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  **UNITED STATES SECURITIES AND EXCHANGE COMMISSION****Washington, D.C. 20549** **FORM 10-K/A****Amendment No. 1 to Form 10-K**   þ **Annual report pursuant to section 13 or 15 (d)of the Securities Exchange Act of 1934******For the fiscal year ended December 31, 2006******Commission file number****0-49651****SUNTRON CORPORATION**(Exact Name of Registrant as Specified in Its Charter)   **Delaware** **86-1038668**   (State of Incorporation) (I.R.S. Employer Identification No.)   **2401 West Grandview Road, Phoenix, Arizona** **85023** (Address of Principal Executive Offices) (Zip Code)**(602) 789-6600** (Registrant’s telephone number, including area code)Securities registered pursuant to Section 12(b) of the Act: **None**Securities registered pursuant to Section 12(g) of the Exchange Act:   Title of Each Class Name of Each Exchange on Which Registered      **Common Stock, $0.01 par value** **Nasdaq SmallCap Market**        Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule405 of the Securities Act. Yes o     No þ     Indicate by check mark if the registrant is not required to file reports pursuant to Section13 or Section 15(d) of the Act. Yes o     No þ     Indicate by check mark whether the registrant: (1) has filed all reports required to be filedby Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (orfor such shorter period that the registrant was required to file such reports), and (2) has beensubject to such filing requirements for the past 90 days. Yes þ     No o     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K isnot contained herein, and will not be contained, to the best of registrant’s knowledge, indefinitive proxy or information statements incorporated by reference in Part III of this Form 10-Kor any amendment to this Form 10-K.o     Indicate by check mark whether the registrant is a large accelerated filer, an acceleratedfiler, or a non-accelerated filer as defined in Exchange Act Rule 12b-2.Large Accelerated Filer o      Accelerated Filer o      Non-Accelerated Filerþ     Indicate by check mark whether the registrant is a shell company as defined in Exchange ActRule 12b-2. Yes o     No þ     The aggregate market value of the outstanding common equity held by non-affiliates of theregistrant, computed as of June 30, 2006, was **$4.0 million**. This amount is based on 2,770,000shares held by non-affiliates. For purposes of this computation, all current officers, directors,and 10% beneficial owners of the registrant are deemed to be affiliates. Such determination shouldnot be deemed to be an admission that such officers, directors, or 10% beneficial owners are, infact, affiliates of the registrant.     As of **February 28, 2007**, there were outstanding **27,577,282**shares of the registrant’s CommonStock, $0.01 par value.**Documents Incorporated by Reference**Not Applicable.  
 

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PART IIIITEM 10. DIRECTORS AND EXECUTIVE OFFICERSITEM 11. EXECUTIVE COMPENSATIONITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONSITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICESSIGNATURES

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**PART III****ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS**     The following table, together with the accompanying text, presents certain information,as of March 31, 2007, with respect to each of our executive officers and directors.       **Name** **Age** **Position(s) Held With the Company**Hargopal (Paul) Singh  57  Chief Executive Officer, President and Director       Thomas B. Sabol  48  Chief Financial Officer and Director       James A. Doran  52  Vice President, Chief Accounting Officer,Controller and Secretary       Allen S. Braswell, Jr  48  Director       Ivor J. (Ike) Evans  64  Director and Chairman of the Board       James J. Forese  70  Director       Kurt D. Grindstaff  54  Director       Douglas P. McCormick  38  Director       Scott D. Rued  50  Director       Marc T. Schölvinck  49  Director       William S. Urkiel  61  Director     *Hargopal (Paul) Singh*has served as our Chief Executive Officer and President since May 2005and as a director since June 2005. From July 2004 to May 2005, Mr. Singh was Vice President incharge of our largest manufacturing facility in Sugar Land, Texas. From 1995 until 2003, Mr. Singhwas with Pemstar, Inc., an electronic manufacturing services (“EMS”) company, where he served onthe Board for five years and held various senior executive positions, including Chief OperatingOfficer and Executive Vice President — International Operations. From 1979 to 1995, Mr. Singh heldsenior management positions in major corporations such as Microsoft and IBM. Mr. Singh has beenactively involved in community and professional societies. Mr. Singh holds a BE MechanicalEngineering from Osmania University, in India, and a MS in Industrial Engineering and Managementfrom Oklahoma State University.     *Thomas B. Sabol*has served as a director since July 2004 and as our Chief Financial Officersince February 2006. From March 2005 to November 2005, Mr. Sabol served as Chief Financial Officerfor Wolverine Tube, Inc., a manufacturer and distributor of copper and copper alloy tube products.From December 2004 to March 2005, Mr. Sabol served as Senior Vice President, Finance & Accountingfor Wolverine Tube, Inc. Mr. Sabol served as an independent business consultant from January 2004to November 2004. Previously, Mr. Sabol served as the Executive Vice President and Chief OperatingOfficer of Plexus Corp., an EMS company, from July 2002 to November 2003 and as the Chief FinancialOfficer of Plexus from January 1996 to September 2002. Mr. Sabol is a Certified Public Accountant.     *James A. Doran*has served as our Vice President, Controller and Chief Accounting Officer sinceFebruary 2002. Mr. Doran served as our interim Chief Financial Officer from October 2005 toFebruary 2006. Since October 2005, Mr. Doran has also served as our Secretary. Mr. Doran served asEFTC’s Controller from September 1999 to February 2002, and he was a member of EFTC’s Board ofDirectors from 1993 until 2000. From 1977 through 1999, Mr. Doran was primarily engaged in thepractice of public accounting with an emphasis on audits of publicly-held companies. Mr. Doran isa Certified Public Accountant.
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     *Allen S. Braswell, Jr.*has served as a director since October 2001. Mr. Braswell has engagedin private investment activities as his principal occupation since December 2000. From October 1996until December 2000, Mr. Braswell served as President of Jabil Global Services and itspredecessors. Jabil Global Services is a subsidiary of Jabil Circuit, Inc., which was purchasedfrom EFTC Corporation in September 1999. Mr. Braswell is also a director for MedicationTechnologies Inc.     *Ivor J. (Ike) Evans*has served as our Chairman of the Board since November 2005and a director since June 2005. He has been an Operating Partner of Thayer Capital Partners, aprivate equity investment firm, since May 2005. He served as a director of both Union PacificCorporation and Union Pacific Railroad from 1999 until February 2005, and he served as vicechairman from January 2004 until his retirement in February 2005. From 1998 until his election asvice chairman, Mr. Evans served as the President and Chief Operating Officer of Union PacificRailroad. From 1990 until 1998, Mr. Evans served in various executive positions at Emerson ElectricCompany. Mr. Evans is also a director of Cooper Industries, Ltd., Textron, Inc., ArvinMeritor, Inc.and Spirit Aerosystems, Inc.     *James J. Forese*has served as a director since July 2004. He has been Operating Partner andChief Operating Officer of Thayer Capital Partners, since July 2003. He was Chairman of the Boardof IKON Office Solutions, Inc. (“IKON”) from 2000 until his retirement in February 2003. He wasPresident and Chief Executive Officer of IKON from 1998 to 2002, Executive Vice President andPresident of International Operations of IKON from 1997 to 1998, and Executive Vice President andChief Operating Officer of IKON from 1996 to 1997. Prior to joining IKON, he spent 36 years withIBM Corporation (“IBM”) in numerous executive positions, including two years as Chairman and ChiefExecutive Officer of IBM Credit Corporation, three years as Vice President—Finance of IBM, and sixyears as Vice President and Controller of IBM. He is also a director of Anheuser-Busch, BFI CanadaInc., and Spherion Corporation.     *Kurt D. Grindstaff has*served as a director since November 2005. Mr. Grindstaff has performedfinancial consulting services since 1999, primarily for clients engaged in the financial servicesindustries. Until September 1998, he served in various executive capacities during his 17-yeartenure with The Seven Up Bottling Company of St. Louis, including as President, Executive VicePresident, Chief Operating Officer and Senior Vice President of Finance. Mr. Grindstaff is aCertified Public Accountant.     *Douglas P. McCormick*has served as a director since October 2001. Mr. McCormick is a ManagingPartner of Thayer Capital Partners where he has also served as a Managing Director since January2001 and a Vice President since January 1999. From June 1997 to January 1999, Mr. McCormick servedas an associate at Morgan Stanley & Co. Incorporated, an investment banking firm. From September1995 to June 1997, Mr. McCormick attended Harvard Business School.     *Scott D. Rued*has served as a director since November 2005. Mr. Rued has served as a ManagingPartner of Thayer Capital Partners since September 2003. Prior to joining Thayer, Mr. Rued servedas President and Chief Executive Officer of Hidden Creek Industries (“HCI”) from May 2001 toOctober 2003. From January 1994 through April 2001, Mr. Rued served as Executive Vice President andChief Financial Officer of HCI and from June 1989 through 1993 he served as Vice President-Financeand Corporate Development of HCI. Mr. Rued also serves as the Chairman of the Board of Directorsfor Commercial Vehicle Group, Inc.     *Marc T. Schölvinck*has served as a director since May 2006. Mr. Schölvinck is a Partner andthe Chief Financial Officer of Blum Capital Partners, L.P. (“Blum LP”), a San Francisco basedprivate equity and strategic block investment firm. Mr. Schölvinck joined Blum LP in 1991. From1991 to 1993 he was Vice President and Controller of Blum LP (except for a ten-month period in 1993when he held the position of Personal Assistant to the Chairman of Intabex, where he wasresponsible for worldwide investments). Prior to initially joining Blum LP, he was a Senior Managerin the Capital Markets Services Group of Deloitte & Touche, responsible for merger and acquisitionservices for international and North American clients and for audit services for financialinstitutions. He was previously a Senior Manager at
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Touche Ross & Co. in Cape Town, South Africa. Mr. Schölvinck has a Bachelor of Commerce(Honors) from the University of Cape Town and is a Chartered Accountant (South Africa).     *William S. Urkiel*has served as a director since August 1, 2006. Mr. Urkiel has been a memberof the Board of Directors of Crown Holdings, Inc. since December 9, 2004. From 1999 until 2005, Mr.Urkiel served as Senior Vice President and Chief Financial Officer of IKON Office Solutions. From1995 until 1999, Mr. Urkiel served as the corporate controller and Chief Financial Officer at AMPIncorporated. Prior to 1999, Mr. Urkiel held various financial management positions at IBMCorporation.**Audit Committee**     Our Board of Directors has established an audit committee to review and monitor ourcorporate financial reporting, our internal audit and control functions, the results and scope ofthe annual audit and other services provided by our independent auditors, and our compliance withlegal requirements that have a significant impact on our financial reports. The audit committeealso consults with our management and our independent auditors regarding the preparation offinancial statements and, as appropriate, initiates inquiries into aspects of our financialaffairs. In addition, the audit committee has the responsibility to consider and recommend theappointment of, and to review fee arrangements with, our independent auditors. The current membersof the audit committee are Messrs. Grindstaff, Braswell, and Urkiel. The audit committee met tentimes, including five telephonic meetings, during fiscal year 2006. Our Board of Directors hasdetermined that Kurt D. Grindstaff (the Chairman of our auditcommittee) and William S. Urkiel each qualify as an “audit committeefinancial expert” as defined under Item 401(h) of Regulation S-K.**Section 16(a) Beneficial Ownership Reporting Compliance**     Section 16(a) of the Exchange Act requires our directors, officers, and persons who ownmore than 10% of a registered class of our securities to file reports of ownership and changes inownership with the Securities and Exchange Commission. Directors, officers, and greater than 10%stockholders are required by SEC regulations to furnish us with copies of all Section 16(a) formsthey file. During 2006, we believe that our directors, executive officers and 10 percentstockholders complied with all Section 16(a) filing requirements, except the following officersexercised and sold stock options that were not reported within the two business day deadline:                   **Exercise/ Sale**      **Name** **Date** **Number of Shares** **Exercise Price** **Date Filed**Hargopal (Paul) Singh  3-20-06   6,332  $0.01   4-12-06 Oscar A. Hager  3-20-06   1,117  $0.01   4-12-06 James A. Doran  3-20-06   1,117  $0.01   4-12-06 **Code of Ethics**     We have adopted a Code of Ethics within the meaning of Item 406(b) of Regulation S-K.This Code of Ethics applies to our principal executive officer, principal financial officer andprincipal accounting officer. This Code of Ethics is publicly available on our website atwww.suntroncorp.com/investor/index.html. If we make substantive amendments to this Code of Ethicsor grant any waiver, including any implicit waiver, we will disclose the nature of such amendmentor waiver on our website or in a report on Form 8-K.
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**ITEM 11. EXECUTIVE COMPENSATION****Compensation Discussion and Analysis**     The policies of Suntron’s Compensation Committee (the “Committee”), with respect to thecompensation of executive officers, including the Chief Executive Officer (“CEO”), are designed toprovide compensation sufficient to attract, motivate and retain executives of outstanding abilityand potential and to establish an appropriate relationship between executive compensation and thecreation of stockholder value. To meet these goals, the Committee recommends executive compensationpackages to our Board of Directors that are based on a mix of salary, bonus and equity awards. Webelieve it is important to establish a strong link between executive incentives and the creation ofstockholder value. We believe that performance and equity-based compensation are the most importantcomponent of the total executive compensation package for maximizing stockholder value while, atthe same time, attracting, motivating and retaining high-quality executives.     Overall, we seek to provide total compensation packages that are competitive in terms oftotal potential value to our executives, and that are tailored to the unique characteristics ofSuntron in order to create an executive compensation program that will adequately reward ourexecutives for their roles in creating value for our stockholders. We intend to be competitive withother similarly situated companies in our industry.     ***Benchmarking of Cash and Equity Compensation***     The Committee believes it is important when making its compensation-related decisions tobe informed as to current practices of comparable companies. In 2006, the Committee reviewedcompensation information for comparable public companies using survey data from third-partydatabases. The Committee also considered compensation analysis from Syzygy Consulting, an executivecompensation consulting firm, in determining the equity awards for our CEO and Chief FinancialOfficer. In addition to benchmarking studies, the Committee has historically taken into accountinput from other sources, including input from other independent members of the Board of Directorsand publicly available data relating to the compensation practices and policies of other companieswithin and outside of our industry. While benchmarking may not always be appropriate as astand-alone tool for setting compensation due to the aspects of our business and objectives thatmay be unique to us, we generally believe that gathering this information is an important part ofour compensation-related decision-making process.     The Committee’s objective is to provide for total cash compensation near the median forcomparable companies, by generally targeting performance-based cash compensation at or above themedian and fixed salary compensation at or below the median. The Committee may retain the servicesof third-party executive compensation specialists from time to time, as the Committee sees fit, inconnection with the establishment of cash and equity compensation and related policies.     ***Compensation Components***     *Base Salary.*Generally, we believe that executive base salaries should be set near themedian of the range of salaries for executives in similar positions and with similarresponsibilities at comparable companies. We believe this approach minimizes competitivedisadvantage while avoiding paying amounts in excess of what we believe to be necessary to motivateexecutives to meet corporate goals. Base salaries are generally reviewed annually, and theCommittee and Board may adjust base salary amounts after taking into account individualresponsibilities, performance and experience as well as competitive dynamics.     For our executives that were employed throughout 2006, the increase in the salaries of theexecutive officers was 5.6% and the CEO was 33.3% compared to the annualized salaries at the end of
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2005. The table below sets forth the base salaries for each of the executive officers namedin the Summary Compensation Table (the “Named Executive Officers”):         **Named Executive Officer** **2005 Base Salary** **2006 Base Salary****Hargopal Singh** $300,000  $400,000 **Thomas B. Sabol** $—  $275,000 **James A. Doran** $165,680  $175,000 **Oscar A. Hager** $175,000  $185,000 **John H. Kulp** $200,000  $200,000      The Committee has not determined whether to adjust base salaries for the Named ExecutivesOfficers for 2007.     *Annual Executive Bonus Plan.*In addition to base salaries, we believe that performance-basedcash bonuses play an important role in providing incentives to our executives to achieve definedannual corporate goals. Each year, the Committee determines a target bonus for each executive. TheCommittee then determines certain “threshold” percentages and the corresponding bonus payoutlevels. The Committee works with management to develop corporate performance goals that theCommittee believes management can reasonably achieve with hard work over the next year. For 2006,the Committee based the cash incentive bonus awards for each Named Executive Officer on ourachieving the EBITDA target established by the Committee.     The table below lists the potential 2006 bonus levels for each of our Named ExecutiveOfficers.                       **Bonus Levels as % of Base Salary (1)**  **75%** **87.5%** **100%** **112%** **124%****Named Executive Officer** **of Target** **of Target** **of Target** **of Target** **of Target (2)**Hargopal Singh  60%  90%  120%  120%  120%                     Thomas B. Sabol  —   21%  35%  52.5%  70%                     James A. Doran  —   15%  25%  37.5%  50%                     Oscar A. Hager  —   15%  25%  37.5%  50%                     John H. Kulp  —   15%  25%  37.5%  50% (1) Represents the potential bonus awards for each of our Named Executive Officers, expressedas a percentage of their 2006 base salary, if we achieve the corresponding percentage of theEBITDA target. (2) Represents the maximum potential bonus payout.     At the end of each year, the Committee determines the level of achievement for each corporategoal and awards credit for the achievement of goals as a percentage of the goals. Actual bonusesare paid to the executives after the end of each fiscal year . Bonus payments under our annualbonus plan are contingent on continued employment with Suntron through the date that we pay out thebonus.     In the first quarter of 2007, the Committee confirmed that the minimum EBITDA level for bonuspayments was not achieved, and, accordingly, the Committee decided not to award cash bonuses to ourNamed Executive Officers. The Committee has not determined the performance goals and target bonusawards for 2007.
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     *Equity Awards.*We believe that providing a significant portion of our executives’ totalcompensation package in stock options aligns the incentives of our executives with the interests ofour stockholders and with our long-term success. The Committee and Board develop their equity awarddeterminations based on their judgments as to whether the complete compensation packages providedto our executives, including prior equity awards, are sufficient to retain, motivate and adequatelyaward the executives. This judgment is based in part on information provided by benchmarkingstudies and advice from outside executive compensation experts.     We grant equity awards solely through our Amended and Restated 2002 Stock Option Plan (the“Plan”), which was approved by our stockholders to permit the grant of incentive and nonqualifiedstock options, including performance-based stock options to our officers, directors, employees andconsultants. All of our employees, directors, and consultants are eligible to participate in thePlan. The material terms of the Plan are further described in Note 7 to our financial statementsincluded in Item 8 of our 2006 Annual Report on Form 10-K, filed on April 2, 2007.     In connection with Mr. Sabol’s employment with the Company, in February 2006 we issued optionsto him to purchase 100,000 shares of our common stock. In March 2006, we issued options to purchase150,000 shares of our common stock to Mr. Singh, and 25,000 shares each to Mr. Doran and Mr. Hager.All options were granted at an exercise price equal to the fair market value of our common stock onthe date of grant, and each of these options vest with respect to 25% of the shares on the firstanniversary of the grant date and for an additional 12.5% of the shares every six monthsthereafter.     We also granted performance-vest options to purchase an additional 150,000 shares to Mr. Singhin March 2006 and these options provided for vesting based on the same performance criteria asthose contained in the 2006 Annual Bonus Plan applicable to Mr. Singh. However, since we did notachieve our EBITDA target for 2006, all of these performance-vest options expired on December 31,2006.     The Committee has not determined whether to grant additional equity awards to our NamedExecutive Officers in 2007.     *Severance Benefits.*We have entered into change of control severance agreements with each ofour Named Executive Officers, the terms of which are more fully described below in the sectionentitled “Employment Agreements and Change of Control Arrangements.” We believe these severance andchange in control benefits are an essential element of our executive compensation package andassist us in recruiting and retaining talented individuals.     *Other Compensation.*All of our executives are eligible to participate in our employee benefitplans, including medical, dental, life insurance and 401(k) plans. These plans are available to allsalaried employees and do not discriminate in favor of executive officers. It is generally ourpolicy to not extend significant perquisites to our executives that are not available to ouremployees generally. We have no current plans to make changes to levels of benefits and perquisitesprovided to executives.**Summary Compensation Table**     The following table sets forth information concerning the compensation paid by Suntronfor the fiscal year ended December 31, 2006 to our Chief Executive Officer, our Chief FinancialOfficer, our other two executive officers, and a former executive officer who would have been amongthe five most highly compensated executives if he had been employed at the end of the fiscal year(these five individuals are collectively referred to as our “Named Executive Officers”).
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                             **Name and**             **Equity Awards (1)** **All Other**  **Principal Position** **Year** **Salary** **Bonus** **Stock** **Options** **Compensation** **Total****Hargopal Singh**  2006  $400,000  $3⁄4  $3⁄4  $109,784  $26,403  $536,187 Chief Executive Officer& President                                                         **Thomas B. Sabol (4)**  2006  $241,850  $3⁄4  $3⁄4  $39,344  $10,148  $291,342 Chief Financial Officer                                                         **James A. Doran (4)**  2006  $175,000  $50,000  $3⁄4  $13,214  $39,919  $278,133 Chief Accounting Officer,Treasurer & Secretary                                                         **Oscar A. Hager (3)**  2006  $185,000  $3⁄4  $3⁄4  $13,214  $1,452  $199,666 Vice President- InformationTechnology & Administration                                                         **John H. Kulp (2)**  2006  $28,493  $3⁄4  $3⁄4  $3⁄4  $105,412  $133,905 Former Vice President- Sales& Marketing                             (1) The valuation method and assumptions used to calculate the value of the options granted toour Named Executive Officers are discussed in Note 1 to our financial statements (beginning onpage F-11) included in Item 8 of our 2006 Annual Report on Form 10-K filed on April 2, 2007.For stock options granted in 2006, the fair value of the stock options is being expensed overthe four year vesting period of the option using the attribution method described in FASBInterpretation No. 28. Accordingly, the aggregate amounts shown in the table of $175,556 forthe Named Executive Officers as a group represents approximately 36% of the total expense thatwill be recognized over the entire vesting period, assuming that none of the options areforfeited. (2) Mr. Kulp ceased serving as an executive officer on February 21, 2006. (3) Mr. Hager ceased serving as an executive officer on March 9, 2007. (4) Mr. Doran served as our interim Chief Financial Officer from October 2005 through February13, 2006. Effective February 14, 2006, Mr. Sabol began serving as our Chief Financial Officerand Mr. Doran resumed his duties as our Chief Accounting Officer     “All Other Compensation” in the Summary Compensation Table above includes the followingcomponents:                             **Named Executive** **Moving** **401(k)** **Retention** **Severance** **Commuting** **Spousal**  **Officer** **Costs** **Match** **Benefits** **Benefits** **Costs** **Travel** **Total****Hargopal Singh** $21,272  $2,769  $3⁄4  $3⁄4  $3⁄4  $2,362  $26,403                              **Thomas B. Sabol** $7,821  $2,327  $3⁄4  $3⁄4  $3⁄4  $3⁄4  $10,148                              **James A. Doran** $3⁄4  $2,438  $5,000  $3⁄4  $32,481  $3⁄4  $39,919                              **Oscar A. Hager** $3⁄4  $1,452  $3⁄4  $3⁄4  $3⁄4  $3⁄4  $1,452                              **John H. Kulp** $3⁄4  $412  $3⁄4  $105,000  $3⁄4  $3⁄4  $105,412      (1) The amount shown in the Severance Benefits column for Mr. Kulp was paid over the sixmonth period ended after employment was terminated on February 21, 2006.
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**2006 Grants of Plan-Based Awards**     We granted performance-vest options for 150,000 shares to Mr. Singh in March 2006 and theseoptions provided for vesting based on the same performance criteria as those contained in the 2006Annual Bonus Plan applicable to Mr. Singh. None of our Named Executive Officers qualified for apayout under the 2006 Annual Bonus Plan and, accordingly, all of Mr. Singh’s performance-vestoptions expired on December 31, 2006. No other Named Executive Officer received an Equity orNon-equity incentive-based award in 2006.     The following table sets forth information regarding plan-based awards to our Named ExecutiveOfficers in 2006, all of which provide that the option will expire ten years from the date ofgrant:                   **Number of** **Exercise** **Grant Date**    **Securities** **Price of** **Fair Value**    **Underlying** **Option** **of Option****Named Executive Officer** **Grant Date** **Options (1)** **Award(2)** **Awards (3)****Hargopal Singh** 3/17/06  150,000  $2.50  $264,000 **Thomas B. Sabol** 2/14/06  100,000  $1.86  $131,000 **James A. Doran** 3/17/06  25,000  $2.50  $44,000 **Oscar A. Hager** 3/17/06  25,000  $2.50  $44,000  (1) Represents options to purchase shares of Suntron common stock that become exercisable for25% of the underlying shares on the first anniversary of the date of grant and 12.5% insemi-annual installments thereafter, so long as the executive remains employed with Suntron.Does not include the performance-vest options granted to Mr. Singh in March 2006 describedabove, which expired on December 31, 2006. (2) The exercise price was equal to the fair market value of our common stock on the grant date. (3) The grant date fair value of these stock options is being expensed over the four year vestingperiod of the option using the attribution method described in FASB Interpretation No. 28. Theamounts shown in the table will be recognized as an expense in our financial statements overthe vesting period, assuming that none of the options are forfeited. The Black-Scholesvaluation model was used to arrive at the amount shown in the table using key assumptions thatincluded historical volatility of our stock of 98.6%, an expected term for the options of 4.5years, a risk-free interest rate of 4.9%, and that we would not pay any dividends on ourcommon stock.**Outstanding Equity Awards at Fiscal Year-End**     None of our Named Executive Officers received restricted stock awards in 2006. The followingtable sets forth information regarding each unexercised stock option held by our Named ExecutiveOfficers as of December 31, 2006:
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                     **Number of Securities Underlying**      **Grant** **Outstanding Options** **Exercise** **Expiration****Named Executive Officer** **Date** **Exercisable** **Unexercisable** **Price** **Date****Hargopal Singh** 7/26/04  25,000   —  $10.52  7/25/14  5/6/05  175,000   525,000  $1.79  5/5/15  8/29/05  —   56,950  $0.01  3/10/08  3/17/06  —   150,000  $2.50  3/16/16 **Thomas B. Sabol** 7/26/04  15,000   —  $4.16  7/25/14  9/30/04  1,000   —  $4.95  9/29/14  12/31/04  400   600  $3.14  12/30/14  3/31/05  200   800  $2.15  3/30/15  6/30/05  200   800  $1.06  6/29/15  9/30/05  200   800  $1.35  9/29/15  12/31/05  200   800  $1.22  12/30/15  2/14/06  —   100,000  $1.86  2/13/16 **James A. Doran** 9/13/99  22,500   —  $13.52  9/12/09  7/17/00  1,875   —  $10.52  7/16/10  4/24/02  16,000   —  $10.52  4/23/12  6/19/02  1,875   —  $10.52  7/16/10  8/29/05  —   2,792  $0.01  3/10/08  12/9/05  —   1,395  $0.01  3/10/08  3/17/06  —   25,000  $2.50  3/16/16 **Oscar A. Hager** 4/12/99  7,500   —  $18.76  4/11/09  11/1/00  3,750   —  $10.52  10/31/10  1/16/01  1,875   —  $10.52  1/15/11  4/24/02  18,000   —  $10.52  4/23/12  6/19/02  1,875   —  $10.52  1/15/11  6/19/02  3,750   —  $10.52  10/31/10  12/31/02  17,500   —  $3.74  12/30/12  8/29/05  —   4,186  $0.01  3/10/08  3/17/06  —   25,000  $2.50  03/16/16 **John H. Kulp** —  —   —   —  —**Option Exercises and Stock Vested in 2006**     The following table sets forth information with respect to Suntron’s Chief Executive Officerand the executive officers named in the Summary Compensation Table concerning options exercised in2006:
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                   **Option Awards** **Stock Awards**  **Number of** **Value** **Number of**    **Shares** **Realized** **Shares** **Value****Named Executive** **Acquired on** **Upon** **Acquired** **Realized on****Officer** **Exercise** **Exercise** **on Vesting** **Vesting**Hargopal Singh  33,230  $59,191   —  $—                  Thomas B. Sabol  —  $—   —  $—                  James A. Doran  14,863  $22,640   —  $—                  Oscar A. Hager  20,864  $34,189   —  $—                  John H. Kulp  12,000  $17,970   —  $— **Employment Agreements and Change of Control Arrangements**     On May 16, 2006, we entered into an Amended and Restated Employment Agreement with HargopalSingh, our President and Chief Executive Officer, pursuant to which his existing employmentagreement was amended to (i) increase his base salary to $400,000 effective January 1, 2006; (ii)provide for a potential 2006 performance bonus of up to $480,000, based on achieving certainrevenue, EBITDA and operational objectives established by the Committee; and (iii) provide for aseverance payment equal to three times the sum of his base salary and the maximum bonus payable tohim by Suntron for the fiscal year in which his employment is terminated, in the event that hisemployment is terminated within 12 months following a “Change of Control” (as defined in theagreement) by either (1) the Company without “Cause” (as defined in the agreement) or (2) Mr. Singhfor “Good Reason” (as defined in the agreement).     On February 14, 2006, we entered into a Change of Control Severance Agreement with Thomas B.Sabol in connection with his appointment as our Chief Financial Officer. On May 16, 2006, theCompany also entered into Change of Control Severance Agreements with James A. Doran and Oscar A.Hager, the Company’s Chief Accounting Officer and Vice President of Information Technology andAdministration, respectively (each a “Change of Control Agreement”). Each Change of ControlAgreement provides that, in the event the executive is terminated within 12 months following a“Change of Control” (as defined in the Change of Control Agreement) by either (1) us without“Cause” (as defined in the Change of Control Agreement) or (2) the executive for “Good Reason” (asdefined in the Change of Control Agreement), the executive will be entitled to receive as severancea payment equal to two times the sum of his base annual salary and the maximum bonus payable to himby us for the fiscal year in which the executive’s employment was terminated.             **Named Executive Officer** **Salary** **Bonus** **Total****Hargopal Singh** $1,200,000  $1,440,000  $2,640,000 **Thomas B. Sabol** $550,000  $385,000  $935,000 **James A. Doran** $350,000  $175,000  $525,000 **Oscar A. Hager** $370,000  $185,000  $555,000 **John H. Kulp** $—  $—  $— 
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**Compensation Committee Interlocks and Insider Participation**     As of the fiscal year ended December 31, 2006, our compensation committee consisted of Messrs.Forese (chairman) and Schölvinck. None of these individuals had any contractual or otherrelationships with us during such fiscal year except as directors and those transactions discussedunder “Certain Relationships and Related Transactions”. No interlocking relationship existsbetween any member of our compensation committee and any member of any other company’s Board ofDirectors or compensation committee.**Report of the Compensation Committee**     The Committee has reviewed and discussed with management the Compensation Discussion andAnalysis required by Item 402(b) of Regulation S-K, which is contained in this Annual Report onForm 10-K. Based on this review and discussion, the Compensation Committee has recommended to theBoard of Directors that the Compensation Discussion and Analysis be included in this Annual Reporton Form 10-K.*Members of the Suntron Corporation Compensation Committee:*James J. ForeseMarc T. Schölvinck**Non-Employee Director Compensation**     Our independent non-employee directors are entitled to an annual retainer of $15,000 which ispayable on a quarterly basis. Additionally, each independent non-employee director is entitled toBoard fees of $500 per meeting; $10,000 for serving on a Special Committee; $1,000 for attendingaudit committee meetings ($500 for telephonic meetings); $500 for attending compensation,nominating and corporate governance committee meetings ($250 for telephonic meetings). The Chairmanof the audit committee receives an additional $500 for each meeting attended and $250 for eachtelephonic meeting.     Upon joining our Board of Directors, each independent non-employee director receives aninitial stock option award for 15,000 shares which is exercisable at the market price on the dateof grant and which vests for 20% of the shares on December 31st of each year subsequentto the grant date. At the end of each quarter thereafter, an option for 1,000 shares is granted atan exercise price equal to the closing market price on the date of grant and which vests for 20% ofthe shares on the first anniversary of the grant date and 20% each year thereafter. Our directorsare also entitled to receive reimbursement of reasonable out-of-pocket expenses incurred by them toattend our Board and committee meetings.     The following table sets forth a summary of the compensation we paid to our independentnon-employee directors in 2006:
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               **Fees**      **Earned or**      **Paid in** **Option**  **Named Executive Officer** **Cash** **Awards (1)(2)** **Total****Allen S. Braswell, Jr. (3)** $34,000  $590  $34,590 **Kurt D. Grindstaff (4)** $38,750  $590  $39,340 **Thomas B. Sabol (5)** $3,333  $—  $3,333 **William S. Urkiel (6)** $10,736  $3,975  $14,711  (1) The valuation method and assumptions used to calculate the value of the options granted toour independent non-employee directors are discussed in Note 1 to our financial statements(beginning on page F-11) included in Item 8 of our 2006 Annual Report on Form 10-K filed onApril 2, 2007. For stock options granted in 2006, the fair value of the stock options is beingexpensed over the vesting period of the option using the attribution method described in FASBInterpretation No. 28. Accordingly, the aggregate amounts shown in the table of $5,155 for theaggregate of all 2006 grants to the independent non-employee directors as a group representsapproximately 18% of the total expense that will be recognized over the entire vesting period,assuming that none of the options are forfeited. (2) The grant date fair value of these stock options was determined using the Black-Scholesvaluation model using key assumptions for historical volatility of our stock of 98.4%, anexpected term for the options of 4.5 years, a risk-free interest rate of 4.7%, and that wewould not pay any dividends on our common stock. (3) Fees Earned or Paid in Cash include a $10,000 fee earned for serving on a Special Committeeof our Board of Directors in 2006. (4) Fees Earned or Paid in Cash include a $10,000 fee earned for serving on a Special Committeeof our Board of Directors in 2006. (5) Fees Earned or Paid in Cash consists of compensation received by Mr. Sabol in 2006 forservices as a director prior to his appointment as our CFO on February 14, 2006. Mr. Sabol didnot receive compensation for his services as a director after he was appointed as our CFO. (6) Mr. Urkiel joined our board in August 2006. The fees paid to him include a pro-rated portionof his retainer for the period during which he served as a director.
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**ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATEDSTOCKHOLDER MATTERS**     The following table sets forth information with respect to our common stock beneficiallyowned as of March 31, 2007 by (a) each person known by us to own beneficially more than fivepercent of our outstanding common stock, (b) each of our directors, (c) each of our executiveofficers, and (d) all of our directors and executive officers as a group.**Beneficial Ownership Table**           **Shares Beneficially Owned****Name of Beneficial Owner(1)** **Number** **Percent (2)**Thayer-Blum Funding III, L.L.C. (3)  24,582,191   89.1%Hargopal Singh (4)  421,988   1.5%Allen S. Braswell, Jr. (5)  216,094   * Ivor J. Evans (6)(7)  24,607,191   89.1%James J. Forese (6)  24,582,191   89.1%Kurt D. Grindstaff (8)  6,200   * Douglas P. McCormick (6)  24,582,191   89.1%Scott D. Rued (6)  24,582,191   89.1%Thomas B. Sabol (9)  42,400   * Marc T. Schölvinck (6)  24,582,191   89.1%William S. Urkiel (10)  3,000   * James A. Doran (11)  50,266   * All directors and executive officers as a group(12 persons) (6)(12)  25,344,139   90.0% * Represents less than 1% of our outstanding common stock. (1) Except as otherwise indicated, the address of each person listed in the table is 2401 WestGrandview Road, Phoenix, Arizona 85023. (2) We have determined beneficial ownership in accordance with the rules of the SEC. Incomputing the number of shares beneficially owned by a person and the percentage ownership ofthat person, we have included the shares of common stock subject to options and convertiblesecurities held by that person that are currently exercisable or convertible or will becomeexercisable or convertible within 60 days after March 31, 2007, but we have not included thoseshares for purposes of computing percentage ownership of any other person. We have assumedunless otherwise indicated that the persons and entities named in the table have sole votingand investment power with respect to all shares beneficially owned, subject to communityproperty laws where applicable. Beneficial ownership is based on 27,591,821 shares of ourcommon stock outstanding as of March 31, 2007. (3) Thayer-Blum Funding III, L.L.C. is owned as follows: 59.94% by Thayer Equity Investors IV,L.P., 0.04% by TC Manufacturing Holdings, L.L.C., 0.02% by TC KCo, L.L.C., 33.9% by BlumStrategic Partners, L.P., and 6.1% by Blum (K*TEC) Co-Investment Partners, L.P.   TC Manufacturing Holdings, L.L.C. is controlled by limited liability companies, the managingmembers of which are Frederick Malek, Carl Rickersten, and Paul Stern.   Thayer Equity Investors IV, L.P. is controlled by a limited liability company, the managingmembers of which are Frederick Malek and Carl Rickersten.   TC KCo, L.L.C. is controlled by a limited liability company, the managing members of which areFrederik Malek and Carl Rickersten.   Blum Strategic Partners, L.P. is controlled by a limited liability company, of which thegeneral partner is Blum Strategic GP, L.L.C.
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  Blum (K*TEC) Co-Investment Partners, L.P. is controlled by a limited liability company, ofwhich the general partner is Blum Strategic GP, L.L.C.   Messrs. McCormick and Rued, both directors of ours, are Managing Partners of the limitedliability company that controls Thayer Equity Investors IV, L.P. Mr. Forese, one of ourdirectors, is an Operating Partner and Chief Operating Officer of the company that controlsThayer Equity Investors IV, L.P. Mr. Evans, one of our directors, is an Operating Partner ofthe company that controls Thayer Equity Investors IV, L.P. Mr. Schölvinck is a member ofthe general partner of Blum Strategic Partners, L.P.   The address of Thayer-Blum Funding III, L.L.C. is 1455 Pennsylvania Avenue, N.W., Suite 350,Washington, D.C. 20004. (4) Includes of 417,244 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (5) Includes 37,561 shares beneficially owned by the Allen S. Braswell, Jr. Family LimitedPartnership; 24,455 shares beneficially owned by the Allen S. Braswell, Jr. Gifting Trust; 6shares beneficially owned by Uniform Gift to Minors Accounts of the minor children of Allen S.Braswell, Jr.,; 133,522 shares beneficially owned by Circuit Test International GRIT LimitedPartnership, of which Braswell Investment Corporation (“BIC”) is a general partner; and20,550 shares issuable pursuant to options that are exercisable within 60 days of March 31,2007. Allen S. Braswell, Jr. is president of BIC. (6) Reflects 24,582,191 shares held by Thayer-Blum Funding III, L.L.C. See footnote 3. Messrs.Evans, Forese, McCormick, Rued, and Schölvinck disclaim beneficial ownership of these shares,except to the extent of any pecuniary interest therein. (7) Includes 25,000 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (8) Consists of 6,200 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (9) Consists of 42,400 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (10) Consists of 3,000 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (11) Includes 49,337 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007. (12) Includes 563,731 shares issuable pursuant to options that are currently exercisable orexercisable within 60 days of March 31, 2007.
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**ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS****Thayer-Blum Management Fees**     During 2006, we incurred $750,000 for management fees to affiliates of our majoritystockholder, Thayer-Blum Funding III, L.L.C. The services provided under this arrangement consistof management fees related to corporate development activities and consulting services forstrategic and operational issues.**Thayer Equity Note Purchase Agreement**     On March 30, 2006, we entered into a $10,000,000 subordinated Note Purchase Agreement (the“Second Lien Note”) with Thayer Equity Investors IV, L.P. The Second Lien Note is collateralizedby a second priority security interest in substantially all of the collateral under the US Bankcredit agreement. The Second Lien Note is subordinated in right of payment to the obligations underthe US Bank credit agreement and provides for a maturity date that is 45 days after the maturitydate of the US Bank credit agreement. The Second Lien Note provides for an interest rate of 16.0%,payable quarterly in kind (or payable in cash with written approval from US Bank). We have theoption to prepay the Second Lien Note with a redemption penalty up to 3.0% of the then outstandingprincipal balance. If the note is paid on the maturity date, a fee equal to 2.0% of the thenoutstanding principal balance is due.**Thayer Equity FCC Maintenance Agreement**     In connection with the US Bank credit agreement, Thayer Equity Investors IV, L.P. agreed toenter into a FCC maintenance agreement that requires them to make up to $5,000,000 of additionalsubordinated loans to us if our fixed charge coverage ratio, or FCC, falls below a prescribedlevel. Loans pursuant to the FCC maintenance agreement would have similar terms as the Second LienNote; however, the interest rate on such additional loans can not exceed 18.0%.
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**ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES**     KPMG LLP served as our independent registered public accounting firm for each of theyears in the three-year period ended December 31, 2006.**Fees Charged By Independent Registered Public Accounting Firm**     The following is a summary of fees, all of which were approved by our audit committee, billedby KPMG LLP for audit and other professional services during the years ended December 31, 2005 and2006:           **2005**  **2006** Audit fees and expenses $255,000  $275,000 Audit-related fees  —   11,400 Income tax fees  7,000   — All other fees  —   —                 Total fees $262,000  $286,400             “Audit-related fees” include fees related to the statutory audit of our Mexican subsidiary.“Income tax fees” include tax return preparation and consultation on various tax-related issues.**Pre-Approval Policy for Independent Registered Public Accounting Firm’s Fees**     In 2003 our Audit Committee adopted a formal policy concerning pre-approval of audit andnon-audit services to be provided by our independent auditors. The policy requires that allproposed services to be provided by KPMG LLP must be pre-approved by the audit committee before anyservices are performed. This policy includes all audit, tax and consulting services that KPMG LLPmay provide to the Company. In evaluating whether to engage KPMG LLP for non-audit services, ourAudit Committee considers whether the performance of services other than audit services iscompatible with maintaining the independence of KPMG LLP.
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**SIGNATURES**     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of1934, the Registration has duly caused this report to be signed on its behalf by the undersigned,thereunto duly authorized.      **SUNTRON CORPORATION**