2007 includes a charge of $1.6 million related to
certain exit activities, a credit of $0.9 million which resulted from
a refund of employee health insurance premiums paid previously, a
benefit of $0.5 million related to sale of previously written down
inventory and a credit of $0.3 million due to a change in the estimate
related to collectibility of certain accounts receivable. Refer to
Note 12 of our consolidated financial statements herein for further
disclosures related to the exit activities.(c)
    
    Operating income in 2008 includes $2.4 million of stock-based
compensation expenses and a charge of $0.6 million related to certain
exit activities. Refer to Notes 5 and 12 of our consolidated financial
statements herein for further disclosures related to these items. 
 ITEM 7.
        MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   - 22 -




---



##### 



OVERVIEW
    CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   Revenue Recognition
    - 23 -




---



##### 



Inventories and Purchase Order Commitments
  Warranty Obligations
  Allowance for Bad Debts
   - 24 -




---



##### 



Deferred Income Taxes
 Accounting for Taxes, (
  Stock-Based Compensation
  RESULTS OF OPERATIONS
    - 25 -




---



##### 



Net Sales
 2008 vs. 2007
 Amount of
    
    
    Percentage(in millions)
    
    2008
    
    
    2007
    
    
    Change
    
    
    ChangeSales of:Systems
    
    $
    102.7
    
    
    $
    80.7
    
    
    $
    22.0
    
    
    
    27
    %Spare parts
    
    
    11.6
    
    
    
    15.9
    
    
    
    (4.3
    )
    
    
    -27
    %Services
    
    
    17.0
    
    
    
    15.6
    
    
    
    1.4
    
    
    
    9
    %Licenses
    
    
    0.4
    
    
    
    0.1
    
    
    
    0.3
    
    
    
    300
    %Total Net Sales
    
    $
    131.7
    
    
    $
    112.3
    
    
    $
    19.4
    
    
    
    17
    %
          - 26 -




---



##### 



2007 vs. 2006
 Amount of
    
    
    Percentage(in millions)
    
    2007
    
    
    2006
    
    
    Change
    
    
    ChangeSales of:Systems
    
    $
    80.7
    
    
    $
    87.9
    
    
    $
    (7.2
    )
    
    
    -8
    %Spare parts
    
    
    15.9
    
    
    
    17.3
    
    
    
    (1.4
    )
    
    
    -8
    %Services
    
    
    15.6
    
    
    
    14.2
    
    
    
    1.4
    
    
    
    10
    %Licenses
    
    
    0.1
    
    
    
    0.2
    
    
    
    (0.1
    )
    
    
    -50
    %Total Net Sales
    
    $
    112.3
    
    
    $
    119.6
    
    
    $
    (7.3
    )
    
    
    -6
    %
        Gross Profit
 2008 vs. 2007
   - 27 -




---



##### 



2007 vs. 2006
  Research, Development and Engineering Expenses
 2008 vs. 2007
 Amount of
    
    
    Percentage(in millions)
    
    2008
    
    
    2007
    
    
    Change
    
    
    ChangeResearch, development and engineering expenses
    
    $
    23.3
    
    
    $
    23.4
    
    
    $
    (0.1
    )
    
    
    0
    %
  2007 vs. 2006
 Amount of
    
    
    Percentage(in millions)
    
    2007
    
    
    2006
    
    
    Change
    
    
    ChangeResearch, development and engineering expenses
    
    $
    23.4
    
    
    $
    26.2
    
    
    $
    (2.8
    )
    
    
    -11
    %
  Selling, General and Administrative Expenses
 2008 vs. 2007
 Amount of
    
    
    Percentage(in millions)
    
    2008
    
    
    2007
    
    
    Change
    
    
    ChangeSelling, general and administrative expenses
    
    $
    31.9
    
    
    $
    31.2
    
    
    $
    0.7
    
    
    
    2
    %
   - 28 -




---



##### 



2007 vs. 2006
 Amount of
    
    
    Percentage(in millions)
    
    2007
    
    
    2006
    
    
    Change
    
    
    ChangeSelling, general and administrative expenses
    
    $
    31.2
    
    
    $
    34.2
    
    
    $
    (3.0
    )
    
    
    -9
    %
  Interest and Other Income, Net
 (in millions)
    
    2008
    
    
    2007
    
    
    2006Interest income
    
    $
    3.4
    
    
    $
    5.7
    
    
    $
    6.3Other income (expense), net
    
    
    (0.3
    )
    
    
    
    
    
    
    0.3Interest and other income, net
    
    $
    3.1
    
    
    $
    5.7
    
    
    $
    6.6
  Provision for Income Taxes
   Accounting for Uncertainty in Income Taxes  an Interpretation of FASB Statement No.
109
   - 29 -




---



##### 



Outlook
    LIQUIDITY AND CAPITAL RESOURCES
    - 30 -




---



##### 



Less than
    
    
    
    
    
    
    
    
    
    
    AfterIn millions
    
    Total
    
    
    1 year
    
    
    1-3 years
    
    
    3-5 years
    
    
    5 yearsNotes payable obligations
    
    $
    6.0
    
    
    $
    6.0
    
    
    $
    
    
    
    $
    
    
    
    $
    Non-cancelable capital lease obligations
    
    
    0.5
    
    
    
    0.1
    
    
    
    0.3
    
    
    
    0.1
    
    
    
    Non-cancelable operating lease obligations
    
    
    14.9
    
    
    
    6.7
    
    
    
    7.1
    
    
    
    1.1
    
    
    
    Long-term payables
    
    
    2.0
    
    
    
    0.2
    
    
    
    
    
    
    
    0.1
    
    
    
    1.7Asset retirement obligations
    
    
    2.3
    
    
    
    
    
    
    
    2.2
    
    
    
    
    
    
    
    0.1Open purchase order commitments
    
    
    32.6
    
    
    
    28.3
    
    
    
    4.3
    
    
    
    
    
    
    
    Total contractual cash obligations
    
    
    58.3
    
    
    
    41.3
    
    
    
    13.9
    
    
    
    1.3
    
    
    
    1.8Sublessor agreement
    
    
    (0.7
    )
    
    
    (0.7
    )
    
    
    
    
    
    
    
    
    
    
    Net
    
    $
    57.6
    
    
    $
    40.6
    
    
    $
    13.9
    
    
    $
    1.3
    
    
    $
    1.8
    - 31 -




---



##### 



Off-Balance Sheet Transactions
  Foreign Currency
  
 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Interest Rate Risk
    Cash equivalents and
    
    Valuation of securities
    
    
    
    
    
    
    Valuation of securitiesAvailable-for-sale
    
    given an interest rate
    
    
    No change in
    
    
    given an interest rateInvestments
    
    decrease of X basis points
    
    
    interest rate
    
    
    increase of X basis points(in thousands)
    
    (150 BPS)
    
    
    (100 BPS)
    
    
    (50 BPS)
    
    
    0 BPS
    
    
    50 BPS
    
    
    100 BPS
    
    
    150 BPSSecurities and obligations of U.S.
government agencies
    
    $
    63,174
    
    
    $
    62,933
    
    
    $
    62,694
    
    
    $
    62,457
    
    
    $
    62,223
    
    
    $
    61,990
    
    
    $
    61,760Money market funds and commercial papers
    
    
    74,677
    
    
    
    74,669
    
    
    
    74,661
    
    
    
    74,653
    
    
    
    74,645
    
    
    
    74,637
    
    
    
    74,629Total investments
    
    $
    137,851
    
    
    $
    137,601
    
    
    $
    137,355
    
    
    $
    137,110
    
    
    $
    136,868
    
    
    $
    136,627
    
    
    $
    136,389
  - 32 -




---



##### 



Credit Risk
   Foreign Exchange Risk
   
 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
  ULTRATECH, INC.
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
  Page NumberConsolidated Balance SheetsDecember 31, 2008 and 2007
    
    
    34Consolidated Statements of OperationsYears ended December 31, 2008, 2007, and 2006
    
    
    35Consolidated Statements of Cash FlowsYears ended December 31, 2008, 2007, and 2006
    
    
    36Consolidated Statements of Stockholders EquityYears ended December 31, 2008,
2007, and 2006
    
    
    37Notes to Consolidated Financial Statements
    
    
    38Reports of Ernst & Young LLP, Independent Registered Public Accounting Firm
    
    
    59
   - 33 -




---



##### 



ULTRATECH, INC.
 
 CONSOLIDATED BALANCE SHEETS
 December 31,
    
    
    December 31,In thousands, except share and per share amounts
    
    2008
    
    
    2007AssetsCurrent assets:Cash and cash equivalents
    
    $
    94,034
    
    
    $
    54,586Short-term investments
    
    
    64,464
    
    
    
    77,412Accounts receivable, net of allowance for doubtful accounts of
$185 and $306 at December 31, 2008 and 2007, respectively
    
    
    18,318
    
    
    
    30,562Inventories
    
    
    31,618
    
    
    
    29,128Prepaid expenses and other current assets
    
    
    4,836
    
    
    
    3,874Total current assets
    
    
    213,270
    
    
    
    195,562Equipment and leasehold improvements, net
    
    
    12,788
    
    
    
    16,826Demonstration inventory
    
    
    82
    
    
    
    3,652Other assets
    
    
    3,051
    
    
    
    2,601Total assets
    
    $
    229,191
    
    
    $
    218,641Liabilities and Stockholders EquityCurrent liabilities:Notes payable
    
    $
    6,000
    
    
    $
    5,794Accounts payable
    
    
    8,830
    
    
    
    8,200Accrued expenses
    
    
    9,923
    
    
    
    9,552Deferred product and services income
    
    
    4,328
    
    
    
    10,161Total current liabilities
    
    
    29,081
    
    
    
    33,707Accrued rent
    
    
    1,505
    
    
    
    2,093Other liabilities
    
    
    5,182
    
    
    
    5,441Commitments and contingenciesStockholders equity:Preferred Stock, $0.001 par value:2,000,000 shares authorized; none issued
    
    
    
    
    
    
    Common Stock, $0.001 par value:40,000,000 shares authorized; 23,516,198 and 23,371,055
shares issued and outstanding at December 31, 2008 and 2007,
respectively
    
    
    25
    
    
    
    25Additional paid-in capital
    
    
    233,246
    
    
    
    229,412Treasury stock: 1,843,301 and 1,845,301 shares at December 31,
2008 and 2007, respectively
    
    
    (26,605
    )
    
    
    (26,634
    )Accumulated other comprehensive income, net
    
    
    474
    
    
    
    91Accumulated deficit
    
    
    (13,717
    )
    
    
    (25,494
    )Total stockholders equity
    
    
    193,423
    
    
    
    177,400Total liabilities and stockholders equity
    
    $
    229,191
    
    
    $
    218,641
 See accompanying notes to consolidated financial statements.
  - 34 -




---



##### 



ULTRATECH, INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 Years Ended December 31,In thousands, except per share amounts
    
    2008
    
    
    2007
    
    
    2006Net salesProducts
    
    $
    114,311
    
    
    $
    96,583
    
    
    $
    105,277Services
    
    
    17,036
    
    
    
    15,627
    
    
    
    14,156Licenses
    
    
    400
    
    
    
    100
    
    
    
    200Total net sales
    
    
    131,747
    
    
    
    112,310
    
    
    
    119,633Cost of salesCost of products sold
    
    
    58,235
    
    
    
    53,834
    
    
    
    64,256Cost of services
    
    
    9,138
    
    
    
    9,617
    
    
    
    9,353Gross profit
    
    
    64,374
    
    
    
    48,859
    
    
    
    46,024Research, development and engineering
    
    
    23,316
    
    
    
    23,435
    
    
    
    26,206Selling, general, and administrative
    
    
    31,923
    
    
    
    31,191
    
    
    
    34,189Operating income (loss)
    
    
    9,135
    
    
    
    (5,767
    )
    
    
    (14,371
    )Interest expense
    
    
    (121
    )
    
    
    (701
    )
    
    
    (237
    )Interest and other income, net
    
    
    3,171
    
    
    
    5,710
    
    
    
    6,594Income (loss) before income taxes
    
    
    12,185
    
    
    
    (758
    )
    
    
    (8,014
    )Provision for income taxes
    
    
    408
    
    
    
    286
    
    
    
    954Net income (loss)
    
    $
    11,777
    
    
    $
    (1,044
    )
    
    $
    (8,968
    )Net income (loss) per share  basicNet income (loss)
    
    $
    0.50
    
    
    $
    (0.04
    )
    
    $
    (0.38
    )Number of shares used in per share computations  basic
    
    
    23,524
    
    
    
    23,354
    
    
    
    23,764Net income (loss) per share  dilutedNet income (loss)
    
    $
    0.50
    
    
    $
    (0.04
    )
    
    $
    (0.38
    )Number of shares used in per share computations  diluted
    
    
    23,665
    
    
    
    23,354
    
    
    
    23,764
 See accompanying notes to consolidated financial statements.
  - 35 -




---



##### 



ULTRATECH, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Years Ended December 31,In thousands
    
    2008
    
    
    2007
    
    
    2006Cash flows from operating activities:Net income (loss)
    
    $
    11,777
    
    
    $
    (1,044
    )
    
    $
    (8,968
    )Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:Depreciation
    
    
    5,431
    
    
    
    6,386
    
    
    
    5,874Amortization
    
    
    898
    
    
    
    907
    
    
    
    1,344Amortization of postretirement benefit plan obligation
    
    
    102
    
    
    
    8
    
    
    
    Accretion of asset retirement obligations
    
    
    157
    
    
    
    240
    
    
    
    179(Gain)/loss on disposal of equipment
    
    
    22
    
    
    
    217
    
    
    
    (217
    )Stock-based compensation
    
    
    2,388
    
    
    
    1,552
    
    
    
    1,957Deferred income taxes
    
    
    (43
    )
    
    
    40
    
    
    
    (26
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    12,244
    
    
    
    (12,508
    )
    
    
    1,056Inventories
    
    
    (2,397
    )
    
    
    10,324
    
    
    
    (11,955
    )Prepaid expenses and other current assets
    
    
    (896
    )
    
    
    129
    
    
    
    (593
    )Demonstration Inventory
    
    
    (668
    )
    
    
    
    
    
    
    (486
    )Other assets
    
    
    316
    
    
    
    464
    
    
    
    (207
    )Accounts payable
    
    
    630
    
    
    
    (2,240
    )
    
    
    2,037Accrued expenses
    
    
    (387
    )
    
    
    (5,221
    )
    
    
    2,504Deferred product and services income
    
    
    (5,833
    )
    
    
    7,211
    
    
    
    980Other liabilities
    
    
    (530
    )
    
    
    (468
    )
    
    
    28Net cash provided by (used in) operating activities
    
    
    23,211
    
    
    
    5,997
    
    
    
    (6,493
    )Cash flows from investing activities:Capital expenditures
    
    
    (4,713
    )
    
    
    (1,112
    )
    
    
    (3,317
    )Proceeds from sales of fixed assets
    
    
    6,801
    
    
    
    
    
    
    
    79Purchase of patents
    
    
    (744
    )
    
    
    
    
    
    
    (42
    )Purchase of investments in securities
    
    
    (116,723
    )
    
    
    (59,710
    )
    
    
    (42,155
    )Proceeds from maturities of investments
    
    
    129,964
    
    
    
    84,994
    
    
    
    44,612Net cash provided by (used in) investing activities
    
    
    14,585
    
    
    
    24,172
    
    
    
    (823
    )Cash flows from financing activities:Proceeds from notes payable
    
    
    49,061
    
    
    
    27,456
    
    
    
    62,954Repayment of notes payable
    
    
    (48,855
    )
    
    
    (28,636
    )
    
    
    (60,269
    )Proceeds from issuance of common stock
    
    
    1,446
    
    
    
    1,714
    
    
    
    2,964Repurchase of common stock
    
    
    
    
    
    
    
    
    
    
    (10,794
    )Net cash provided by (used in) financing activities
    
    
    1,652
    
    
    
    534
    
    
    
    (5,145
    )Net increase (decrease) in cash and cash equivalents
    
    
    39,448
    
    
    
    30,703
    
    
    
    (12,461
    )Cash and cash equivalents at beginning of period
    
    
    54,586
    
    
    
    23,883
    
    
    
    36,344Cash and cash equivalents at end of period
    
    $
    94,034
    
    
    $
    54,586
    
    
    $
    23,883Supplemental disclosures of cash flow information:Cash paid during the period for:Interest
    
    $
    51
    
    
    $
    332
    
    
    $
    201Income taxes paid
    
    $
    442
    
    
    $
    590
    
    
    $
    936Other non-cash changes:Capital lease of phone system
    
    $
    42
    
    
    $
    562
    
    
    $
    Systems transferred from (to) inventory to (from) equipment and
demonstration
inventory
    
    $
    (93
    )
    
    $
    1,535
    
    
    $
    60Decrease in net equipment and leasehold improvements due to adoption
of FIN 47
    
    $
    
    
    
    $
    
    
    
    $
    (229
    )Increase/(decrease) in asset retirement obligations resulting from
adoption of FIN 47
    
    $
    157
    
    
    $
    240
    
    
    $
    (82
    )
 See accompanying notes to consolidated financial statements.
  - 36 -




---



##### 



ULTRATECH, INC.
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
 Stockholders EquityAdditional
    
    
    
    
    
    
    Accumulated Other
    
    
    
    
    
    
    TotalCommon Stock
    
    
    Paid-in
    
    
    Treasury
    
    
    Comprehensive
    
    
    Accumulated
    
    
    StockholdersIn thousands
    
    Shares
    
    
    Amount
    
    
    Capital
    
    
    Stock
    
    
    Income (Loss)
    
    
    (Deficit)
    
    
    EquityBalance at December 31, 2005
    
    
    23,750
    
    
    $
    25
    
    
    $
    221,225
    
    
    $
    (15,904
    )
    
    $
    (886
    )
    
    $
    (15,510
    )
    
    $
    188,950Net issuance of common stock under stock option plans
    
    
    211
    
    
    
    
    
    
    
    2,964
    
    
    
    28
    
    
    
    
    
    
    
    
    
    
    
    2,992Repurchase of common stock
    
    
    (742
    )
    
    
    
    
    
    
    
    
    
    
    (10,794
    )
    
    
    
    
    
    
    
    
    
    
    (10,794
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,957
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,957Minimum postretirement benefits obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (200
    )
    
    
    
    
    
    
    (200
    )Components of comprehensive loss:Change in net unrealized gains (losses) on:Available-for-sale investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    353
    
    
    
    
    
    
    
    353Foreign exchange contracts
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (182
    )
    
    
    
    
    
    
    (182
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,968
    )
    
    
    (8,968
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,797
    )Balance at December 31, 2006
    
    
    23,219
    
    
    
    25
    
    
    
    226,146
    
    
    
    (26,670
    )
    
    
    (915
    )
    
    
    (24,478
    )
    
    
    174,108Net issuance of common stock under stock option plans
    
    
    152
    
    
    
    
    
    
    
    1,714
    
    
    
    36
    
    
    
    
    
    
    
    
    
    
    
    1,750Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,552
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,552Impact of adjustment on adoption of FIN 48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28
    
    
    
    28Components of comprehensive loss:Change in net unrealized gains (losses) on:Available-for-sale investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,051
    
    
    
    
    
    
    
    1,051Foreign exchange contracts
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (53
    )
    
    
    
    
    
    
    (53
    )Change in minimum postretirement benefits obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8
    
    
    
    
    
    
    
    8Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,044
    )
    
    
    (1,044
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (38
    )Balance at December 31, 2007
    
    
    23,371
    
    
    
    25
    
    
    
    229,412
    
    
    
    (26,634
    )
    
    
    91
    
    
    
    (25,494
    )
    
    
    177,400Net issuance of common stock under stock option plans
    
    
    145
    
    
    
    
    
    
    
    1,446
    
    
    
    29
    
    
    
    
    
    
    
    
    
    
    
    1,475Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    2,388
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,388Components of comprehensive income:Change in net unrealized gains (losses) on:Available-for-sale investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    444
    
    
    
    
    
    
    
    444Foreign exchange contracts
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (163
    )
    
    
    
    
    
    
    (163
    )Change in minimum postretirement benefits obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    102
    
    
    
    
    
    
    
    102Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,777
    
    
    
    11,777Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,160Balance at December 31, 2008
    
    
    23,516
    
    
    $
    25
    
    
    $
    233,246
    
    
    $
    (26,605
    )
    
    $
    474
    
    
    $
    (13,717
    )
    
    $
    193,423
 See accompanying notes to consolidated financial statements.
  - 37 -




---



##### 



ULTRATECH, INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. COMPANY AND INDUSTRY INFORMATION
 Nature of Operations
   Major Customers
  Business Segments
  Enterprise-Wide Disclosures
  In thousands
    
    2008
    
    
    2007
    
    
    2006Net sales:United States of America
    
    $
    50,352
    
    
    $
    38,740
    
    
    $
    43,064Japan
    
    
    21,514
    
    
    
    23,267
    
    
    
    31,482Europe
    
    
    24,328
    
    
    
    17,962
    
    
    
    10,698Taiwan
    
    
    12,567
    
    
    
    14,753
    
    
    
    15,936Rest of the world
    
    
    22,986
    
    
    
    17,588
    
    
    
    18,453Total
    
    $
    131,747
    
    
    $
    112,310
    
    
    $
    119,633Long-lived assets:United States of America
    
    $
    14,905
    
    
    $
    22,351
    
    
    $
    27,598Rest of the world
    
    
    1,016
    
    
    
    728
    
    
    
    811Total
    
    $
    15,921
    
    
    $
    23,079
    
    
    $
    28,409
    - 38 -




---



##### 



2. CONCENTRATIONS OF RISKS
    3. BASIS OF PRESENTATION
   Use of Estimates
  4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Cash Equivalents
  Investments
    - 39 -




---



##### 



Allowance for Bad Debts
  Inventories
  Long-lived Assets
    Related-Party Transactions
   Derivative Instruments and Hedging
    - 40 -




---



##### 



Cash Flow Hedging
    Balance Sheet Hedging
   Revenue Recognition
      - 41 -




---



##### 



Warranty Accrual
  Research, Development and Engineering Expenses
  Deferred Income Taxes
 Accounting for Taxes, (
 Taxes Collected from Customers
  Reclassifications
  Impact of Recently Issued Accounting Standards
 Business Combinations
  - 42 -




---



##### 



Noncontrolling Interests in Consolidated
Financial Statementsan amendment of Accounting Research Bulletin No. 51
 Disclosures about Derivative Instruments and
Hedging Activitiesan amendment of FASB Statement No. 133 ,
 Effective Date of FASB
Statement No. 157 Fair Value Measurement
 Determining the Fair Value of
a Financial Asset When the Market for That Asset Is Not Active
 5. STOCK-BASED COMPENSATION
 Accounting for Stock Issued to Employees Accounting for Certain Transactions Involving Stock Compensation Accounting for Stock-Based Compensation Share-Based Payment
  - 43 -




---



##### 



Years Ended December 31,In thousands
    
    2008
    
    
    2007
    
    
    2006Cost of Sales
    
    $
    118
    
    
    $
    97
    
    
    $
    140Research, development, and engineering
    
    
    464
    
    
    
    378
    
    
    
    264Selling, general and administrative expenses
    
    
    1,806
    
    
    
    1,077
    
    
    
    1,553Total stock-based compensation expense
    
    
    2,388
    
    
    
    1,552
    
    
    
    1,957Tax benefit related to stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    Net effect on net income/loss
    
    $
    2,388
    
    
    $
    1,552
    
    
    $
    1,957
     2008
    
    
    2007
    
    
    2006Expected life (in years)
    
    
    5.3
    
    
    
    5.0
    
    
    
    4.8Risk-free interest rate
    
    
    2.87
    %
    
    
    4.11
    %
    
    
    4.93
    %Volatility factor
    
    
    0.51
    
    
    
    0.47
    
    
    
    0.55Dividend yield
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
  1993 Stock Option Plan/Stock Issuance Plan
   - 44 -




---



##### 



1998 Supplemental Stock Option/Stock Issuance Plan
   Stock Option Activity
  Weighted Average
    
    
    AggregateWeighted-
    
    
    Remaining
    
    
    Intrinsic ValueAverage
    
    
    Contractual Term
    
    
    as of December 31,Options
    
    
    Exercise Price
    
    
    (Years)
    
    
    2008Outstanding at January 1, 2008
    
    
    5,376,777
    
    
    $
    17.36Granted
    
    
    301,713
    
    
    $
    10.87Exercised
    
    
    (110,423
    )
    
    $
    13.03Forfeited and expired
    
    
    (881,518
    )
    
    $
    17.55Outstanding at December 31, 2008
    
    
    4,686,549
    
    
    $
    17.01
    
    
    
    4.80
    
    
    $
    796,063Exercisable at December 31, 2008
    
    
    4,115,146
    
    
    $
    17.77
    
    
    
    4.24
    
    
    $
    284,744
   2007
    
    
    2006Weighted-
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    AverageOptions
    
    
    Exercise Price
    
    
    Options
    
    
    Exercise PriceOutstanding at January 1
    
    
    6,107,636
    
    
    $
    17.68
    
    
    
    6,443,948
    
    
    $
    17.71Granted
    
    
    398,000
    
    
    $
    11.90
    
    
    
    153,000
    
    
    $
    15.13Exercised
    
    
    (140,456
    )
    
    $
    12.51
    
    
    
    (206,478
    )
    
    $
    14.37Forfeited and expired
    
    
    (988,403
    )
    
    $
    17.82
    
    
    
    (282,834
    )
    
    $
    19.40Outstanding at December 31
    
    
    5,376,777
    
    
    $
    17.36
    
    
    
    6,107,636
    
    
    $
    17.68
  - 45 -




---



##### 



Options Outstanding
    
    
    Options ExercisableWeighted-AverageRemaining
    
    
    Weighted-
    
    
    
    
    
    
    Weighted-Contractual Life
    
    
    Average
    
    
    
    
    
    
    AverageRange of Exercise Prices
    
    Options
    
    
    (Years)
    
    
    Exercise Price
    
    
    Options
    
    
    Exercise Price$8.41  $11.88
    
    
    832,377
    
    
    
    5.31
    
    
    $
    11.02
    
    
    
    560,977
    
    
    $
    11.46$11.88  $13.96
    
    
    1,258,038
    
    
    
    4.61
    
    
    $
    13.39
    
    
    
    987,315
    
    
    $
    13.64$14.12  $16.01
    
    
    809,226
    
    
    
    4.94
    
    
    $
    14.86
    
    
    
    788,446
    
    
    $
    14.86$16.16  $21.83
    
    
    968,622
    
    
    
    5.39
    
    
    $
    19.81
    
    
    
    960,122
    
    
    $
    19.80$22.21  $29.68
    
    
    794,586
    
    
    
    3.74
    
    
    $
    27.36    
    
    
    794,586
    
    
    $
    27.36$30.00  $31.75
    
    
    23,700
    
    
    
    4.49
    
    
    $
    31.11
    
    
    
    23,700
    
    
    $
    31.11$8.41  $31.75
    
    
    4,686,549
    
    
    
    4.80
    
    
    $
    17.01
    
    
    
    4,115,146
    
    
    $
    17.77
  Restricted Stock Unit Activity
  2008
    
    
    2007
    
    
    2006Weighted-Average
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    Weighted-AverageGrant Date
    
    
    
    
    
    
    Grant Date
    
    
    
    
    
    
    Grant DateShares
    
    
    Fair Value
    
    
    Shares
    
    
    Fair Value
    
    
    Shares
    
    
    Fair ValueNonvested stock at
January 1
    
    
    87,188
    
    
    $
    15.53
    
    
    
    93,681
    
    
    $
    19.20
    
    
    
    
    
    
    $
    Granted
    
    
    150,000
    
    
    $
    10.90
    
    
    
    55,000
    
    
    $
    12.29
    
    
    
    167,500
    
    
    $
    19.20Vested
    
    
    (116,680
    )
    
    $
    13.85
    
    
    
    (46,404
    )
    
    $
    18.68
    
    
    
    (53,694
    )
    
    $
    19.20Forfeited
    
    
    (5,168
    )
    
    $
    9.97
    
    
    
    (15,089
    )
    
    $
    16.80
    
    
    
    (20,125
    )
    
    $
    19.20Nonvested stock at
December 31
    
    
    115,340
    
    
    $
    11.47
    
    
    
    87,188
    
    
    $
    15.53
    
    
    
    93,681
    
    
    $
    19.20
  Treasury Stock
  6. BASIC AND DILUTED NET INCOME (LOSS) PER SHARE
  Years Ended December 31,In thousands, except per share amounts
    
    2008
    
    
    2007
    
    
    2006Numerator:Net income (loss)
    
    $
    11,777
    
    
    $
    (1,044
    )
    
    $
    (8,968
    )Denominator:Basic weighted-average shares outstanding
    
    
    23,524
    
    
    
    23,354
    
    
    
    23,764Effect of dilutive employee stock options
and restricted stock units
    
    
    141
    
    
    
    
    
    
    
    Diluted weighted-average shares outstanding
    
    
    23,665
    
    
    
    23,354
    
    
    
    23,764Net income (loss) per sharebasic and diluted
    
    $
    0.50
    
    
    $
    (0.04
    )
    
    $
    (0.38
    )
  - 46 -




---



##### 



7. FAIR VALUE MEASUREMENTS
 Effective Date of FASB Statement No. 157 Determining the Fair
Value of a Financial Asset When the Market for That Asset Is Not Active
      Fair Value Measurements at Reporting Date UsingQuoted Prices inActive Markets for
    
    
    Significant Other
    
    
    SignificantIdentical Assets
    
    
    Observable Inputs
    
    
    Unobservable Inputs(In thousands)
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Available-for-sale securities(1)
    
    $
    137,110
    
    
    $
    56,658
    
    
    $
    80,452
    
    
    $
    Foreign currency derivatives(2)
    
    
    198
    
    
    
    
    
    
    
    198
    
    
    
    $
    137,308
    
    
    $
    56,658
    
    
    $
    80,650
    
    
    $
    
 
 (1)
    
    Included in cash and cash equivalents and short-term investments on our consolidated balance sheet.(2)
    
    Included in current liabilities on our consolidated balance sheet.   - 47 -




---



##### 



8. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
  December 31,
    
    
    December 31,
    
    
    December 31,(In thousands)
    
    2008
    
    
    2007
    
    
    2006Net income (loss)
    
    $
    11,777
    
    
    $
    (1,044
    )
    
    $
    (8,968
    )Other comprehensive income (loss):Unrealized gain on available-for-sale investments before
adjustment
    
    
    860
    
    
    
    1,051
    
    
    
    353Reclassification adjustment for gains included in net income (loss)
    
    
    (416
    )
    
    
    
    
    
    
    Net unrealized gain on available-for-sale investments
    
    
    444
    
    
    
    1,051
    
    
    
    353Unrealized loss on foreign exchange forward contracts
    
    
    (163
    )
    
    
    (53
    )
    
    
    (182
    )Change in minimum postretirement benefits obligation
    
    
    102
    
    
    
    8
    
    
    
    Comprehensive income (loss)
    
    $
    12,160
    
    
    $
    (38
    )
    
    $
    (8,797
    )
  December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Unrealized gains (losses) on:Available-for-sale investments
    
    $
    648
    
    
    $
    204Foreign exchange contracts
    
    
    (84
    )
    
    
    79Unrealized component of postretirement medical obligations
    
    
    (90
    )
    
    
    (192
    )Accumulated other comprehensive income at end of year
    
    $
    474
    
    
    $
    91
   9. INVESTMENTS
   December 31, 2008
    
    
    December 31, 2007Accumulated
    
    
    
    
    
    
    
    
    
    
    AccumulatedOther
    
    
    
    
    
    
    
    
    
    
    OtherCash equivalents and Available-
    
    Amortized
    
    
    Comprehensive
    
    
    Estimated
    
    
    Amortized
    
    
    Comprehensive
    
    
    Estimatedfor-sale Investments, in thousands
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value
    
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueSecurities and obligations of
U.S. government agencies
    
    $
    61,819
    
    
    $
    638
    
    
    $
    
    
    
    $
    62,457
    
    
    $
    87,424
    
    
    $
    264
    
    
    $
    25
    
    
    $
    87,663Money market funds and
commercial papers
    
    
    74,642
    
    
    
    11
    
    
    
    
    
    
    
    74,653
    
    
    
    39,025
    
    
    
    23
    
    
    
    
    
    
    
    39,048Total
    
    $
    136,461
    
    
    $
    649
    
    
    $
    
    
    
    $
    137,110
    
    
    $
    126,449
    
    
    $
    287
    
    
    $
    25
    
    
    $
    126,711
  - 48 -




---



##### 



In thousands
    
    2008
    
    
    2007Cash equivalents
    
    $
    72,646
    
    
    $
    49,299Short-term investments
    
    
    64,464
    
    
    
    77,412Investments, at estimated fair value
    
    $
    137,110
    
    
    $
    126,711
   GrossAmortized
    
    
    FairIn thousands
    
    Cost
    
    
    ValueDue in one year or less
    
    $
    122,241
    
    
    $
    122,658Due after one year through five years
    
    
    14,220
    
    
    
    14,452Total
    
    $
    136,461
    
    
    $
    137,110
  In Loss Position for
    
    
    In Loss Position forLess Than 12 Months
    
    
    More Than 12 Months
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedInvestments, in thousands
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesSecurities and
obligations of U.S.
government agencies
    
    $
    21,996
    
    
    $
    5
    
    
    $
    10,480
    
    
    $
    20
    
    
    $
    32,476
    
    
    $
    25Money market funds and
commercial papers
    
    
    3,588
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,588
    
    
    
    $
    25,584
    
    
    $
    5
    
    
    $
    10,480
    
    
    $
    20
    
    
    $
    36,064
    
    
    $
    25
   - 49 -




---



##### 



10. BALANCE SHEET DETAIL
 December 31,
    
    
    December 31,2008
    
    
    2007Inventories:Raw materials
    
    $
    15,380
    
    
    $
    18,016Work-in-process
    
    
    7,175
    
    
    
    6,938Finished products
    
    
    9,063
    
    
    
    4,174Total
    
    $
    31,618
    
    
    $
    29,128Equipment and leasehold improvements, net:Machinery and equipment
    
    $
    36,059
    
    
    $
    41,722Leasehold improvements
    
    
    8,383
    
    
    
    8,180Office equipment and furniture(a)
    
    
    14,498
    
    
    
    14,37158,940
    
    
    
    64,273Accumulated depreciation and amortization
    
    
    (46,152
    )
    
    
    (47,447
    )Total
    
    $
    12,788
    
    
    $
    16,826Accrued expenses:Salaries and benefits
    
    $
    4,949
    
    
    $
    3,545Warranty accrual
    
    
    1,522
    
    
    
    2,112Accrued taxes-other
    
    
    1,374
    
    
    
    863Reserve for losses on purchase order commitments
    
    
    155
    
    
    
    508Capital lease, current portion
    
    
    113
    
    
    
    99Other
    
    
    1,810
    
    
    
    2,425Total
    
    $
    9,923
    
    
    $
    9,552Other Liabilities:Deferred compensation
    
    $
    941
    
    
    $
    1,287Asset retirement obligations
    
    
    2,281
    
    
    
    2,222Postretirement benefits obligation
    
    
    546
    
    
    
    773Capital lease
    
    
    385
    
    
    
    463Income tax payable  long term
    
    
    381
    
    
    
    Deferred income tax liabilities  long term
    
    
    386
    
    
    
    363Other
    
    
    262
    
    
    
    333$
    5,182
    
    
    $
    5,441
 
 (a)
    
    As of December 31, 2008 and 2007, office equipment and furniture
included $0.6 million of cost capitalized under a capital lease.
Accumulated depreciation as of December 31, 2008 and 2007 was $0.2
million and $56,000, respectively. Warranty Accrual
   - 50 -




---



##### 



December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Balance, beginning of year
    
    $
    2,112
    
    
    $
    2,264Warranties issued during year
    
    
    2,843
    
    
    
    3,171Settlements during year
    
    
    (2,835
    )
    
    
    (2,916
    )Changes in liability for
pre-existing warranties during
year, including expirations
    
    
    (598
    )
    
    
    (407
    )Balance, end of year
    
    $
    1,522
    
    
    $
    2,112
 Deferred Service Income
  December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Balance, beginning of year
    
    $
    2,087
    
    
    $
    2,444Service contracts sold during year
    
    
    2,997
    
    
    
    3,621Service contract revenue recognized during year
    
    
    (2,967
    )
    
    
    (3,978
    )Balance, end of year
    
    $
    2,117
    
    
    $
    2,087
 11. NOTES PAYABLE
  12. EXIT ACTIVITIES
  Balance at
    
    
    
    
    
    
    
    
    
    
    Balance at
    
    
    
    
    
    
    
    
    
    
    Balance at
    
    
    
    
    
    
    
    
    
    
    Balance atJanuary 1,
    
    
    
    
    
    
    
    
    
    
    December 31,
    
    
    
    
    
    
    
    
    
    
    December 31,
    
    
    
    
    
    
    
    
    
    
    December 31,In thousands
    
    2006
    
    
    Expenses
    
    
    Payments
    
    
    2006
    
    
    Expenses
    
    
    Payments
    
    
    2007
    
    
    Expenses
    
    
    Payments
    
    
    2008Severance and
benefits (2006)
    
    $
    
    
    
    $
    1,612
    
    
    $
    (694
    )
    
    $
    918
    
    
    $
    
    
    
    $
    (872
    )
    
    $
    46
    
    
    $
    
    
    
    $
    (46
    )
    
    $
    Facilities (2006)
    
    
    
    
    
    
    294
    
    
    
    (294
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Severance and
benefits (2007)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,588
    
    
    
    (1,206
    )
    
    
    382
    
    
    
    
    
    
    
    (382
    )
    
    
    Severance and
benefits (2008)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    591
    
    
    
    (573
    )
    
    
    18Total
    
    $
    
    
    
    $
    1,906
    
    
    $
    (988
    )
    
    $
    918
    
    
    $
    1,588
    
    
    $
    (2,078
    )
    
    $
    428
    
    
    $
    591
    
    
    $
    (1,001
    )
    
    $
    18
    - 51 -




---



##### 



13. EMPLOYEE BENEFIT PLANS
 Employee bonus plans
  Employee Savings and Retirement Plans
  Postretirement Benefits
     December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Prior service cost
    
    $
    164
    
    
    $
    202Net actuarial gain
    
    
    (74
    )
    
    
    (10
    )Amount recognized in other comprehensive income
    
    $
    90
    
    
    $
    192
  - 52 -




---



##### 



December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Benefit obligation at beginning of year
    
    $
    773
    
    
    $
    701Interest cost
    
    
    45
    
    
    
    43Additions
    
    
    
    
    
    
    29Actuarial gain
    
    
    (272
    )
    
    
    Benefit obligation at end of year
    
    
    546
    
    
    
    773Fair value of plan assets at end of year
    
    
    
    
    
    
    Funded status at end of year
    
    $
    (546
    )
    
    $
    (773
    )
  December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Noncurrent assets
    
    $
    
    
    
    $
    Current liabilities
    
    
    
    
    
    
    Noncurrent liabilities
    
    
    (546
    )
    
    
    (773
    )$
    (546
    )
    
    $
    (773
    )
    December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Interest cost
    
    $
    45
    
    
    $
    43Amortization of prior service cost
    
    
    37
    
    
    
    37Amortization of net gain
    
    
    (207
    )
    
    
    Net periodic benefit cost
    
    $
    (125
    )
    
    $
    80
  December 31,
    
    
    December 31,In thousands
    
    2008
    
    
    2007Net actuarial gain
    
    $
    (65
    )
    
    $
    Prior service cost
    
    
    
    
    
    
    29Amortization of prior service cost
    
    
    (37
    )
    
    
    (37
    )Total recognized from other comprehensive income (loss)
    
    $
    (102
    )
    
    $
    (8
    )Total recognized in net periodic benefit cost and from
other comprehensive income
    
    $
    (227
    )
    
    $
    72
  - 53 -




---



##### 



In thousands2009
    
    $
    2010
    
    
    362011
    
    
    362012
    
    
    362013
    
    
    3820142018
    
    
    191$
    337
  At December 31, 20081-Percentage-
    
    1-Percentage-In thousands
    
    Point Increase
    
    
    Point DecreaseEffect on total of service and interest cost components
    
    $
    7
    
    
    $
    (6
    )Effect on postretirement benefit obligation
    
    
    69
    
    
    
    (58
    )
 14. INCOME TAXES
  Years Ended December 31,In thousands
    
    2008
    
    
    2007
    
    
    2006Domestic
    
    $
    11,113
    
    
    $
    (1,288
    )
    
    $
    (10,941
    )Foreign
    
    
    1,072
    
    
    
    530
    
    
    
    2,927Income (loss) before income taxes
    
    $
    12,185
    
    
    $
    (758
    )
    
    $
    (8,014
    )
  Years Ended December 31,In thousands
    
    2008
    
    
    2007
    
    
    2006Federal:Current
    
    $
    51
    
    
    $
    
    
    
    $
    Deferred
    
    
    163
    
    
    
    (52
    )
    
    
    214
    
    
    
    (52
    )
    
    
    State:Current
    
    
    59
    
    
    
    
    
    
    
    3Deferred
    
    
    6
    
    
    
    (6
    )
    
    
    65
    
    
    
    (6
    )
    
    
    3Foreign:Current
    
    
    171
    
    
    
    246
    
    
    
    979Deferred
    
    
    (42
    )
    
    
    98
    
    
    
    (28
    )129
    
    
    
    344
    
    
    
    951Total income tax provision
    
    $
    408
    
    
    $
    286
    
    
    $
    954
  - 54 -




---



##### 



Years Ended December 31,In thousands
    
    2008
    
    
    2007
    
    
    2006Tax computed at statutory rate
    
    $
    4,265
    
    
    $
    (265
    )
    
    $
    (2,805
    )State income taxes, net of federal benefit
    
    
    42
    
    
    
    (4
    )
    
    
    2Foreign taxes
    
    
    (246
    )
    
    
    158
    
    
    
    (73
    )U.S. losses not benefited/(utilized)
    
    
    (3,653
    )
    
    
    397
    
    
    
    3,830Income tax provision
    
    $
    408
    
    
    $
    286
    
    
    $
    954
  In thousands
    
    2008
    
    
    2007
    
    
    2006Deferred tax assets:Net operating loss carryforwards
    
    $
    27,047
    
    
    $
    29,639
    
    
    $
    40,965Inventory valuation
    
    
    3,671
    
    
    
    3,143
    
    
    
    3,257Bad debt reserve
    
    
    72
    
    
    
    118
    
    
    
    181Basis difference in assets
    
    
    12,005
    
    
    
    13,450
    
    
    
    3,326Tax credit carryforwards
    
    
    22,281
    
    
    
    21,418
    
    
    
    24,777Warranty reserves
    
    
    591
    
    
    
    825
    
    
    
    876Deferred product and services income
    
    
    1,399
    
    
    
    1,417
    
    
    
    1,133Other non-deductible accruals and reserves
    
    
    5,417
    
    
    
    6,746
    
    
    
    6,966Stock compensation
    
    
    1,739
    
    
    
    1,022
    
    
    
    540Total deferred tax assets
    
    
    74,222
    
    
    
    77,778
    
    
    
    82,021Valuation allowance
    
    
    (70,824
    )
    
    
    (74,821
    )
    
    
    (77,726
    )Net deferred tax assets
    
    
    3,398
    
    
    
    2,957
    
    
    
    4,295Deferred tax liabilities:Unremitted earnings of foreign subsidiaries
    
    $
    (2,979
    )
    
    $
    (2,581
    )
    
    $
    (3,827
    )Other
    
    
    (109
    )
    
    
    (109
    )
    
    
    (109
    )Total deferred tax liabilities
    
    
    (3,088
    )
    
    
    (2,690
    )
    
    
    (3,936
    )Net deferred tax assets
    
    $
    310
    
    
    $
    267
    
    
    $
    359
      Accounting for Uncertainty
in Income Taxes  an Interpretation of FASB Statement No. 109
  - 55 -




---



##### 



In thousands
    
    2008
    
    
    2007Balance at January 1
    
    $
    3,329
    
    
    $
    2,842Tax positions related to the current year:Additions
    
    
    288
    
    
    
    502Tax positions related to the prior years:Additions
    
    
    112
    
    
    
    Reductions
    
    
    (215
    )
    
    
    Lapses in statutes of limitations
    
    
    (68
    )
    
    
    (15
    )Balance at December 31
    
    $
    3,445
    
    
    $
    3,329
   15. COMMITMENTS AND CONTINGENCIES
 Commitments
   Accounting for Leases
  - 56 -




---



##### 



Capital
    
    
    Operating(In thousands)
    
    Lease
    
    
    LeaseFor the years:2009
    
    $
    141
    
    
    $
    6,6952010
    
    
    141
    
    
    
    4,9812011
    
    
    141
    
    
    
    2,1662012
    
    
    140
    
    
    
    1,118Thereafter
    
    
    
    
    
    
    Total minimum lease payments
    
    
    563
    
    
    
    14,960Total noncancelable sublease income to be received
    
    
    
    
    
    
    (728
    )Total minimum lease payments net of sublease income
    
    
    
    
    
    $
    14,232Amount representing interest
    
    
    (65
    )Present value of total minimum lease payments
    
    
    498Current portion
    
    
    (113
    )Capital lease obligation, net of current portion
    
    $
    385
   Legal Proceedings
    16. FINANCIAL GUARANTEES
   - 57 -




---



##### 



17. ASSET RETIREMENT OBLIGATIONS
   In thousands
    
    2008
    
    
    2007Balance as of January 1
    
    $
    2,222
    
    
    $
    1,982Accretion expense
    
    
    157
    
    
    
    240Liabilities incurred
    
    
    75
    
    
    
    Liabilities settled
    
    
    (44
    )
    
    
    Adjustment to liabilities
    
    
    (129
    )
    
    
    Balance as of December 31
    
    $
    2,281
    
    
    $
    2,222
  - 58 -




---



##### 



REPORT OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
       /s/ Ernst & Young LLPSan Jose, CaliforniaFebruary 23, 2009
  - 59 -




---



##### 



REPORT OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  Internal ControlIntegrated Framework
      /s/ Ernst & Young LLPSan Jose, CaliforniaFebruary 23, 2009
  - 60 -




---



##### 



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Controls and Procedures
   Managements Annual Report on Internal Control Over Financial Reporting
  Internal ControlIntegrated
Framework
  Changes in Internal Control Over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
   - 61 -




---



##### 



PART III
  
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  
 ITEM 11. EXECUTIVE COMPENSATION
  
 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED  STOCKHOLDER MATTERS
  
 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  
 PART IV
 
 ITEM 15. FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULES, AND EXHIBITS
      Page NumberSchedule II Valuation and Qualifying Accounts
    
    
    66
   - 62 -




---



##### 



Exhibit
    
    Description3.1
    (1)
    
    Amended and Restated Certificate of Incorporation of the Registrant, filed October 6, 1993.3.1.1
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, dated May 17, 1995.3.1.2
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, filed June 17, 1998.3.1.3
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, filed June 20, 2003.3.2
    (2)
    
    Bylaws of Registrant, as amended.4.1
    (3)
    
    Specimen Common Stock Certificate of Registrant.10.1
    (4)
    
    1993 Stock Option/Stock Issuance Plan (amended and restated as of January 30, 2007).10.2
    (3)
    
    Form of Indemnification Agreement entered into between the Registrant and each of its officers and
directors.10.3
    (5)
    
    Form of Indemnification Agreement entered into between the Registrant and certain officers.10.4
    (3)
    
    Standard Industrial LeaseSingle Tenant, Full Net between The Equitable Life Assurance Society of
the United States, as Landlord, and Registrant, as Tenant, dated August 27, 1993.10.4.1
    (5)
    
    First Amendment to Lease between The Equitable Life Assurance Society of the United States, as
Landlord, and Registrant, as Tenant, dated November 1999.10.5
    (6)
    
    Profit Sharing Plan.10.6
    (7)
    
    1998 Supplemental Stock Option/ Stock Issuance Plan (amended and restated effective January 29,
2008).10.7
    (8)
    
    Private Wealth Management Client Agreement with Morgan Stanley, dated December 16, 2004.10.8
    (9)
    
    Lease Agreement between Montague LLC, As Landlord, and Registrant, As Tenant dated November 22,
1999.10.9
    
    
    Amended and Restated Employment Agreement between Registrant and Mr. Arthur Zafiropoulo, Chief
Executive Officer, dated as of October 14, 2008.10.10
    
    
    Amended and Restated Employment Agreement between Registrant and Mr. Bruce Wright, Chief Financial
Officer, dated as of October 14, 2008.10.11
    
    
    Form of Restricted Stock Unit Issuance Agreement for Executive Officers with Employment Agreements.10.12
    
    
    Form of Restricted Stock Unit Issuance Agreement for Executive Officers without Employment
Agreements.10.13
    (11)
    
    Form of Restricted Stock Unit Issuance Agreement for Other Employees.10.14
    (10)
    
    Description of 2007 Management Incentive Compensation Plan.10.15
    (7)
    
    Ultratech, Inc. Long Term Incentive Compensation Plan as amended and restated January 28, 2008.
  - 63 -




---



##### 



Exhibit
    
    Description10.16
    
    
    Amended and Restated Non-Qualified Supplemental Deferred Compensation Plan.10.17
    
    
    Adoption Agreement Related to Amended and Restated Non-Qualified Supplemental Deferred
Compensation Plan.10.18
    
    
    Amendment No. 1 to Amended and Restated Non-Qualified Supplemental Deferred Compensation Plan.10.19
    
    
    Special
Form of Stock Option Agreement for Executive Officers with Employment
Agreements.10.20
    
    
    Special
Form of Stock Option Agreement for Executive Officers without Employment
Agreements.10.21
    
    
    Regular
Form of Stock Option Agreement.21
    
    
    Subsidiaries of Registrant.23
    
    
    Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.24
    
    
    Power of Attorney (contained in Signature page hereto).31.1
    
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    *
    
    Certifications 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.
 
 *
    
    Exhibit 32.1 is being furnished and shall not be deemed to be filed for purposes of Section 18
of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that
section, nor shall such exhibit be deemed to be incorporated by reference in any registration
statement or other document filed under the Securities Act of 1933, as amended, or the Securities
Exchange Act, except as otherwise stated in such filing. (1)
    
    Previously filed with our Quarterly Report on Form 10-Q for the quarter ended June 28,
2003 (Commission File No. 0-22248).(2)
    
    Previously filed with our Current Report on Form 8-K filed on October 20, 2008
(Commission File No. 0-22248).(3)
    
    Previously filed with our Registration Statement on Form S-1 declared effective with
the Securities and Exchange Commission on September 28, 1993. File No. 33-66522.(4)
    
    Incorporated by reference to Item 5.02 of our Current Report on Form 8-K filed on
July 30, 2007 (Commission File No. 0-22248).(5)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
2002 (Commission File No. 0-22248).(6)
    
    Previously filed with our 1993 Annual Report on Form 10-K (Commission File No. 0-22248).(7)
    
    Previously filed with our Current Report on Form 8-K filed on February 1, 2008
(Commission File No. 0-22248).(8)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
2004 (Commission File No. 0-22248).(9)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
1999 (Commission File No. 0-22248).(10)
    
    Incorporated herein by reference to Item 5.02 of the Registrants Current Report on
Form 8-K filed with the Commission on February 2, 2007.(11)
    
    Previously filed with our Quarterly Report on Form 10-Q filed on May 5, 2006
(Commission File No. 0-22248).(b)
    
    Exhibits. See list of exhibits under (a)(3) above.(c)
    
    Financial Statement Schedules. See list of schedules under (a)(2) above.  - 64 -




---



##### 



SIGNATURES
  Ultratech, Inc.Date: February 26, 2009
    
    By:
    
    /s/ Arthur ZafiropouloArthur ZafiropouloChairman of the Board of Directors and Chief Executive Officer
   Signature
    
    Title
    
    Date/s/ Arthur Zafiropoulo

Arthur Zafiropoulo
    
    Chairman of the
Board of Directors
and Chief Executive
Officer (Principal
Executive Officer)
    
    February 26, 2009/s/ Bruce Wright

Bruce Wright
    
    Senior Vice
President, Finance,
Chief Financial
Officer and
Secretary
(Principal
Financial and
Accounting Officer)
    
    February 26, 2009/s/ Dennis Raney
    
    Director
    
    February 26, 2009Dennis Raney/s/ Rick Timmins
    
    Director
    
    February 26, 2009Rick Timmins/s/ Henri Richard
    
    Director
    
    February 26, 2009Henri P Richard/s/ Joel Gemunder
    
    Director
    
    February 26, 2009Joel Gemunder/s/ Nicholas Konidaris
    
    Director
    
    February 26, 2009Nicholas Konidaris/s/ Vincent F. Sollitto
    
    Director
    
    February 26, 2009Vincent F. Sollitto
  - 65 -




---



##### 



SCHEDULE II
 ULTRATECH, INC.
 VALUATION AND QUALIFYING ACCOUNTS
 (in thousands)
 CreditedBalance at
    
    
    to Costs
    
    
    Charged to
    
    
    
    
    
    
    Balance atBeginning
    
    
    and
    
    
    Other
    
    
    
    
    
    
    End ofDescription
    
    of Year
    
    
    Expenses
    
    
    Accounts
    
    
    Deductions(1)
    
    
    YearAllowance for doubtful accounts:Year ended December 31, 2006Trade accounts receivable
    
    $
    577
    
    
    $
    (112
    )
    
    $
    1
    
    
    $
    
    
    
    $
    466$
    577
    
    
    $
    (112
    )
    
    $
    1
    
    
    $
    
    
    
    $
    466Year ended December 31, 2007Trade accounts receivable
    
    $
    466
    
    
    $
    (160
    )
    
    $
    
    
    
    $
    
    
    
    $
    306$
    466
    
    
    $
    (160
    )
    
    $
    
    
    
    $
    
    
    
    $
    306Year ended December 31, 2008Trade accounts receivable
    
    $
    306
    
    
    $
    (121
    )
    
    $
    
    
    
    $
    
    
    
    $
    185$
    306
    
    
    $
    (121
    )
    
    $
    
    
    
    $
    
    
    
    $
    185
 
 (1)
    
    Deductions represent write-offs against reserve account balances.  - 66 -




---



##### 



EXHIBIT INDEX
 Exhibit
    
    Description3.1
    (1)
    
    Amended and Restated Certificate of Incorporation of the Registrant, filed October 6, 1993.3.1.1
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, dated May 17, 1995.3.1.2
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, filed June 17, 1998.3.1.3
    (1)
    
    Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the
Registrant, filed June 20, 2003.3.2
    (2)
    
    Bylaws of Registrant, as amended.4.1
    (3)
    
    Specimen Common Stock Certificate of Registrant.10.1
    (4)
    
    1993 Stock Option/Stock Issuance Plan (amended and restated as of January 30, 2007).10.2
    (3)
    
    Form of Indemnification Agreement entered into between the Registrant and each of its officers and
directors.10.3
    (5)
    
    Form of Indemnification Agreement entered into between the Registrant and certain officers.10.4
    (3)
    
    Standard Industrial LeaseSingle Tenant, Full Net between The Equitable Life Assurance Society of
the United States, as Landlord, and Registrant, as Tenant, dated August 27, 1993.10.4.1
    (5)
    
    First Amendment to Lease between The Equitable Life Assurance Society of the United States, as
Landlord, and Registrant, as Tenant, dated November 1999.10.5
    (6)
    
    Profit Sharing Plan.10.6
    (7)
    
    1998 Supplemental Stock Option/ Stock Issuance Plan (amended and restated effective January 29,
2008).10.7
    (8)
    
    Private Wealth Management Client Agreement with Morgan Stanley, dated December 16, 2004.10.8
    (9)
    
    Lease Agreement between Montague LLC, As Landlord, and Registrant, As Tenant dated November 22,
1999.10.9
    
    
    Amended and Restated Employment agreement between Registrant and Mr. Arthur Zafiropoulo, Chief
Executive Officer, dated as of October 14, 2008.10.10
    
    
    Amended and Restated Employment agreement between Registrant and Mr. Bruce Wright, Chief Financial
Officer, dated as of October 14, 2008.10.11
    
    
    Form of Restricted Stock Unit Issuance Agreement for Executive Officers with Employment Agreements.10.12
    
    
    Form of Restricted Stock Unit Issuance Agreement for Executive Officers without Employment
Agreements.10.13
    (11)
    
    Form of Restricted Stock Unit Issuance Agreement for Other Employees.10.14
    (10)
    
    Description of 2007 Management Incentive Compensation Plan.10.15
    (7)
    
    Ultratech, Inc. Long Term Incentive Compensation Plan as amended and restated January 28, 2008.10.16
    
    
    Amended and Restated Non-Qualified Supplemental Deferred Compensation Plan.
  - 67 -




---



##### 



Exhibit
    
    Description10.17
    
    
    Adoption Agreement Related to Amended and Restated Non-Qualified Supplemental Deferred
Compensation Plan.10.18
    
    
    Amendment No. 1 to Amended and Restated Non-Qualified Supplemental Deferred Compensation Plan.10.19
    
    
    Special
Form of Stock Option Agreement for Executive Officers with Employment
Agreements.10.20
    
    
    Special
Form of Stock Option Agreement for Executive Officers without Employment
Agreements.10.21
    
    
    Regular
Form of Stock Option Agreement.21
    
    
    Subsidiaries of Registrant.23
    
    
    Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.24
    
    
    Power of Attorney (contained in Signature page hereto).31.1
    
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    *
    
    Certifications 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.
 
 *
    
    Exhibit 32.1 is being furnished and shall not be deemed to be filed for purposes of Section 18
of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that
section, nor shall such exhibit be deemed to be incorporated by reference in any registration
statement or other document filed under the Securities Act of 1933, as amended, or the Securities
Exchange Act, except as otherwise stated in such filing. (1)
    
    Previously filed with our Quarterly Report on Form 10-Q for the quarter ended June 28,
2003 (Commission File No. 
0-22248).(2)
    
    Previously filed with our Current Report on Form 8-K filed on October 20, 2008
(Commission File No. 0-22248).(3)
    
    Previously filed with our Registration Statement on Form S-1 declared effective with
the Securities and Exchange Commission on September 28, 1993. File No. 33-66522.(4)
    
    Incorporated by reference to Item 5.02 of our Current Report on Form 8-K filed on
July 30, 2007 (Commission File No.
 0-22248).(5)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
2002 (Commission File No. 
0-22248).(6)
    
    Previously filed with our 1993 Annual Report on Form 10-K
(Commission File No. 
0-22248).(7)
    
    Previously filed with our Current Report on Form 8-K filed on February 1, 2008
(Commission File No. 
0-22248).(8)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
2004 (Commission File No. 
0-22248).(9)
    
    Previously filed with our Annual Report on Form 10-K for the year ended December 31,
1999 (Commission File No. 
0-22248).(10)
    
    Incorporated herein by reference to Item 5.02 of the Registrants Current Report on
Form 8-K filed with the Commission on February 2, 2007.(11)
    
    Previously filed with our Quarterly Report on Form 10-Q filed on May 5, 2006
(Commission File No. 0-22248).  - 68 -