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U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
 FORM 10-K x
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended June 30, 2004 Commission File No. 0-23866 VL Dissolution Corporation  Colorado
    
    06-0679347(State or other jurisdiction of incorporation)
    
    (I.R.S. Employer Identification No.)
 1625 Broadway
Suite 990
Denver, Colorado 80202
(303) 592-5700
(Address and Telephone Number of Principal Executive Offices) Securities registered under Section 12(b) of the Exchange Act:
None Securities registered under Section 12(g) of the Exchange Act: Title of
Class   Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past
90 days. x  Yes o  No Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-K contained in this form, and no disclosure will be
contained, to the best of issuers knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. x Check if registrant is an accelerated filer (as defined in Rule 12b-2 of the
Act). o  Yes x  No As of June 28, 2004, all remaining assets of the issuer were distributed
to its shareholders and the stock transfer books were closed. The distribution
resulted in the complete redemption and cancellation of all outstanding shares
of the Common Stock. Accordingly, there are no remaining holders of record of
the issuers Common Stock.




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TABLE OF CONTENTS  PART IItem 1. BusinessItem 2. Description of PropertyItem 3. Legal ProceedingsItem 4. Submission of Matters to a Vote of Security HoldersPART IIItem 5. Market for Common Equity and Related Stockholder MattersItem 6. Selected Financial DataItem 7. Managements Discussion and Analysis of Financial Condition and Results of OperationsItem 7A. Quantitative and Qualitative Disclosures about Market RiskItem 8. Financial StatementsItem 9. Changes In and Disagreements With Accountants on Accounting and Financial DisclosureItem 9A. Controls and ProceduresPART IIIItem 10. Executive Officers and Directors of the RegistrantItem 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 ServicesPart IVItem 15. Exhibits, Financial Statement Schedules and Reports on Form 8-KSIGNATURESFinancial StatementsReport of Independent Registered Public Accounting FirmStatements of Net Assets in LiquidationStatements of Changes in Net Assets in LiquidationStatements of OperationsStatements of Stockholders EquityStatements of Cash FlowsNotes to the Financial StatementsExhibit IndexCertification Pursuant to Section 302Certification Pursuant to Section 906    Table of Contents  
 PART I 
 Item 1. Business Introduction VL Dissolution Corporation, formerly Vari-L Company, Inc., a Colorado
corporation (the Company), was engaged in the process of orderly liquidation
of its remaining assets, the winding up of its business and operations, and the
dissolution of the Company. Effective June 28, 2004, we distributed all of our
remaining assets to our shareholders. On May 5, 2003, we completed the sale of substantially all of our assets to a
wholly owned subsidiary of Sirenza Microdevices, Inc. (Sirenza). In exchange
for the assets sold, we received cash and shares of Sirenzas common stock. At
the time of the closing, the cash and stock were valued at approximately
$14.469 million, which consisted of $3.835 million in cash, $5.143 million in
Sirenza stock (3.255 million shares valued at $1.53 per share), and assumption
and forgiveness of $5.948 million in debt and accrued interest by Sirenza. We
also adopted a plan of dissolution, which included the change of our corporate
name to VL Dissolution Corporation. All of our officers and employees resigned
or were terminated following the closing of the asset sale. To manage the
Companys wind down and liquidation, we retained Cloyses Partners, LLC
(Cloyses), an independent consulting firm. As of the date of this filing, we have completed the process of the orderly
liquidation of our remaining assets, the winding up of the business, and our
dissolution. The process involved the sale and disposition of assets that were
not acquired by Sirenza, the payment of or provision for liabilities and other
claims that were not assumed by Sirenza, and the distribution of all remaining
assets to our shareholders. During the year ended June 30, 2004, we made aggregate distributions to our
shareholders of approximately 2.7 million shares of Sirenzas common stock
valued at $11.8 million at the time of such distributions and approximately
$1.5 million in cash. At June 30, 2004, we have satisfied our known liabilities
and distributed all of our assets other than a small cash balance to satisfy
any remaining liabilities relating to our liquidation. Accordingly, we will not
make any further distributions to our shareholders and the Company will cease
to exist in any capacity. As outstanding shares of our common stock are deemed worthless as of the date
of final distribution, our Board of Directors approved the closing of our stock
transfer books. Accordingly, no transfers of shares of our common stock have
been registered on our stock transfer books or otherwise recognized by us after
July 13, 2004, the date on which our transfer books were closed. We have also filed Form 15 with the Securities and Exchange Commission,
pursuant to which our duty to file reports required under Section 13(a) of the
Securities Exchange Act of 1934, as amended, was immediately suspended and our
duty to file reports required under Section 15(d) of the Securities Exchange
Act of 1934, as amended, was suspended as of June 30, 2004. This annual report
represents our final periodic report to be filed with the Securities Exchange
Commission. No other filings will be made with the Securities and Exchange
Commission and no further communications will be made to our shareholders. Business Operations Prior to the Asset Sale Prior to closing the asset sale to Sirenza, we designed, manufactured, and
marketed a wide variety of radio frequency and microwave components and devices
for use in wireless communications. Our products were used in many different
commercial and military/aerospace applications, including 2




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wireless telecommunications networks, wireless base stations, wireless
point-to-point radio systems, wireless point-to-multi-point radio systems,
wireless local area networks, satellite payload, test equipment
(instrumentation) and ground communications, radar systems, weapons guidance
systems and advanced telemetry systems. We operated as a single business unit
and continued to report as such during liquidation. While we no longer have
active business operations, the following description of our business
operations prior to the asset sale is provided to aid our readers
understanding of our historical financial statements. Our products were primarily used as parts or components of other manufacturers
wireless communications products or equipment. Wireless communication is the
transmission of voice or data signals through the air, without a physical
connection, such as a metal wire or fiber-optic cable. Information transmitted
through wireless communications equipment is transmitted by electromagnetic
waves, also known as signals. Electromagnetic waves vary in length, frequency,
and intensity. The range of electromagnetic waves is called the spectrum,
which encompasses audio near the low end and light toward the higher end. In
between is the radio spectrum used in most wireless communications. RF refers
to the lower frequencies in the spectrum while microwave refers to higher
frequencies. For more than 50 years, we supplied wireless communications products to the
military/aerospace industry. In 1993, we expanded our engineering,
manufacturing and sales efforts to address the growing demand for commercial
wireless communications products. In 2002, we expanded our product line by
introducing wideband voltage-controlled oscillators and stripline couplers. Through May 5, 2003, our principal commercial customers were original equipment
manufacturers (OEMs) and contract manufacturers that design and build
electronic products and equipment such as cellular base stations, point to
point radios, pagers and radar systems. These contract manufacturers included
Solectron, Flextronics and Sanmina-SCI. Our commercial product lines were
marketed to OEM customers including Motorola, Ericsson, Lucent, Nokia,
Microwave Data Systems, Hughes Network Systems, GE Medical and Siemens. We sold
our military/aerospace product lines to companies such as Raytheon, Lockheed
Martin, Northrup Grumman and Textron. Our product lines fell into two major categories: products which produce
electromagnetic signals, which we referred to as signal source components, and
products which receive or process electromagnetic signals, or passive
components. Sales of our products were generated through a combination of
manufacturers representatives and our own direct sales force team, and were
supplemented by advertising in trade magazines, participating in trade shows
and on our website. Most of our products were customized according to our
customers specifications, but we also produced some standard products. We
also designed and manufactured custom products in response to specific customer
requirements. The majority of our sales were in parts that are customized to
meet the performance requirements of specific customers. Products Prior to the closing of the asset sale to Sirenza, we had three primary product
lines:  
    
    Commercial Signal Sources
    
    High-Reliability Signal Sources
    
    Military Signal Processing Components Most of our revenue came from sales of signal source components namely,
voltage-controlled oscillators (VCOs) and phase locked loop synthesizers
(PLLs). These signal source components were designed to produce a high
quality signal that can be used over a range of radio frequencies. We held six
patents related to signal source design and technology. These patents were
included in the assets sold to Sirenza. 3




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Commercial Signal Source Components From 1996 through 2003, most of our revenues came from sales of our commercial
narrowband VCOs. However, in mid-2003 we were beginning to see a shift in the
wireless industry from VCOs to PLLs resulting in increasing sales of our PLLs.
The PLL assemblies consisted of our VCOs integrated with other components and
had a higher average selling price than our VCOs. Our VCOs and PLLs were used
in high-performance cellular base stations and other demanding applications
where signal quality was especially important. High-Reliability Signal Source Components Our high reliability, or hi-rel, signal source components performed the same
function as the commercial signal source components. Our hi-rel signal source
components, however, were constructed using different assembly techniques
because they are designed to operate in different operating environments. These
components were designed for wideband applications (i.e., applications
involving a wider range of signal frequencies) and were constructed in
hermetically sealed packages for use over extended temperature ranges and in
adverse environments. Hi-rel products were typically specified for both
military/aerospace and high-end industrial applications. Military Signal Processing Components Our military signal processing components were primarily used in military and
aerospace applications. These products included power dividers and combiners
used for directing RF and microwave signals, solid state switches used to
change the routing of RF and microwave signals, and transformers used to
convert signals between different impedances. We also produced mixers, which
were used to convert the frequency of RF and microwave signals to baseband
signals. Other Products In March 2002, we introduced a line of 3-dB hybrid couplers. 3-dB hybrid
couplers were critical components used to build high-power amplifiers, vector
modulators and antenna systems. We also offered other passive components (couplers, transformers and power
dividers) that were used in a variety of niche fiber-optic applications,
including cable television and point-to-point data transmission networks.
However, these products did not account for a significant percentage of our
total revenue. Manufacturing Through the date of the asset sale to Sirenza, we manufactured most of our
products in our own facilities in Denver, Colorado. All of our products were
completed and tested at our manufacturing facilities in Denver, Colorado. A
contract manufacturer who specialized in the unique production process required
by this product manufactured our 3dB hybrid couplers. Final testing and marking
was performed at our facilities in Denver, Colorado. Sales and Marketing Our original business focus was on the military/aerospace market. In 1993, we
expanded our market focus to include commercial applications, to lessen our
susceptibility to cyclical trends in defense spending and to seek a share of
the growing market for commercial wireless communications products. As a
result of this shift, our business became less dependent on U.S. military
spending and more dependent on the commercial telecommunications market. During
the fiscal year ended June 30, 2002 and the period from July 1, 2002 to May 5,
2003, demand for our core products sold 4




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to the telecommunications equipment providers fell dramatically due to an
overall slowdown within the telecommunications industry, including rapid
declines in expenditures for capital infrastructure equipment by service
providers. Our commercial signal source product line accounted for 76% and 73% of revenue
for the period from July 1, 2002 to May 5, 2003 and for the year ended June 30,
2002. The following table summarizes our net sales by product line (in thousands of
dollars): Period from
    
    YearJuly 1, 2002 to
    
    EndedMay 5, 2003
    
    June 30, 2002Commercial Signal Source Components
    
    $
    10,541
    
    
    $
    15,615Hi-Rel Signal Source Components
    
    
    2,684
    
    
    
    3,651Military Signal Processing Components
    
    
    630
    
    
    
    1,848Other Products
    
    
    56
    
    
    
    234Net sales
    
    $
    13,911
    
    
    $
    21,348
 We sold our products primarily through manufacturers representatives who
promoted and solicited orders for our products on a commission basis in
exclusive marketing territories. We typically engaged 14 to 16 manufacturers
representative firms in the U.S. We also had 20 manufacturers representatives
covering 18 foreign countries. In addition, we had a direct-sales force. Customers Our principal customers were OEMs and contract manufacturers of communications
equipment in either the commercial or military/aerospace marketplace. Many of
our customers were large international and domestic companies with worldwide
operations or prime contractors for military/aerospace work. Through May 5, 2003, our key customers included ACAL Electronics, Hughes
Network Systems, Ericsson, Motorola, Nokia, Microwave Data Systems, Siemens and
Solectron in the commercial market, and Boeing (formerly Hughes), Lockheed
Martin, Textron, Northrop Grumman, Raytheon and in the military/aerospace
market. The following represents the sales revenues from our largest customers as a
percentage of our total sales: Period from
    
    Year endedJuly 1, 2002 to
    
    June 30,May 5, 2003
    
    2002Nokia
    
    
    23
    %
    
    
    18
    %Motorola
    
    
    13
    %
    
    
    17
    %ACAL Electronics (includes Siemens)
    
    
    11
    %
    
    
    13
    %
 Our customers historically purchased products from us as needed, rather than
through long-term supply contracts. We did, however, enter into long-term
purchase agreements with some of our 5




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larger customers that established preferred vendor status for us and, in most
cases, indicated estimated purchase quantities over the term of the agreement. Competition We considered Mini-Circuits, M/A-COM, Matsushita, ALPs, Temex and Z-Com to be
our largest competitors in the commercial signal source components market.
Additionally, we believed Merrimac Industries was our largest competitor in the
military signal processing components market. Remec/Magnum was our primary
competitor in the Hi-Rel signal source components market and Anaren Microwave
was our primary competitor in the coupler market. Research and Development Prior to the asset sale to Sirenza, we focused our research and development
efforts in the following areas:  
    
    Application engineering,
    
    Improvement of the Commercial Signal Source product line, and
    
    Development of new product lines. Our research and development team focused on developing both new base
technologies and design methodologies for existing base technologies. The
application and design engineering team used these efforts and modified and/or
extended them to meet specific customer needs. We also had an ongoing product
improvement program. Our research and development expenses for the period from July 1, 2002 to May
5, 2003 were $2.4 million compared to $2.7 million for the year ended June 30,
2002. Patents We do not have any patents. Employees We had no employees as of June 30, 2004 and 2003. All persons who have provided
services to the Company, including Cloyses, have done so in their capacity as
independent contractors. 6




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Financial Information about Geographic Regions Prior to May 5, 2003, we attributed sales to customers based on the country to
which the products were shipped. Net sales by country were as follows (in
thousands of dollars): Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002United States
    
    $
    5,954
    
    
    
    8,985China
    
    
    2,506
    
    
    
    3,800Finland
    
    
    2,217
    
    
    
    2,995Germany
    
    
    647
    
    
    
    1,147Sweden
    
    
    623
    
    
    
    1,321Italy
    
    
    404
    
    
    
    462England
    
    
    232
    
    
    
    1,349Canada
    
    
    201
    
    
    
    109Other
    
    
    1,127
    
    
    
    1,180Net sales
    
    $
    13,911
    
    
    
    21,348
 
 Item 2. Description of Property At June 30, 2004, we have no facilities. We previously leased a 13,500 square
foot building in Denver, Colorado which was our main commercial products
manufacturing facility from a partnership that included our former Chief
Scientific Officer as the general partner. This lease was scheduled to expire
on October 31, 2005 and the lease rate was $10,801 per month. We had the option
to terminate the lease in the event the landlord contracted to sell the
property during the lease term. In April 2004, the building was sold and we
terminated the lease. In connection with the termination of the lease, we made
a lease termination payment of $203,100. 
 Item 3. Legal Proceedings As of June 30, 2004, there are no material legal proceedings involving the
Company. 
 Item 4. Submission of Matters to a Vote of Security Holders None 7




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PART II 
 Item 5. Market for Common Equity and Related Stockholder Matters. Market Our stock was traded on the Over the Counter Bulletin Board system (the
OTCBB) under the stock symbol VARL until November 25, 2003. Our stock was
delisted by the OTCBB for failure to remain in compliance with the listing
requirements set forth in OTCBB Rule 6530. Beginning November 26, 2003 and
until the final distribution to our shareholders, our stock was quoted on the
Pink Sheets OTC market under the stock symbol VLDS.PK. The following table
sets forth the high and low prices for the common stock for the periods
indicated: High
    
    LowQuarter ended September 30, 2002
    
    $
    1.05
    
    
    $
    0.45Quarter ended December 31, 2002
    
    $
    0.90
    
    
    $
    0.21Quarter ended March 31, 2003
    
    $
    0.77
    
    
    $
    0.40Quarter ended June 30, 2003
    
    $
    0.67
    
    
    $
    0.41Quarter ended September 30, 2003Quarter ended December 31, 2003
    
    $
    0.73
    
    
    $
    0.62Quarter ended March 31, 2004
    
    $
    0.98
    
    
    $
    0.63Period ended June 28, 2004
    
    $
    0.82
    
    
    $
    0.61
 As the outstanding shares of our common stock are deemed worthless as of the
date of the final distribution, our Board of Directors approved the closing of
our stock transfer books. Accordingly, no transfers of shares of our common
stock have been registered on our stock transfer books or otherwise recognized
by us after July 13, 2004, the date on which our transfer books were closed. Holders As of June 28, 2004, all remaining assets of the Company were distributed to
our shareholders and the stock transfer books were closed. Under our Amended
Plan of Dissolution the distribution of our remaining assets to our
shareholders resulted in the complete redemption and cancellation of all
outstanding shares of Common Stock. Accordingly, there are no remaining holders
of record of our common stock. Dividends/Distributions On October 31, 2003, our Board of Directors effected an initial distribution
(or conversion to cash in the case of fractional shares) of approximately 1.4
million shares of Sirenzas common stock to our shareholders. On June 28, 2004, our Board of Directors effected a final distribution (or
conversion to cash in the case of fractional shares) of approximately 1.3
million shares of Sirenzas common stock and approximately $1.5 million in cash
to our shareholders. 8




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Item 6. Selected Financial Data The selected historical financial information presented below (in thousands of
dollars, except share and per share data) should be read in conjunction with
Managements Discussion and Analysis of Financial Condition and Results of
Operations and our financial statements and related notes thereto. Certain
fiscal year 2002 amounts have been reclassified to conform to the fiscal year
2003 presentation. The financial statements for periods prior to June 30, 2000
have not been audited. Upon the sale of substantially all of our operating assets to Sirenza on May 5,
2003, we terminated our employees and ceased operations. Accordingly, a
comparison of the selected financial data for the period from July 1, 2002 to
May 5, 2003 with that of the prior fiscal years should take into account the
fact that the Company ceased its operations just over ten months after the
beginning of the fiscal year ended June 30, 2003. Period
    
    
    
    
    
    
    
    
    
    Twelvefrom
    
    Year
    
    Year
    
    MonthsJuly 1, 2002
    
    Ended
    
    Ended
    
    Endedto May 5,
    
    June 30,
    
    June 30,
    
    June 30,2003
    
    2002
    
    2001
    
    2000Statement of Operations Data:Net sales
    
    $
    13,911
    
    
    
    21,348
    
    
    
    41,377
    
    
    
    30,597Cost of goods sold
    
    
    10,148
    
    
    
    13,582
    
    
    
    21,747
    
    
    
    17,540Gross profit
    
    
    3,763
    
    
    
    7,766
    
    
    
    19,630
    
    
    
    13,057Operating expenses:Selling
    
    
    2,299
    
    
    
    2,925
    
    
    
    4,268
    
    
    
    3,636General and administrative
    
    
    5,040
    
    
    
    6,398
    
    
    
    9,664
    
    
    
    4,436Research and development
    
    
    2,444
    
    
    
    2,653
    
    
    
    4,021
    
    
    
    5,646Expenses related to workforce
reductions and the asset sale to
Sirenza
    
    
    3,636
    
    
    
    101
    
    
    
    
    
    
    
    Expenses related to accounting
restatements and the related
shareholder litigation
    
    
    82
    
    
    
    1,805
    
    
    
    2,387
    
    
    
    469Total operating expenses
    
    
    13,501
    
    
    
    13,882
    
    
    
    20,340
    
    
    
    14,187Operating loss
    
    
    (9,738
    )
    
    
    (6,116
    )
    
    
    (710
    )
    
    
    (1,130
    )Other income (expense):Interest income
    
    
    18
    
    
    
    48
    
    
    
    416
    
    
    
    460Interest expense
    
    
    (866
    )
    
    
    (199
    )
    
    
    (1,062
    )
    
    
    (873
    )Gain on disposition of assets
    
    
    6,284
    
    
    
    
    
    
    
    
    
    
    
    Other, net
    
    
    375
    
    
    
    12
    
    
    
    (43
    )
    
    
    (35
    )Total other income (expenses)
    
    
    5,811
    
    
    
    (139
    )
    
    
    (689
    )
    
    
    (448
    )Net loss
    
    $
    (3,927
    )
    
    
    (6,255
    )
    
    
    (1,399
    )
    
    
    (1,578
    )Loss per share
    
    $
    (0.54
    )
    
    
    (0.87
    )
    
    
    (0.20
    )
    
    
    (0.25
    )Weighted average shares outstanding
    
    
    7,258,853
    
    
    
    7,152,342
    
    
    
    7,083,866
    
    
    
    6,232,964
 9




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June 30,
    
    June 30,
    
    June 30,2002
    
    2001
    
    2000Balance Sheet Data at Period End:Cash and cash equivalents
    
    $
    553
    
    
    
    2,013
    
    
    
    11,030Working capital
    
    
    1,999
    
    
    
    7,093
    
    
    
    6,742Total assets
    
    
    13,394
    
    
    
    20,454
    
    
    
    32,571Notes payable and current
installments of long-term obligations
    
    
    1,611
    
    
    
    1,764
    
    
    
    11,566Long-term obligations
    
    
    55
    
    
    
    1,321
    
    
    
    92Total stockholders equity
    
    
    7,739
    
    
    
    13,829
    
    
    
    14,685
 On May 5, 2003, we completed the sale of all of our operating assets to Sirenza
and ceased preparing our financial statements on a going concern basis in
accordance with accounting principles generally accepted in the United States
of America. Changes in our net assets in liquidation since May 5, 2003 are as
follows (in thousands of dollars): Period fromYear ended
    
    May 6, 2003 toJune 30, 2004
    
    June 30, 2003Net increase (decrease) in net assets in liquidation:Mark-to-market adjustment on investment in common
stock of Sirenza
    
    $
    6,363
    
    
    $
    1,920Realized gains (losses) on sale of investment in
common stock of Sirenza, net
    
    
    971
    
    
    
    Net death benefits from life insurance policy
    
    
    329
    
    
    
    Refund of use tax paid
    
    
    60
    
    
    
    Adjustment to estimated costs of liquidation
    
    
    (199
    )
    
    
    Interest income
    
    
    7
    
    
    
    Issuance of 2.0 million shares of common stock to
fund settlement obligation
    
    
    1,200
    
    
    
    Distribution of 2.7 million shares of Sirenza common
stock
    
    
    (11,753
    )
    
    
    Distribution of cash to shareholders
    
    
    (1,486
    )
    
    
    Net increase (decrease) in net assets in liquidation
    
    
    (4,508
    )
    
    
    1,920Net assets in liquidation, beginning of period
    
    
    4,508
    
    
    
    2,588Net assets in liquidation, end of period
    
    $
    
    
    
    $
    4,508
 10




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis should be read in conjunction with the
selected financial data in Item 6 and our financial statements and the notes
thereto beginning on page F-1. Prior to May 5, 2003, our operations consisted
of a single business segment  the design, manufacture and sale of a wide
variety of radio frequency and microwave components and devices mainly used in
the wireless communications industry. Critical Accounting Policies and Estimates Our discussion and analysis of our historical and liquidation based financial
condition and results of operations are based upon our financial statements,
which have been prepared in accordance with accounting principles generally
accepted in the United States of America. The preparation of these financial
statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses. On an on-going basis, we
evaluated our estimates, including those related to revenue recognition,
allowances for doubtful accounts, inventory valuation and commitments and
contingencies. We based our estimates on historical experience and on various
other assumptions that are believed to be reasonable under the circumstances,
the results of which form the basis for making judgments about the carrying
value of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates under different
assumptions or conditions. We believe the following critical accounting policies impacted our more
significant judgments and estimates used in the preparation of our historical
and liquidation based financial statements. Revenue Recognition and Allowances for Doubtful Accounts Revenues were recognized at the time of shipment to, or acceptance by, the
customer, provided title and risk of loss transferred to the customer. We maintained allowances for doubtful accounts for estimated losses
resulting from the inability of our customers to make required payments. The
allowance for doubtful accounts was determined based on review of the
overall condition of accounts receivable balances and review of significant
past due accounts. Additionally, we maintained credit insurance on certain
of our foreign accounts receivable. If the financial condition of our
customers deteriorated, resulting in an impairment of their ability to make
payments, additional allowances were provided. Inventory Valuation We valued our inventories at lower of cost or market on a part-by-part
basis. Additionally, we made estimates regarding the market value of our
inventory, including an assessment of excess or obsolete inventory. We
determined excess and obsolete inventory based on an estimate of the future
demand within a specified time horizon, generally twelve months. The
estimates we used for demand were also used for near-term capacity planning
and inventory purchasing and were consistent with our revenue forecasts. If
our actual forecast was less than our demand forecast, we provided
additional excess inventory charges, which decreased future gross margin and
net operating results. 11




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Commitments and Contingencies We were party to various legal proceedings and claims, as well as various
other commitments and contingencies. We recorded a liability if it was (1)
probable that an obligation was incurred because of a transaction or event
happening on or before the date of the financial statements and (2) the
amount of the obligation could be reasonably estimated. Accrued Costs of Liquidation and Effects of Change to Liquidation Basis Pursuant to the amended plan of dissolution, which was approved by the
shareholders at the special meeting on May 5, 2003, we filed articles of
dissolution with the Secretary of State of the State of Colorado. Upon
filing of the articles of dissolution, our operations were limited to
winding-up our business and affairs, selling our remaining assets,
discharging our known liabilities, establishing a contingency reserve for
payment of expenses and contingent liabilities, and distributing any
remaining assets to our shareholders, all in accordance with the amended
plan of dissolution. As a result, we changed our basis of accounting to the
liquidation basis as of May 5, 2003. The accompanying statements of
operations, stockholders equity and cash flows for the period from July 1,
2002 to May 5, 2003 and for year ended June 30, 2002 have been presented on
a going concern basis comparable to prior periods, which assumes the
realization of assets and the liquidation of liabilities in the normal
course of business. Upon changing to the liquidation basis of accounting,
which assumes that assets and liabilities are reflected at the estimated
amounts to be paid or received, we recorded $1.317 million of accrued costs
of liquidation representing an estimate of the costs to be incurred during
dissolution. During the year ended June 30, 2004, the Company recorded
adjustments of $199,000 representing an increase in its original estimate of
the costs to be incurred during dissolution. Comparison of our Results of Operations On May 5, 2003, we completed the sale of all of our operating assets to Sirenza
and ceased preparing our financial statements on a going concern basis under
generally accepted accounting principles. Accordingly, results of operations
for the period from May 6, 2003 to June 30, 2004 and for the year ended June
30, 2004 are not comparable to any other periods. Changes in Net Assets in Liquidation for the year ended June 30, 2004 For the year ended June 30, 2004, we recorded a mark-to market adjustment of
$6.4 million due to a net increase in value in our investment in the common
stock of Sirenza and we recorded a net death benefit of $329,000 as we were the
sole beneficiary on a life insurance policy. We sold 570,974 shares of Sirenza
common stock realizing net gains of $1.3 million. We received a use tax
settlement from the State of Colorado in the amount of $60,000 and we issued 2
million shares of our common stock valued at $1.2 million, pursuant to the
settlement of the private securities class action. Additionally we recorded an
adjustment of $199,000 representing an increase in our original estimate of the
costs to be incurred during dissolution and we made distributions to our
shareholders of 2.7 million shares of Sirenzas common stock with a fair market
value on the dates of distribution of $11.8 million and cash of $1.5 million. Changes in Net Assets in Liquidation for the period from May 6, 2003 to June
30, 2003 Upon closing of the asset sale on May 5, 2003, we received shares in the common
stock of Sirenza. Those shares increased in value by $1.9 million during the
period from May 6, 2003 to June 30, 2003, which increase has been recorded as a
mark-to-market adjustment in the accompanying Statement of Changes in Net
Assets in Liquidation for the period from May 6, 2003 to June 30, 2003. 12




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Results of Operations for the period from July 1, 2002 to May 5, 2003 compared
with the Fiscal Year Ended June 30, 2002 Net Sales Net sales for the period from July 1, 2002 to May 5, 2003 decreased 34.8% to
$13.9 million compared with $21.3 million for the year ended June 30, 2002.
While our unit volume for its commercial signal source products increased
slightly, we maintained our pattern of the last few quarters of lowering prices
of our commercial signal source products to several key customers to maintain
market share. The sale of all of our operating assets on May 5, 2003 also
contributed to the decline in revenue. Overall, the wireless telecommunications
industry was negatively impacted by the severe market downturn and more
specifically by a rapid decline in expenditures for capital infrastructure
equipment by service providers. Gross Profit Gross profit for the period from July 1, 2002 to May 5, 2003 decreased 51.5% to
$3.8 million, or 27.1% of net sales, compared with $7.8 million, or 36.4% of
net sales, for the year ended June 30, 2002. The gross profit percent in any
period can be affected significantly by volume and price concessions. Fixed
manufacturing overhead adversely affects gross profit at lower sales levels.
Accordingly, reduced sales levels combined with fixed manufacturing overhead
levels comparable to prior periods has the effect of lowering gross profit as a
percentage of sales. Additionally, changes in market demand for our products,
combined with changes in product design resulted in excess inventory parts. On
a quarterly basis, we reviewed our inventory on hand and firm purchase
commitments versus our sales forecast to determine the adequacy of the existing
reserve for excess and obsolete inventory. Included in cost of goods sold for the period from July 1, 2002 to May 5, 2003
and for the year ended June 30, 2002 is a charge of $475,000 and $564,000 for
excess and obsolete inventory, respectively. Additionally, for the year ended
June 30, 2002, we recognized a benefit of $268,000 of recoveries for previously
written-off inventory. Selling Expenses Selling expenses for the period from July 1, 2002 to May 5, 2003 decreased
21.4% to $2.3 million, or 16.5% of net sales, compared with $2.9 million, or
13.7% of net sales, for the year ended June 30, 2002. The dollar decrease in
selling expenses was primarily attributable to a decrease of $267,000 in
commissions paid to manufacturers representatives as a result of reduced sales
volume. The sale of all of our operating assets on May 5, 2003 also contributed
to the decline in selling expenses. General and Administrative Expenses General and administrative expenses for the period from July 1, 2002 to May 5,
2003 decreased 21.2% to $5.0 million, or 36.2% of net sales, compared with $6.4
million, or 30.0% of net sales, for the year ended June 30, 2002. The dollar
decrease was primarily attributable to a decrease of $1.4 million in salaries
paid and independent contractors utilized for accounting and information
technology services. The sale of all of our operating assets on May 5, 2003
also contributed to the decline in general and administrative expenses. Research and Development Expenses Research and development expenses for the period from July 1, 2002 to May 5,
2003 decreased 7.9% to $2.4 million, or 17.6% of net sales, compared with $2.7
million or 12.4% of net sales, for the year ended June 30, 2002. 13




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Expenses Related to Workforce Reductions and the Asset Sale to Sirenza As a result of the continuing weakness in the wireless industry in 2002 and
2003 and the impact it had upon our revenues, we reduced our workforce and
incurred severance expenses. Additionally, we incurred costs in connection with
the asset sale to Sirenza. Expenses related to workforce reductions and the
asset sale to Sirenza were as follows (in thousands of dollars): Period fromJuly 1, 2002 to
    
    Year endedMay 5, 2003
    
    June 30, 2002Severance and post-closing bonuses
    
    $
    1,031
    
    
    
    101Legal fees
    
    
    665
    
    
    
    Investment bankers fees
    
    
    502
    
    
    
    Lease termination penalties
    
    
    825
    
    
    
    Asset impairment
    
    
    451
    
    
    
    Other related costs
    
    
    162
    
    
    
    Total
    
    $
    3,636
    

    
    
    101
 Expenses Relating to Accounting Restatements and Related Legal Matters, Net of
Recoveries In early 2000, management of the Company commenced efforts to restate its
previously issued financial statements after being notified by the Securities
and Exchange Commission (the Commission) that the Commission was
investigating its accounting and reporting practices. Certain costs incurred
in conjunction with these efforts have been separately classified in the
Companys Statements of Operations as Expenses relating to accounting
restatements and related legal matters, net of recoveries. Expenses included
in this classification include the cost of external counsel for services
provided in connection with shareholder lawsuits, the Commissions
investigation of the Company, legal fees and expenses of the Special Litigation
Committee of the Board of Directors, the costs incurred to settle the private
securities action and the Company action against former officers (net of
recoveries), the cost of certain consultants and temporary labor hired to
assist in the accounting restatements, and reimbursements to current and former
employees of the Company for their legal fees and expenses. The accounting restatements were completed in February 2001. Additionally,
during October 2002 and December 2002, the Company, the individual defendants
in the private securities class action, the Agricultural Excess and Surplus
Insurance Company, and the individual defendants in the action against former
officers attended global settlement conferences. All parties involved reached
an agreement in principle for the global settlement of all litigation as
further described in Part II, Item I, Legal Proceedings. On January 22, 2003,
the Company, the class action representatives and the individual defendants in
the private securities class action executed and filed a Stipulation of
Settlement (the Stipulation) with the United States District Court for the
District of Colorado (the Court). On January 29, 2003, the Court issued its
order preliminarily approving the settlement of the private securities class
action, certification of the class, and the provision of notice to members of
the class (the Preliminary Approval). On March 28, 2003, the Court held a
fairness hearing regarding the settlement of the private securities class
action. At the hearing, the court approved the settlement of the private
securities class action as fair and reasonable to the members of the class.
Following the hearing, the Court entered its final judgment and order of
dismissal of the actions with prejudice. See Part I, Item 3 Legal Proceedings
for additional information. 14




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Expenses relating to accounting restatements and related legal matters, net of
recoveries, were as follows (in thousands of dollars): Period fromJuly 1, 2002 to
    
    Year endedMay 5, 2003
    
    June 30, 2002Legal fees incurred in connection with the shareholder
lawsuits, Special Litigation Committee and the global
settlement
    
    $
    199
    
    
    
    472Adjustment of previously recorded estimates of $286,000
(representing legal fees incurred by former officers, the
present value of post-employment health care obligations and
a one time separation bonus payable to Mr. Kiser) to $245,000
reflecting the settlement agreements
    
    
    (41
    )
    
    
    Adjustment of previously recorded estimates of $117,000
(representing net employment obligations payable to Mr.
Sherman) to $0 reflecting termination of an agreement due to
misappropriation of funds
    
    
    
    
    
    
    (117
    )Mr. Shermans transfer of 100,813 shares of common stock to
the Company. The shares were valued at the closing market
price on the date in which Mr. Sherman and the Company
executed a mutual general release
    
    
    (76
    )
    
    
    Approximate cost to settle the Private Securities Class Action
    
    
    
    
    
    
    1,450Total
    
    $
    82
    
    
    
    1,805
 Other Income (Expense) Interest expense increased 335.2% to $848,000 for the period from July 1, 2002
to May 5, 2003, compared with expense of $199,000 for the year ended June 30,
2002. The increase was primarily attributable to an increase in interest
expense of $649,000 due to a larger balance of debt outstanding during the
period from July 1, 2002 to May 5, 2003 as compared to the year ended June 30,
2002 at significantly higher interest rates as a result of our Loan Facility
with Sirenza. The sale of all of our operating assets on May 5, 2003 contributed to the net
gain of $6.3 million. Other income, net, primarily represents a gain of
$375,000 on the sale of various term and whole life insurance policies. Net Loss and Loss per Share Due to the factors described above, our net loss decreased $2.6 million to $3.9
million, or $0.54 per share, for the period from July 1, 2002 to May 5, 2003,
compared with a net loss of $6.3 million, or $0.87 per share, for the year
ended June 30, 2002. 15




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Liquidity and Capital Resources At June 30, 2004, all the remaining available assets of the Company had been
distributed to our shareholders. Approximately $102,000 in cash has been set
aside to settle final liabilities which include: (1) preparation  of our 2004
fiscal year tax return, (2) payment to our independent accountants for various
audit services, and (3) other miscellaneous fees for professional services to
be provided to the Company. As of June 30, 2003, we had $60,000 of unrestricted cash. During the period
from July 1, 2002 to May 5, 2003, operations consumed $4.4 million of cash
primarily due to losses incurred. During the period from July 1, 2002 to May 5, 2003, investing activities
provided $4.0 million of cash due primarily to the sale of substantially all of
our operating assets to Sirenza. We received $3.8 million in cash and 3.3
million shares of Sirenzas common stock with a market value of $5.1 million at
May 5, 2003. During the period from July 1, 2002 to May 5, 2003, financing activities
provided $3.8 million in cash primarily due to forgiveness and assumption of
$5.3 million in secured loans in connection with the closing of the asset sale. Contractual Obligations At June 30, 2004, we had no contractual obligations requiring tabular
disclosure. Effect of Recently Issued Accounting Standards We have evaluated all recent accounting pronouncements and believe such
pronouncements do not have a material effect on our financial statements. 
 Item 7A. Quantitative and Qualitative Disclosures about Market Risk At June 30, 2004, we were not exposed to any market risks. The carrying amounts
of cash and accounts payable approximate fair value because of the short
maturities of these instruments. At June 30, 2003, we were exposed to certain market risks, including the
effects of adverse changes in interest rates. Our exposure to such changes
resulted from cash deposits managed by Colorado Business Bank. During that
time, we had no financial instruments in place to manage the impact of changes
in interest rates. We estimate that a 1% increase or decrease in interest rates
would have impacted our results of operations by less than $1,000 for the year
ended June 30, 2003. Additionally we were exposed to the effects of adverse
changes in the fair value of marketable securities. We had an investment in the
common stock of Sirenza acquired in connection with the asset sale with no
financial instrument in place to manage the impact of a change in the fair
value. We estimate that a 10% increase or decrease in the fair value would have
impacted the change in net assets in liquidation by approximately $661,000 at
June 30, 2003. 
 Item 8. Financial Statements The financial statements and related financial information required to be filed
hereunder begins on page F-1. 16




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Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure None 
 Item 9A. Controls and Procedures The Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the reports that the
Company files under the Securities Exchange Act of 1934, as amended (Exchange
Act), is recorded, processed, summarized and reported within the time periods
specified in the SECs rules and forms, and that such information is
accumulated and communicated to the Board of Directors to allow timely
decisions regarding required disclosure about Companys disclosure controls and
procedures, as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act. As of May 5, 2003 the Company sold substantially all of its assets and began
the orderly dissolution and liquidation of its assets. As the Company
currently has no ongoing operations, chief executive officer, principal
financial officers, principal accounting officer or employees, the evaluation
of the effectiveness of the design and operation of the Companys disclosure
controls and procedures as of the end of the period covered by this Form 10-K
was performed by the Companys Board of Directors. Based on that evaluation,
the Board has concluded that the Companys disclosure controls and procedures
are effective as of June 30, 2004. 17




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##### Table of Contents



PART III 
 Item 10. Executive Officers and Directors of the Registrant Executive Officers Concurrent with the closing of the asset sale with Sirenza on May 5, 2003, all
employees of the Company resigned or were terminated. Effective May 6, 2003,
the process of liquidating our remaining assets, winding up the business, and
dissolving the Company was being managed by Cloyses under the direction of our
Board of Directors. Directors David A. Lisowski  Director. Mr. Lisowski, age 51, was elected a Director
on June 26, 1996. Mr. Lisowski is the President of the Denver Wholesale Florist
Company, a national wholesale florist, for which he has been the President and
Chief Executive Officer since 1993. He was employed by Central Bank of Denver,
N.A., a commercial bank in Colorado, and various affiliated banks from 1972 to
1992. His employment with Central Bank included serving as Senior Vice
President of Commercial Lending in Southern Colorado as well as various other
positions. Mr. Lisowski attended Metropolitan State College where he received a
BS degree in Finance in 1988. Anthony B. Petrelli  Acting Chairman of the Board and Director. Mr.
Petrelli, age 51, was elected a Director on October 17, 1997 and became Acting
Chairman of the Board of Directors on July 3, 2001. Mr. Petrelli has served as
Senior Vice President of Investment Banking Services at Neidiger, Tucker,
Bruner, Inc., an investment banking firm and registered broker-dealer in
Denver, Colorado, since May of 1987. He formerly served as a Director of
Guardian Acceptance Corp., a consumer finance company in Denver, Colorado, for
which he served as President from September 1996 until December 1997. Mr.
Petrelli received a BS degree in Business in 1974 and an MBA in 1979 from the
University of Colorado. David M. Risley  Director. Mr. Risley, age 60, was elected a Director on
November 27, 2001. He currently serves as Senior Vice President and Chief
Financial Officer of La-Z-Boy Inc., a $2.2 billion furniture manufacturer. Mr.
Risley also serves as a member of the Board of Directors of Tecumseh Products
Company. Prior to joining La-Z-Boy, he was Vice President of Finance and Chief
Financial Officer with Aeroquip Vickers, Inc., a manufacturing firm serving the
industrial, aerospace and automotive markets with power and motion control
devices, fluid connectors and composite components. He holds a BBA in
Accounting from the University of Iowa and an MBA in Finance from Loyola
University of Chicago. The Company currently does not have any employees or executive officers. All
persons providing services to the Company, including Cloyses, are doing so in
their capacity as independent contractors. Audit Committee The Board of Directors has determined that Mr. Risley qualifies as an audit
committee financial expert, as defined in applicable SEC rules. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the 1934 Act requires our directors and executive officers,
and persons who own more than ten percent of a registered class of our equity
securities, to file with the SEC initial reports of ownership and reports of
changes in ownership of our common stock and other equity securities. 18




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Officers, directors and greater than ten percent stockholders are required by
SEC regulation to furnish us with copies of all Section 16(a) forms they file. To our knowledge, based solely on a review of the copies of such reports
furnished to us and written representations that no other reports were
required, during the fiscal years ended June 30, 2004, all Section 16(a) filing
requirements applicable to our officers, directors and greater than ten percent
beneficial owners were complied with. Code of Ethics Since, in connection with the closing of the asset sale with Sirenza on May 5,
2003, all employees of the Company resigned or were terminated, the Company has
not adopted a code of ethics. 
 Item 11. Executive Compensation Concurrent with the closing of the asset sale with Sirenza on May 5, 2003, all
employees of the Company resigned or were terminated. Effective May 6, 2003,
the process of liquidating our remaining assets, winding up the business, and
dissolving the Company was being managed by Cloyses under the direction of our
Board of Directors. Directors Compensation During the fiscal year ended June 30, 2004, we had an arrangement whereby each
outside Director received $3,000 per financial quarter. We reimbursed outside
Directors for their expenses in attending meetings of the Board of Directors
and its committees. Compensation Committee Interlocks Upon closing of the asset sale and the termination or resignation of all of its
employees, the Compensation Committee was disbanded. None of the directors is or was in the past one of our officers or employees.
No interlocking relationship exists between the Board of Directors or the
Compensation Committee and the board of directors or compensation committee of
any other company, nor has such an interlocking relationship existed in the
past. 
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Equity Compensation Plan Information As of June 30, 2004, the Company had no securities to be issued upon exercise
of outstanding options, warrants or rights. All equity compensation plans have
been terminated in connection with the asset sale and dissolution of the
Company. Security Ownership of Certain Beneficial Owners and Management As of June 28, 2004, all remaining assets of the Company were distributed to
our shareholders and the stock transfer books were closed. Under our Amended
Plan of Dissolution the distribution of our remaining assets to our
shareholders resulted in the complete redemption and cancellation of all
outstanding shares of Common Stock. Accordingly, there are no remaining holders
of record of our common stock. 19




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Item 13. Certain Relationships and Related Transactions In the past, the Company has entered into various transactions with its
officers and major shareholders. Transactions with such individuals which
subject the Company to continuing obligations are described below. Indemnification and Expense Advancement Under our Articles of Incorporation, Bylaws and applicable Colorado corporate
law, we have certain obligations to indemnify our officers and directors for
expenses they incur in connection with the defense of litigation brought
against them on account of actions taken by them in those capacities if such
officers or directors are wholly successful, on the merits or otherwise, in
their defense in such proceedings. The Company entered into an Amended and Restated Indemnity Agreement with each
of David A. Lisowski, Anthony B. Petrelli and David M. Risley, each dated as of
March 11, 2003 (the Indemnity Agreements). The Indemnity Agreements provide
that the Company shall indemnify each indemnitee to the fullest extent
permitted by law, including against any and all reasonable expenses, witness
fees, damages, judgments, fines and amounts paid because of any claim made
against or by the indemnitee in connection with any threatened, pending or
completed action, suit or other proceeding of any sort to which the indemnitee
is, was or at any time becomes a party, or is threatened to be made a party, by
reason of the fact that the indemnitee is, was or at any time becomes a
director, officer, employee or other agent of the Company. The Companys
obligation to indemnify does not apply where a determination has been made that
the indemnitee is not entitled to indemnification under applicable law, in
which case the indemnitee agrees to reimburse the Company for any amounts
previously paid or advanced to the indemnitee. Additionally, the Company shall
not be required to indemnify an indemnity for any claims for which
indemnification is not lawful, on account of the indemnitees conduct that is
established by a final judgment as knowingly fraudulent or deliberately
dishonest or that constituted willful misconduct, for claims initiated by the
indemnitee and not by way of defense (except in certain limited circumstances),
to the extent which payment is actually made to the indemnity under a valid and
collectible insurance policy or under a valid and enforceable indemnity clause,
by law or agreement, or for claims under Section 16 of the Securities Exchange
Act of 1934. The indemnification obligation of the Company under the Indemnity Agreements
extends throughout an indemnitees term of service to the Company and for so
long thereafter as an indemnitee shall be subject to any possible claim or
action of any sort by reason of the fact that the indemnitee was serving the
Company. The Company is also obligated to advance reasonable expenses incurred
by an indemnitee in connection with a covered claim or action if it receives
any affirmation by the indemnitee required by the Companys Bylaws or the
Colorado Business Corporation Act and an undertaking by the indemnitee to repay
any amounts advanced if it shall be determined ultimately that the indemnitee
is not entitled to be indemnified under the Indemnity Agreements. 20




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Item 14. Principal Accountant Fees and Services The following is a summary of the fees billed to the Company by KPMG LLP for
professional services rendered for the fiscal years ended June 30, 2004 and
2003: Fee Category
    
    Fiscal 2004
    
    Fiscal 2003Audit Fees (1)
    
    $
    21,500
    
    
    $
    112,641Audit-Related Fees (2)
    
    
    32,281
    
    
    
    26,808Tax Fees (3)
    
    
    27,780
    
    
    
    22,475All Other Fees
    
    
    
    
    
    
    Total Fees
    
    $
    81,531
    
    
    $
    161,924
 All 2003 fees described above were pre-approved by the Audit Committee. (1) Audit fees consist of fees paid for professional services for the
audit of our consolidated financial statements included in Form 10-K and
review of financial statements included in Form 10-Qs, and for services
that are normally provided by the auditor in connection with statutory
and regulatory filings or engagements. (2) Audit-related fees consist of fees for audits of employee benefit
plans and consulting on employee benefits. (3) Tax fees consist of fees for tax consultation and tax
compliance services. Pre-Approval Policies and Procedures. The Audit Committee complies with procedures for the pre-approval of audit and
non-audit services rendered by our independent registered public accounting
firm, KPMG LLP. Pre-approval may be given as part of the Audit Committees
approval of the scope of the engagement of the independent auditor or on an
individual explicit case-by-case basis before the independent auditor is
engaged to provide each service. The Audit Committee has determined that the rendering of the services other
than audit services by KPMG LLP is compatible with maintaining the principal
auditors independence. 21




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##### Table of Contents



Part IV 
 Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K Exhibit No.
    
    Description2.1
    
    Amended Plan of Dissolution of Vari-L Company, Inc. as approved
by the shareholders at the special meeting held on May 5, 2003 filed
as Exhibit 2.1 to the Form 10-Q for the quarter ended March 31, 2003
and incorporated herein by reference.3.1a
    
    Restated Articles of Incorporation, as Amended, filed as Exhibit
4.1 to the Form S-8 Registration Statement (No. 33-88666) and
incorporated herein by reference.3.1b
    
    Articles of Amendment to the Articles of Incorporation filed as
Exhibit 3.1b to the Form 10-KSB for the year ended December 31, 1996
and incorporated herein by reference.3.2
    
    Amended and Restated Bylaws adopted September 26, 2002 and
filed as Exhibit 3.2 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.4.1
    
    Specimen Certificate for $.01 par value Common Stock filed as
Exhibit 4.3 to the Form SB-2 Registration Statement (No. 33-74704-D)
and incorporated herein by reference.4.2
    
    Rights Agreement with American Securities Transfer, Inc. dated
March 15, 1996 filed as Exhibit 4.2 to the Form 8-A/A Registration
Statement (No. 0-23866) and incorporated herein by reference.4.3
    
    Specimen Certificate for Right to Purchase $.01 par value
Common Stock filed as Exhibit 4.3 to the Form 8-A/A Registration
Statement (No. 0-23866) and incorporated herein by reference.4.4
    
    Securities Purchase Agreement with the Purchasers dated March
4, 1997 filed as Exhibit 4.5 to the Form S-3 Registration Statement
(No. 333-25173) and incorporated herein by reference.4.6
    
    Form of Warrant to Purchase Common Stock issued to the
Purchasers under the Securities Purchase Agreement dated March 4,
1997 filed as Exhibit 4.7 to the Form S-3 Registration Statement (No.
333-25173) and incorporated herein by reference.4.7
    
    Amendment No. 1 to Rights Agreement with American Securities
Transfer, Inc. dated October 7, 2002 and filed as Exhibit 4.7 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.1
    
    Executive Employment Agreement with Joseph H. Kiser, dated
effective June 1, 1997, filed as Exhibit 10.1 to the Form 10-QSB for
the quarter ended September 30, 1998 and incorporated herein by
reference.10.2
    
    Lease Agreement dated January 1, 1987 with J.C. Enterprises for
the facility located at 5165 Peoria Street, Denver, Colorado, as
amended on December 6,
 22




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##### Table of Contents



Exhibit No.
    
    Description1990 and March 23, 1993, filed as Exhibit 10.15 to the Form
SB-2 Registration Statement (No. 33-74704-D) and incorporated
herein by reference.10.3
    
    Settlement Agreement with Joseph H. Kiser, David G. Sherman,
Alwin E. Branson and Carolyn Y. Kiser dated January 31, 1992, as
amended March 23, 1993, filed as Exhibit 10.18 to the Form SB-2
Registration Statement (No. 33-74704-D) and incorporated herein by
reference.10.4
    
    Profit Sharing Plan and Trust Agreement, as amended and restated
effective April 19, 1994 filed as Exhibit 10.16 to the Form 10-KSB for
the year ended December 31, 1994 and incorporated herein by reference.10.5
    
    Lease Agreement dated March 12, 1997 with Five K Investments for
the facility located at 4895 Peoria Street, Denver, Colorado filed as
Exhibit 10 to the Form 10-QSB for the quarter ended September 30, 1997
and incorporated herein by reference.10.6
    
    Third Amendment to Lease Agreement dated January 1, 1987 with
J.C. Enterprises for the facility located at 5165 Peoria Street,
Denver, Colorado, as amended December 6, 1990, March 23, 1993, and
October 30, 1998 filed as Exhibit 10.6 to the Form 10-QSB for the
quarter ended September 30, 1998 and incorporated herein by reference.10.7
    
    Termination and Consulting Agreement with David G. Sherman dated
August 1, 2000 filed as Exhibit 10.1 to the Form 8-K dated August 1,
2000 and incorporated herein by reference.10.8
    
    Employment Agreement with Timothy M. Micun dated March 2, 2001
filed as Exhibit 10.26 to the Form 10-K for the fiscal year ended June
30, 2001 and incorporated herein by reference.10.9
    
    Credit and Security Agreement with Wells Fargo Business Credit,
Inc. dated June 28, 2001 filed as Exhibit 99.2 to the Form 8-K dated
June 28, 2001 and incorporated herein by reference.10.10
    
    Patent and Trademark Security Agreement with Wells Fargo Business
Credit, Inc. dated June 28, 2001 filed as Exhibit 99.3 to the Form 8-K
dated June 28, 2001 and incorporated herein by reference.10.11
    
    First Amendment to Credit and Security Agreement dated September
17, 2001 filed as Exhibit 10.1 to the Form 10-Q dated September 30,
2001 and incorporated herein by reference.10.12
    
    Employee Stock Purchase Plan effective as of November 30, 2001
filed as Exhibit 10.1 to the Form 10-Q for the quarter ended December
31, 2001 and incorporated herein by reference.10.13
    
    Amended and Restated Tandem Stock Option and Stock Appreciation
Rights Plan, effective as of January 1, 2002 filed as Exhibit 10.1 to
the Form 10-Q for the quarter ended March 31, 2002 and incorporated by
reference herein.10.14
    
    Stock Grant Plan effective as of January 1, 2002 filed as Exhibit
10.2 to the Form 10-Q for the quarter ended March 31, 2002 and
incorporated herein by reference.
 23




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##### Table of Contents



Exhibit No.
    
    Description10.15
    
    Agreement between Vari-L Company, Inc. and Asvan Technology, LLC
dated January 25, 2002 filed as Exhibit 10.15 to the Form 10-K for the
fiscal year ended June 30, 2002 and incorporated herein by reference.10.16
    
    Second Amendment to Credit and Security Agreement with Wells Fargo
Business Credit, Inc. dated February 8, 2002 filed as Exhibit 10.16 to
the Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.17
    
    Form of Indemnity Agreement by and among Vari-L Company, Inc. and
each of Gil J. Van Lunsen (dated June 1, 2001), Sarah L. Booher (dated
July 5, 2001), David A. Lisowski (dated July 5, 2001), Anthony B.
Petrelli (dated July 5, 2001), David M. Risley (dated November 21,
2001) and Robert C. Dixon (dated January 11, 2002) filed as Exhibit
10.17 to the Form 10-K for the fiscal year ended June 30, 2002 and
incorporated herein by reference.10.18
    
    Employment Agreement with Charles R. Bland dated August 1, 2002
filed as Exhibit 10.18 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.19
    
    Employment Agreement with Russell M. Crouch dated August 1, 2002
filed as Exhibit 10.19 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.20
    
    Employment Agreement with Richard P. Dutkiewicz dated August 1,
2002 filed as Exhibit 10.20 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.21
    
    Employment Agreement with Ernest C. Hafersat dated August 1, 2002
filed as Exhibit 10.21 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.22
    
    Employment Agreement with Janice E. Hyland dated August 1, 2002
filed as Exhibit 10.22 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.23
    
    Employment Agreement with Matthew D. Pope dated August 1, 2002
filed as Exhibit 10.23 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.24
    
    Employment Agreement with Larry M. Romero dated August 1, 2002
filed as Exhibit 10.24 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.25
    
    Employment Agreement with Timothy G. Schamberger dated August 1,
2002 filed as Exhibit 10.25 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.26
    
    Employment Agreement with Daniel J. Wilmot dated August 1, 2002
filed as Exhibit 10.26 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.
 24




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##### Table of Contents



Exhibit No.
    
    Description10.27
    
    Engagement letter with Green, Manning & Bunch, Ltd. dated
September 9, 2002 filed as Exhibit 10.27 to the Form 10-K for the
fiscal year ended June 30, 2002 and incorporated herein by reference.10.28
    
    Forbearance Agreement and Third Amendment to Credit and Security
Agreement with Wells Fargo Business Credit, Inc. dated September 26,
2002 filed as Exhibit 99.1 to the Form 8-K dated October 1, 2002 and
incorporated herein by reference.10.29
    
    Indemnity Agreement, dated October 2, 2002, by and among Vari-L
Company with Charles R. Bland filed as Exhibit 10.29 to the Form 10-K
for the fiscal year ended June 30, 2002 and incorporated herein by
reference.10.30
    
    Indemnity Agreement, dated October 2, 2002, by and among Vari-L
Company, Inc. with Richard P. Dutkiewicz filed as Exhibit 10.30 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.31
    
    Memorandum of Understanding dated October 3, 2002 between Vari-L
Company, Inc. and the plaintiffs in Civil Action No. 00-S-1198 between
plaintiffs Michael Rasner, et al., on behalf of themselves and other
similarly situated and defendants Vari-L Company, Inc., Derek Bailey,
Joseph Kiser, David G. Sherman and Jon Clark in the United States
District Court, District of Colorado, by and through their respective
attorneys, for settlement of litigation against Vari-L Company, Inc.
filed as Exhibit 10.31 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.32
    
    Loan Agreement with Sirenza Microdevices, Inc. dated October 7,
2002 filed as Exhibit 10.32 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.33
    
    Security Agreement with Sirenza Microdevices, Inc. dated October
7, 2002 filed as Exhibit 10.33 to the Form 10-K for the fiscal year
ended June 30, 2002 and incorporated herein by reference.10.34
    
    Exclusivity and Right of First Refusal Agreement with Sirenza
Microdevices, Inc. dated October 7, 2002 filed as Exhibit 10.34 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.35
    
    Resale Registration Rights Agreement with Sirenza Microdevices,
Inc. dated October 7, 2002 filed as Exhibit 10.35 to the Form 10-K for
the fiscal year ended June 30, 2002 and incorporated herein by
reference.10.36
    
    Letter Agreement dated November 12, 2002 between Vari-L
Corporation, Inc. and Five K Investments amending that certain lease
agreement dated as of March 12,1997 by and between Vari-L Corporation,
Inc. and Five K Investments filed as Exhibit 10.1 to the Form 10-Q for
the quarter ended September 30, 2002 and incorporated herein by
reference.10.37
    
    Stipulation of Settlement dated January 22, 2003 between Vari-L
Company, Inc., Derek L. Bailey, Joseph H. Kiser, David G. Sherman, Jon
L. Clark and the plaintiffs in Civil No. 00-S-1198 between plaintiffs
Michael Rasner, et al., on behalf of themselves and other similarly
situated and defendants Vari-L Company, Inc., Derek L. Bailey, Joseph
H. Kiser, David G. Sherman and Jon L. Clark in the United State
District Court, District of Colorado, by and through
 25




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##### Table of Contents



Exhibit No.
    
    Descriptiontheir respective attorneys, for settlement of litigation
against Vari-L Company, Inc. filed as Exhibit 10.1 to the Form
10-Q for the quarter ended December 31, 2002 and incorporated
herein by reference.10.38
    
    Form of Amended and Restated Indemnity Agreement by and among
Vari-L Company, Inc. and each of Gil J. Van Lunsen, Sarah L. Booher,
David A. Lisowski, Anthony B. Petrelli, David M. Risley, Robert C.
Dixon, Charles A. Bland and Richard P. Dutkiewicz each dated as of
March 11, 2003 filed as Exhibit 10.1 to the Form 10-Q for the quarter
ended March 31, 2003 and incorporated herein by reference.10.39
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 11101 East 51st Street, Denver, Colorado filed as Exhibit 10.2 to
the Form 10-Q for the quarter ended March 31, 2003 and incorporated
herein by reference.10.40
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 5165 Peoria Street, Denver, Colorado filed as Exhibit 10.3 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.10.41
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 4895 Peoria Street, Denver, Colorado filed as Exhibit 10.4 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.10.42
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 4955 Peoria Street, Denver, Colorado filed as Exhibit 10.5 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.23
    
    Letter Agreement dated May 6, 2003 between Vari-L Corporation,
Inc. and Cloyses Partners, LLC filed as exhibit 10.43 to the Form 10-K
for the year ended June 30, 2003 and incorporated herein by reference.31
    
    Certification pursuant to 18 U.S.C. Section 1350 by the Board of
Directors, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed with the Securities and Exchange Commission as
Exhibit 31 to the companys Annual Report on Form 10-K for the year
ended June 30, 2004.32
    
    Certification pursuant to 18 U.S.C Section 1350 by the Board of
Directors, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, filed with the Securities and Exchange Commission as
Exhibit 32 to the companys Annual Report on Form 10-K for the year
ended June 30, 2004.
 26




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Financial Statement Schedule Schedule II, Valuation and Qualifying Accounts, for the period from July 1,
2002 to May 5, 2003 and for the year ended June 30, 2002 Reports on Form 8-K A report on Form 8-K dated June 15, 2004 under Items 5 and 7 was filed with the
Commission on June 15, 2004. 27




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SIGNATURES In accordance with the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated. /s/ David A. Lisowski
    
    Date: August 10, 2004David A. Lisowski, Director/s/ Anthony B. Petrelli
    
    Date: August 10, 2004Anthony B. Petrelli, Director/s/ David M. Risley
    
    Date: August 10, 2004David M. Risley, Director
 28




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VL DISSOLUTION CORPORATION Financial Statements June 30, 2004 (With Independent Auditors Report Thereon)




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##### Table of Contents



VL DISSOLUTION CORPORATION 
 Financial Statements June 30, 2004 Index Financial Statements:Report of Independent Registered Public Accounting Firm
    
    
    F-1Statements of Net Assets in Liquidation, June 30, 2004 and 2003
    
    
    F-2Statements of Changes in Net Assets in Liquidation, for the year ended June 30, 2004
and for the period from May 6, 2003 to June 30, 2003
    
    
    F-3Statements of Operations, for the period from July 1, 2002 to May 5, 2003 and for the
year ended June 30, 2002
    
    
    F-4Statements of Stockholders Equity, for the period from July 1, 2002 to May 5, 2003
and for the year ended June 30, 2002
    
    
    F-5Statements of Cash Flows, for the period from July 1, 2002 to May 5, 2003 and for the
year ended June 30, 2002
    
    
    F-6Notes to Financial Statements
    
    
    F-7Schedule:Schedule II  Valuation and Qualifying Accounts for the period from July 1, 2002
to May 5, 2003 and for the year ended June 30, 2002
    
    
    F-17




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##### Table of Contents



Report of Independent Registered Public Accounting Firm The Board of Directors
VL Dissolution Corporation: We have audited the accompanying statements of net assets in liquidation of VL
Dissolution Corporation as of June 30, 2004 and 2003, and the related
statements of changes in net assets in liquidation for the year ended June 30,
2004 and for the period from May 6, 2003 to June 30, 2003. We have also audited
the related statements of operations, stockholders equity, and cash flows for
the period from July 1, 2002 to May 5, 2003 and for the year ended June 30,
2002. These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion. As described in Note 1 to the financial statements, the stockholders of Vari-L
Company, Inc. approved a plan of liquidation on May 5, 2003, and the Company
commenced liquidation shortly thereafter. As a result, the Company has changed
its basis of accounting for periods subsequent to May 5, 2003, from the
going-concern basis to a liquidation basis. Also on May 5, 2003, Vari-L
Company, Inc. changed its name to VL Dissolution Corporation. In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets in liquidation of VL Dissolution
Corporation as of June 30, 2004 and 2003, the changes in its net assets in
liquidation for the year ended June 30, 2004 and for the period from May 6,
3003 to June 30, 2003, and the results of its operations and its cash flows for
the period from July 1, 2002 to May 5, 2003, and for the year ended June 30,
2002, in conformity with U.S. generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplementary information included
in Schedule IIValuation and Qualifying Accounts as of May 5, 2003 and for the
period from July 1, 2002 to May 5, 2003, and for the year ended June 30, 2002
is presented for purposes of additional analysis and is not a required part of
the basic financial statements. Such information has been subjected to the
auditing procedures applied in the audits of the basic financial statements
and, in our opinion, is fairly stated in all material respects in relation to
the basic financial statements taken as a whole. /s/ KPMG LLP Denver, Colorado
July 19, 2004 F-1




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##### Table of Contents



VL DISSOLUTION CORPORATION
Statements of Net Assets in Liquidation (in thousands of dollars) June 30,
    
    June 30,2004
    
    2003AssetsCash and cash equivalents
    
    $
    102
    
    
    
    60Restricted cash
    
    
    
    
    
    
    1,475Prepaid expenses and other assets
    
    
    
    
    
    
    96Investment in common stock of Sirenza
    
    
    
    
    
    
    4,065Restricted investment in common stock of Sirenza
    
    
    
    
    
    
    2,542$
    102
    
    
    
    8,238LiabilitiesAccounts payable and accrued costs of liquidation
    
    $
    (102
    )
    
    
    (2,530
    )Settlement obligation to issue 2,000,000 shares
of common stock
    
    
    
    
    
    
    (1,200
    )Commitments and contingenciesNet assets in
liquidation
    
    $
    
    
    
    
    4,508
 See accompanying notes to financial statements. F-2




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VL DISSOLUTION CORPORATION
Statements of Changes in Net Assets in Liquidation (in thousands of dollars) Period fromMay 6, 2003Year ended
    
    toJune 30, 2004
    
    June 30, 2003Net increase (decrease) in net assets in liquidation (Note 3):Mark-to-market adjustments, including realized gains on sale of investment
in common stock of Sirenza
    
    $
    7,334
    
    
    
    1,920Net death benefits from life insurance policy
    
    
    329
    
    
    
    Refund of use tax paid
    
    
    60
    
    
    
    Adjustment to estimated costs of liquidation
    
    
    (199
    )
    
    
    Interest income
    
    
    7
    
    
    
    Issuance of 2.0 million shares of common stock to fund settlement obligation
    
    
    1,200
    
    
    
    Distribution of 2.7 million shares of Sirenza common stock
    
    
    (11,753
    )
    
    
    Distribution of cash to shareholders
    
    
    (1,486
    )
    
    
    Net increase (decrease) in net assets in liquidation
    
    
    (4,508
    )
    
    
    1,920Net assets in liquidation, beginning of period
    
    
    4,508
    
    
    
    2,588Net assets in liquidation, end of period
    
    $
    
    
    
    
    4,508
 See accompanying notes to financial statements. F-3




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##### Table of Contents



VL DISSOLUTION CORPORATION Statements of Operations (in thousands of dollars, except share and per share data) Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002Net sales
    
    $
    13,911
    
    
    
    21,348Cost of goods sold
    
    
    10,148
    
    
    
    13,582Gross profit
    
    
    3,763
    
    
    
    7,766Operating expenses:Selling
    
    
    2,299
    
    
    
    2,925General and administrative
    
    
    5,040
    
    
    
    6,398Research and development
    
    
    2,444
    
    
    
    2,653Expenses related to workforce reductions and
the asset sale to Sirenza (Note 6)
    
    
    3,636
    
    
    
    101Expenses relating to accounting restatements and
related legal matters, net of recoveries (Note 7)
    
    
    82
    
    
    
    1,805Total operating expenses
    
    
    13,501
    
    
    
    13,882Operating loss
    
    
    (9,738
    )
    
    
    (6,116
    )Other income (expense):Interest income
    
    
    18
    
    
    
    48Interest expense
    
    
    (866
    )
    
    
    (199
    )Gain on sale/disposal of assets, net
    
    
    6,284
    
    
    
    Other, net
    
    
    375
    
    
    
    12Total other income (expense)
    
    
    5,811
    
    
    
    (139
    )Net loss
    
    $
    (3,927
    )
    
    
    (6,255
    )Loss per share, basic and diluted (Note 8)
    
    $
    (0.54
    )
    
    
    (0.87
    )Weighted average shares outstanding, basic and diluted
    
    
    7,258,853
    
    
    
    7,152,342
 See accompanying notes to financial statements. F-4




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##### Table of Contents



VL DISSOLUTION CORPORATION Statements of Stockholders Equity Period from July 1, 2002 to May 5, 2003 and for the year ended June 30, 2002 (in thousands of dollars, except share data) Common stock
    
    Additionalpaid-in
    
    Unamortizedstockcompensation
    
    Accumulated
    

TotalstockholdersShares
    
    Amount
    
    capital
    
    cost
    
    deficit
    
    equityBalance June 30, 2001
    
    
    7,107,161
    
    
    
    71
    
    
    
    36,829
    
    
    
    (79
    )
    
    
    (22,992
    )
    
    
    13,829Common stock issued under employee stock
purchase plan
    
    
    76,011
    
    
    
    1
    
    
    
    123
    
    
    
    
    
    
    
    
    
    
    
    124Common stock issued under stock award plan
    
    
    2,900
    
    
    
    
    
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    4Common stock repurchased and retired
    
    
    (6,240
    )
    
    
    
    
    
    
    (7
    )
    
    
    
    
    
    
    
    
    
    
    (7
    )Stock options forfeited
    
    
    
    
    
    
    
    
    
    
    (4
    )
    
    
    4
    
    
    
    
    
    
    
    Amortization of stock compensation cost
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44
    
    
    
    
    
    
    
    44Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,255
    )
    
    
    (6,255
    )Balance June 30, 2002
    
    
    7,179,832
    
    
    $
    72
    
    
    
    36,945
    
    
    
    (31
    )
    
    
    (29,247
    )
    
    
    7,739Common stock issued under employee stock
purchase plan
    
    
    169,874
    
    
    
    2
    
    
    
    115
    
    
    
    
    
    
    
    
    
    
    
    117Common stock issued under stock award plan
    
    
    3,600
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    1Common stock surrendered and retired
    
    
    (100,813
    )
    
    
    (1
    )
    
    
    (75
    )
    
    
    
    
    
    
    
    
    
    
    (76
    )Common stock exercised under stock option plan
    
    
    96,079
    
    
    
    
    
    
    
    23
    
    
    
    
    
    
    
    
    
    
    
    23Stock options forfeited
    
    
    
    
    
    
    
    
    
    
    (3
    )
    
    
    3
    
    
    
    
    
    
    
    Amortization of stock compensation cost
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28
    
    
    
    
    
    
    
    28Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,927
    )
    
    
    (3,927
    )Balance May 5, 2003
    
    
    7,348,572
    
    
    $
    73
    
    
    
    37,006
    
    
    
    
    
    
    
    (33,174
    )
    
    
    3,905Effects of change to liquidation basis (Note 9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,317
    )
    
    
    (1,317
    )Balance May 5, 2003
    
    
    7,348,572
    
    
    $
    73
    
    
    
    37,006
    
    
    
    
    
    
    
    (34,491
    )
    
    
    2,588
 See accompanying notes to financial statements. F-5




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VL DISSOLUTION CORPORATION
Statements of Cash Flows (in thousands of dollars) Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002Net income (loss)
    
    $
    (3,927
    )
    
    
    (6,255
    )Adjustments to reconcile net loss to cash provided by (used in)
operating activities:Depreciation and amortization
    
    
    1,679
    
    
    
    2,095Gain on sale/disposal of assets
    
    
    (6,284
    )
    
    
    Loss on disposal of other assets
    
    
    59
    
    
    
    30Common stock issued under profit sharing and stock award plans
    
    
    1
    
    
    
    4Common stock surrendered and retired
    
    
    (76
    )
    
    
    Amortization of stock compensation
    
    
    28
    
    
    
    44Write-off of debt issue costs
    
    
    59
    
    
    
    Forfeiture and write-off of deposits
    
    
    131
    
    
    
    Settlement obligation to issue 2,000,000 shares of common stock
    
    
    
    
    
    
    1,200Changes in:Accounts receivable, inventories, prepaid expenses and other assets
    
    
    2,025
    
    
    
    4,457Accounts payable, accrued expenses and other liabilities
    
    
    1,905
    
    
    
    (751
    )Total adjustments
    
    
    (473
    )
    
    
    7,079Cash provided by (used in) operating activities
    
    
    (4,400
    )
    
    
    824Cash flows from investing activities:Purchases of property and equipment
    
    
    (156
    )
    
    
    (953
    )Proceeds from sale of other assets
    
    
    23
    
    
    
    59Consideration from sale of assets to Sirenza
    
    
    3,835
    
    
    
    Net proceeds (investment) from cash surrender value of whole life insurance
    
    
    269
    
    
    
    (29
    )Cash provided by (used in) investing activities
    
    
    3,971
    
    
    
    (923
    )Cash flows from financing activities:Proceeds from notes payable
    
    
    5,751
    
    
    
    7,257Payments of notes payable
    
    
    (578
    )
    
    
    (8,738
    )Proceeds from long-term obligations
    
    
    
    
    
    
    484Payments of long-term obligations
    
    
    (1,527
    )
    
    
    (422
    )Payment of debt issue costs
    
    
    
    
    
    
    (59
    )Proceeds from common stock issued under stock option plan
    
    
    23
    
    
    
    Proceeds from common stock issued under stock purchase plan
    
    
    117
    
    
    
    124Common stock repurchased and retired
    
    
    
    
    
    
    (7
    )Cash provided by (used) in financing activities
    
    
    3,786
    
    
    
    (1,361
    )Increase (decrease) in cash and cash equivalents
    
    
    3,357
    
    
    
    (1,460
    )Cash and cash equivalents at beginning of period
    
    
    553
    
    
    
    2,013Cash and cash equivalents at end of period
    
    $
    3,910
    
    
    
    553Supplemental disclosure of cash flow information:Cash paid for interest
    
    $
    819
    
    
    
    159Cash paid for income taxes
    
    $
    
    
    
    
    
 See accompanying notes to financial statements. F-6




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (1)
    
    Liquidation Basis of Accounting and Sale of Substantially All AssetsVari-L Company, Inc. (the Company) was founded in 1953 and, prior to May 6,
2003, was a manufacturer of electronic components. The Company designed,
manufactured, and marketed radio frequency and microwave signal source and
processing components and other electronic devices used in the
communications industry. The Company operated as a single business
segment, and its products were sold to original equipment manufacturers of
communication equipment who marketed their products in both commercial and
military markets in the United States and internationally.On December 2, 2002, the Company entered into a definitive asset purchase
agreement (the Asset Purchase Agreement) to sell substantially all of its
assets to a wholly owned subsidiary of Sirenza Microdevices, Inc.
(Sirenza).On May 5, 2003, the asset sale contemplated by the Asset Purchase Agreement
was consummated. Effective with the closing, the Company received $3.835
million in cash, 3.255 million shares of Sirenzas common stock with a
market value of $5.143 million as of May 5, 2003, forgiveness of $1.354
million and assumption of $4.594 million of secured loans and accrued
interest payable to Sirenza.Pursuant to the amended plan of dissolution, which was approved by the
shareholders at the special stockholders meeting on May 5, 2003, the
Companys operations were limited to winding-up its business and affairs,
selling certain of its remaining assets, discharging its known liabilities,
establishing a contingency reserve for payment of expenses and contingent
liabilities, and distributing any remaining assets to its stockholders, all
in accordance with the amended plan of dissolution. As a result, the
Company changed its basis of accounting to the liquidation basis as of May
5, 2003, which assumes that assets and liabilities are reflected at the
estimated amounts to be paid or received; however actual costs could differ
from those estimates.In connection with the asset sale and the dissolution of the Company, the
Company filed articles of amendment to change its name from Vari-L Company,
Inc. to VL Dissolution Corporation, effective May 5, 2003.Final dissolution of the Company and related distributions to its
stockholders could not occur prior to obtaining final resolution of all
liquidation issues and expiration of the period during which Sirenza could
make an indemnity claim. The expiration of the period during which Sirenza
was entitled to make an indemnity claim against the Company was March 31,
2004. Sirenza and its indemnified parties did not make any claims against
the Company. Effective June 28, 2004, resolution of all
liquidation issues and final distributions to its stockholders occurred.
During the year ended June 30, 2004, the Company made aggregate
distributions (or conversion to cash in the case of fractional shares) of
approximately 2.7 million shares of Sirenzas common stock to its
shareholders valued at $11.8 million and $1.5 million in cash. At June 30,
2004, the Company has satisfied its known liabilities and distributed all
of its assets other than a small cash balance to satisfy any remaining
liabilities relating to its liquidation. Accordingly, the Company will not
make any further distributions to its shareholders and the Company will
cease to exist in any capacity. F-7




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##### Table of Contents



VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (2)
    
    Summary of Significant Accounting Policies  (a)
    
    Use of estimatesManagement of the Company has made a number of estimates and
assumptions relating to the reporting of assets and liabilities and
the disclosure of contingent assets and liabilities to prepare these
financial statements in conformity with accounting principles
generally accepted in the United States of America. Significant
assumptions inherent in the preparation of the accompanying financial
statements include, but are not limited to, estimated costs of
liquidation and commitments and contingencies. Actual results could
differ from those estimates.(b)
    
    Restricted cashIn connection with the asset sale, $1.475 million of cash was
restricted as to withdrawal and was retained in a separate bank
account designated for such purpose. The cash was to remain restricted
until the later of March 31, 2004 or the date at which all
indemnification claims against the Company made by Sirenza and its
indemnified parties were paid or otherwise resolved. Sirenza and its
indemnified parties did not make any claims against the Company.
Accordingly, the restricted designation was removed effective March
31, 2004.(c)
    
    Marketable securitiesMarketable securities consisted of an investment in the common stock
of Sirenza, were classified as held for trading and were recorded at
fair value. In connection with the asset sale, the Company held
approximately 1.3 million shares that were restricted as to withdrawal
or distribution. The shares were to remain restricted until the later
of March 31, 2004 or the date at which all indemnification claims
against the Company made by Sirenza and its indemnified parties were
paid or otherwise resolved. Sirenza and its indemnified parties did
not make any claims against the Company. Accordingly, the restricted
designation was removed effective March 31, 2004.Unrealized gains on Sirenzas common shares distributed to our
shareholders were reported in the Statements of Changes in Net Assets
in Liquidation.(d)
    
    Income taxesFor the period from July 1, 2002 to May 5, 2003, and for the year
ended June 30, 2002, the Company recorded no provision for federal or
state income taxes since a valuation allowance
was provided for the income tax benefit of the net operating losses
incurred during those periods. F-8




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##### Table of Contents



VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (e)
    
    Research and Development and Advertising CostsResearch and development and advertising costs were expensed when
incurred. Research and development expense for the period from July
1, 2002 to May 5, 2003 and for the year ended June 30, 2002 totaled
$2.4 million and $2.7 million, respectively. This amount was
comprised of product development expenses of $1.7 million and $1.9
million, respectively, which represented the design costs associated
with customized products for customers. Additionally this amount was
comprised of research expenses of $729,000 and $813,000, respectively,
which were costs associated with the development of new product lines.
Advertising costs were $141,000 for the period from July 1, 2002 to
May 5, 2003 and $220,000 for the year ended June 30, 2002.(f)
    
    Revenue RecognitionRevenues were recognized at the time of shipment. Provisions were
made for sales discounts and allowances at the time product sales were
recognized.  (3)
    
    Changes in Net Assets in Liquidation  (a)
    
    Net realized gains on sale of investment in common stock of
SirenzaDuring the year ended June 30, 2004, the Company sold 570,974 shares
generating proceeds of approximately $2.2 million, realizing net gains
of $1.3 million. The proceeds were used to satify liabilities and pay
expenses of the Company.(b)
    
    Net death benefitsThe Company was a beneficiary to a life insurance policy in which a
former officer was named as the insured. Under the policy, the Company
was entitled to 100% of the net death benefits. In January 2004, the
Company was notified of the death of this former officer. The Company
received the net proceeds from the life insurance policy during April
2004 and recorded the receipt of $329,000 in its Statement of Changes
in Assets for the year ended June 30, 2004.(c)
    
    Adjustment to estimated costs of liquidationDuring the year ended June 30, 2004, the Company recorded an
adjustment of $199,000 representing an increase in its original
estimate of the costs to be incurred during dissolution. The increase
primarily represents unanticipated costs incurred in connection with
the distribution of Sirenzas common stock to the Companys
shareholders. F-9




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (d)
    
    Issuance of 2.0 million shares of common stock to fund settlement
obligationDuring October 2003, the Company issued an aggregate of 2.0 million shares of its common stock to the shareholders in the plaintiff class
pursuant to the settlement of the private securities class action. The
Company recorded a liability of $1.2 million for the issuance of the
settlement shares in June 2002, when all substantive aspects of the settlement were agreed upon, based upon the fair market value of the shares on such date.(e)
    
    Distribution of 2.7 million shares of Sirenza common stockDuring the year ended June 30, 2004, the Company made aggregate
distributions (or conversion to cash in the case of fractional shares)
of 2,683,683 shares of Sirenzas common stock to its shareholders
valued at $11.8 million.  (4)
    
    Stock Transfer BooksThe Company received a total of 3,254,657 shares of Sirenza common stock in
the asset sale. The Company either sold, in order to satisfy its
liabilities and pay expenses of the Company, or distributed all of the shares. The Company has also distributed all of its remaining cash, other
than a small reserve to satisfy any remaining liabilities. As such, the
Company will not make any further distributions to its shareholders and the
Company will cease to exist in any capacity.As outstanding shares of the Companys common stock are deemed worthless as
of the date of final distribution, the Companys Board of Directors
approved the closing of the Companys stock transfer books. Accordingly, no
transfers of shares of the Companys common stock have been registered on
the Companys stock transfer books or otherwise recognized by the Company
after July 13, 2004, the date on which our transfer books were closed.The Company has also filed Form 15 with the Securities and Exchange
Commission, pursuant to which its duty to file reports required under
Section 13(a) of the Securities Exchange Act of 1934, as amended, was
immediately suspended and its duty to file reports required under Section
15(d) of the Securities Exchange Act of 1934, as amended, was suspended as
of June 30, 2004. This annual report represents the Companys final
periodic report to be filed with the Securities Exchange Commission. No
other filings will be made with the Securities and Exchange Commission and
no further communications will be made to the former shareholders of the
Company.(5)
    
    Effects of Change to Liquidation BasisCommencing on May 5, 2003, the Companys operations were limited to
winding-up its business and affairs, selling certain of its remaining
assets, discharging its known liabilities, establishing a contingency
reserve for payment of expenses and contingent liabilities, and
distributing any remaining assets to its stockholders, all in accordance
with the amended plan of dissolution. As a result, the Company changed its
basis of accounting to the liquidation basis as of May 5, 2003. Upon
changing to the liquidation basis of accounting, which assumes that assets
and liabilities are reflected at the estimated amounts to be paid or
received, the Company recorded a charge to equity of $1.317 million
representing an estimate of the costs to be incurred during dissolution of
the Company. F-10




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  At June 30, 2003, the following represented the estimated costs of
liquidation (in thousands of dollars): Insurance premiums
    
    $
    407Officer stay payments
    
    
    383Legal, audit and tax services
    
    
    349Other estimated costs of liquidation
    
    
    178Total
    
    $
    1,317
  During the year ended June 30, 2004, actual costs of liquidation were
revised to $1.516 million. See Note 3 for additional information.  (6)
    
    Certain Risks and Concentrations prior to the Liquidation Period  The Companys products were sold to original equipment manufacturers of
communications equipment, either in commercial or military markets. The
following table shows the percentage of total revenues contributed by
significant customers for the periods presented. A significant customer was
defined as one contributing 10% or more of total revenues. Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002Nokia
    
    
    22.73
    %
    
    
    17.49
    %Motorola
    
    
    12.98
    %
    
    
    16.71
    %ACAL Electronics (includes Siemens)
    
    
    10.66
    %
    
    
    12.99
    %
  The Company produced and sold electronic components in four product lines.
Net sales for each of the product lines for the periods presented were as
follows (in thousands of dollars): Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002Commercial Signal Source Components
    
    $
    10,541
    
    
    
    15,615Hi-Rel Signal Source Components
    
    
    2,684
    
    
    
    3,651Military Signal Processing Components
    
    
    630
    
    
    
    1,848Other products
    
    
    56
    
    
    
    234Net sales
    
    $
    13,911
    
    
    
    21,348
 F-11




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004 F-12




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  The Company attributed sales to customers based on the country to which the
products were shipped. Net sales by country were as follows (in thousands
of dollars): Period fromJuly 1, 2002
    
    Year endedto
    
    June 30,May 5, 2003
    
    2002United States
    
    $
    5,954
    
    
    
    8,985China
    
    
    2,506
    
    
    
    3,800Finland
    
    
    2,217
    
    
    
    2,995Germany
    
    
    647
    
    
    
    1,147Sweden
    
    
    623
    
    
    
    1,321Italy
    
    
    404
    
    
    
    462England
    
    
    232
    
    
    
    1,349Canada
    
    
    201
    
    
    
    109Other
    
    
    1,127
    
    
    
    1,180$
    13,911
    
    
    
    21,348
  (7)
    
    Expenses Related to Workforce Reductions and the Asset Sale to Sirenza
prior to the Liquidation Period  As a result of the continuing weakness in the wireless industry and the
impact it had upon the Companys revenues, the Company reduced its
workforce and incurred severance expenses. Additionally, the Company
incurred costs in connection with the asset sale to Sirenza. Expenses
related to workforce reductions and the asset sale to Sirenza were as
follows (in thousands of dollars): Period from
    
    Year endedJuly 1, 2002 to
    
    June 30,May 5, 2003
    
    2002Severance and post-closing bonuses
    
    $
    1,031
    
    
    
    101Legal fees
    
    
    665
    
    
    
    Investment bankers fees
    
    
    502
    
    
    
    Lease termination penalties
    
    
    825
    
    
    
    Asset impairment
    
    
    451
    
    
    
    Other related costs
    
    
    162
    
    
    
    Total
    
    $
    3,636
    
    
    
    101
 F-13




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##### Table of Contents



VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (8)
    
    Expenses of Accounting Restatements, Stockholder Litigation and Related
Matters prior to the Liquidation PeriodIn early 2000, management of the Company commenced efforts to restate its
previously issued financial statements after being notified by the
Securities and Exchange Commission (the Commission) that the Commission was
investigating its accounting and reporting practices. Certain costs
incurred in conjunction with these efforts have been separately classified
in the Companys Statements of Operations as Expenses relating to
accounting restatements and related legal matters, net of recoveries.
Expenses included in this classification include the cost of external
counsel for services provided in connection with shareholder lawsuits, the
Commissions investigation of the Company, legal fees and expenses of the
Special Litigation Committee of the Board of Directors (the SLC), the
costs incurred to settle the private securities action and the Company
action against former officers (net of recoveries), the cost of certain
consultants and temporary labor hired to assist in the accounting
restatements, and reimbursements to current and former employees of the
Company for their legal fees and expenses.The accounting restatements were completed in February 2001. Additionally,
during October 2002 and December 2002, the Company, the individual
defendants in the private securities class action, the Agricultural Excess
and Surplus Insurance Company, and the individual defendants in the action
against former officers attended global settlement conferences. All parties
involved reached an agreement in principle for the global settlement of all
litigation. On January 22, 2003, the Company, the class action
representatives and the individual defendants in the private securities
class action executed and filed a Stipulation of Settlement with the United
States District Court for the District of Colorado (the Court). On March
28, 2003, the Court held a fairness hearing regarding the settlement of the
private securities class action. At the hearing, the Court approved the
settlement of the private securities class action as fair and reasonable to
the members of the class. Following the hearing, the Court entered its
final judgment and order of dismissal of the actions with prejudice. The
terms under the Stipulation provided that the Company pay $250,000 in cash
and issue 2.0 million shares of its common stock valued at $1.2 million to
settle that action.Expenses relating to accounting restatements and related legal matters, net
of recoveries, were as follows (in thousands of dollars): Period from
    
    Year endedJuly 1, 2002 to
    
    June 30,May 5, 2003
    
    2002Legal fees incurred in connection with the
stockholder lawsuits, Special Litigation
Committee and the global settlement
    
    $
    199
    
    
    
    472Approximate cost to settle the Private
Securities Class Action
    
    
    
    
    
    
    1,450Other adjustments related to legal settlements
    
    
    (117
    )
    
    
    (117
    )Total
    
    $
    82
    
    
    
    1,805
 F-14




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (9)
    
    Earnings Per Share prior to the Liquidation PeriodThe Company computed net loss per share by dividing the net loss for the
period by the weighted average number of shares of common stock outstanding
during the period. Diluted net loss per share was computed by dividing the
net loss for the period by the weighted average number of shares of common
stock increased for potentially dilutive common shares outstanding. The
effects of potential common stock equivalents were not been included in the
computation of diluted net loss per share as their effect was
anti-dilutive.The following table sets forth the computation of basic and diluted net
loss per share for the periods indicated (in thousands, except share and
per share data): Period fromJuly 1, 2002 to
    
    Year endedMay 5, 2003
    
    June 30, 2002Net income (loss)
    
    $
    (3,927
    )
    
    
    (6,255
    )Weighted average shares outstanding
    
    
    7,258,853
    
    
    
    7,152,342Basic and diluted net income (loss) per share
    
    $
    (0.54
    )
    
    
    (0.87
    )
 F-15




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VL DISSOLUTION CORPORATION Notes to the Financial Statements June 30, 2004  (10)
    
    Quarterly Financial Information (Unaudited)The following is a summary of the unaudited quarterly financial information
for periods prior to change to liuidation basis accounting (in thousands of
dollars, except per share amounts): Quarters EndedSeptember 30,
    
    December 31,
    
    March 31,
    
    May 5,2002
    
    2002
    
    2003
    
    2003*Net sales
    
    $
    3,982
    
    
    
    4,309
    
    
    
    4,024
    
    
    
    1,596Gross profit
    
    
    922
    
    
    
    1,241
    
    
    
    1,315
    
    
    
    285Operating loss
    
    
    (2,159
    )
    
    
    (2,485
    )
    
    
    (1,489
    )
    
    
    (3,605
    )Net income (loss)
    
    
    (2,321
    )
    
    
    (2,751
    )
    
    
    (1,816
    )
    
    
    2,961Basic and diluted
earnings (loss) per
share
    
    
    (0.32
    )
    
    
    (0.38
    )
    
    
    (0.25
    )
    
    
    0.41
  * On May 5, 2003, the Company completed the sale of all of its operating
assets to Sirenza and ceased preparing its financial statements on a going
concern basis under generally accepted accounting principles. Accordingly,
results of operations for the period ended May 5, 2003 are not comparable
to prior quarters. Quarters EndedSeptember 30,
    
    December 31,
    
    March 31,
    
    June 30,2001
    
    2001
    
    2002
    
    2002Net sales
    
    $
    5,676
    
    
    
    5,607
    
    
    
    5,163
    
    
    
    4,902Gross profit
    
    
    2,146
    
    
    
    2,322
    
    
    
    1,928
    
    
    
    1,305Operating loss
    
    
    (1,079
    )
    
    
    (493
    )
    
    
    (1,160
    )
    
    
    (5,542
    )Net loss
    
    
    (1,120
    )
    
    
    (528
    )
    
    
    (1,211
    )
    
    
    (3,396
    )Basic and diluted
loss per share
    
    
    (0.16
    )
    
    
    (0.07
    )
    
    
    (0.17
    )
    
    
    (0.47
    )
 F-16




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VL DISSOLUTION CORPORATION Schedule II  Valuation and Qualifying Accounts (in thousands of dollars) Balance at
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance atbeginning
    
    
    
    
    
    
    
    
    
    
    
    
    
    endDescription
    
    of period
    
    Additions (a)
    
    Deductions (b)
    
    Asset Sale (c)
    
    of periodPeriod ended May 5, 2003:Allowance for doubtful accounts
    
    $
    132
    
    
    
    25
    
    
    
    (107
    )
    
    
    (50
    )
    
    
    Allowance for excess and obsolete
inventories
    
    
    2,522
    
    
    
    475
    
    
    
    (1,291
    )
    
    
    (1,706
    )
    
    
    Reserve for product warranties
and returns
    
    
    20
    
    
    
    
    
    
    
    
    
    
    
    (20
    )
    
    
    Total
    
    $
    2,674
    
    
    
    500
    
    
    
    (1,398
    )
    
    
    (1,776
    )
    
    
    Year ended June 30, 2002:Allowance for doubtful accounts
    
    $
    279
    
    
    
    104
    
    
    
    (251
    )
    
    
    
    
    
    
    132Allowance for excess and obsolete
inventories
    
    
    2,423
    
    
    
    564
    
    
    
    (465
    )
    
    
    
    
    
    
    2,522Reserve for product warranties
and returns
    
    
    31
    
    
    
    10
    
    
    
    (21
    )
    
    
    
    
    
    
    20Total
    
    $
    2,733
    
    
    
    678
    
    
    
    (737
    )
    
    
    
    
    
    
    2,674
 Notes:
(a) Amounts charged to costs and expenses.
(b) Bad debt write-offs and charges to reserves.
(c) Reserves deducted against proceeds from sale of assets to Sirenza. See accompanying report of independent registered public accounting firm. F-17




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Exhibit Index Exhibit No.
    
    Description2.1
    
    Amended Plan of Dissolution of Vari-L Company, Inc. as approved
by the shareholders at the special meeting held on May 5, 2003 filed
as Exhibit 2.1 to the Form 10-Q for the quarter ended March 31, 2003
and incorporated herein by reference.3.1a
    
    Restated Articles of Incorporation, as Amended, filed as Exhibit
4.1 to the Form S-8 Registration Statement (No. 33-88666) and
incorporated herein by reference.3.1b
    
    Articles of Amendment to the Articles of Incorporation filed as
Exhibit 3.1b to the Form 10-KSB for the year ended December 31, 1996
and incorporated herein by reference.3.2
    
    Amended and Restated Bylaws adopted September 26, 2002 and
filed as Exhibit 3.2 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.4.1
    
    Specimen Certificate for $.01 par value Common Stock filed as
Exhibit 4.3 to the Form SB-2 Registration Statement (No. 33-74704-D)
and incorporated herein by reference.4.2
    
    Rights Agreement with American Securities Transfer, Inc. dated
March 15, 1996 filed as Exhibit 4.2 to the Form 8-A/A Registration
Statement (No. 0-23866) and incorporated herein by reference.4.3
    
    Specimen Certificate for Right to Purchase $.01 par value
Common Stock filed as Exhibit 4.3 to the Form 8-A/A Registration
Statement (No. 0-23866) and incorporated herein by reference.4.4
    
    Securities Purchase Agreement with the Purchasers dated March
4, 1997 filed as Exhibit 4.5 to the Form S-3 Registration Statement
(No. 333-25173) and incorporated herein by reference.4.6
    
    Form of Warrant to Purchase Common Stock issued to the
Purchasers under the Securities Purchase Agreement dated March 4,
1997 filed as Exhibit 4.7 to the Form S-3 Registration Statement (No.
333-25173) and incorporated herein by reference.4.7
    
    Amendment No. 1 to Rights Agreement with American Securities
Transfer, Inc. dated October 7, 2002 and filed as Exhibit 4.7 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.1
    
    Executive Employment Agreement with Joseph H. Kiser, dated
effective June 1, 1997, filed as Exhibit 10.1 to the Form 10-QSB for
the quarter ended September 30, 1998 and incorporated herein by
reference.10.2
    
    Lease Agreement dated January 1, 1987 with J.C. Enterprises for
the facility located at 5165 Peoria Street, Denver, Colorado, as
amended on December 6,




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Exhibit No.
    
    Description1990 and March 23, 1993, filed as Exhibit 10.15 to the Form
SB-2 Registration Statement (No. 33-74704-D) and incorporated
herein by reference.10.3
    
    Settlement Agreement with Joseph H. Kiser, David G. Sherman,
Alwin E. Branson and Carolyn Y. Kiser dated January 31, 1992, as
amended March 23, 1993, filed as Exhibit 10.18 to the Form SB-2
Registration Statement (No. 33-74704-D) and incorporated herein by
reference.10.4
    
    Profit Sharing Plan and Trust Agreement, as amended and restated
effective April 19, 1994 filed as Exhibit 10.16 to the Form 10-KSB for
the year ended December 31, 1994 and incorporated herein by reference.10.5
    
    Lease Agreement dated March 12, 1997 with Five K Investments for
the facility located at 4895 Peoria Street, Denver, Colorado filed as
Exhibit 10 to the Form 10-QSB for the quarter ended September 30, 1997
and incorporated herein by reference.10.6
    
    Third Amendment to Lease Agreement dated January 1, 1987 with
J.C. Enterprises for the facility located at 5165 Peoria Street,
Denver, Colorado, as amended December 6, 1990, March 23, 1993, and
October 30, 1998 filed as Exhibit 10.6 to the Form 10-QSB for the
quarter ended September 30, 1998 and incorporated herein by reference.10.7
    
    Termination and Consulting Agreement with David G. Sherman dated
August 1, 2000 filed as Exhibit 10.1 to the Form 8-K dated August 1,
2000 and incorporated herein by reference.10.8
    
    Employment Agreement with Timothy M. Micun dated March 2, 2001
filed as Exhibit 10.26 to the Form 10-K for the fiscal year ended June
30, 2001 and incorporated herein by reference.10.9
    
    Credit and Security Agreement with Wells Fargo Business Credit,
Inc. dated June 28, 2001 filed as Exhibit 99.2 to the Form 8-K dated
June 28, 2001 and incorporated herein by reference.10.10
    
    Patent and Trademark Security Agreement with Wells Fargo Business
Credit, Inc. dated June 28, 2001 filed as Exhibit 99.3 to the Form 8-K
dated June 28, 2001 and incorporated herein by reference.10.11
    
    First Amendment to Credit and Security Agreement dated September
17, 2001 filed as Exhibit 10.1 to the Form 10-Q dated September 30,
2001 and incorporated herein by reference.10.12
    
    Employee Stock Purchase Plan effective as of November 30, 2001
filed as Exhibit 10.1 to the Form 10-Q for the quarter ended December
31, 2001 and incorporated herein by reference.10.13
    
    Amended and Restated Tandem Stock Option and Stock Appreciation
Rights Plan, effective as of January 1, 2002 filed as Exhibit 10.1 to
the Form 10-Q for the quarter ended March 31, 2002 and incorporated by
reference herein.10.14
    
    Stock Grant Plan effective as of January 1, 2002 filed as Exhibit
10.2 to the Form 10-Q for the quarter ended March 31, 2002 and
incorporated herein by reference.




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##### Table of Contents



Exhibit No.
    
    Description10.15
    
    Agreement between Vari-L Company, Inc. and Asvan Technology, LLC
dated January 25, 2002 filed as Exhibit 10.15 to the Form 10-K for the
fiscal year ended June 30, 2002 and incorporated herein by reference.10.16
    
    Second Amendment to Credit and Security Agreement with Wells Fargo
Business Credit, Inc. dated February 8, 2002 filed as Exhibit 10.16 to
the Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.17
    
    Form of Indemnity Agreement by and among Vari-L Company, Inc. and
each of Gil J. Van Lunsen (dated June 1, 2001), Sarah L. Booher (dated
July 5, 2001), David A. Lisowski (dated July 5, 2001), Anthony B.
Petrelli (dated July 5, 2001), David M. Risley (dated November 21,
2001) and Robert C. Dixon (dated January 11, 2002) filed as Exhibit
10.17 to the Form 10-K for the fiscal year ended June 30, 2002 and
incorporated herein by reference.10.18
    
    Employment Agreement with Charles R. Bland dated August 1, 2002
filed as Exhibit 10.18 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.19
    
    Employment Agreement with Russell M. Crouch dated August 1, 2002
filed as Exhibit 10.19 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.20
    
    Employment Agreement with Richard P. Dutkiewicz dated August 1,
2002 filed as Exhibit 10.20 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.21
    
    Employment Agreement with Ernest C. Hafersat dated August 1, 2002
filed as Exhibit 10.21 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.22
    
    Employment Agreement with Janice E. Hyland dated August 1, 2002
filed as Exhibit 10.22 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.23
    
    Employment Agreement with Matthew D. Pope dated August 1, 2002
filed as Exhibit 10.23 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.24
    
    Employment Agreement with Larry M. Romero dated August 1, 2002
filed as Exhibit 10.24 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.25
    
    Employment Agreement with Timothy G. Schamberger dated August 1,
2002 filed as Exhibit 10.25 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.26
    
    Employment Agreement with Daniel J. Wilmot dated August 1, 2002
filed as Exhibit 10.26 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.




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##### Table of Contents



Exhibit No.
    
    Description10.27
    
    Engagement letter with Green, Manning & Bunch, Ltd. dated
September 9, 2002 filed as Exhibit 10.27 to the Form 10-K for the
fiscal year ended June 30, 2002 and incorporated herein by reference.10.28
    
    Forbearance Agreement and Third Amendment to Credit and Security
Agreement with Wells Fargo Business Credit, Inc. dated September 26,
2002 filed as Exhibit 99.1 to the Form 8-K dated October 1, 2002 and
incorporated herein by reference.10.29
    
    Indemnity Agreement, dated October 2, 2002, by and among Vari-L
Company with Charles R. Bland filed as Exhibit 10.29 to the Form 10-K
for the fiscal year ended June 30, 2002 and incorporated herein by
reference.10.30
    
    Indemnity Agreement, dated October 2, 2002, by and among Vari-L
Company, Inc. with Richard P. Dutkiewicz filed as Exhibit 10.30 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.31
    
    Memorandum of Understanding dated October 3, 2002 between Vari-L
Company, Inc. and the plaintiffs in Civil Action No. 00-S-1198 between
plaintiffs Michael Rasner, et al., on behalf of themselves and other
similarly situated and defendants Vari-L Company, Inc., Derek Bailey,
Joseph Kiser, David G. Sherman and Jon Clark in the United States
District Court, District of Colorado, by and through their respective
attorneys, for settlement of litigation against Vari-L Company, Inc.
filed as Exhibit 10.31 to the Form 10-K for the fiscal year ended June
30, 2002 and incorporated herein by reference.10.32
    
    Loan Agreement with Sirenza Microdevices, Inc. dated October 7,
2002 filed as Exhibit 10.32 to the Form 10-K for the fiscal year ended
June 30, 2002 and incorporated herein by reference.10.33
    
    Security Agreement with Sirenza Microdevices, Inc. dated October
7, 2002 filed as Exhibit 10.33 to the Form 10-K for the fiscal year
ended June 30, 2002 and incorporated herein by reference.10.34
    
    Exclusivity and Right of First Refusal Agreement with Sirenza
Microdevices, Inc. dated October 7, 2002 filed as Exhibit 10.34 to the
Form 10-K for the fiscal year ended June 30, 2002 and incorporated
herein by reference.10.35
    
    Resale Registration Rights Agreement with Sirenza Microdevices,
Inc. dated October 7, 2002 filed as Exhibit 10.35 to the Form 10-K for
the fiscal year ended June 30, 2002 and incorporated herein by
reference.10.36
    
    Letter Agreement dated November 12, 2002 between Vari-L
Corporation, Inc. and Five K Investments amending that certain lease
agreement dated as of March 12,1997 by and between Vari-L Corporation,
Inc. and Five K Investments filed as Exhibit 10.1 to the Form 10-Q for
the quarter ended September 30, 2002 and incorporated herein by
reference.10.37
    
    Stipulation of Settlement dated January 22, 2003 between Vari-L
Company, Inc., Derek L. Bailey, Joseph H. Kiser, David G. Sherman, Jon
L. Clark and the plaintiffs in Civil No. 00-S-1198 between plaintiffs
Michael Rasner, et al., on behalf of themselves and other similarly
situated and defendants Vari-L Company, Inc., Derek L. Bailey, Joseph
H. Kiser, David G. Sherman and Jon L. Clark in the United State
District Court, District of Colorado, by and through




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##### Table of Contents



Exhibit No.
    
    Descriptiontheir respective attorneys, for settlement of litigation
against Vari-L Company, Inc. filed as Exhibit 10.1 to the Form
10-Q for the quarter ended December 31, 2002 and incorporated
herein by reference.10.38
    
    Form of Amended and Restated Indemnity Agreement by and among
Vari-L Company, Inc. and each of Gil J. Van Lunsen, Sarah L. Booher,
David A. Lisowski, Anthony B. Petrelli, David M. Risley, Robert C.
Dixon, Charles A. Bland and Richard P. Dutkiewicz each dated as of
March 11, 2003 filed as Exhibit 10.1 to the Form 10-Q for the quarter
ended March 31, 2003 and incorporated herein by reference.10.39
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 11101 East 51st Street, Denver, Colorado filed as Exhibit 10.2 to
the Form 10-Q for the quarter ended March 31, 2003 and incorporated
herein by reference.10.40
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 5165 Peoria Street, Denver, Colorado filed as Exhibit 10.3 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.10.41
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 4895 Peoria Street, Denver, Colorado filed as Exhibit 10.4 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.10.42
    
    Sublease Agreement dated March 31, 2003, by and among Vari-L
Company, Inc. and Olin Acquisition Corporation for the facility located
at 4955 Peoria Street, Denver, Colorado filed as Exhibit 10.5 to the
Form 10-Q for the quarter ended March 31, 2003 and incorporated herein
by reference.23
    
    Letter Agreement dated May 6, 2003 between Vari-L Corporation,
Inc. and Cloyses Partners, LLC filed as exhibit 10.43 to the Form 10-K
for the year ended June 30, 2003 and incorporated herein by reference.31
    
    Certification pursuant to 18 U.S.C. Section 1350 by the Board of
Directors, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed with the Securities and Exchange Commission as
Exhibit 31 to the companys Annual Report on Form 10-K for the year
ended June 30, 2004..32
    
    Certification pursuant to 18 U.S.C Section 1350 by the Board of
Directors, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, filed with the Securities and Exchange Commission as
Exhibit 32 to the companys Annual Report on Form 10-K for the year
ended June 30, 2004.