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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-K
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
 for the fiscal year ended December 31, 2008
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
 for the transition period from  to .
 Commission File No. 000-30109
 
 LUMINEX CORPORATION
  DELAWARE
    
    74-2747608(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)12212 TECHNOLOGY BLVD., AUSTIN, TEXAS
    
    78727(Address of principal executive offices)
    
    (Zip Code)
 (512) 219-8020
 
  Title of each class
    
    Name of exchange on which registeredCommon Stock, $0.001 par value
    
    The NASDAQ Global MarketRights to Purchase Series A Junior
Participating Preferred Stock, $0.001
par value
    
    The NASDAQ Global Market
 NONE
 Yes þ No o
 Yes o No þ
 þ o
 o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o  (Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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##### 



LUMINEX CORPORATION
 FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 2008
 TABLE OF CONTENTS
 PAGEPART IItem 1. Business
    
    
    1Item 1A. Risk Factors
    
    
    17Item 1B. Unresolved Staff Comments
    
    
    28Item 2. Properties
    
    
    28Item 3. Legal Proceedings
    
    
    28Item 4. Submission of Matters to a Vote of Security Holders
    
    
    28Executive Officers of the Registrant
    
    
    28PART IIItem 5. Market for the Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
    
    
    30Item 6. Selected Financial Data
    
    
    32Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    33Item 7A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    49Item 8. Financial Statements and Supplementary Data
    
    
    50Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    82Item 9A. Controls and Procedures
    
    
    83Item 9B. Other Information
    
    
    83PART IIIItem 10. Directors, Executive Officers and Corporate Governance
    
    
    84Item 11. Executive Compensation
    
    
    84Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
    
    
    85Item 13. Certain Relationships and Related Transactions, and Director Independence
    
    
    85Item 14. Principle Accountant Fees and Services
    
    
    85PART IVItem 15. Exhibits, Financial Statement Schedules
    
    
    86Signatures and Certifications
    
    
    S-1Exhibit 21.1Exhibit 23.1Exhibit 24.1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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Safe Harbor Cautionary Statement
  
    
    risks and uncertainties relating to market demand and acceptance of our products and
technology;
    
    dependence on strategic partners for development, commercialization and distribution of
products;
    
    the impact of the ongoing uncertainty in global finance markets on us and on our
strategic partners and their customers, including its effects on their capital spending
policies and their ability to finance purchases of our products;
    
    concentration of our revenue in a limited number of strategic partners;
    
    fluctuations in quarterly results due to a lengthy and unpredictable sales cycle, bulk
purchases of consumables, and the seasonal nature of some of our assay products;
    
    our ability to scale manufacturing operations and manage operating expenses, gross
margins and inventory levels;
    
    potential shortages, or increases in costs, of components;
    
    competition;
    
    our ability to successfully launch new products;
    
    the timing of regulatory approvals;
    
    the implementation, including any modification, of our strategic operating plans;
    
    the uncertainty regarding the outcome or expense of any litigation brought against or
initiated by us, including the SUNY litigation;
    
    risks relating to our foreign operations; and
    
    risks and uncertainties associated with implementing our acquisition strategy including
our ability to obtain financing, our ability to integrate acquired companies or selected
assets into our consolidated business operations, and the ability to recognize the benefits
of our acquisitions.




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® ® ® ® ® ® ® TM TM ® ® ® ®




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PART I
 
 ITEM 1. BUSINESS
 Overview
 ®
   TM
   1




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www.luminexcorp.com http://www.sec.gov
 Industry Background
  
    
    measure the presence and quantity of substances such as infectious agents, antigens for
histocompatibility, hormones, cancer markers and other proteins in a patients blood, other body
fluid or tissue to assist physicians in diagnosing, treating or monitoring disease conditions;
    
    detect genetic variations, such as single nucleotide polymorphisms or genetic mutations
present in inherited diseases;
    
    measure the response to a compound or dosage by measuring cellular activity for drug discovery
and development; and
    
    assist physicians in prescribing the appropriate tailored drug therapy based on the patients
unique genetic makeup, a process known as pharmacogenetics.
   2




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KEY TECHNOLOGIES
    
    DESCRIPTION
    
    MARKETS SERVEDBioChips/Microarrays
    
    High-density arrays of DNA fragments
or proteins attached to a flat glass
or silicon surface
    
    Biomedical research and
select clinical
diagnosticsAutomated Immunoassays
    
    Automated test tube-based instruments
used for detecting antibodies,
proteins and other analytes
    
    Clinical diagnosticsGels and blots
    
    Physical separation of molecules or
analytes for
visualization
    
    Clinical diagnostics
and biomedical researchPCR methods
    
    Tests which use polymerase chain
reaction (PCR) technology to test DNA
and ribonucleic acid (RNA)
    
    Nucleic acid testing in
clinical diagnostics
and biomedical researchMicrofluidics chips
    
    Miniaturized liquid handling system on
a chip
    
    Biomedical researchMicrotiter-plate based assays
    
    Plastic trays with discrete wells in
which different types of assays are
performed, usually Enzyme-Linked
Immuno-Sorbent Assay (ELISA) tests
    
    Drug discovery,
clinical diagnostics
and biomedical researchGenotyping technologies
    
    DNA primers or probes designed to
identify small differences between
DNA targets using methods such as
primer extension assays, ligation
assays, cleavage assays or
hybridization assays, sequencing and
others
    
    Drug discovery,
clinical diagnostics
and biomedical research
  Our xMAP Technology
  
    
    Multi-analyte/multi-formatxMAP technology has been designed to simultaneously perform up to 100
distinct bioassays in a single tube or well of a microtiter plate
using only a small amount of sample. Moreover, unlike most existing
technologies that are dedicated to only one type of bioassay, xMAP can
perform multiple types of assays including enzymatic, genetic and
immunologic tests on the same instrumentation platform.
    
    Flexibility/scalabilityxMAP technology allows flexibility in customizing test panels. Panels can be modified to include
new bioassays in the same tube by adding additional microsphere sets. It is also scalable,
meaning that there is no change in the manufacturing process and only minimal changes to the
required labor to produce a small or large number of microsphere-based tests.
  3




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
    
    Both protein and nucleic acid applications on a single platformxMAP technology has the unique ability to analyze both proteins and nucleic acids. This allows
customers to utilize a single platform to evaluate samples across more biological parameters and
generate a more complete assessment of these samples. Alternative technologies are restricted
to either proteins or nucleic acid, requiring customers to use two or more technologies from
other vendors to get the same information.
    
    High ThroughputOur technology is currently able to perform up to 100 tests in a single tube permitting up to
9,600 unattended tests to be detected in less than an hour with only a small amount of sample.
Products we are currently developing and that are planned for market release in 2009 will be
able to perform 500 tests in a single tube permitting up to 96,000 unattended tests to be
detected in approximately an hour with only a small amount of sample. Rapid sample analysis
permits efficient use for high-throughput applications.
    
    Ease of useMost xMAP bioassays are simple to perform. A test sample is added to a solution containing
microspheres that have been coated with reagents. The solution is then processed through our
xMAP technology system which incorporates proprietary software to automate data acquisition and
analysis in real-time.
    
    Cost effectiveBy performing multiple assays at one time, xMAP technology is designed to be cost effective for
customers compared to competitive techniques such as enzyme-linked immunosorbent assay (ELISA)
or Real-time PCR. By analyzing only those assays in which a customer is interested, xMAP is also
more cost effective than most competing microarray technologies. In addition, microsphere-based
bioassays are inexpensive compared to other technologies such as biochips.
   ®
   4




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Business Strategy
  
    
    Focus on key market segmentsThrough our strategic studies, we have identified the following key market segments: (i) life
sciences research profile oriented screening and secondary screening, (ii) life sciences research
RNA profiling and transcriptional screening, (iii) genetic disease and molecular infectious
disease testing, and (iv) immunodiagnostics. In addition to the segments listed above, we have
identified other potential market opportunities in the applied markets such as bio-defense, or
bio-threat testing, and food safety and animal health testing. We will continue to employ both a
partnership driven business model focused on selected key segments and a product driven business
model in other key segments, working with our partners as distributors.We will continue to focus our commercialization efforts through strategic partners on large
sectors of the life sciences industry where Luminex believes it has distinct competitive
advantages over existing and emerging technologies and approaches. We define strategic partners
as companies in the life sciences industry that either develop and distribute assays and tests on
xMAP technology or may only distribute our xMAP technology based systems and consumables. With
our partners support, we have targeted major pharmaceutical companies, large clinical
laboratories, research institutions and major medical institutions for our principal marketing
efforts. We believe these customers provide the greatest opportunity for maximizing the use of
xMAP based products and continued adoption by these industry leaders will promote wider market
acceptance of our xMAP technology.
    
    Continue to develop strategic partnerships focused on our key market segmentsCurrently, 35 of our approximately 60 strategic partners have developed reagent-based products
utilizing the Luminex platform and are submitting royalties. We also have strategic partners who
distribute Luminex products. During 2008, the 35 strategic partners who have commercialized
reagent-based products accounted for approximately 69% of our total revenue and all of our
strategic partners represented approximately 79% of our total revenue. We intend to broaden and
accelerate market acceptance of xMAP technology through development, marketing and distribution
partnerships with leaders in the life sciences industry. By leveraging our strategic partners
market positions and utilizing their distribution channels and marketing infrastructure, we
believe we can continue to expand our installed instrument base. Furthermore, our partners
investments in research and development for xMAP applications provide Luminex users with more
menu options than we can presently generate ourselves.
    
    Develop and deliver market-leading assay productsWe are focused on maximizing the value we provide our stockholders, partners and end-user
customers by developing internally and co-developing with partners content applications based on
customers needs in key market segments. We believe that by enhancing both our partner driven
model and our direct efforts with the delivery of value-added assay content, Luminex should be
able to gain greater control over product development, market penetration and commercialization.
  5




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
    
    Develop next generation productsOur research and development group is pursuing projects such as the development of consumables,
automation, software and the expansion and enhancement of our multiplexing capabilities to
advance our xMAP technology and its market acceptance. We are also collaborating with industry
participants, biomedical research institutions and government entities to develop additional xMAP
products. We also continuously consider other adjacent markets where our platform and assay
offerings would be beneficial. We believe that our design, development, and manufacturing
capabilities and FDA compliance track record, coupled with expertise in the FDA approval process,
provide us a competitive advantage over our competitors, relating to both the commercialization
of multiplex testing platforms and assay products.
    
    Opportunistically pursue acquisitions that could accelerate these strategiesWe have developed analytical tools and an evaluation template to assess potential acquisition
targets to accelerate our business strategies in the key markets described above. This approach
led to the acquisition of Tm Bioscience in 2007. We are actively evaluating other opportunities
to enhance our capabilities or our access to markets or technologies, or provide us other
advantages in executing our business strategies in our key markets.
 Products
 Technology Segment
 Instruments
 Luminex® 100 and Luminex® 200. ®
 Luminex® XYP (XY
Platform) Luminex® SD (Luminex Sheath Delivery System).
 FLEXMAP
3D TM .
   6




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Consumables
 MicroPlex® Microspheres.
 MagPlex Microspheres.
 xTAG Microspheres.
 SeroMAP Microspheres.
 Calibration and Control Microspheres.
  Software
 LXR.
 xPONENT®.
  7




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Assay Segment
 Kits
  FlexmiR ® MicroRNA Labeling Kit.
 FlexmiR ® MicroRNA Human Panel.
 FlexmiR ® MicroRNA Mouse/Rat Extension Panel.
 FlexmiR ® Select.
 Pneumococcal Assay.
 xTAG ® Respiratory Viral Panel.
 xTAG ® Ashkenazi Jewish Panel.
 xTAG ® Cystic Fibrosis Kit .
 xTAG ® CFTR 70+6 Mutation Detection Kit
 xTAG ® Mutation Detection Products for Coagulation.
 xTAG ® Mutation Detection Kit for P450-2C19
  8




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xTAG ® Mutation Detection Kit for P450-2D6
 xTAG ® Mutation Detection Kit for P450-2C9 and VKORCI
  Sales and Marketing
     9




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Customers
  Technical Operations
  Remote Support
  Training
  Field Support
  Research and Development
  
    
    New product developmentOur research and development teams, including the Assay Segment, and marketing team are working
closely with both internal and external groups to design and develop products that will expand
capabilities of the xMAP-based technologies. We believe that these efforts will continue to
result in unique products. These products will include instrumentation, services, software and
consumables including assays.
  10




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
    
    Instrument developmentOur engineering group responsible for the design of our xMAP instruments leverages proprietary
electrical, optical and digital signal processing technologies to achieve high performance and
reliability. This methodology enabled the recently released FlexMAP 3DTM instrument
to double throughput, multiplex up to 500 analytes, enhance assay limit of detection, and greatly
extends the usable dynamic range.To further market penetration, we are now engaged in the development of an instrument line that
maintains the top features of our existing products, at a greatly reduced sales and manufacturing
cost. Simultaneously, a highly efficient subset of the engineering team is engaged in the
focused research necessary to extend our intellectual property position, and keep our products
innovative for many years to come.
    
    Assay developmentOur Assay Segment, consisting of LBG and LMD, develops new assay products that include both
nucleic acid-based and protein-based assays. These assays include immunoassays and molecular
diagnostic assays for the diagnostics industry, and nucleic acid-based and protein-based assays
for the research life science market. All assay applications make use of our xMAP technology and
our strength in multiplex technology. Our assay research and development is intended to increase
the penetration of our xMAP instruments and our application menu, and to drive growth in our
high-margin assay businesses.
    
    Consumable developmentWe continue to develop and enhance our existing consumable product line and support introduction
of new product lines. These new products include calibrators, controls and microspheres with
additional performance characteristics.Our current bead utilizes three common chemistries for the immobilization of assays on its
surface. While these chemistries are well accepted in the industry, it is desirable to expand our
bead chemistry capability to enhance market penetration and adoption. We continue to work on
other surface chemistries to provide optimal performance in broader application areas
    
    Software developmentOur software research and development teams will continue to extend xPONENT instrument control
and analysis software capabilities. xPONENT software provides analysis and automation interface
capabilities as well as control functions for Luminex instruments like the FLEXMAP 3D product.
New versions of xPONENT will provide sophisticated data regression functionality and increased
productivity through better instrument utilization. We continue to develop applications like
xPONENT QC-Reviewer that will bridge the gap between the instrument control software and the
Laboratory Information Systems (LIS) to provide better test results management and wider use of
Luminex developed assays.We are maintaining and extending our system platform through our SDK as well as providing new
end-user applications. Our SDK provides a straightforward platform for our strategic partners
and their customers to rapidly develop their own user interface software packages. In addition,
our end-user applications will allow us to provide turn key solutions to partners.
    
    AutomationWe collaborate with our strategic partners and others to provide automation solutions that will
integrate our various xMAP instruments with sample handling equipment and laboratory information
systems to increase bioassay throughput and operational efficiencies and allow for walk-away
capability.
    
    Technical ApplicationsIn order to allow customers to expedite the production of bioassays for use on our systems, we
have a technical applications group, based in Austin, Texas, that includes highly experienced
biological scientists. This group works closely with our customers in their development of
bioassays with the ultimate goal of faster technology adoption and commercialization.
    
    Enhancing bioassay performance and operational efficienciesOur scientists and engineers dedicate efforts to further enhance xMAP in the areas of assay
performance, such as sensitivity, precision, reliability and operational efficiencies. We are
actively collecting market and customer requirements that will allow us to provide optimal
features and benefits in current and future products.
  11




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Manufacturing
    Instruments
  Microspheres
  Kits
   12




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Competition
     Intellectual Property
      13




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Government Regulation
 Food and Drug Administration
       14




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WEEE
  European IVD Directive
    15




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Environmental
  Employees
  Segments
   16




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ITEM 1A. RISK FACTORS
 We have a limited history of profitability and had an accumulated deficit of approximately $84.7
million as of December 31, 2008.
  We expect our operating results to continue to fluctuate from quarter to quarter.
       17




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Our success depends significantly on the establishment and maintenance of successful relationships
with our strategic partners. Currently, a limited number of strategic partners account for a
majority of our revenue and the loss of any one of these partners or their inability to perform to
expectations could have a material adverse effect on our business, financial condition and results
of operations.
       18




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Current economic conditions and the uncertain economic outlook may adversely impact our business,
results of operations, financial condition or liquidity.
  If the FDA or other governmental laws and regulations change in ways that we do not anticipate and
we fail to comply with those regulations that affect our business, we could be subject to
enforcement actions, injunctions and civil and criminal penalties or otherwise be subject to
increased costs that could delay or prevent marketing of our products.
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If our technology and products do not become widely used in the life sciences and clinical
diagnostics industries, it is unlikely that we can maintain or increase profitability.
  
    
    convince prospective strategic partners and customers that our technology is an attractive
alternative to other technologies for pharmaceutical, research, clinical, biomedical and
genetic testing and analysis;
    
    encourage these partners to develop and market products using our technology;
    
    manufacture products in sufficient quantities with acceptable quality and at an acceptable cost;
    
    obtain and maintain sufficient pricing and royalties from partners on such Luminex products; and
    
    place and service sufficient quantities of our products, including the ability to provide the level of service required in
the mainstream clinical diagnostics market segment.
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Our reliance on strategic partners to market our products makes forecasting difficult.
  
    
    We have no control over the timing or extent of product development,
marketing or sale of our products by our strategic partners.
    
    Most of our strategic partners are not committed to minimum purchase
commitments, and we do not control the incentives provided by our
strategic partners to their sales personnel.
    
    A significant number of our strategic partners intend to produce
clinical diagnostic applications that may need to be approved by the
FDA, or other regulatory bodies in jurisdictions outside of the United
States.
    
    Certain strategic partners may have unique requirements for their
applications and systems. Assisting the various strategic partners may
strain our research and development and manufacturing resources. To
the extent that we are not able to timely assist our strategic
partners, the commercialization of their products will likely be
delayed.
    
    Certain strategic partners may fail to deliver products that satisfy
market requirements, or such products may fail to perform properly.
    
    We have limited access to partner confidential corporate information.
A sudden unexpected change in ownership, strategy or other material
event could adversely impact partner purchases of our products.
    
    Partners tend to order in bulk prior to the production of new lots of
their products and prior to major product development initiatives.
The frequency of these bulk purchases is difficult to predict and may
cause large fluctuations in microsphere sales quarter to quarter.
 The life sciences industry is highly competitive and subject to rapid technological change, and we
may not have the resources necessary to compete successfully.
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Our success depends on our ability to service and support our products directly or in collaboration
with our strategic partners.
  The property rights we rely upon to protect the technology underlying our products may not be
adequate to maintain market exclusivity. Inadequate intellectual property protection could enable
third parties to exploit our technology or use very similar technology and could reduce our ability
to distinguish our products in the market.
      22




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Our success depends partly on our ability to operate without infringing on or misappropriating the
proprietary rights of others.
   We have only produced our products in limited quantities, and we may experience problems in scaling
our manufacturing operations or delays or component shortages that could limit the growth of our
revenue.
    
    
    the possibility that one or more of our suppliers or our assemblers that do not have supply agreements with us could
terminate their services at any time without penalty;
    
    the potential obsolescence and/or inability of our suppliers to obtain required components;
  23




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
    
    the potential delays and expenses of seeking alternate sources of supply or manufacturing services;
    
    the inability to qualify alternate sources without impacting performance claims of our products;
    
    reduced control over pricing, quality and timely delivery due to the difficulties in switching to alternate suppliers or
assemblers; and
    
    increases in prices of raw materials and key components.
  International business operations create additional operational and legal risk.
  
    
    changes in or interpretations of foreign law that may adversely affect our ability to sell our products, perform services
or repatriate profits to the United States;
    
    the imposition of tariffs;
    
    hyperinflation or economic or political instability in foreign countries;
    
    imposition of limitations on or increase of withholding and other taxes on remittances and other payments by foreign
subsidiaries;
    
    conducting business in places where business practices and customs are unfamiliar and unknown;
    
    the burden of complying with complex and changing foreign regulatory requirements;
    
    longer accounts receivable collection times;
    
    the imposition of restrictive trade policies, including export restrictions;
    
    worldwide political conditions;
    
    the imposition of inconsistent laws or regulations;
    
    reduced protection of intellectual property rights in some foreign countries;
    
    the imposition or increase of investment requirements and other restrictions by foreign governments;
    
    longer collection cycles for account receivables;
    
    the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute;
    
    uncertainties relating to foreign laws, including labor laws, and legal proceedings;
    
    significant currency fluctuations;
    
    having to comply with a variety of U.S. laws, including the Foreign Corrupt Practices Act; and
    
    having to comply with U.S. export control regulations and policies that restrict our ability to communicate with non-U.S.
employees and supply foreign affiliates, partners and customers.
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The capital spending policies of our customers have a significant effect on the demand for our
products.
  If we become subject to product liability claims, we may be required to pay damages that exceed our
insurance coverage.
  If third-party payors increasingly restrict payments for healthcare expenses or fail to adequately
pay for multi-analyte testing, we may experience reduced sales which would hurt our business and
our business prospects.
  We may in the future incur substantial debt that could restrict our operations.
  
    
    limiting our ability to compete and our flexibility in planning for,
or reacting to, changes in our business and the industry in which we
operate;
    
    limiting our ability to borrow additional funds for working capital,
capital and research and development expenditures, acquisitions and
general corporate or other purposes; and
    
    exposing us to interest rate risk.
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We may be unsuccessful in implementing our acquisition strategy. We may face difficulties
integrating acquired entities with our existing businesses.
  
    
    we may not be able to accurately estimate the financial effect of acquisitions on our business;
    
    future acquisitions may require us to assume liabilities, incur large and immediate write-offs, issue capital stock
potentially dilutive to our stockholders or spend significant cash or may result in a decrease in our future operating
income or operating margins;
    
    we may be unable to realize the anticipated benefits and synergies from acquisitions as a result of inherent risks and
uncertainties, including difficulties integrating acquired businesses or retaining their key personnel, partners, customers
or other key relationships, entering market segments in which we have no or limited experience, and risks that acquired
entities may not operate profitably or that acquisitions may not result in improved operating performance;
    
    acquisitions and subsequent integration of these companies may disrupt our business and distract our management from other
responsibilities; and
    
    the costs of unsuccessful acquisition efforts may adversely affect our financial performance.Other risks of integration include:
    
    disparate information technology, internal control, financial reporting and record-keeping systems;
    
    differences in accounting policies, including those requiring judgment or complex estimation processes;
    
    new partners or customers who may operate on terms and programs different than ours;
    
    additional employees not familiar with our operations;
    
    facilities or operations in remote locations or potentially foreign jurisdictions and the inherent risks of operating in
unfamiliar legal and regulatory environments; and
    
    new products, including the risk that any underlying intellectual property associated with such products may not have been
adequately protected or that such products may infringe on the proprietary rights of others.
 We rely on the innovation and resources of larger industry participants and public programs to
advance genomic research and educate physicians/clinicians on genetic diagnostics.
  We are subject to evolving legislative, judicial and ethical standards on use of technology and
biotechnology.
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Our success depends on our ability to attract and retain our management and staff.
  Our stock price has been and is likely to continue to be volatile.
  
    
    actual or anticipated variations in quarterly operating results from historical results or estimates of results prepared by
securities analysts;
    
    announcements of technological innovations or new products or services by us or our competitors;
    
    announcements by us of significant acquisitions, strategic partnerships, joint ventures or capital commitments;
    
    conditions or trends in the life science, biotechnology and pharmaceutical industries;
    
    additions or departures of key personnel;
    
    changes in financial estimates by securities analysts;
    
    general economic conditions and interest rates;
    
    instability in the United States and other financial markets and the ongoing and possible escalation of unrest in the
Middle East, other armed hostilities or further acts or threats of terrorism in the United States or elsewhere;
    
    sales of our common stock; and
    
    the potential adverse impact of the secondary trading of our stock on foreign exchanges which are subject to less
regulatory oversight than the NASDAQ Global Market, without our permission, and the activity of the market makers of our
stock on such exchanges, including the risk that such market makers may engage in naked short sales and/or other deceptive
trading practices which may artificially depress or otherwise affect the price of our common stock on the NASDAQ Global
Market.
  Anti-takeover provisions in our certificate of incorporation, bylaws and stockholder rights plan
and Delaware law could make a third party acquisition of us difficult.
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ITEM 1B. UNRESOLVED STAFF COMMENTS
  
 ITEM 2. PROPERTIES
  
 ITEM 3. LEGAL PROCEEDINGS
   
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 Executive Officers of the Registrant as of February 26, 2009
 Name
    
    Age
    
    PositionPatrick J. Balthrop
    
    
    52
    
    
    President and Chief Executive OfficerRussell W. Bradley
    
    
    45
    
    
    Vice President, Business Development and Strategic PlanningJeremy Bridge-Cook,
Ph.D
    
    
    40
    
    
    Vice President, Luminex Molecular DiagnosticsHarriss T. Currie
    
    
    47
    
    
    Chief Financial Officer, Vice President, Finance and TreasurerGregory J. Gosch
    
    
    46
    
    
    Vice President, Luminex Bioscience GroupDavid S. Reiter
    
    
    42
    
    
    Vice President, General Counsel and Corporate Secretary
 Patrick J. Balthrop
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Russell W. Bradley
 Jeremy Bridge-Cook, Ph.D.
 Harriss T. Currie.
 Gregory J. Gosch.
 David S. Reiter.
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PART II
 
 ITEM 5.

    MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
 Market Information
   2008
    
    High
    
    
    LowFirst Quarter
    
    $
    20.48
    
    
    $
    14.75Second Quarter
    
    $
    23.09
    
    
    $
    18.00Third Quarter
    
    $
    27.00
    
    
    $
    19.41Fourth Quarter
    
    $
    25.11
    
    
    $
    12.57
 2007
    
    High
    
    
    LowFirst Quarter
    
    $
    16.82
    
    
    $
    12.08Second Quarter
    
    $
    14.71
    
    
    $
    11.44Third Quarter
    
    $
    17.30
    
    
    $
    11.62Fourth Quarter
    
    $
    17.77
    
    
    $
    14.11
 Holders
  Dividends
  Recent Sales of Unregistered Securities
  Date
    
    
    
    
    
    Exercise
    
    
    AggregateExercised
    
    Shares
    
    
    Price
    
    
    Proceeds04/25/08
    
    
    29,250
    
    
    $
    16.39
    
    
    $
    479,40806/09/08
    
    
    25,000
    
    
    
    17.38
    
    
    
    434,50006/19/08
    
    
    18,600
    
    
    
    16.39
    
    
    
    304,85408/28/08
    
    
    40,388
    
    
    
    17.38
    
    
    
    701,94309/11/08
    
    
    12,000
    
    
    
    17.38
    
    
    
    208,560
   30




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##### Table of Contents



Performance Graph
  
 12/03
    
    
    12/04
    
    
    12/05
    
    
    12/06
    
    
    12/07
    
    
    12/08Luminex Corporation
    
    $
    100.00
    
    
    $
    94.67
    
    
    $
    123.88
    
    
    $
    135.39
    
    
    $
    173.13
    
    
    $
    227.72NASDAQ Composite
    
    
    100.00
    
    
    
    110.08
    
    
    
    112.88
    
    
    
    126.51
    
    
    
    138.13
    
    
    
    80.47NASDAQ Biotechnology
    
    
    100.00
    
    
    
    112.17
    
    
    
    130.53
    
    
    
    130.05
    
    
    
    132.24
    
    
    
    122.10
 Issuer Purchases of Equity Securities
  ISSUER PURCHASES OF EQUITY SECURITIES
 Total Number ofTotal
    
    
    Average
    
    
    Shares Purchased as
    
    
    Approximate Dollar ValueNumber of
    
    
    Price Paid
    
    
    Part of Publicly
    
    
    of Shares that May Yet BeShares
    
    
    per Share
    
    
    Announced Plans or
    
    
    Purchased Under the PlansPeriod
    
    Purchased
    
    
    (1)($)
    
    
    Programs
    
    
    or Programs10/01/08  10/31/08
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11/1/08  11/30/08
    
    
    52
    
    
    
    22.16
    
    
    
    
    
    
    
    12/01/08  12/31/08
    
    
    446
    
    
    
    21.07
    
    
    
    
    
    
    
    Total Fourth Quarter
    
    
    498
    
    
    
    21.18
    
    
    
    
    
    
    
    
 (1)
    
    Shares purchased are attributable to the withholding of shares by Luminex to satisfy the payment of tax
obligations related to the vesting of restricted shares.  31




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##### Table of Contents



ITEM 6. SELECTED FINANCIAL DATA
  Year Ended December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(In thousands, except per share data)Consolidated Results of Operations Data:Total revenue
    
    $
    104,447
    
    
    $
    75,010
    
    
    $
    52,989
    
    
    $
    42,313
    
    
    $
    35,880Gross profit
    
    
    70,946
    
    
    
    46,094
    
    
    
    32,252
    
    
    
    22,321
    
    
    
    14,722Income (loss) from operations
    
    
    3,353
    
    
    
    (17,418
    )
    
    
    (581
    )[1]
    
    
    (3,496
    )
    
    
    (4,164
    )Net income (loss)
    
    
    3,057
    
    
    
    (2,711
    )
    
    
    1,507
    )[1]
    
    
    (2,666
    )
    
    
    (3,605
    )Net income (loss) applicable to common stockholders
    
    $
    3,057
    
    
    $
    (2,711
    )
    
    $
    1,507
    
    
    $
    (2,666
    )
    
    $
    (3,605
    )Net income (loss) per common share, basic
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05
    )[1]
    
    $
    (0.09
    )
    
    $
    (0.12
    )Shares used in computing net income (loss) per
share, basic
    
    
    37,868
    
    
    
    34,361
    
    
    
    31,434
    
    
    
    30,990
    
    
    
    30,698Net income (loss) per share, diluted
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05
    )[1]
    
    $
    (0.09
    )
    
    $
    (0.12
    )Shares used in computing net income (loss) per
share, diluted
    
    
    39,700
    
    
    
    34,361
    
    
    
    32,988
    
    
    
    30,990
    
    
    
    30,698
 At December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(In thousands)Consolidated Balance Sheet Data:Cash and cash equivalents
    
    $
    81,619
    
    
    $
    27,233
    
    
    $
    27,414
    
    
    $
    25,206
    
    
    $
    19,238Short-term investments
    
    
    40,501
    
    
    
    6,944
    
    
    
    10,956
    
    
    
    10,947
    
    
    
    12,891Long-term investments
    
    
    2,000
    
    
    
    
    
    
    
    7,346
    
    
    
    5,466
    
    
    
    3,991Working capital
    
    
    131,516
    
    
    
    40,801
    
    
    
    44,179
    
    
    
    39,364
    
    
    
    40,823Total assets
    
    
    217,291
    
    
    
    123,559
    
    
    
    66,696
    
    
    
    58,035
    
    
    
    53,175Total long-term debt
    
    
    3,359
    
    
    
    3,110
    
    
    
    
    
    
    
    
    
    
    
    Total stockholders equity
    
    
    194,540
    
    
    
    103,480
    
    
    
    54,159
    
    
    
    44,710
    
    
    
    44,546
 
 [1]
    
    As discussed in Note 14 to the consolidated financial statements, effective January 1, 2006, we changed our method of accounting for
stock-based compensation to conform to Statement of Financial Accounting Standard No.123(R), Share-Based Payment.  32




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##### Table of Contents



ITEM 7.

    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
 The following information should be read in conjunction with the Consolidated Financial
Statements and the accompanying Notes included below in Item 8 and Risk Factors included above in
Item 1A of this Annual Report on Form 10-K . This discussion contains forward-looking statements
that involve risks and uncertainties. Our actual results may differ materially from those
anticipated in these forward-looking statements.
 Overview
 ®
    
    
    System revenue is generated from the sale of our xMAP systems and peripherals.
Currently, system revenue is derived from the sale of the Luminex 100 and 200 analyzers,
our FLEXMAP 3D system, optional XY Platform and Sheath Delivery Systems.
    
    Consumable revenue is generated from the sale of our dyed polystyrene microspheres and
sheath fluid. Our larger commercial and development partners often purchase these
consumables in bulk to minimize the number of incoming qualification events and to allow
for longer development and production runs.
    
    Royalty revenue is generated when a partner sells a kit incorporating our proprietary
microspheres to an end user or when a partner utilizes a kit to provide a testing result to
a user. End users can be facilities such as testing labs, development facilities and
research facilities that buy prepared kits and have specific testing needs or testing
service companies that provide assay results to pharmaceutical research companies or
physicians.
    
    Assay revenue is generated from the sale of our kits which are a combination of chemical
and biological reagents and our proprietary bead technology used to perform diagnostic and
research assays on samples. Assay revenue includes revenue from LMD since the effective
date our acquisition of LMD on March 1, 2007. Assay revenue generated from LBG is also
classified here. Prior to our forming the assay segment, assay revenue generated from LBG
was recorded in other revenue as it did not constitute a material amount of total revenue.
  33




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##### Table of Contents




    
    Service revenue is generated when a partner or other owner of a system purchases a
service contract from us after the warranty has expired. Service contract revenue is
amortized over the life of the contract and the costs associated with those contracts are
recognized as incurred.
    
    Other revenue consists of items such as training, shipping, parts sales, license
revenue, grant revenue, contract research and development fees and milestone revenue and
other items that individually amount to less than 5% of total revenue.
 2008 Highlights
 
    
    Luminex grew total revenue by approximately 39% to $104.4 million over 2007 revenue
    
    Gross margin percentage of 68%, up from 61% in 2007
    
    Delivered first commercial shipments of new instrument, FLEXMAP 3D
    
    Record system shipments of 915 for the year ended December 31, 2008, including three
FLEXMAP 3D shipments
    
    Cumulative world wide system sales to date of 5,894 systems, including three FLEXMAP
3D placements
    
    For the year ended 2008, royalty revenue increased 45% and consumables revenue
increased 65% over the prior calendar year
 Change in Cash Position
  Segment Information
  Future Operations
    34




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##### Table of Contents



Critical Accounting Policies
  Revenue Recognition.
   Inventory Valuation.
 Warranties.
 Accounts Receivable and Allowance for Doubtful Accounts.
  35




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##### Table of Contents



Purchase Price Allocation, Intangibles and Goodwill.
  Accounting for Income Taxes.
 Stock compensation
  36




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##### Table of Contents



Consolidated Results of Operations
  Year Ended December 31,2008
    
    
    2007
    
    
    2006Revenue
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %Cost of revenue
    
    
    32
    %
    
    
    39
    %
    
    
    39
    %Gross profit
    
    
    68
    %
    
    
    61
    %
    
    
    61
    %Operating expensesResearch and development expense
    
    
    18
    %
    
    
    21
    %
    
    
    16
    %Selling, general and administrative expense
    
    
    47
    %
    
    
    54
    %
    
    
    46
    %In-process research and development expense
    
    
    
    
    
    
    10
    %
    
    
    Total operating expenses
    
    
    65
    %
    
    
    85
    %
    
    
    62
    %Income (loss) from operations
    
    
    3
    %
    
    
    (23
    )%
    
    
    (1
    )%Interest expense from long-term debt
    
    
    
    
    
    
    (1
    )%
    
    
    Other income, net
    
    
    1
    %
    
    
    2
    %
    
    
    4
    %Settlement of litigation
    
    
    
    
    
    
    15
    %
    
    
    Gain on settlement of liability
    
    
    
    
    
    
    3
    %
    
    
    Income taxes
    
    
    (1
    )%
    
    
    
    
    
    
    Net income (loss)
    
    
    3
    %
    
    
    (4
    )%
    
    
    3
    %
 Year Ended December 31, 2008 Compared to Year Ended December 31, 2007
 Year Ended December 31,Variance
    
    
    Variance2008
    
    
    2007
    
    
    ($)
    
    
    (%)(in thousands)Revenue
    
    $
    104,447
    
    
    $
    75,010
    
    
    $
    29,437
    
    
    
    39
    %Gross profit
    
    $
    70,946
    
    
    $
    46,094
    
    
    $
    24,852
    
    
    
    54
    %Gross margin percentage
    
    
    68
    %
    
    
    61
    %
    
    
    7
    %
    
    
    N/AOperating expenses
    
    $
    67,593
    
    
    $
    63,512
    
    
    $
    4,081
    
    
    
    6
    %Net income (loss)
    
    $
    3,057
    
    
    $
    (2,711
    )
    
    $
    5,768
    
    
    
    213
    %
 Revenue.
  37




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##### Table of Contents



Year Ended December 31,2008
    
    
    2007System sales
    
    $
    28,136
    
    
    $
    24,428Consumable sales
    
    
    31,724
    
    
    
    19,199Royalty revenue
    
    
    14,897
    
    
    
    10,244Assay revenue
    
    
    18,715
    
    
    
    11,323Service contracts
    
    
    5,363
    
    
    
    4,431Other revenue
    
    
    5,612
    
    
    
    5,385$
    104,447
    
    
    $
    75,010
  Gross Profit.
 Research and Development Expense.
 Selling, General and Administrative Expense.
 Other Income, net.
 Settlement of litigation.
 Gain on settlement of liability.
  38




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Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
 Year Ended December 31,Variance
    
    
    Variance2007
    
    
    2006
    
    
    ($)
    
    
    (%)(in thousands)Revenue
    
    $
    75,010
    
    
    $
    52,989
    
    
    $
    22,021
    
    
    
    42
    %Gross profit
    
    $
    46,094
    
    
    $
    32,252
    
    
    $
    13,842
    
    
    
    43
    %Gross margin percentage
    
    
    61
    %
    
    
    61
    %
    
    
    0
    %
    
    
    N/AOperating expenses
    
    $
    63,512
    
    
    $
    32,833
    
    
    $
    30,679
    
    
    
    93
    %Net (loss) income.
    
    $
    (2,711
    )
    
    $
    1,507
    
    
    $
    (4,218
    )
    
    
    280
    %
 Revenue.
  Year Ended December 31,2007
    
    
    2006System sales
    
    $
    24,428
    
    
    $
    20,644Consumable sales
    
    
    19,199
    
    
    
    15,676Royalty revenue
    
    
    10,244
    
    
    
    8,228Assay revenue
    
    
    11,323
    
    
    
    19Service contracts
    
    
    4,431
    
    
    
    3,450Other revenue
    
    
    5,385
    
    
    
    4,972$
    75,010
    
    
    $
    52,989
  Gross Profit.
 Research and Development Expense.
 Selling, General and Administrative Expense.
 Other Income, net.
  39




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##### Table of Contents



Settlement of litigation.
 Gain on settlement of liability.
 Segment Results of Operations
 Technology Segment
  Year Ended December 31,Variance
    
    
    Variance2008
    
    
    2007
    
    
    ($)
    
    
    (%)(in thousands)Revenue
    
    $
    83,567
    
    
    $
    62,436
    
    
    $
    21,131
    
    
    
    34
    %Gross profit
    
    $
    54,756
    
    
    $
    37,864
    
    
    $
    16,892
    
    
    
    45
    %Gross margin percentage
    
    
    66
    %
    
    
    61
    %
    
    
    5
    %
    
    
    N/AOperating expenses
    
    $
    45,723
    
    
    $
    38,391
    
    
    $
    7,332
    
    
    
    19
    %Net income
    
    $
    9,405
    
    
    $
    12,330
    
    
    $
    (2,925
    )
    
    
    24
    %
 Revenue.
  Year Ended December 31,2008
    
    
    2007System sales
    
    $
    26,408
    
    
    $
    23,320Consumable sales
    
    
    31,678
    
    
    
    19,197Royalty revenue
    
    
    14,897
    
    
    
    10,213Service contracts
    
    
    5,290
    
    
    
    4,431Other revenue
    
    
    5,294
    
    
    
    5,275$
    83,567
    
    
    $
    62,436
    40




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##### Table of Contents



Gross Profit.
 Operating expenses.
  Settlement of litigation.
  41




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##### Table of Contents



Assay Segment
  Year Ended December 31,Variance
    
    
    Variance2008
    
    
    2007
    
    
    ($)
    
    
    (%)(in thousands)Revenue
    
    $
    20,880
    
    
    $
    12,574
    
    
    $
    8,306
    
    
    
    66
    %Gross profit
    
    $
    16,190
    
    
    $
    8,230
    
    
    $
    7,960
    
    
    
    97
    %Gross margin percentage
    
    
    78
    %
    
    
    65
    %
    
    
    13
    %
    
    
    N/AOperating expenses
    
    $
    21,870
    
    
    $
    25,121
    
    
    $
    (3,251
    )
    
    
    (13
    )%Net loss
    
    $
    (6,348
    )
    
    $
    (15,041
    )
    
    $
    8,693
    
    
    
    58
    %
 Revenue.
  Year Ended December 31,2008
    
    
    2007System sales
    
    $
    1,728
    
    
    $
    1,108Consumable sales
    
    
    46
    
    
    
    2Royalty revenue
    
    
    
    
    
    
    31Service contracts
    
    
    73
    
    
    
    Assay revenue
    
    
    18,715
    
    
    
    11,323Other revenue
    
    
    318
    
    
    
    110$
    20,880
    
    
    $
    12,574
  Gross profit
 Operating expenses.
  42




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##### Table of Contents



Gain on settlement of liability.
 Liquidity and Capital Resources
 December 31,
    
    
    December 31,2008
    
    
    2007(in thousands)Cash and cash equivalents
    
    $
    81,619
    
    
    $
    27,233Short-term investments
    
    
    40,501
    
    
    
    6,944Long-term investments
    
    
    2,000
    
    
    
    $
    124,120
    
    
    $
    34,177
      43




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44




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45




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Contractual Obligations
  Payments Due By PeriodLess Than
    
    
    
    
    
    
    
    
    
    
    More ThanContractual Obligations
    
    Total
    
    
    1 Year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 YearsNon-cancelable rental
obligations

    $
    10,931
    
    
    $
    1,966
    
    
    $
    3,468
    
    
    $
    3,550
    
    
    $
    1,947Non-cancelable purchase
obligations (1)
    
    
    10,050
    
    
    
    4,946
    
    
    
    1,573
    
    
    
    1,299
    
    
    
    2,232Long-term debt
obligations (2)
    
    
    4,485
    
    
    
    445
    
    
    
    1,617
    
    
    
    2,423
    
    
    
    Capital lease obligations
    
    
    47
    
    
    
    29
    
    
    
    18
    
    
    
    
    
    
    
    Total (3)
    
    $
    25,513
    
    
    $
    7,386
    
    
    $
    6,676
    
    
    $
    7,272
    
    
    $
    4,179
 (1)
    
    Purchase obligations include contractual arrangements in the form of purchase orders
primarily as a result of normal inventory purchases or minimum payments due resulting when
minimum purchase commitments are not met.(2)
    
    On December 12, 2003, LMD entered into an agreement with the Ministry of Industry
of the Government of Canada under which the Government agreed to invest up to Canadian
(Cdn) $7.3 million relating to the development of several genetic tests. Funds were
advanced from Technology Partnerships Canada (TPC), a special operating program. The
actual payments we received were predicated on eligible expenditures made during the
project period which ended July 31, 2006. LMD has received Cdn $4.3 million from TPC which
is expected to be repaid along with approximately Cdn $1.4 million of imputed interest for
a total of approximately Cdn $5.7 million.LMD has agreed to repay the TPC funding through a royalty on revenues. Royalty payments
commenced in 2007 at a rate of 1% of total revenue and at a rate of 2.5% for 2008 and
thereafter. Aggregate royalty repayment will continue until total advances plus imputed
interest has been repaid or until April 30, 2015, whichever is earlier. The repayment
obligation expires on April 30, 2015 and any unpaid balance will be cancelled and forgiven on
that date. Should the term of repayment be shorter than expected due to higher than expected
assay revenue, the effective interest rate would increase as repayment is accelerated.
Repayments denominated in U.S. Dollars are currently projected to be as shown in the table
above, but actual future sales generating a repayment obligation will vary from this
projection and are subject to the risks and uncertainties described elsewhere in this report,
including under Risk Factors and Safe Harbor Cautionary Statement. Furthermore, payment
reflected in U.S. Dollars is subject to adjustment based upon applicable exchange rates as of
the reporting date.(3)
    
    Due to the uncertainty with respect to the timing of future cash flows associated with
Luminexs unrecognized tax benefits at December 31, 2008, Luminex is unable to make
reasonably reliable estimates of the timing of cash settlement with the respective taxing
authority. Therefore, $251,000 of unrecognized tax benefits have been excluded from the
contractual obligations table above. See Note 10 to the Consolidated Financial Statements
for a discussion on income taxes. Inflation
   46




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Recently Adopted Accounting Standards
  Recent Accounting Pronouncements
  Determining the Fair Value of a Financial Asset
When the Market for That Asset Is Not Active Fair Value Measurements Accounting Changes and Error
Corrections
  
  47




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The Hierarchy of Generally Accepted Accounting
Principles The Meaning
of Present Fairly in Conformity With Generally Accepted Accounting Principles
  48




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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Interest Rate Risk.
  Foreign Currency Risk.
   49




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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 Index to Consolidated Financial Statements
 PAGEReport of Independent Registered Public Accounting Firm
    
    
    51Report of Independent Registered Public Accounting
Firm
    
    
    52Consolidated Balance Sheets
    
    
    53Consolidated Statements of Operations
    
    
    54Consolidated Statements of Cash Flows
    
    
    55Consolidated Statements of Changes in Stockholders Equity
    
    
    56Notes to Consolidated Financial Statements
    
    
    57
  50




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
     .
  /s/ Ernst & Young LLP 
  51




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      /s/ Ernst & Young LLP 
  52




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LUMINEX CORPORATION
 
 CONSOLIDATED BALANCE SHEETS
 (In thousands, except share and per share amounts)
 December 31,2008
    
    
    2007ASSETSCurrent assets:Cash and cash equivalents
    
    $
    81,619
    
    
    $
    27,233Short-term investments
    
    
    40,501
    
    
    
    6,944Accounts receivable, (net of allowance for doubtful accounts of
$272 and $356 at December 31, 2008 and 2007, respectively)
    
    
    11,024
    
    
    
    11,827Inventories, net
    
    
    11,589
    
    
    
    6,508Prepaids and other
    
    
    1,660
    
    
    
    856Total current assets
    
    
    146,393
    
    
    
    53,368Property and equipment, net
    
    
    12,567
    
    
    
    12,673Intangible assets, net
    
    
    14,901
    
    
    
    16,919Long-term investments
    
    
    2,000
    
    
    
    Goodwill
    
    
    39,617
    
    
    
    39,617Other
    
    
    1,813
    
    
    
    982Total assets
    
    $
    217,291
    
    
    $
    123,559LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    4,580
    
    
    $
    3,346Accrued liabilities
    
    
    7,181
    
    
    
    6,811Deferred revenue
    
    
    2,671
    
    
    
    2,276Current Portion of long term debt
    
    
    445
    
    
    
    134Total current liabilities
    
    
    14,877
    
    
    
    12,567Long-term debt
    
    
    2,914
    
    
    
    2,976Deferred revenue
    
    
    4,960
    
    
    
    4,536Total liabilities
    
    
    22,751
    
    
    
    20,079Stockholders equity:Common stock, $.001 par value, 200,000,000 shares authorized; issued and
outstanding: 40,334,082 shares in 2008; 35,391,211 shares in 2007
    
    
    40
    
    
    
    35Preferred stock, $.001 par value, 5,000,000 shares authorized; none
issued and outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    279,255
    
    
    
    191,218Accumulated other comprehensive loss
    
    
    (47
    )
    
    
    (8
    )Accumulated deficit
    
    
    (84,708
    )
    
    
    (87,765
    )Total stockholders equity
    
    
    194,540
    
    
    
    103,480Total liabilities and stockholders equity
    
    $
    217,291
    
    
    $
    123,559
   53




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##### Table of Contents



LUMINEX CORPORATION
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share amounts)
 Year Ended December 31,2008
    
    
    2007
    
    
    2006Revenue
    
    $
    104,447
    
    
    $
    75,010
    
    
    $
    52,989Cost of revenue
    
    
    33,501
    
    
    
    28,916
    
    
    
    20,737Gross profit
    
    
    70,946
    
    
    
    46,094
    
    
    
    32,252Operating expenses:Research and development
    
    
    18,628
    
    
    
    15,383
    
    
    
    8,673Selling, general and administrative
    
    
    48,965
    
    
    
    40,729
    
    
    
    24,160In-process research and development
    
    
    
    
    
    
    7,400
    
    
    
    Total operating expenses
    
    
    67,593
    
    
    
    63,512
    
    
    
    32,833Income (loss) from operations
    
    
    3,353
    
    
    
    (17,418
    )
    
    
    (581
    )Interest expense from long-term debt
    
    
    (592
    )
    
    
    (513
    )
    
    
    Other income, net
    
    
    1,144
    
    
    
    1,665
    
    
    
    2,108Settlement of litigation
    
    
    
    
    
    
    11,500
    
    
    
    Gain on settlement of liability
    
    
    
    
    
    
    2,345
    
    
    
    Income (loss) before income taxes
    
    
    3,905
    
    
    
    (2,421
    )
    
    
    1,527Income taxes
    
    
    (848
    )
    
    
    (290
    )
    
    
    (20
    )Net income (loss)
    
    $
    3,057
    
    
    $
    (2,711
    )
    
    $
    1,507Net income (loss) per share, basic
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05Shares used in computing net income (loss) per share, basic
    
    
    37,868
    
    
    
    34,361
    
    
    
    31,434Net income (loss) per share, diluted
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05Shares used in computing net income (loss) per share, diluted
    
    
    39,700
    
    
    
    34,361
    
    
    
    32,988
   54




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##### Table of Contents



LUMINEX CORPORATION
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Year Ended December 31,2008
    
    
    2007
    
    
    2006CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    3,057
    
    
    $
    (2,711
    )
    
    $
    1,507Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation and amortization expense
    
    
    7,001
    
    
    
    5,063
    
    
    
    1,483In-process research and development expense
    
    
    
    
    
    
    7,400
    
    
    
    Gain on settlement of liability
    
    
    
    
    
    
    (2,345
    )
    
    
    Amortization of deferred stock, restricted stock
and stock compensation expense
    
    
    7,251
    
    
    
    6,593
    
    
    
    5,511Imputed interest
    
    
    
    
    
    
    
    
    
    
    (13
    )Loss on disposal of assets
    
    
    8
    
    
    
    88
    
    
    
    4Other
    
    
    (415
    )
    
    
    268
    
    
    
    (15
    )Changes in operating assets and liabilities:Accounts receivable, net
    
    
    694
    
    
    
    (3,255
    )
    
    
    (1,657
    )Inventories, net
    
    
    (5,081
    )
    
    
    (129
    )
    
    
    (290
    )Other assets
    
    
    (942
    )
    
    
    1,019
    
    
    
    (1,009
    )Accounts payable
    
    
    1,760
    
    
    
    (2,958
    )
    
    
    (602
    )Accrued liabilities
    
    
    (312
    )
    
    
    (715
    )
    
    
    (307
    )Deferred revenue
    
    
    830
    
    
    
    75
    
    
    
    (566
    )Net cash provided by operating activities
    
    
    13,851
    
    
    
    8,393
    
    
    
    4,046CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of held-to-maturity securities
    
    
    (55,868
    )
    
    
    (6,325
    )
    
    
    (15,064
    )Maturities of held-to-maturity securities
    
    
    20,310
    
    
    
    17,717
    
    
    
    13,175Purchase of property and equipment
    
    
    (4,449
    )
    
    
    (6,685
    )
    
    
    (2,638
    )Acquisition of business, net of cash acquired
    
    
    
    
    
    
    (2,686
    )
    
    
    Acquisition activity
    
    
    (481
    )Proceeds from sale of assets
    
    
    19
    
    
    
    30
    
    
    
    45Acquired intangible assets
    
    
    
    
    
    
    (10
    )
    
    
    Acquired technology rights
    
    
    (1,216
    )
    
    
    (265
    )
    
    
    (25
    )Net cash provided by (used in) investing activities
    
    
    (41,685
    )
    
    
    1,776
    
    
    
    (4,507
    )CASH FLOWS FROM FINANCING ACTIVITIES:Payments on debt
    
    
    (134
    )
    
    
    (12,349
    )
    
    
    Proceeds from secondary offering, net of offering costs
    
    
    74,722
    
    
    
    
    
    
    
    Proceeds from issuance of common stock
    
    
    7,075
    
    
    
    1,868
    
    
    
    2,622Other
    
    
    
    
    
    
    13
    
    
    
    Net cash (used in) provided by financing activities
    
    
    81,663
    
    
    
    (10,468
    )
    
    
    2,622Effect of foreign currency exchange rate on cash
    
    
    557
    
    
    
    118
    
    
    
    47Change in cash and cash equivalents
    
    
    54,386
    
    
    
    (181
    )
    
    
    2,208Cash and cash equivalents, beginning of year
    
    
    27,233
    
    
    
    27,414
    
    
    
    25,206Cash and cash equivalents, end of year
    
    $
    81,619
    
    
    $
    27,233
    
    
    $
    27,414Interest and penalties paid
    
    
    160
    
    
    
    1,360
    
    
    
    SUPPLEMENTAL DISLOSURE OF NONCASH
INVESTING ACTIVITIES:Purchase of leasehold improvements under trade
payable arrangement
    
    $
    
    
    
    $
    
    
    
    $
    445SUPPLEMENTAL DISCLOSURE OF NON-CASH
EFFECT OF ACQUISITIONS:Purchase price
    
    
    
    
    
    
    (49,401
    )
    
    
    Common stock issued
    
    
    
    
    
    
    41,754
    
    
    
    Conversion of Tm options and warrants
    
    
    
    
    
    
    2,315
    
    
    
    Forgiveness of receivable from acquired company
    
    
    
    
    
    
    1,233
    
    
    
    Write-off of acquired technology rights
    
    
    
    
    
    
    473
    
    
    
    Cash acquired
    
    
    
    
    
    
    940
    
    
    
    Acquisition, net of cash acquired
    
    
    
    
    
    
    (2,686
    )
    
    
    
   55




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##### Table of Contents



LUMINEX
CORPORATION
 
 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
(In thousands, except per share data)
 AccumulatedCommon Stock
    
    
    Additional
    
    
    Other
    
    
    Deferred
    
    
    
    
    
    
    TotalNumber of
    
    
    
    
    
    
    Paid-In
    
    
    Comprehensive
    
    
    Stock
    
    
    Accumulated
    
    
    StockholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Income/(Loss)
    
    
    Compensation
    
    
    Deficit
    
    
    EquityBalance at December 31, 2005
    
    
    31,655,683
    
    
    $
    32
    
    
    $
    135,440
    
    
    $
    18
    
    
    $
    (4,219
    )
    
    $
    (86,561
    )
    
    $
    44,710Exercise of stock options
    
    
    422,499
    
    
    
    
    
    
    
    2,622
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,622Issuances of restricted stock, net of
shares withheld for taxes
    
    
    144,539
    
    
    
    
    
    
    
    (242
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (242
    )Effect of adoption of FAS 123R
    
    
    (544,113
    )
    
    
    
    
    
    
    (4,220
    )
    
    
    
    
    
    
    4,219
    
    
    
    
    
    
    
    (1
    )Stock compensation
    
    
    
    
    
    
    
    
    
    
    5,516
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,516Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,507
    
    
    
    1,507Foreign currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47
    
    
    
    
    
    
    
    
    
    
    
    47Balance at December 31, 2006
    
    
    31,678,608
    
    
    $
    32
    
    
    $
    139,116
    
    
    $
    65
    
    
    $
    
    
    
    $
    (85,054
    )
    
    $
    54,159Exercise of stock options
    
    
    331,754
    
    
    
    
    
    
    
    1,868
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,868Issuances of restricted stock, net of
shares withheld for taxes
    
    
    178,815
    
    
    
    
    
    
    
    (425
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (425
    )Shares Exchanged in Tm Acquisition
    
    
    3,202,034
    
    
    
    3
    
    
    
    41,751
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,754Value of Tm options and warrants traded
    
    
    
    
    
    
    
    
    
    
    2,315
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,315Stock compensation
    
    
    
    
    
    
    
    
    
    
    6,593
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,593Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,711
    )
    
    
    (2,711
    )Foreign currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (73
    )
    
    
    
    
    
    
    
    
    
    
    (73
    )Balance at December 31, 2007
    
    
    35,391,211
    
    
    $
    35
    
    
    $
    191,218
    
    
    $
    (8
    )
    
    $
    
    
    
    $
    (87,765
    )
    
    $
    103,480Exercise of stock options
    
    
    644,057
    
    
    
    1
    
    
    
    7,075
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,076Issuances of restricted stock, net of
shares withheld for taxes
    
    
    273,814
    
    
    
    
    
    
    
    (1,281
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,281
    )Stock compensation
    
    
    
    
    
    
    
    
    
    
    7,251
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,251Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,057
    
    
    
    3,057Secondary public offering, net of offering costs
    
    
    4,025,000
    
    
    
    4
    
    
    
    74,718
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    74,722Tax benefits associated with options
    
    
    
    
    
    
    
    
    
    
    274
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    274Foreign currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (39
    )
    
    
    
    
    
    
    
    
    
    
    (39
    )Balance at December 31, 2008
    
    
    40,334,082
    
    
    $
    40
    
    
    $
    279,255
    
    
    $
    (47
    )
    
    $
    
    
    
    $
    (84,708
    )
    
    $
    194,540
   56




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##### Table of Contents



LUMINEX
CORPORATION
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 1  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Description of Business
 ®
 Principles of Consolidation
   Use of Estimates
  Cash and Cash Equivalents
  Investments
  Fair Value of Financial Instruments
   57




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##### Table of Contents



Concentration of Credit Risk
    Inventories
  Property and Equipment
  Intangible Assets
  Impairment of Long-Lived Assets
   58




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##### Table of Contents



Revenue Recognition and Allowance For Doubtful Accounts
   Product-Related Expenses
  Research and Development Costs
  Incentive Compensation
  Income Taxes
   59




---



##### Table of Contents



Earnings Per Share
  Stock-Based Compensation
  Segment Reporting
   60




---



##### Table of Contents



NOTE
2  BUSINESS COMBINATIONS
 Acquisition
       61




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##### Table of Contents



Cash
    
    $
    940Other current assets
    
    
    3,157Other assets
    
    
    28Property and equipment
    
    
    3,518Purchased intangible assets
    
    
    18,800In-process research and development
    
    
    7,400Goodwill
    
    
    39,617Total assets
    
    $
    73,460Current portion of debt assumed
    
    $
    12,447Accrued severance assumed
    
    
    1,945Other current liabilities assumed
    
    
    7,148Long-term debt assumed
    
    
    2,294Other long-term liabilities assumed
    
    
    225Total liabilities
    
    
    24,059Purchase price
    
    $
    49,401
 Pro Forma Information
    Year EndedDecember 31,2007
    
    
    2006Revenues
    
    $
    75,328
    
    
    $
    60,361Net loss
    
    $
    (8,488
    )
    
    $
    (17,792
    )Net loss per share, basic and diluted
    
    $
    (0.25
    )
    
    $
    (0.51
    )
 In-process Research and Development (IPR&D)
   62




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##### Table of Contents



NOTE
3  INVESTMENTS
   December 31,2008
    
    
    2007Accrued
    
    
    Amortized
    
    
    
    
    
    
    Accrued
    
    
    AmortizedCost
    
    
    Interest
    
    
    Cost
    
    
    Cost
    
    
    Interest
    
    
    CostDue in one year or less
    
    $
    40,501
    
    
    $
    283
    
    
    $
    40,784
    
    
    $
    6,944
    
    
    $
    38
    
    
    $
    6,982Due after one year through two years
    
    
    2,000
    
    
    
    20
    
    
    
    2,020
    
    
    
    
    
    
    
    
    
    
    
    $
    42,501
    
    
    $
    303
    
    
    $
    42,804
    
    
    $
    6,944
    
    
    $
    38
    
    
    $
    6,982
      63




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##### Table of Contents



Fair Value Measurements at Reporting Date UsingLevel 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalMoney Market funds
    
    $
    81,619
    
    
    
    
    
    
    
    
    
    
    $
    81,619Federal agency debt securities
    
    
    42,501
    
    
    
    
    
    
    
    
    
    
    
    42,501Total
    
    $
    124,120
    
    
    
    
    
    
    
    
    
    
    $
    124,120Amounts included in:Cash and cash equivalents
    
    $
    81,619
    
    
    
    
    
    
    
    
    
    
    $
    81,619Short-term investments
    
    
    40,501
    
    
    
    
    
    
    
    
    
    
    
    40,501Long-term investments
    
    
    2,000
    
    
    
    
    
    
    
    
    
    
    
    2,000Total
    
    $
    124,120
    
    
    
    
    
    
    
    
    
    
    $
    124,120
 NOTE 4  ACCOUNTS RECEIVABLE
  2008
    
    
    2007Accounts receivable
    
    $
    11,296
    
    
    $
    12,183Less: Allowance for doubtful accounts
    
    
    (272
    )
    
    
    (356
    )$
    11,024
    
    
    $
    11,827
  Balance at December 31, 2005
    
    $
    366Additions charged to costs and expenses
    
    
    (52
    )Write-offs of uncollectible accounts
    
    
    (13
    )Recoveries of uncollectible accounts
    
    
    Balance at December 31, 2006
    
    
    301Reductions charged to costs and expenses
    
    
    Write-offs of uncollectible accounts
    
    
    (1
    )Additions due to acquired accounts receivable
    
    
    56Recoveries of uncollectible accounts
    
    
    Balance at December 31, 2007
    
    $
    356Reductions charged to costs and expenses
    
    
    (50
    )Write-offs of uncollectible accounts
    
    
    (34
    )Additions due to acquired accounts receivable
    
    
    Recoveries of uncollectible accounts
    
    
    Balance at December 31, 2008
    
    $
    272
  64




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##### Table of Contents



NOTE 5  INVENTORY, NET
  2008
    
    
    2007Parts and supplies
    
    $
    5,756
    
    
    $
    3,613Work-in-progress
    
    
    4,022
    
    
    
    1,632Finished goods
    
    
    2,588
    
    
    
    1,95612,366
    
    
    
    7,201Less: Allowance for excess and obsolete inventory
    
    
    (777
    )
    
    
    (693
    )$
    11,589
    
    
    $
    6,508
  NOTE 6  PROPERTY AND EQUIPMENT
  2008
    
    
    2007Laboratory equipment
    
    $
    9,223
    
    
    $
    7,686Leasehold improvements
    
    
    6,550
    
    
    
    6,089Computer equipment
    
    
    3,071
    
    
    
    1,944Purchased software
    
    
    5,521
    
    
    
    4,463Furniture and fixtures
    
    
    1,609
    
    
    
    1,512Assets on loan/rental
    
    
    1,516
    
    
    
    1,341Capital lease equipment
    
    
    116
    
    
    
    11527,606
    
    
    
    23,150Less: Accumulated amortization and depreciation
    
    
    (15,039
    )
    
    
    (10,477
    )$
    12,567
    
    
    $
    12,673
   65




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##### Table of Contents



NOTE 7  ACQUIRED INTANGIBLE ASSETS
  Gross carrying
    
    
    Accumulated
    
    
    Weightedamount
    
    
    amortization
    
    
    average lifeTechnology/trade secrets
    
    $
    17,400
    
    
    $
    (3,465
    )
    
    
    9Customer lists/contracts
    
    
    1,100
    
    
    
    (134
    )
    
    
    15Total
    
    $
    18,500
    
    
    $
    (3,599
    )
  For the year endingDecember 31,2009
    
    $
    1,9632010
    
    
    1,9632011
    
    
    1,9632012
    
    
    1,9632013
    
    
    1,963
 NOTE
8  OTHER ASSETS
  2008
    
    
    2007Purchased technology rights (net of accumulated amortization of
$548,000 and $108,000 in 2008 and 2007, respectively)
    
    $
    1,300
    
    
    $
    509Other
    
    
    627
    
    
    
    5871,927
    
    
    
    1,096Less: Current portion
    
    
    (114
    )
    
    
    (114
    )$
    1,813
    
    
    $
    982
   66




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##### Table of Contents



NOTE 9  ACCRUED WARRANTY COSTS
   Accrued warranty costs at December 31, 2005
    
    $
    351Warranty expenses
    
    
    (635
    )Accrual for warranty costs
    
    
    595Accrued warranty costs at December 31, 2006
    
    
    311Warranty expenses
    
    
    (525
    )Accrual for warranty costs
    
    
    473Accrued warranty costs at December 31, 2007
    
    
    259Warranty expenses
    
    
    (946
    )Accrual for warranty costs
    
    
    1,166Accrued warranty costs at December 31, 2008
    
    $
    479
 NOTE 10  INCOME TAXES
  2008
    
    
    2007
    
    
    2006Domestic
    
    $
    13,021
    
    
    $
    12,164
    
    
    $
    1,428Foreign
    
    
    (9,116
    )
    
    
    (14,585
    )
    
    
    99Total
    
    $
    3,905
    
    
    $
    (2,421
    )
    
    $
    1,527
  2008
    
    
    2007
    
    
    2006Current:Federal
    
    $
    308
    
    
    $
    177
    
    
    $
    Foreign
    
    
    146
    
    
    
    84
    
    
    
    40State
    
    
    394
    
    
    
    29
    
    
    
    (20
    )Total current
    
    $
    848
    
    
    $
    290
    
    
    $
    20Deferred:Federal
    
    
    
    
    
    
    
    
    
    
    Foreign
    
    
    
    
    
    
    
    
    
    
    State
    
    
    
    
    
    
    
    
    
    
    Total deferred
    
    
    
    
    
    
    
    
    
    
    Total provision for income taxes
    
    $
    848
    
    
    $
    290
    
    
    $
    20
  67




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##### Table of Contents



2008
    
    
    2007
    
    
    2006Deferred tax assets:Current deferred tax assetsAccrued liabilities and other
    
    $
    908
    
    
    $
    1,061
    
    
    $
    775Gross current deferred tax assets
    
    
    908
    
    
    
    1,061
    
    
    
    775Valuation allowance
    
    
    (906
    )
    
    
    (1,059
    )
    
    
    (628
    )Net current deferred tax assets
    
    
    2
    
    
    
    2
    
    
    
    147Noncurrent deferred tax assetsNet operating loss and credit carryforwards
    
    
    49,726
    
    
    
    54,168
    
    
    
    34,155Deferred revenue
    
    
    2,835
    
    
    
    2,535
    
    
    
    2,342Depreciation and amortization
    
    
    6,924
    
    
    
    7,902
    
    
    
    348Investment basis
    
    
    
    
    
    
    
    
    
    
    1,637Stock compensation
    
    
    3,191
    
    
    
    1,981
    
    
    
    615Gross Noncurrent Deferred Tax Assets
    
    
    62,676
    
    
    
    66,586
    
    
    
    39,097Valuation allowance
    
    
    (57,732
    )
    
    
    (60,944
    )
    
    
    (39,069
    )Net noncurrent deferred tax assets
    
    $
    4,944
    
    
    $
    5,642
    
    
    $
    28Deferred tax liabilities:Current deferred tax liabilitiesPrepaid expenses
    
    
    
    
    
    
    
    
    
    
    (147
    )Total current deferred tax liabilities
    
    
    
    
    
    
    
    
    
    
    (147
    )Net current deferred tax asset (liability)
    
    $
    2
    
    
    $
    2
    
    
    $
    Noncurrent deferred tax liabilitiesAcquired intangibles
    
    $
    (4,825
    )
    
    $
    (5,521
    )
    
    $
    Total noncurrent deferred tax liabilities
    
    $
    (4,825
    )
    
    $
    (5,521
    )
    
    $
    Net noncurrent deferred tax asset (liability)
    
    $
    119
    
    
    $
    121
    
    
    $
    28Net deferred tax assets (liabilities)
    
    $
    121
    
    
    $
    123
    
    
    $
    28
    68




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Year Ended December 31,2008
    
    
    2007
    
    
    2006Statutory tax rate
    
    
    35.0
    %
    
    
    34.0
    %
    
    
    34.0
    %State taxes, net of federal benefit
    
    
    7.3
    %
    
    
    3.6
    %
    
    
    (2.7
    )%Permanent items
    
    
    16.0
    %
    
    
    (21.2
    )%
    
    
    3.3
    %Effect of foreign operations
    
    
    (0.6
    )%
    
    
    14.7
    %
    
    
    0.5
    %Research and incentive tax credit generated
    
    
    (21.9
    )%
    
    
    35.8
    %
    
    
    (22.0
    )%Canadian tax rate change
    
    
    0.0
    %
    
    
    (64.8
    )%
    
    
    0.0
    %Deferred assets not benefited
    
    
    (14.4
    )%
    
    
    (11.4
    )%
    
    
    (11.7
    )%21.4
    %
    
    
    (9.3
    )%
    
    
    1.4
    %
    Balance at January 1, 2008
    
    $
    Additions based on tax positions related to the current year
    
    
    Additions for tax positions of prior years
    
    
    251Reductions for tax positions of prior years
    
    
    Settlements
    
    
    Lapse of statute of limitations
    
    
    Cumulative translation adjustment
    
    
    Balance at December 31, 2008
    
    $
    251
   69




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NOTE 11  LONG-TERM DEBT
     2009
    
    $
    4452010
    
    
    6862011
    
    
    9312012
    
    
    1,1472013
    
    
    1,276Thereafter
    
    
    $
    4,485Less: Amount representing implied interest
    
    
    (971
    )Total principal repayments
    
    $
    3,514Discount
    
    $
    (155
    )Total long-term debt
    
    $
    3,359Less: Current portion of long-term debt
    
    
    (445
    )$
    2,914
   70




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##### Table of Contents



NOTE 12  NET INCOME (LOSS) PER SHARE
  Year Ended December 31,2008
    
    
    2007
    
    
    2006Numerator:Net income (loss)
    
    $
    3,057
    
    
    $
    (2,711
    )
    
    $
    1,507Denominator:Denominator for basic net income (loss) per share 
weighted average common stock outstanding
    
    
    37,868
    
    
    
    34,361
    
    
    
    31,434Effect of dilutive securities:Stock options and awards
    
    
    1,832
    
    
    
    
    
    
    
    1,554Denominator for diluted net income (loss) per share 
weighted average shares outstanding  diluted
    
    
    39,700
    
    
    
    34,361
    
    
    
    32,988Basic net income (loss) per share
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05Diluted net income (loss) per share
    
    $
    0.08
    
    
    $
    (0.08
    )
    
    $
    0.05
  NOTE 13  STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME/ LOSS
 Preferred Stock
  Stockholders Rights Plan
  Comprehensive Income/Loss
   71




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##### Table of Contents



NOTE 14  EMPLOYEE BENEFIT PLANS AND STOCK-BASED COMPENSATION
 Stock-Based Compensation
  Equity Incentive Plans
     72




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##### Table of Contents




    
    Partial or complete achievement of the trading price goal is dependent upon the average
closing price of Luminexs Common Stock for the twenty consecutive trading days ending
December 31, 2010, inclusive, subject to certain adjustments as described in the LTIP.
There is a range of trading price targets as follows: a minimum threshold of $24.79 per
share, a target of $28.17 per share, and a maximum goal of $44.73 per share.
 
    
    Partial or complete achievement of the operating cash flow goal is dependent upon the
average quarterly total operating cash flows per diluted share for the four quarters
ended December 31, 2010, as further described in the LTIP. Total operating cash flows
means Luminexs GAAP net cash provided by operating activities as shown on its financial
statements for the 12 month period ended December 31, 2010, as further described in the
LTIP. There is a range of targets as follows: a minimum threshold of $0.101 per share, a
target of $0.111 per share, and a maximum goal of $0.157 per share.
   73




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##### Table of Contents



Accounting for Stock Compensation
   2008
    
    
    2007
    
    
    2006Dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %Expected volatility
    
    
    0.5
    
    
    
    0.5
    
    
    
    0.6Risk-free rate of return
    
    
    3.0
    %
    
    
    5.0
    %
    
    
    5.0
    %Expected life
    
    8 yrs.
    
    
    7 yrs.
    
    
    6 yrs.Weighted average fair
value at grant date
    
    $
    8.62
    
    
    $
    4.70
    
    
    
    N/A
    [1]
 [1]
    
    No stock options were issued to employees during this period.   74




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##### Table of Contents



WeightedWeighted
    
    
    Average
    
    
    AggregateAverage
    
    
    Remaining
    
    
    IntrinsicShares
    
    
    Exercise
    
    
    Contractual
    
    
    ValueStock Options
    
    (in thousands)
    
    
    Price
    
    
    Life
    
    
    (in thousands)Outstanding at December 31,
2007
    
    
    3,444
    
    
    $
    11.96Granted
    
    
    77
    
    
    
    20.70Exercised
    
    
    (644
    )
    
    
    10.99Cancelled or expired
    
    
    (106
    )
    
    
    24.22Outstanding at December 31,
2008
    
    
    2,771
    
    
    $
    11.96
    
    
    
    4.29
    
    
    $
    27,972Vested at December 31, 2008 and expected to vest
    
    
    2,768
    
    
    $
    11.95
    
    
    
    4.29
    
    
    $
    27,958Exercisable at December 31, 2008
    
    
    2,591
    
    
    $
    11.56
    
    
    
    4.04
    
    
    $
    27,229
   Weighted AverageShares
    
    
    Exercise PriceOptions outstanding, December 31,
2005
    
    
    3,758
    
    
    $
    9.85Granted
    
    
    
    
    
    
    Exercised
    
    
    (423
    )
    
    $
    6.22Surrendered
    
    
    (172
    )
    
    $
    20.39Options outstanding, December 31,
2006
    
    
    3,163
    
    
    $
    9.76Granted
    
    
    823
    
    
    
    21Exercised
    
    
    (332
    )
    
    $
    5.63Surrendered
    
    
    (210
    )
    
    $
    23.86Options outstanding, December 31, 2007
    
    
    3,444
    
    
    $
    11.96
  75




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##### Table of Contents



Weighted-AverageShares
    
    
    Grant-DateRestricted Stock Awards
    
    (in thousands)
    
    
    Fair ValueNon-vested at December 31, 2007
    
    
    1,333
    
    
    $
    13.37Granted
    
    
    310
    
    
    
    20.97Vested
    
    
    (337
    )
    
    
    12.97Cancelled or expired
    
    
    (109
    )
    
    
    14.05Non-vested at December 31, 2008
    
    
    1,197
    
    
    $
    15.39
 SharesRestricted Stock Units
    
    (in thousands)Non-vested at December 31, 2007
    
    
    Granted
    
    
    284Vested
    
    
    Cancelled or expired
    
    
    (4
    )Non-vested at December 31, 2008
    
    
    280
      76




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##### Table of Contents



Year Ended December 31,2008
    
    
    2007
    
    
    2006Cost of revenue
    
    $
    523
    
    
    $
    380
    
    
    $
    318Research and development
    
    
    1,143
    
    
    
    810
    
    
    
    594Selling, general and administrative
    
    
    5,585
    
    
    
    5,403
    
    
    
    4,599Stock-based compensation costs reflected
in net income (loss)
    
    $
    7,251
    
    
    $
    6,593
    
    
    $
    5,511
 Reserved Shares of Common Stock
  Options / Warrants
    
    
    Shares Available
    
    
    Total SharesOutstanding
    
    
    for Future Issuance
    
    
    Reserved1996 Plan
    
    
    20,400
    
    
    
    
    
    
    
    20,4002000 Plan
    
    
    1,217,000
    
    
    
    
    
    
    
    1,217,0002001 Plan
    
    
    489,638
    
    
    
    
    
    
    
    489,6382006 Equity Incentive
Plan
    
    
    467,932
    
    
    
    322,340
    
    
    
    790,2722006 Management Stock Purchase Plan
    
    
    
    
    
    
    500,000
    
    
    
    500,000Tm Plan
    
    
    68,414
    
    
    
    
    
    
    
    68,414Other *
    
    
    787,748
    
    
    
    
    
    
    
    787,7483,051,132
    
    
    
    822,340
    
    
    
    3,873,472
 *
    
    Balthrop Option and Tm Warrants Employee Savings Plans
   77




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##### Table of Contents



NOTE 15  COMMITMENTS AND CONTINGENCIES
 Lease Arrangements
   2009
    
    $
    1,9662010
    
    
    1,7332011
    
    
    1,7352012
    
    
    1,7682013
    
    
    1,782Thereafter
    
    
    1,947Total
    
    $
    10,931
  Non-Cancelable Purchase Commitments
  Employment Contracts
  Gain on Settlement of Liability
  Legal Proceedings
   78




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##### Table of Contents



Unfunded Credit Facility
   NOTE 16  GUARANTEES
  NOTE 17  SEGMENT AND GEOGRAPHIC INFORMATION
  Technology Segment 
 Assay Segment
  79




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##### Table of Contents



2008
    
    

2007Technology
    
    
    Assay
    
    
    
    
    
    
    Technology
    
    
    AssaySegment
    
    
    Segment
    
    
    Consolidated
    
    
    Segment
    
    
    Segment
    
    
    ConsolidatedRevenues from external
customers
    
    $
    83,567
    
    
    $
    20,880
    
    
    $
    104,447
    
    
    $
    62,436
    
    
    $
    12,574
    
    
    $
    75,010Depreciation and amortization
    
    
    3,279
    
    
    
    3,722
    
    
    $
    7,001
    
    
    
    2,241
    
    
    
    2,822
    
    
    $
    5,063Segment profit (loss)
    
    
    9,405
    
    
    
    (6,348
    )
    
    $
    3,057
    
    
    
    12,330
    
    
    
    (15,041
    )
    
    $
    (2,711
    )Segment assets
    
    
    145,008
    
    
    
    72,283
    
    
    $
    217,291
    
    
    
    58,091
    
    
    
    65,468
    
    
    $
    123,559
  Sales to Customers
    
    
    Long-Term Assets2008
    
    
    2007
    
    
    2006
    
    
    2008
    
    
    2007
    
    
    2006Domestic
    
    $
    89,465
    
    
    $
    63,591
    
    
    $
    40,823
    
    
    $
    13,553
    
    
    $
    10,863
    
    
    $
    6,042Foreign:Europe
    
    
    9,279
    
    
    
    7,835
    
    
    
    5,760
    
    
    
    428
    
    
    
    501
    
    
    
    173Asia
    
    
    1,204
    
    
    
    739
    
    
    
    2,870
    
    
    
    
    
    
    
    
    
    
    
    Canada
    
    
    2,204
    
    
    
    846
    
    
    
    2,157
    
    
    
    56,885
    [1]
    
    
    58,676
    [1]
    
    
    Other
    
    
    2,295
    
    
    
    1,999
    
    
    
    1,379
    
    
    
    32
    
    
    
    
    
    
    
    $
    104,447
    
    
    $
    75,010
    
    
    $
    52,989
    
    
    $
    70,898
    
    
    $
    70,040
    
    
    $
    6,215
 [1]
    
    $39,617 of the long-term assets in Canada represents goodwill from the acquisition of LMD. NOTE 18  SETTLEMENT OF LITIGATION
   80




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##### Table of Contents



NOTE 19  RECENT ACCOUNTING PRONOUNCEMENTS
  Fair Value Measurements Accounting Changes and Error
Corrections
  
  81




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##### Table of Contents



The Meaning
of Present Fairly in Conformity With Generally Accepted Accounting Principles
 SELECTED QUARTERLY RESULTS (UNAUDITED)
  Quarter EndedMarch 31,
    
    
    June 30,
    
    
    September 30,
    
    
    December 31,2008
    
    
    2008
    
    
    2008
    
    
    2008Revenue
    
    $
    23,012
    
    
    $
    24,341
    
    
    $
    28,897
    
    
    $
    28,197Gross profit
    
    
    15,257
    
    
    
    16,563
    
    
    
    19,554
    
    
    
    19,572Income (loss) from operations
    
    
    (1,268
    )
    
    
    (514
    )
    
    
    2,981
    
    
    
    2,154Net income (loss)
    
    
    (1,166
    )
    
    
    (959
    )
    
    
    3,173
    
    
    
    2,009Basic income (loss) per share
    
    
    (0.03
    )
    
    
    (0.03
    )
    
    
    0.08
    
    
    
    0.05Diluted income (loss) per
share
    
    
    (0.03
    )
    
    
    (0.03
    )
    
    
    0.08
    
    
    
    0.05
 Quarter EndedMarch 31,
    
    
    June 30,
    
    
    September 30,
    
    
    December 31,2007
    
    
    2007
    
    
    2007
    
    
    2007Revenue
    
    $
    16,607
    
    
    $
    17,548
    
    
    $
    19,353
    
    
    $
    21,501Gross profit
    
    
    10,429
    
    
    
    10,337
    
    
    
    12,017
    
    
    
    13,310Income (loss) from operations
    
    
    (372
    )
    
    
    (12,244
    )
    
    
    (1,858
    )
    
    
    (2,943
    )Net income (loss)
    
    
    136
    
    
    
    (12,056
    )
    
    
    (1,852
    )
    
    
    11,061Basic income (loss) per share
    
    
    0.00
    
    
    
    (0.34
    )
    
    
    (0.05
    )
    
    
    0.31Diluted income (loss) per
share
    
    
    0.00
    
    
    
    (0.34
    )
    
    
    (0.05
    )
    
    
    0.30
 
 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL 
                DISCLOSURE
   82




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##### Table of Contents



ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
  Managements Report on Internal Control Over Financial Reporting
   Changes in Internal Control Over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
   83




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##### Table of Contents



PART III
 
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
   
 ITEM 11. EXECUTIVE COMPENSATION
   84




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##### Table of Contents



ITEM 12.

    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
  Securities Authorized for Issuance Under Equity Compensation Plans
  Number of Securities RemainingAvailable for Future IssuanceNumber of Securities to
    
    
    Weighted-Average
    
    
    Under Equity Compensation Plansbe Issued Upon Exercise
    
    
    Exercise Price of
    
    
    (Excluding Securities ReflectedPlan Category
    
    of Outstanding Options
    
    
    Outstanding Options
    
    
    in Column (A))(A)
    
    
    (B)
    
    
    (C)Equity compensation plans
approved by security
holders
    
    
    1,705,332
    
    
    $
    9.04
    
    
    
    822,340Equity compensation plans
not approved by security
holders (1)
    
    
    1,345,800
    
    
    $
    13.16
    
    
    
    Total
    
    
    3,051,132
    
    
    
    
    
    
    
    822,340
 (1)
    
    Includes shares issuable upon the exercise of options granted under the Tm Bioscience
Corporation Share Option Plan assumed by Luminex in connection with the acquisition of Tm
Bioscience. These options have a weighted average exercise price of $23.99. No further grants
will be made pursuant to this plan. Also includes options to purchase 500,000 shares of the
Companys common stock issued to Patrick J. Balthrop, Sr. on May 15, 2004, in connection with his
hiring and outside of any stockholder approved equity incentive plan. The terms of this option,
together with the amendment to the related option agreement, are more fully described in Note 14 to
the Consolidated Financial Statements. 
 ITEM 13.

    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
  
 ITEM 14. PRINCIPLE ACCOUNTING FEES AND SERVICES
   85




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PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
  (1)
    
    Financial Statements:
     EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT2.1
    
    
    Merger Agreement, dated December 14, 2006, by and between the Company and Tm Bioscience
Corporation (Previously filed as an Exhibit to the Companys Current Report on Form 8-K
dated December 15, 2006).3.1
    
    
    Restated Certificate of Incorporation of the Company (Previously filed as an Exhibit to the
Companys Registration Statement on Form S-1 (File No. 333-96317), filed February 7, 2000,
as amended).3.2
    
    
    Amended and Restated Bylaws of the Company (Previously filed as an Exhibit to the Companys
Current Report on Form 8-K, filed September 16, 2008).4.1
    
    
    Rights Agreement dated as of June 20, 2001 between Luminex Corporation and Mellon Investor
Services, LLC, as Rights Agent which includes as Exhibit A the form of Certificate of
Designations of Series A Junior Participating Preferred Stock setting forth the terms of
the Series A Junior Participating Preferred Stock, as Exhibit B the form of Rights
Certificate and as Exhibit C the Summary of Rights (Previously filed as Exhibit 4 to the
Companys Current Report on Form 8-K dated June 21, 2001 (File No. 000-30109)).10.1
    #
    
    1996 Stock Option Plan of the Company, as amended (Previously filed as an Exhibit to the
Companys Registration Statement on Form S-1 (File No. 333-96317), filed February 7, 2000,
as amended).10.2
    #
    
    Form of Stock Option Agreement for the 1996 Stock Option Plan (Previously filed as an
Exhibit to the Companys Registration Statement on Form S-1 (File No. 333-96317), filed
February 7, 2000, as
amended).10.3
    #
    
    Form of Incentive Stock Option Agreement for the 1996 Stock Option Plan (Previously filed
as an Exhibit to the Companys Registration Statement on Form S-1 (File No. 333-96317),
filed February 7, 2000, as amended).10.4
    #
    
    2000 Long-Term Incentive Plan of the Company, as amended (Previously filed as an Exhibit to
the Companys Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2002
(File No. 000-30109)).10.5
    #
    
    Form of Stock Option Award Agreement for the 2000 Long-Term Incentive Plan (Previously
filed as an Exhibit to the Companys Registration Statement on Form S-1 (File No.
333-96317), filed February 7, 2000, as amended).10.6
    #
    
    2001 Broad-Based Stock Option Plan of the Company (Previously filed as an Exhibit to the
Companys Annual Report on Form 10-K for the fiscal year ended December 30, 2001 (File No.
000-30109)).10.7
    #
    
    Form of Option Grant Certificate for the 2001 Broad-Based Stock Option Plan (Previously
filed as an Exhibit to the Companys Annual Report on Form 10-K for the fiscal year ended
December 30, 2001 (File No. 000-30109)).10.8
    #
    
    Form of Amended and Restated Employment Agreement between the Company and Randel S. Marfin
(Previously filed as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
period ended June 30, 2002 (File No. 000-30109)).
  86




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT10.9
    #
    
    Form of Indemnification Agreement between the Company and each of the directors and
executive officers of the Company (Previously filed as an Exhibit to the Companys Current
Report on Form 8-K filed September 16, 2008).10.10
    
    
    Lease Agreement between Aetna Life Insurance Company, as Landlord, and Luminex Corporation,
as Tenant, dated October 19, 2001 (Previously filed as an Exhibit to the Companys Form
10-Q for the quarterly period ended September 30, 2001 (File No. 000-30109)).10.11
    
    
    First Amendment to Lease Agreement between Aetna Life Insurance Company, as Landlord, and
Luminex Corporation as Tenant, dated July 25, 2002. (Previously filed as an Exhibit to the
Companys Quarterly Report on Form 10-Q for the period ended June 30, 2002 (File No.
000-30109)).10.12
    
    
    Lease Amendment between McNeil 4 & 5 Investors, LP, as Landlord, and Luminex Corporation,
as Tenant, dated January 27, 2003 (Previously filed as an Exhibit to the Companys Annual
Report on Form 10-K for the fiscal year ended December 31, 2002 (File No. 000-30109)).10.13
    #
    
    Employment Agreement, effective as of October 1, 2003, by and between Luminex Corporation
and Harriss T. Currie (Previously filed as an Exhibit to the Companys Annual Report on
Form 10-K for the fiscal year ended December 31, 2003).10.14
    #
    
    Employment Agreement effective as of October 1, 2003, by and between Luminex Corporation
and David S. Reiter (Previously filed as an Exhibit to the Companys Annual Report on Form
10-K for the fiscal year ended December 31, 2003).10.15
    #
    
    Employment Agreement effective as of May 15, 2004, by and between Luminex Corporation and
Patrick J. Balthrop (Previously filed as an Exhibit to the Companys Current Report on
Form 8-K filed May 18, 2004).10.16
    #
    
    Employment Agreement effective as of October 25, 2004, by and between Luminex Corporation
and Gregory J. Gosch (Previously filed as an Exhibit to the Companys Current Report on
Form 8-K filed October 22, 2004).10.17
    #
    
    Employment Agreement effective as of May 23, 2005, by and between Luminex Corporation and
Russell W. Bradley (Previously filed as an Exhibit to the Companys Current Report on
Form 8-K filed May 25, 2005).10.18
    #
    
    Form of Restricted Stock Agreement for the 2000 Long-Term Incentive Plan and 2001
Broad-Based Stock Option Plan (Previously filed as an Exhibit to the Companys Quarterly
Report on Form 10-Q for the quarterly period ended September 30, 2004).10.19
    #
    
    Form of Non-Qualified Stock Option Agreement dated as of May 15, 2004, by and between
Luminex Corporation and Patrick J. Balthrop (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed May 18, 2004).10.20
    #
    
    Form of Amendment to Executive Employment Agreements (Previously filed as an Exhibit to the
Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2005).10.21
    #
    
    Luminex Corporation 2006 Equity Incentive Plan (Previously filed as Exhibit A to the
Companys Proxy Statement for its Annual Meeting of Shareholders held on May 25, 2006).10.22
    #
    
    Form of Non-Qualified Stock Option Agreement for the 2006 Equity Incentive Plan (Previously
filed as an Exhibit to the Companys Current Report on Form 8-K filed May 25, 2006).10.23
    #
    
    Form of Restricted Share Award Agreement for Officers & Employees for the 2006 Equity
Incentive Plan (Previously filed as an Exhibit to the Companys Current Report on Form 8-K
filed May 25, 2006).10.24
    #
    
    Form of Restricted Share Award Agreement for Directors for the 2006 Equity Incentive Plan
(Previously filed as an Exhibit to the Companys Current Report on Form 8-K filed May 25,
2006).
  87




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT10.25
    #
    
    Luminex Corporation 2006 Management Stock Purchase Plan (Previously filed as Exhibit B to
the Companys Proxy Statement for its Annual Meeting of Shareholders held on May 25, 2006).10.26
    
    
    Credit Agreement, dated March 1, 2007, by and between the Luminex Corporation and JPMorgan
Chase Bank, N.A. (Previously filed as an Exhibit to the Companys Current Report on Form
8-K filed March 1, 2007).10.27
    
    
    First Amendment to Credit Agreement, effective as of February 28, 2008, by and between
Luminex Corporation and JPMorgan Chase Bank, N.A. (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed May 29, 2008).10.28
    #
    
    Employment Agreement effective as of March 1, 2007, by and between Luminex Corporation, Tm
Bioscience and Jeremy Bridge-Cook (Previously filed as an Exhibit to the Companys Annual
Report on Form 10-K for the fiscal year ended December 31, 2006).10.29
    #
    
    Form of Restricted Stock Unit Agreement for the 2006 Equity Incentive Plan (Previously
filed as an Exhibit to the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2006).10.30
    #
    
    Amendment to Restricted Stock Agreement, dated as of March 25, 2007, by and between Luminex
Corporation and Patrick J. Balthrop, Sr. (Previously filed as an Exhibit to the Companys
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2007).10.31
    #
    
    Amendment to Luminex Corporation 2000 Amended and Restated Long-Term Incentive Plan dated
as of May 24, 2007 (Previously filed as an Exhibit to the Companys Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 2007).10.32
    #
    
    Amendment to Luminex Corporation 2001 Broad-Based Stock Option Plan dated as of May 24,
2007 (Previously filed as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2007).10.33
    #
    
    Amendment to Luminex Corporation 2006 Management Stock Purchase Plan dated as of May 24,
2007 (Previously filed as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2007).10.34
    #
    
    Amendment to Luminex Corporation 2006 Equity Incentive Plan dated as of May 24, 2007
(Previously filed as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2007).10.35
    #
    
    Form of Amendments to Equity Award Agreements (Previously filed as an Exhibit to the
Companys Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2007).10.36
    #
    
    Employment Agreement, dated as of July 16, 2007, by and between Luminex Corporation and
Douglas C. Bryant (Previously filed as an Exhibit to the Companys Current Report on Form
8-K filed July 18, 2007).10.37
    #
    
    Employment Agreement, effective as of September 30, 2007, by and between Luminex
Corporation and James W. Jacobson (Previously filed as an Exhibit to the Companys Current
Report on Form 8-K filed September 19, 2007).10.38
    #
    
    2007 Executive Compensation Summary (Previously filed as an Exhibit to the Companys
Current Report on Form 8-K filed March 28, 2008).10.39
    #
    
    Luminex Corporation 2008 Long Term Incentive Plan (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed December 9, 2008).10.40
    #
    
    Form of Restricted Share Unit Award Agreement for Awards under the Luminex Corporation 2008
Long Term Incentive Plan (Previously filed as an Exhibit to the Companys Current Report on
Form 8-K filed December 9, 2008).21.1
    
    
    Subsidiaries of the Company.
  88




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT23.1
    
    
    Consent of Independent Registered Public Accounting Firm.24.1
    
    
    Power of Attorney (incorporated in the signature page of this report).31.1
    
    
    Certification by CEO pursuant to Securities and Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification by CFO pursuant to Securities and Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification by CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification by CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
 #
    
    Management contract or compensatory plan or arrangement.  89




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##### Table of Contents



SIGNATURES
  LUMINEX CORPORATIONBy:
    /s/ Patrick J. BalthropPatrick J. BalthropPresident and Chief Executive Officer SIGNATURES
    
    TITLE
    
    DATE/s/ Patrick J. Balthrop

Patrick J. Balthrop
    
    President and Chief Executive Officer,
Director 
(Principal Executive Officer)
    
    February 26, 2009/s/ Harriss T. Currie

Harriss T. Currie
    
    Chief Financial Officer, Vice
President, Finance and Treasurer
(Principal Financial Officer and

Principal Accounting Officer)
    
    February 26, 2009/s/ Robert J. Cresci

Robert J. Cresci
    
    Director
    
    February 26, 2009/s/ Thomas W. Erickson

Thomas W. Erickson
    
    Director
    
    February 26, 2009/s/ Fred C. Goad, Jr.

Fred C. Goad, Jr.
    
    Director
    
    February 26, 2009/s/ Jay B. Johnston

Jay B. Johnston
    
    Director
    
    February 26, 2009/s/ Jim D. Kever

Jim D. Kever
    
    Director
    
    February 26, 2009/s/ G. Walter Loewenbaum II

G. Walter Loewenbaum II
    
    Chairman of the Board of Directors

Director
    
    February 26, 2009/s/ Kevin M. McNamara

Kevin M. McNamara
    
    Director
    
    February 26, 2009/s/ J. Stark Thompson

J. Stark Thompson
    
    Director
    
    February 26, 2009/s/ Gerard Vaillant

Gerard Vaillant
    
    Director
    
    February 26, 2009
  S-1




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##### Table of Contents



EXHIBIT INDEX
 EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT2.1
    
    
    Merger Agreement, dated December 14, 2006, by and between the Company and
Tm Bioscience Corporation (Previously filed as an Exhibit to the Companys
Current Report on Form 8-K dated December 15, 2006).3.1
    
    
    Restated Certificate of Incorporation of the Company (Previously filed as
an Exhibit to the Companys Registration Statement on Form S-1 (File No.
333-96317), filed February 7, 2000, as amended).3.2
    
    
    Amended and Restated Bylaws of the Company (Previously filed as an Exhibit
to the Companys Current Report on Form 8-K, filed September 16, 2008).4.1
    
    
    Rights Agreement dated as of June 20, 2001 between Luminex Corporation and
Mellon Investor Services, LLC, as Rights Agent which includes as Exhibit A
the form of Certificate of Designations of Series A Junior Participating
Preferred Stock setting forth the terms of the Series A Junior
Participating Preferred Stock, as Exhibit B the form of Rights Certificate
and as Exhibit C the Summary of Rights (Previously filed as Exhibit 4 to
the Companys Current Report on Form 8-K dated June 21, 2001 (File No.
000-30109)).10.1
    #
    
    1996 Stock Option Plan of the Company, as amended (Previously filed as an
Exhibit to the Companys Registration Statement on Form S-1 (File No.
333-96317), filed February 7, 2000, as amended).10.2
    #
    
    Form of Stock Option Agreement for the 1996 Stock Option Plan (Previously
filed as an Exhibit to the Companys Registration Statement on Form S-1
(File No. 333-96317), filed February 7, 2000, as
amended).10.3
    #
    
    Form of Incentive Stock Option Agreement for the 1996 Stock Option Plan
(Previously filed as an Exhibit to the Companys Registration Statement on
Form S-1 (File No. 333-96317), filed February 7, 2000, as amended).10.4
    #
    
    2000 Long-Term Incentive Plan of the Company, as amended (Previously filed
as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2002 (File No. 000-30109)).10.5
    #
    
    Form of Stock Option Award Agreement for the 2000 Long-Term Incentive Plan
(Previously filed as an Exhibit to the Companys Registration Statement on
Form S-1 (File No. 333-96317), filed February 7, 2000, as amended).10.6
    #
    
    2001 Broad-Based Stock Option Plan of the Company (Previously filed as an
Exhibit to the Companys Annual Report on Form 10-K for the fiscal year
ended December 30, 2001 (File No. 000-30109)).10.7
    #
    
    Form of Option Grant Certificate for the 2001 Broad-Based Stock Option Plan
(Previously filed as an Exhibit to the Companys Annual Report on Form 10-K
for the fiscal year ended December 30, 2001 (File No. 000-30109)).10.8
    #
    
    Form of Amended and Restated Employment Agreement between the Company and
Randel S. Marfin (Previously filed as an Exhibit to the Companys Quarterly
Report on Form 10-Q for the period ended June 30, 2002 (File No.
000-30109)).10.9
    #
    
    Form of Indemnification Agreement between the Company and each of the
directors and executive officers of the Company (Previously filed as an
Exhibit to the Companys Current Report on Form 8-K filed September 16,
2008).
  S-2




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT10.10
    
    
    Lease Agreement between Aetna Life Insurance Company, as Landlord, and
Luminex Corporation, as Tenant, dated October 19, 2001 (Previously filed as
an Exhibit to the Companys Form 10-Q for the quarterly period ended
September 30, 2001 (File No. 000-30109)).10.11
    
    
    First Amendment to Lease Agreement between Aetna Life Insurance Company, as
Landlord, and Luminex Corporation as Tenant, dated July 25, 2002.
(Previously filed as an Exhibit to the Companys Quarterly Report on Form
10-Q for the period ended June 30, 2002 (File No. 000-30109)).10.12
    
    
    Lease Amendment between McNeil 4 & 5 Investors, LP, as Landlord, and
Luminex Corporation, as Tenant, dated January 27, 2003 (Previously filed as
an Exhibit to the Companys Annual Report on Form 10-K for the fiscal year
ended December 31, 2002 (File No. 000-30109)).10.13
    #
    
    Employment Agreement, effective as of October 1, 2003, by and between
Luminex Corporation and Harriss T. Currie (Previously filed as an Exhibit
to the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2003).10.14
    #
    
    Employment Agreement effective as of October 1, 2003, by and between
Luminex Corporation and David S. Reiter (Previously filed as an Exhibit to
the Companys Annual Report on Form 10-K for the fiscal year ended December
31, 2003).10.15
    #
    
    Employment Agreement effective as of May 15, 2004, by and between Luminex
Corporation and Patrick J. Balthrop (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed May 18, 2004).10.16
    #
    
    Employment Agreement effective as of October 25, 2004, by and between
Luminex Corporation and Gregory J. Gosch (Previously filed as an Exhibit to
the Companys Current Report on Form 8-K filed October 22, 2004).10.17
    #
    
    Employment Agreement effective as of May 23, 2005, by and between Luminex
Corporation and Russell W. Bradley (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed May 25, 2005).10.18
    #
    
    Form of Restricted Stock Agreement for the 2000 Long-Term Incentive Plan
and 2001 Broad-Based Stock Option Plan (Previously filed as an Exhibit to
the Companys Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2004).10.19
    #
    
    Form of Non-Qualified Stock Option Agreement dated as of May 15, 2004, by
and between Luminex Corporation and Patrick J. Balthrop (Previously filed
as an Exhibit to the Companys Current Report on Form 8-K filed May 18,
2004).10.20
    #
    
    Form of Amendment to Executive Employment Agreements (Previously filed as
an Exhibit to the Companys Annual Report on Form 10-K for the fiscal year
ended December 31, 2005).10.21
    #
    
    Luminex Corporation 2006 Equity Incentive Plan (Previously filed as Exhibit
A to the Companys Proxy Statement for its Annual Meeting of Shareholders
held on May 25, 2006).10.22
    #
    
    Form of Non-Qualified Stock Option Agreement for the 2006 Equity Incentive
Plan (Previously filed as an Exhibit to the Companys Current Report on
Form 8-K filed May 25, 2006).10.23
    #
    
    Form of Restricted Share Award Agreement for Officers & Employees for the
2006 Equity Incentive Plan (Previously filed as an Exhibit to the Companys
Current Report on Form 8-K filed May 25, 2006).10.24
    #
    
    Form of Restricted Share Award Agreement for Directors for the 2006 Equity
Incentive Plan (Previously filed as an Exhibit to the Companys Current
Report on Form 8-K filed May 25, 2006).10.25
    #
    
    Luminex Corporation 2006 Management Stock Purchase Plan (Previously filed
as Exhibit B to the Companys Proxy Statement for its Annual Meeting of
Shareholders held on May 25, 2006).
  S-3




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT10.26
    
    
    Credit Agreement, dated March 1, 2007, by and between the Luminex
Corporation and JPMorgan Chase Bank, N.A. (Previously filed as an Exhibit
to the Companys Current Report on Form 8-K filed March 1, 2007).10.27
    
    
    First Amendment to Credit Agreement, effective as of February 28, 2008, by
and between Luminex Corporation and JPMorgan Chase Bank, N.A. (Previously
filed as an Exhibit to the Companys Current Report on Form 8-K filed May
29, 2008).10.28
    #
    
    Employment Agreement effective as of March 1, 2007, by and between Luminex
Corporation, Tm Bioscience and Jeremy Bridge-Cook (Previously filed as an
Exhibit to the Companys Annual Report on Form 10-K for the fiscal year
ended December 31, 2006).10.29
    #
    
    Form of Restricted Stock Unit Agreement for the 2006 Equity Incentive Plan
(Previously filed as an Exhibit to the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 2006).10.30
    #
    
    Amendment to Restricted Stock Agreement, dated as of March 25, 2007, by and
between Luminex Corporation and Patrick J. Balthrop, Sr. (Previously filed
as an Exhibit to the Companys Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2007).10.31
    #
    
    Amendment to Luminex Corporation 2000 Amended and Restated Long-Term
Incentive Plan dated as of May 24, 2007 (Previously filed as an Exhibit to
the Companys Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2007).10.32
    #
    
    Amendment to Luminex Corporation 2001 Broad-Based Stock Option Plan dated
as of May 24, 2007 (Previously filed as an Exhibit to the Companys
Quarterly Report on Form 10-Q for the quarterly period ended June 30,
2007).10.33
    #
    
    Amendment to Luminex Corporation 2006 Management Stock Purchase Plan dated
as of May 24, 2007 (Previously filed as an Exhibit to the Companys
Quarterly Report on Form 10-Q for the quarterly period ended June 30,
2007).10.34
    #
    
    Amendment to Luminex Corporation 2006 Equity Incentive Plan dated as of May
24, 2007 (Previously filed as an Exhibit to the Companys Quarterly Report
on Form 10-Q for the quarterly period ended June 30, 2007).10.35
    #
    
    Form of Amendments to Equity Award Agreements (Previously filed as an
Exhibit to the Companys Quarterly Report on Form 10-Q for the quarterly
period ended June 30, 2007).10.36
    #
    
    Employment Agreement, dated as of July 16, 2007, by and between Luminex
Corporation and Douglas C. Bryant (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed July 18, 2007).10.37
    #
    
    Employment Agreement, effective as of September 30, 2007, by and between
Luminex Corporation and James W. Jacobson (Previously filed as an Exhibit
to the Companys Current Report on Form 8-K filed September 19, 2007).10.38
    #
    
    2007 Executive Compensation Summary (Previously filed as an Exhibit to the
Companys Current Report on Form 8-K filed March 28, 2008).10.39
    #
    
    Luminex Corporation 2008 Long Term Incentive Plan (Previously filed as an
Exhibit to the Companys Current Report on Form 8-K filed December 9,
2008).10.40
    #
    
    Form of Restricted Share Unit Award Agreement for Awards under the Luminex
Corporation 2008 Long Term Incentive Plan (Previously filed as an Exhibit
to the Companys Current Report on Form 8-K filed December 9, 2008).21.1
    
    
    Subsidiaries of the Company.23.1
    
    
    Consent of Independent Registered Public Accounting Firm.
  S-4




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF DOCUMENT24.1
    
    
    Power of Attorney (incorporated in the signature page of this report).31.1
    
    
    Certification by CEO pursuant to Securities and Exchange Act Rules
13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification by CFO pursuant to Securities and Exchange Act Rules
13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification by CEO pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification by CFO pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 #
    
    Management contract or compensatory plan or arrangement.  S-5