##### 



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Quarterly Period Ended April 30, 2007
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Transition Period From  to
 
 COMMISSION FILE NUMBER 0-22354
 MARTEK BIOSCIENCES CORPORATION
  Delaware
    
    52-1399362(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification Number)
 6480 Dobbin Road, Columbia, Maryland 21045
 (410) 740-0081
 
 
 þ o
  o þ o
 o þ




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##### 



PART I
    
    FINANCIAL INFORMATIONItem 1.
    
    Financial Statements
    
    
    1Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    23Item 4.
    
    Controls and Procedures
    
    
    23PART II
    
    OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    24Item 1A.
    
    Risk Factors
    
    
    26Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    35Item 3.
    
    Defaults Upon Senior Securities
    
    
    35Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    35Item 5.
    
    Other Information
    
    
    36Item 6.
    
    Exhibits
    
    
    36Signatures
    
    
    37




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##### 



PART I  FINANCIAL INFORMATION
Item 1. Financial Statements.
 MARTEK BIOSCIENCES CORPORATION
  April 30,
    
    
    October 31,2007
    
    
    2006(unaudited)In thousands, except share and per
share dataAssetsCurrent assetsCash and cash equivalents
    
    $
    15,718
    
    
    $
    15,578Short-term investments and marketable securities
    
    
    4,400
    
    
    
    11,250Accounts receivable, net
    
    
    37,463
    
    
    
    32,746Inventories, net
    
    
    111,686
    
    
    
    100,320Other current assets
    
    
    7,240
    
    
    
    10,074Total current assets
    
    
    176,507
    
    
    
    169,968Property, plant and equipment, net
    
    
    283,762
    
    
    
    286,922Deferred tax asset
    
    
    37,912
    
    
    
    41,619Goodwill
    
    
    48,654
    
    
    
    48,603Other intangible assets, net
    
    
    36,566
    
    
    
    36,828Other assets, net
    
    
    6,756
    
    
    
    14,033Total assets
    
    $
    590,157
    
    
    $
    597,973Liabilities and stockholders equityCurrent liabilitiesAccounts payable
    
    $
    20,237
    
    
    $
    21,663Accrued liabilities
    
    
    12,719
    
    
    
    24,098Current portion of notes payable and other long-term obligations
    
    
    1,159
    
    
    
    1,231Current portion of deferred revenue
    
    
    2,104
    
    
    
    2,794Total current liabilities
    
    
    36,219
    
    
    
    49,786Long-term debt under revolving credit facility
    
    
    31,000
    
    
    
    36,000Notes payable and other long-term obligations
    
    
    9,738
    
    
    
    10,277Long-term portion of deferred revenue
    
    
    9,785
    
    
    
    9,335Total liabilities
    
    
    86,742
    
    
    
    105,398CommitmentsStockholders equityPreferred stock, $.01 par value, 4,700,000 shares authorized; none issued or outstanding
    
    
    
    
    
    
    Series B junior participating preferred stock, $.01 par value; 300,000 shares authorized; none issued or outstanding
    
    
    
    
    
    
    Common stock, $.10 par value; 100,000,000 shares authorized; 32,267,678 and 32,156,162 shares issued and
outstanding, respectively
    
    
    3,227
    
    
    
    3,216Additional paid-in capital
    
    
    526,867
    
    
    
    523,486Accumulated other comprehensive income
    
    
    
    
    
    
    171Accumulated deficit
    
    
    (26,679
    )
    
    
    (34,298
    )Total stockholders equity
    
    
    503,415
    
    
    
    492,575Total liabilities and stockholders equity
    
    $
    590,157
    
    
    $
    597,973
 See accompanying notes.
 1




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##### 



MARTEK BIOSCIENCES CORPORATION
  Three months ended April 30,
    
    
    Six months ended April 30,Unaudited - In thousands, except share and per share data
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Revenues:Product sales
    
    $
    72,336
    
    
    $
    65,210
    
    
    $
    139,048
    
    
    $
    125,707Contract manufacturing sales
    
    
    4,350
    
    
    
    5,008
    
    
    
    7,899
    
    
    
    7,403Total revenues
    
    
    76,686
    
    
    
    70,218
    
    
    
    146,947
    
    
    
    133,110Cost of revenues:Cost of product sales, including idle capacity costs
    
    
    45,817
    
    
    
    39,516
    
    
    
    88,786
    
    
    
    76,966Cost of contract manufacturing sales
    
    
    4,192
    
    
    
    4,777
    
    
    
    7,615
    
    
    
    6,816Total cost of revenues
    
    
    50,009
    
    
    
    44,293
    
    
    
    96,401
    
    
    
    83,782Gross margin
    
    
    26,677
    
    
    
    25,925
    
    
    
    50,546
    
    
    
    49,328Operating expenses:Research and development
    
    
    6,261
    
    
    
    6,258
    
    
    
    12,427
    
    
    
    11,738Selling, general and administrative
    
    
    11,633
    
    
    
    10,270
    
    
    
    23,587
    
    
    
    20,137Restructuring charge
    
    
    83
    
    
    
    
    
    
    
    601
    
    
    
    Other operating expenses
    
    
    623
    
    
    
    435
    
    
    
    1,096
    
    
    
    476Total operating expenses
    
    
    18,600
    
    
    
    16,963
    
    
    
    37,711
    
    
    
    32,351Income from operations
    
    
    8,077
    
    
    
    8,962
    
    
    
    12,835
    
    
    
    16,977Interest and other income, net
    
    
    270
    
    
    
    437
    
    
    
    553
    
    
    
    800Interest expense
    
    
    (703
    )
    
    
    (817
    )
    
    
    (1,427
    )
    
    
    (1,681
    )Income before income tax provision
    
    
    7,644
    
    
    
    8,582
    
    
    
    11,961
    
    
    
    16,096Income tax provision
    
    
    2,775
    
    
    
    3,131
    
    
    
    4,342
    
    
    
    5,875Net income
    
    $
    4,869
    
    
    $
    5,451
    
    
    $
    7,619
    
    
    $
    10,221Net income per shareBasic
    
    $
    0.15
    
    
    $
    0.17
    
    
    $
    0.24
    
    
    $
    0.32Diluted
    
    $
    0.15
    
    
    $
    0.17
    
    
    $
    0.23
    
    
    $
    0.31Weighted average common shares outstandingBasic
    
    
    32,238,572
    
    
    
    32,099,288
    
    
    
    32,209,187
    
    
    
    32,077,250Diluted
    
    
    32,441,657
    
    
    
    32,605,494
    
    
    
    32,429,595
    
    
    
    32,481,844
 See accompanying notes.
 2




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##### 



MARTEK BIOSCIENCES CORPORATION
  AccumulatedAdditional
    
    
    OtherCommon Stock
    
    
    Paid-in
    
    
    Comprehensive
    
    
    AccumulatedUnaudited - In thousands, except share data
    
    Shares
    
    
    Amount
    
    
    Capital
    
    
    Income
    
    
    Deficit
    
    
    TotalBalance at October 31, 2006
    
    
    32,156,162
    
    
    $
    3,216
    
    
    $
    523,486
    
    
    $
    171
    
    
    $
    (34,298
    )
    
    $
    492,575Exercise of stock options
    
    
    111,516
    
    
    
    11
    
    
    
    1,582
    
    
    
    
    
    
    
    
    
    
    
    1,593Equity-based compensation
    
    
    
    
    
    
    
    
    
    
    1,489
    
    
    
    
    
    
    
    
    
    
    
    1,489Tax benefit of exercise of non-qualified stock options
    
    
    
    
    
    
    
    
    
    
    310
    
    
    
    
    
    
    
    
    
    
    
    310Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,619
    
    
    
    7,619Other comprehensive income:Unrealized loss on exchange rate forward
contract, net of tax of $(102)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (171
    )
    
    
    
    
    
    
    (171
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,448Balance at April 30, 2007
    
    
    32,267,678
    
    
    $
    3,227
    
    
    $
    526,867
    
    
    $
    
    
    
    $
    (26,679
    )
    
    $
    503,415
 See accompanying notes.
 3




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##### 



MARTEK BIOSCIENCES CORPORATION
  Six months ended April 30,Unaudited  In thousands
    
    2007
    
    
    2006Operating activitiesNet income
    
    $
    7,619
    
    
    $
    10,221Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization
    
    
    12,788
    
    
    
    10,589Deferred tax provision
    
    
    4,342
    
    
    
    5,875Equity-based compensation expense
    
    
    1,312
    
    
    
    1,942Incremental tax benefit from exercise of non-qualified stock options
    
    
    (310
    )
    
    
    Loss from disposal and write-down of assets and other
    
    
    260
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    (4,717
    )
    
    
    (3,961
    )Inventories
    
    
    (4,189
    )
    
    
    (10,789
    )Other assets
    
    
    2,615
    
    
    
    (6,176
    )Accounts payable
    
    
    (1,426
    )
    
    
    3,598Accrued liabilities
    
    
    (10,158
    )
    
    
    (365
    )Deferred revenue and other liabilities
    
    
    (346
    )
    
    
    947Net cash provided by operating activities
    
    
    7,790
    
    
    
    11,881Investing activitiesSale of short-term investments and marketable securities, net
    
    
    6,850
    
    
    
    11,050Expenditures for property, plant and equipment
    
    
    (3,059
    )
    
    
    (4,631
    )Repurchase from sale-leaseback transaction
    
    
    (3,910
    )
    
    
    Capitalization of intangible assets
    
    
    (3,929
    )
    
    
    (3,035
    )Net cash (used in) provided by investing activities
    
    
    (4,048
    )
    
    
    3,384Financing activitiesRepayments of notes payable and other long-term obligations
    
    
    (505
    )
    
    
    (2,505
    )Repayments under revolving credit facility, net
    
    
    (5,000
    )
    
    
    (12,000
    )Proceeds from the exercise of stock options and warrants, net
    
    
    1,593
    
    
    
    2,513Incremental tax benefit from exercise of non-qualified stock options
    
    
    310
    
    
    
    Net cash used in financing activities
    
    
    (3,602
    )
    
    
    (11,992
    )Net increase in cash and cash equivalents
    
    
    140
    
    
    
    3,273Cash and cash equivalents, beginning of period
    
    
    15,578
    
    
    
    11,047Cash and cash equivalents, end of period
    
    $
    15,718
    
    
    $
    14,320Supplemental cash flow disclosures:Interest paid
    
    $
    1,544
    
    
    $
    2,066Income taxes paid
    
    $
    325
    
    
    $
    55
 See accompanying notes.
 4




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##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
 Basis of Presentation
 Consolidation
 Use of Estimates
 Segment Information
 Revenue Recognition
  Shipping Income and Costs
 Foreign Currency Transactions and Hedging Activities
  5




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##### 



Research and Development
 Advertising
 Other Operating Expenses
 Deferred Income Taxes
  Equity-Based Compensation
 Net Income Per Share
 Comprehensive Income
 Cash and Cash Equivalents
 Short-Term Investments and Marketable Securities
   6




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##### 



Fair Value of Financial Instruments
 Trade Receivables
 Inventories
 Property, Plant and Equipment
 Asset Description
    
    Useful Life (years)Building
    
    15  30Fermentation equipment
    
    10  20Oil processing equipment
    
    10  20Other machinery and equipment
    
    5  10Furniture and fixtures
    
    5  7Computer hardware and software
    
    3  7
  Patent Costs
 Goodwill and Other Intangible Assets
 Impairment of Long-Lived Assets
 Recently Issued Accounting Pronouncements
 7




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##### 



2. DSM SUPPLY AND LICENSE AGREEMENT
  3. SHORT-TERM INVESTMENTS AND MARKETABLE SECURITIES
  8




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##### 



4. INVENTORIES
  April 30,
    
    
    October 31,2007
    
    
    2006Finished goods
    
    $
    52,372
    
    
    $
    43,928Work in process
    
    
    61,696
    
    
    
    66,968Raw materials
    
    
    3,218
    
    
    
    3,024Total inventories
    
    
    117,286
    
    
    
    113,920Less: inventory reserve
    
    
    (600
    )
    
    
    (1,600
    )Total inventories, net
    
    
    116,686
    
    
    
    112,320Less: long-term portion
    
    
    (5,000
    )
    
    
    (12,000
    )Inventories, net
    
    $
    111,686
    
    
    $
    100,320
   5. PROPERTY, PLANT AND EQUIPMENT
  April 30,
    
    
    October 31,2007
    
    
    2006Land
    
    $
    2,320
    
    
    $
    2,320Building and improvements
    
    
    62,740
    
    
    
    61,855Machinery and equipment
    
    
    253,411
    
    
    
    248,107Furniture and fixtures
    
    
    2,926
    
    
    
    2,716Computer hardware and software
    
    
    11,882
    
    
    
    11,413333,279
    
    
    
    326,411Less: accumulated depreciation and amortization
    
    
    (60,422
    )
    
    
    (50,473
    )272,857
    
    
    
    275,938Construction in progress
    
    
    10,905
    
    
    
    10,984Property, plant and equipment, net
    
    $
    283,762
    
    
    $
    286,922
  9




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##### 



6. GOODWILL AND OTHER INTANGIBLE ASSETS
  April 30, 2007
    
    
    October 31, 2006Accumulated
    
    
    
    
    
    
    
    
    
    
    AccumulatedIntangible Asset
    
    Gross
    
    
    Amortization
    
    
    Net
    
    
    Gross
    
    
    Amortization
    
    
    NetTrademarks
    
    $
    2,089
    
    
    $
    (620
    )
    
    $
    1,469
    
    
    $
    2,053
    
    
    $
    (545
    )
    
    $
    1,508Patents
    
    
    21,466
    
    
    
    (3,504
    )
    
    
    17,962
    
    
    
    19,233
    
    
    
    (1,835
    )
    
    
    17,398Core technology
    
    
    1,708
    
    
    
    (512
    )
    
    
    1,196
    
    
    
    1,708
    
    
    
    (455
    )
    
    
    1,253Current products
    
    
    10,676
    
    
    
    (3,584
    )
    
    
    7,092
    
    
    
    10,676
    
    
    
    (3,228
    )
    
    
    7,448Licenses
    
    
    11,091
    
    
    
    (2,244
    )
    
    
    8,847
    
    
    
    11,091
    
    
    
    (1,870
    )
    
    
    9,221Goodwill
    
    
    48,654
    
    
    
    
    
    
    
    48,654
    
    
    
    48,603
    
    
    
    
    
    
    
    48,603$
    95,684
    
    
    $
    (10,464
    )
    
    $
    85,220
    
    
    $
    93,364
    
    
    $
    (7,933
    )
    
    $
    85,431
 7. NOTES PAYABLE AND LONG-TERM DEBT
    8. RESTRUCTURING CHARGE
    10




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##### 



EmployeeSeparationCosts
    
    
    Other
    
    
    TotalLiability for restructuring costs at October 31, 2006
    
    $
    1,972
    
    
    $
    74
    
    
    $
    2,046Costs incurred
    
    
    
    
    
    
    601
    
    
    
    601Cash payments
    
    
    (1,946
    )
    
    
    (594
    )
    
    
    (2,540
    )Adjustments
    
    
    (26
    )
    
    
    
    
    
    
    (26
    )Liability for restructuring costs at April 30, 2007
    
    $
    
    
    
    $
    81
    
    
    $
    81
 9. COMMITMENTS AND CONTINGENCIES
 Purchase Commitments
 Scientific Research Collaborations
 OmegaTech Contingent Purchase Price
  Patent Infringement Litigation
 Class Action Lawsuit
 11




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##### 



Other
 10. STOCKHOLDERS EQUITY
    11. NET INCOME PER SHARE
   Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income
    
    $
    4,869
    
    
    $
    5,451
    
    
    $
    7,619
    
    
    $
    10,221Weighted average shares outstanding, basic
    
    
    32,239
    
    
    
    32,099
    
    
    
    32,209
    
    
    
    32,077Effect of dilutive potential common shares:Stock options
    
    
    187
    
    
    
    506
    
    
    
    209
    
    
    
    404Restricted stock units
    
    
    16
    
    
    
    
    
    
    
    12
    
    
    
    Warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Total dilutive potential common shares
    
    
    203
    
    
    
    506
    
    
    
    221
    
    
    
    405Weighted average shares outstanding, diluted
    
    
    32,442
    
    
    
    32,605
    
    
    
    32,430
    
    
    
    32,482Net income per share, basic
    
    $
    0.15
    
    
    $
    0.17
    
    
    $
    0.24
    
    
    $
    0.32Net income per share, diluted
    
    $
    0.15
    
    
    $
    0.17
    
    
    $
    0.23
    
    
    $
    0.31
  12




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##### 



12. COMPREHENSIVE INCOME
  Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income, as reported
    
    $
    4,869
    
    
    $
    5,451
    
    
    $
    7,619
    
    
    $
    10,221Other comprehensive income (loss):Unrealized (loss) gain on exchange rate forward contract,
net of income tax (benefit)
provision of $(23), $254,
$(102) and $413,
respectively
    
    
    (40
    )
    
    
    575
    
    
    
    (171
    )
    
    
    839Comprehensive income
    
    $
    4,829
    
    
    $
    6,026
    
    
    $
    7,448
    
    
    $
    11,060
 13




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##### 



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
 This Managements Discussion and Analysis of Financial Condition and Results of Operations contains
forward-looking statements concerning our business and operations, including, among other things,
statements concerning the following:
 
    
    expectations regarding future revenue growth, gross margin, operating cash flow and overall profitability;
    
    expectations regarding product introductions and growth in nutritional product sales;
    
    expectations regarding potential collaborations and acquisitions;
    
    expectations regarding demand for products with our nutritional oils;
    
    expectations regarding sales to and by our infant formula licensees and supplemented infant formula market penetration levels;
    
    expectations regarding marketing of our oils by our infant formula licensees;
    
    expectations regarding future agreements with and revenues from companies in the food
and beverage, perinatal and nutritional supplement markets;
    
    expectations regarding growing consumer recognition of the key health benefits of DHA and ARA;
    
    expectations regarding competitive products;
    
    expectations regarding future efficiencies and improvements in manufacturing
processes and the cost of production of our nutritional oils;
    
    expectations regarding future purchase volumes and costs of third-party manufactured oils;
    
    expectations regarding the amount of production capacity and our ability to meet future demands for our nutritional oils;
    
    expectations regarding the amount of inventory held by us or our customers;
    
    expectations regarding production capacity utilization and the effects of excess production capacity and the plant restructuring;
    
    expectations regarding future selling, general and administrative and research and development costs;
    
    expectations regarding future capital expenditures;
    
    expectations regarding levels of consumption through governmental programs of infant
formula products containing our nutritional oils;
    
    expectations regarding possibly significant expenses to defend a putative securities
class action lawsuit alleging false and material misstatements and omissions of material
facts concerning our business and prospects; and
    
    expectations regarding our ability to protect our intellectual property.
 Forward-looking statements include those statements containing words such as the following:
 
    
    will,
    
    should,
    
    could,
    
    anticipate,
    
    believe,
    
    plan,
    
    estimate,
    
    expect,
    
    intend, and other similar expressions.
 All of these forward-looking statements involve risks and uncertainties. They and other
forward-looking statements in this Form 10-Q are all made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. We wish to caution you that our actual
results may differ significantly from the results we discuss in our forward-looking statements. We
discuss some of the risks that could cause such differences in Part II, Item 1A. Risk Factors in
this report on Form 10-Q and in our various other filings with the Securities and Exchange
Commission. Our forward-looking statements speak only as of the date of this document, and we do
not intend to update these statements to reflect events or circumstances that occur after that
date.
 GENERAL
 lifesDHA ® lifesDHA ® ® lifesARA
 14




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##### 




    
    the timing of international infant formula market introductions by our customers;
    
    the timing of our customers ordering patterns;
    
    the timing and extent of stocking and destocking of inventory by our customers;
    
    the timing and extent of our customers production campaigns and plant maintenance shutdowns;
    
    the timing and extent of introductions of DHA into various child and/or adult applications;
    
    the continued acceptance of products containing our oils under WIC programs in the U.S.;
    
    the continued acceptance of these products by consumers and continued demand by our customers;
    
    the ability by us and our third-party manufacturers to produce adequate levels of our nutritional oils on a consistent basis;
    
    the ability of our customers to incorporate our oils into various foods and beverages;
    
    our ability to protect against competitive products through our patents;
    
    competition from alternative sources of DHA and ARA; and
    
    agreements with other future third-party collaborators to market our products or develop new products.
  RECENT HIGHLIGHTS
 lifesDHA lifes DHA
 Food and Beverage Products
 
    
    WhiteWave Foods Silk® Plus Omega-3 DHA Soymilk with lifesDHA
    
    Odwallas Soy Smart beverage with Marteks lifesDHA (new flavors launched)
    
    ZenSoys Soy on the Go Soymilk with lifesDHA
    
    FoodTech Internationals Veggie Patch All Natural California Veggie Burgers with lifesDHA
    
    NuGo Nutritions NuGo Organic snack bars featuring lifesDHA (new flavors launched)
 15




---



##### 




    
    Fuji Food Products Fujisan sushi products containing lifesDHA
    
    Parmalat Australias Vaalia My First Yoghurt with lifesDHA
    
    Danone S.A.s Danonino Petit Genio childrens drinkable yogurt with lifesDHA
 Pregnancy and Nursing Products
 
    
    Everett Laboratories Vitafol® -OB+DHA with lifesDHA
    
    Mission Pharmacals Citracal® Prenatal 90 + DHA with lifesDHA
  Food and Beverage Products
 
    
    In March 2007, Martek entered into a new multi-year agreement with Dean Foods Company
(Dean) under which Dean and all of its subsidiaries, including WhiteWave Foods Company
(WhiteWave), have agreed to purchase, subject to certain limited exceptions, all of
their DHA omega-3 needs from Martek for their products in the United States and other
designated territories. Under the new agreement, WhiteWave expects to launch Horizon
Organic® milk and Rachels® natural yogurt containing lifesDHAin the third quarter of
this year.
    
    In April 2007, Martek entered a multi-year agreement with Breyers Yogurt Company
(Breyers), a wholly-owned subsidiary of Healthy Food Holdings, under which Breyers has
agreed to purchase, subject to certain limited exceptions, all of its DHA omega-3 needs
from Martek for products in the United States and other designated territories.
 Infant Formula
 
    
    In March 2007, Arla Foods, Europes second largest dairy company, signed a license
and supply agreement for use of Marteks DHA and ARA oils in infant formula products in
certain markets.
    
    In March 2007, Martek entered into an agreement with Murray Goulburn Co-Operative Co.
Limited, Australias largest processor of milk and exporter of processed food, under
which Martek will be the exclusive ARA supplier for all Murray Goulburn infant formula
products sold in China.
   
    
    An independent study published in The Journal of Nutrition(April 2007) assessed the
effects of low-dose DHA on blood pressure in healthy men and women from the United
Kingdom. Compared with placebo, supplementation with Marteks lifesDHA(0.7 g/day for
3 months) significantly reduced diastolic blood pressure by 3.3 mm Hg.
    
    A study published in The Journal of Neuroscience(April 2007) used a transgenic mouse
model of Alzheimers disease to show that supplementation with DHA reduced the
accumulation of both amyloid-beta and tau, two indicators of the disease in humans.
This study used Marteks DHA oils and funding for the study was provided by Martek.
    
    The results of a study, which were presented in March 2007 at the American College of
Cardiology 56th Annual Scientific Session, showed that supplementation with 2g of Martek
DHA daily for six weeks reduced triglycerides by nearly 20%, reduced pulse rate by 5 beats per
minute and reduced diastolic blood pressure by 4 mm Hg. The study was conducted in men
and women with hypertriglyceridemia who were already taking statin medications for the
reduction of cholesterol. This study used Martek oils and funding for this study was
provided by Martek.
 MANAGEMENT OUTLOOK
  16




---



##### 



PRODUCTION
       17




---



##### 



CRITICAL ACCOUNTING POLICIES AND
THE USE OF ESTIMATES
  RESULTS OF OPERATIONS
 Revenues
  Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Product sales
    
    $
    72,336
    
    
    $
    65,210
    
    
    $
    139,048
    
    
    $
    125,707Contract manufacturing sales
    
    
    4,350
    
    
    
    5,008
    
    
    
    7,899
    
    
    
    7,403Total revenues
    
    $
    76,686
    
    
    $
    70,218
    
    
    $
    146,947
    
    
    $
    133,110
  Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Infant formula market
    
    $
    65,929
    
    
    $
    61,850
    
    
    $
    126,781
    
    
    $
    118,761Food and beverage market
    
    
    1,147
    
    
    
    235
    
    
    
    1,868
    
    
    
    536Pregnancy and nursing,
nutritional
supplements and animal feeds
    
    
    4,176
    
    
    
    2,159
    
    
    
    8,149
    
    
    
    4,581Other non-nutritionals
    
    
    1,084
    
    
    
    966
    
    
    
    2,250
    
    
    
    1,829Total product sales
    
    $
    72,336
    
    
    $
    65,210
    
    
    $
    139,048
    
    
    $
    125,707
 lifesDHA .
   18




---



##### 



Cost of Revenues
  Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Cost of product sales, including idle capacity costs
    
    $
    45,817
    
    
    $
    39,516
    
    
    $
    88,786
    
    
    $
    76,966Cost of contract manufacturing sales
    
    
    4,192
    
    
    
    4,777
    
    
    
    7,615
    
    
    
    6,816Total cost of revenues
    
    $
    50,009
    
    
    $
    44,293
    
    
    $
    96,401
    
    
    $
    83,782
    Operating Expenses
  Three months ended April 30,
    
    
    Six months ended April 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Research and development
    
    $
    6,261
    
    
    $
    6,258
    
    
    $
    12,427
    
    
    $
    11,738Selling, general and administrative
    
    
    11,633
    
    
    
    10,270
    
    
    
    23,587
    
    
    
    20,137Restructuring charge
    
    
    83
    
    
    
    
    
    
    
    601
    
    
    
    Other operating expenses
    
    
    623
    
    
    
    435
    
    
    
    1,096
    
    
    
    476Total operating expenses
    
    $
    18,600
    
    
    $
    16,963
    
    
    $
    37,711
    
    
    $
    32,351
 Research and Development lifesDHA lifesDHA
 Selling, General and Administrative
 Restructuring Charge
 19




---



##### 



Other Operating Expenses
 Interest and Other Income, Net
  Interest Expense
  Income Tax Provision
   Net Income
  RECENTLY ISSUED
ACCOUNTING PRONOUNCEMENTS
   LIQUIDITY AND CAPITAL RESOURCES
  
    
    cash generated from operations;
    
    proceeds from the sale of equity securities;
    
    cash received from the exercise of stock options and warrants; and
    
    debt financing.
 20




---



##### 



Less than
    
    
    1-3
    
    
    3-5
    
    
    More thanIn thousands
    
    Total
    
    
    1 year
    
    
    years
    
    
    years
    
    
    5 yearsNotes payable (1)
    
    $
    10,780
    
    
    $
    1,151
    
    
    $
    8,591
    
    
    $
    316
    
    
    $
    722Borrowings under revolving credit facility
    
    
    31,000
    
    
    
    
    
    
    
    
    
    
    
    31,000
    
    
    
    Operating lease obligations
    
    
    3,981
    
    
    
    1,062
    
    
    
    1,862
    
    
    
    735
    
    
    
    322Unconditional purchase obligations (2)
    
    
    32,783
    
    
    
    3,222
    
    
    
    29,561
    
    
    
    
    
    
    
    Total contractual cash obligations
    
    $
    78,544
    
    
    $
    5,435
    
    
    $
    40,014
    
    
    $
    32,051
    
    
    $
    1,044
 
 (1)
    
    Minimum payments above include interest and principal due under these notes.(2)
    
    Primarily includes future inventory purchases from DSM pursuant to the guarantee
described below in Off-Balance Sheet Arrangements.     
    
    our ability to operate profitably and generate positive cash flow;
    
    growth in our infant formula, food and beverage and other nutritional product sales;
    
    the extent and progress of our research and development programs;
    
    the progress of pre-clinical and clinical studies;
    
    the time and costs of obtaining and maintaining regulatory clearances for our products that are subject to such clearances;
    
    the costs involved in filing, protecting and enforcing patent claims;
    
    competing technological and market developments;
 21




---



##### 




    
    the development or acquisition of new products;
    
    the cost of acquiring additional and/or operating and expanding existing manufacturing
facilities for our various products and potential products (depending on which products we
decide to manufacture and continue to manufacture ourselves);
    
    the costs associated with our internal build-up of inventory levels;
    
    the costs associated with our defense against a putative securities class action and other lawsuits;
    
    the costs of any merger and acquisition activity; and
    
    the costs of marketing and commercializing our products.
  OFF-BALANCE SHEET ARRANGEMENTS
    22




---



##### 



Item 3. Quantitative and Qualitative Disclosures about Market Risk.
    Item 4. Controls and Procedures.
 a)
    
    Evaluation of Disclosure Controls and Procedures.The Chief Executive Officer and Chief
Financial Officer of Martek Biosciences Corporation have evaluated the effectiveness of our
disclosure controls and procedures pursuant to Exchange Act rules 13a-15(e) and 15d-15(e)
and have concluded that, as of the end of the period covered by this report, the disclosure
controls and procedures were effective.b)
    
    Internal Control Over Financial Reporting.There was no change in our internal control
over financial reporting in connection with the evaluation required by paragraph (d) of
Rules 13a-15 or 15d-15 under the Exchange Act that occurred during Marteks quarter ended
April 30, 2007 that materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.
 23




---



##### 



PART II  OTHER INFORMATION
 Item 1. Legal Proceedings.
     Thraustochytrium Schizochytrium
     24




---



##### 



25




---



##### 



Item 1A. Risk Factors.
  A substantial portion of our nutritional oil products sales is made to four of our existing
customers under agreements with no minimum purchase requirements. If demand by these customers
for our nutritional oil products decreases, our revenues may materially decline.
  We are aware of several products that are currently available, and products under development,
that may present a serious competitive threat to our products. If we are unable to maintain a
competitive differentiation from these products, our revenues may be adversely affected.
   
    
    The Ross Products Division of Abbott Laboratories, a significant Martek licensee and
customer, filed a generally recognized as safe notification on January 2, 2002 seeking Food
and Drug Administration (FDA) concurrence that its tuna oil source of DHA and its fungal
source of ARA, as manufactured by Suntory Limited, are generally recognized as safe when
used as ingredients in infant formula. In April 2006, the FDA notified Ross Products that
it had no questions at that time regarding Ross conclusion that DHA-rich oil from tuna and
ARA-rich oil from Mortierella Alpinaare safe as sources of DHA and ARA in term and
post-discharge preterm infant formulas. While Ross Products has not announced any
introduction of its oils into infant formula in the U.S. nor are we aware of any plans by
them or any of our other licensees to do so, the GRAS notification removes a significant
regulatory hurdle to the introduction of competitive products in the U.S. If Ross Products
introduces such competitive products, we cannot be certain that the economic protection
that we believe we have via existing patents, royalty requirements of license agreements
and market factors will protect us from the financial impact of such product introductions.
    
    Reliant Pharmaceuticals is currently selling Omacor, a DHA/ EPA ethyl ester for
treatment of hyperlipidemia. Omacor is a lipid-regulating agent which includes both EPA
and DHA from fish oil. Reliant Pharmaceuticals has recently filed an application with the
FDA for an indication that will expand the use of Omacor. Other pharmaceutical
applications using omega-3 fatty acids may be expected.
    
    Suntory Limited, Cargill Inc., through a joint venture with a company in China, and
other independent Chinese manufacturers are producing and distributing a fungal source of
ARA. In addition, we are aware that there may be manufacturers in China and India
attempting to produce an algal source of DHA, but we are uncertain of the overall status
and commercial potential of these development efforts.
    
    Some infant formulas now on the market outside the United States, including those
marketed by certain of Marteks licensees, use DHA derived from other sources, such as fish
oil or eggs.
    
    In December 2005, Lonza Group LTD, a Swiss chemical and biotechnology group, acquired
from Nutrinova Specialties & Food Ingredients GmbH, a wholly-owned subsidiary of Celanese
Corporation, Nutrinovas business having as its product a DHA-rich microalgal oil. Since
the acquisition, Lonza has actively marketed its DHA oil to the food and beverage and
dietary supplement markets in the United States, Europe and China. Both Nutrinova and
Lonza are defendants in patent infringement actions involving our DHA patents that we
have brought in both the United States and Germany. In October 2006, the infringement action in
the United States was tried, and a verdict favorable to Martek was returned. The jury
found that Lonza infringed all the asserted claims of three Martek patents and that these
patents were valid. It also found that Lonza willfully infringed one of these patents. The
judge is in the process of determining if any of the
jurys decisions were inappropriate as a matter of law, whether Martek is entitled to a
permanent injunction against Lonza, and, if so, whether the permanent injunction should be
stayed pending the outcome of any appeal. These lawsuits are further described in Item 1 of
Part II of this Form 10-Q, Legal Proceedings.
 26




---



##### 




    
    Other companies, several with greater financial resources than ours, are developing
plant-based DHA and other companies may be developing chemically synthesized DHA.
    
    Several large companies, including BASF AG, DSM and Ocean Nutrition, and a number of
smaller companies, manufacture microencapsulated fish oil products. Although
microencapsulation of the oil resolves many of the odor, stability and taste issues found
with fish oil, a microencapsulated product currently is more costly than regular fish oil.
Fish oil-based products (i) are used as a DHA source by some infant formula companies, (ii)
currently dominate the adult DHA supplement market and (iii) are included in certain foods
on the market in various parts of the world. Because fish oil is generally less costly than
our DHA oil, even when microencapsulated, and continues to improve in quality and gain
general market acceptance, fish oil presents a substantial competitive threat.
 If we are unable to obtain or maintain patent protection or if our patents do not provide
protection against competitive products, our results of operations may be adversely affected.
     
    
    Aventis S.A. and Nagase & Co. Ltd. are challenging our European patent covering our
DHA-containing oils. At a hearing in October 2000, the Opposition Division of the European
Patent Office (EPO) revoked our patent on the grounds that it was not novel. We
immediately appealed this ruling, and in July 2002 we received a positive ruling from an
Appeal Board of the EPO, setting aside the prior decision to revoke this patent. The patent
was returned to the Opposition Division for a determination as to whether it has met the
legal requirement of inventive step. A hearing in August 2005 resulted in a ruling by the
Opposition Division that this requirement had been met and the validity of the patent was
upheld. Aventis appealed the decision to the Appeal Board of the EPO. Martek filed its
answer to Aventis grounds for appeal in July 2006. The appeal process is not expected to
be completed before the second half of 2007. Claim 1 of this patent is the basis of the
patent infringement suit against Nutrinova and Lonza in Germany, discussed below.
    
    With respect to our ARA patent issued by the EPO, BASF AG, Friesland Brands B.V., and
Suntory Limited filed their grounds for opposing this patent with the Opposition Division
of the EPO. At a hearing at the Opposition Division in April 2005, the Opposition Division
of the EPO upheld the patent in a form containing modified claims that are narrower than
the claims originally granted. In an effort to broaden the claims of the patent, we
appealed the decision. Suntory and BASF also appealed. Friesland Brands B.V. has
withdrawn from the opposition. In April 2007, the EPO granted another patent to Martek for ARA oil made from Marteks
microbial source for use in infant formula. The newly granted divisional patent
strengthens Marteks intellectual property position by providing commercially significant
protection through the expiration date of the original patent, January 22, 2012. In light of this newly granted divisional patent, the
Company withdrew from the appeal it had previously filed related to its original European ARA
patent for infant formula that was upheld with narrowed claims by the
EPO in April 2005. The original patent will no longer be in
force and effect.
 27




---



##### 




    
    With respect to our blended oil (blend of DHA and ARA oils for use in various
applications, including infant formula) patent issued by the EPO, BASF AG and Suntory
Limited filed their grounds for opposing this patent with the Opposition Division of the
EPO. In November 2004, the Opposition Division of the EPO revoked Marteks European blended
oil patent as a result of these challenges. We immediately
filed an appeal and during the hearing before the Appeal Board of the EPO in February 2007,
Martek decided to withdraw its appeal. As a result, the patent was revoked. Martek is
pursuing protection for its blended oil technology in Europe through related pending patent
applications.
    
    Prior to our purchase of OmegaTech, Aventis Research and Technologies GmbH & Co. KG, and
Nagase Limited challenged OmegaTechs European patent covering its DHA-containing oils. At
a hearing in December 2000, the Opposition Division of the EPO upheld some of the claims
and revoked other claims. OmegaTech immediately appealed this ruling, as did Aventis. At an
appeal hearing in May 2005, we received a favorable decision from the Appeal Board of the
EPO, which overturned the decision of the Opposition Division and returned the case to the
Opposition Division for review on the merits of the patent claims. The Opposition Division
hearing has been scheduled for November 2007. Any decision made by the Opposition Division
can be appealed. Assuming an appeal, the review process is not expected to be completed
before 2009, during which time the patent will remain in full force and effect.
    
    An EPO Opposition Division hearing was held on November 15, 2005, with respect to a
European DHA patent acquired by Martek as part of the OmegaTech purchase. The patent was
upheld in modified form. This patent is directed to processes for fermenting
Thraustochytriumand Schizochytriumunder low chloride conditions and the resulting
products. Nutrinova Nutrition Specialities & Food Ingredients GmbH is the only opponent,
and has appealed. The appeal process is not expected to be completed before late 2007.
    
    In September 2003, we filed a patent infringement lawsuit in the U.S. District Court in
Delaware against Nutrinova Inc., Nutrinova Nutrition Specialties & Food Ingredients GmbH,
Celanese Ventures GmbH, and Celanese AG. Celanese Ventures GmbH and Celanese AG were
dropped from the lawsuit. In October 2006, after an almost two week trial in Wilmington,
Delaware, the jury returned a favorable verdict to Martek, deciding that all three of the
asserted Martek DHA patents were valid and infringed, and that one was willfully infringed.
The judge is in the process of determining if any of the jurys decisions were
inappropriate as a matter of law, whether Martek is entitled to a permanent injunction
against Lonza, and, if so, whether the permanent injunction should be stayed pending the
outcome of any appeal.
    
    We also filed a patent infringement suit involving Nutrinova Nutrition Specialties &
Food Ingredients GmbH and Celanese Ventures GmbH in Germany in January 2004. The complaint
alleges infringement of our European patent relating to DHA-containing oils. A hearing in
this case was held in a district court in Dusseldorf in April 2005 and the court delayed
its decision pending input from a court-appointed technical expert. The experts opinion
was released in February 2007. The court has scheduled a hearing for June 2007. Lonza has
also been added to this lawsuit.
    
    With respect to our ARA patent in South Korea, Suntory has filed an opposition. A
hearing on the matter was held in late January 2006 and the Korean Intellectual Property
Office Examiners have ruled against Martek. Martek has appealed. The appeal brief was
filed in February 2007. The patent will remain in full force and effect during the
pendency of the appeal.
    
    Suntory has also initiated an invalidation case against our blended oil patent in South
Korea. Our response to Suntory was filed in February 2005, Suntory responded in March 2006
and Martek filed further submissions in May 2006. A hearing was held in July 2006. A
ruling against Martek was issued in February 2007. Martek has
appealed. The patent
will remain in full force and effect during the pendency of the appeal process.
    
    There are additional intellectual property oppositions pending against Martek that are
not considered material.
   28




---



##### 



If our food and beverage customers do not introduce products containing our nutritional oils on
a broad scale into the marketplace, our sales to the food and beverage market will be limited.
  If clinical trials do not continue to yield positive results on the benefits of DHA on cognitive
function, cardiovascular health or other health applications, our future revenues may be limited
in the food and beverage and the dietary supplement markets.
  If our oils are unable to be used in organic food and beverage products, the opportunity for
sales of our oils into the food and beverage market will be limited to non-organic products.
   Because food and beverage pricing is very competitive, the premium that our oils adds to the
cost of the food or beverage may never allow it to be priced at levels that will allow
acceptance by consumers.
  If we are unable to gain broad approvals for the incorporation of our oils into foods and
beverages worldwide, our future revenues in the food and beverage market may be limited.
  29




---



##### 



If it is determined that large amounts of eicosapentaenoic acid (EPA) must accompany DHA in
order to achieve optimal health benefits, we may never be able to gain large- scale entry into
the food and beverage market.
  Our oils are very sensitive to oxidation and may not be very compatible with many liquid or dry
foods that are currently on the market. If economical methods are not developed to successfully
incorporate our oils into various food and beverage applications, we may never be able to gain
large-scale entry into the food and beverage market.
  We have a single third-party supplier of our ARA with whom we have a contractual relationship.
If this supplier of our ARA is unable to supply us with our required amounts of ARA or if an
over-capacity situation by our supplier leads to higher cost ARA, our results of operations
and/or financial position may be adversely affected.
  If customer demand for our nutritional oils requires us or our major suppliers to increase
production beyond current levels, we may experience certain risks associated with the ramp-up of
commercial manufacturing that could have a material adverse effect on our business, financial
condition, and/ or results of operations.
   
    
    we may experience problems processing, handling and shipping the higher quantities of oil produced from our expanded facilities;
    
    the costs of expanding, operating and maintaining our production facilities may exceed our expectations;
    
    product defects may result;
    
    lower than anticipated fermentation success rates may result;
    
    lower downstream processing yields may result;
    
    environmental and safety problems may result from our production process; and
    
    regulatory issues relating to the scale-up and operation regarding our production processes may arise.
 30




---



##### 



We have significantly increased our manufacturing capacity and have incurred substantial costs
in doing so. If we are unable to increase our revenues from our nutritional oils produced at
these facilities, we may continue to experience excess production capacity and we may be unable
to recover these plant expansion costs, which could result in a write-down of certain production
assets.
  Failure to effectively manage our growth could disrupt our operations and prevent us from
generating the revenues and gross profit margins we expect.
  Experts differ in their opinions on the importance of DHA and/or ARA in infant formula and the
levels of DHA and/or ARA required to achieve health benefits for babies. Some experts feel that
they are not necessary ingredients for infant development. If clinical trials do not continue
to yield positive results, certain favorable regulatory guidelines are not enacted or current
favorable regulatory guidelines are amended, our future revenues in the infant formula market
may be limited.
    Our opportunity in the U.S. infant formula market may be limited by the renewal rate of
supplemented formulas into the Women, Infants and Children program or if the eligibility
requirements for participating in the program are made more restrictive.
 31




---



##### 



Our business would be harmed if we fail to comply with applicable good manufacturing practices
as required by the FDA.
  Our manufacturing process involves the handling of hazardous materials and emission of regulated
waste. If we fail to properly handle these hazardous materials and/ or waste emissions,
substantial costs and harm to our business could result.
  Our corporate compliance program cannot guarantee that we are in compliance with all potentially
applicable federal and state regulations.
  Our business exposes us to potential product liability claims and recalls, which could adversely
impact our financial condition or performance.
  We may need additional capital in the future to continue our research and development efforts,
to conduct product testing, including preclinical and clinical trials, and to market our
products. We may also need additional capital to expand our production capacity if market
demand for our products continues to grow.
  32




---



##### 



The market price of our common stock may experience a high level of volatility due to factors
such as the volatility in the market for biotechnology stocks generally, and the short-term
effect of a number of possible events.
  
    
    announcements of technical innovations, new commercial products and product launches by us or our competitors;
    
    announcements of use of competitors DHA and/or ARA products by our customers;
    
    arrangements or strategic partnerships by us or our competitors;
    
    announcements of license agreements, acquisitions or strategic alliances;
    
    announcements of sales by us or our competitors
    
    announcements of results of clinical trials by us or our competitors;
    
    patent or other intellectual property achievements or adverse developments;
    
    quarterly fluctuations in our revenues and results of operations;
    
    failure to enter into favorable third-party manufacturing agreements;
    
    regulatory decisions (approvals or disapprovals) or changes concerning our products and our competitors products;
    
    events related to threatened, new or existing litigation, or the results thereof;
    
    changes in our estimates of financial performance or changes in recommendations by securities analysts; and
    
    general market conditions for growth companies and bioscience companies.
   If significant shares eligible for future sales are sold, the result may depress our stock price
by increasing the supply of our shares in the market at a time when demand may be limited.
 33




---



##### 



Changes in foreign currency exchange rates or interest rates could result in losses.
  We are a defendant in a putative class action lawsuit which, if determined adversely, could
have a material adverse affect on us.
   34




---



##### 



Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  Item 3. Defaults Upon Senior Securities.
  Item 4. Submission of Matters to a Vote of Security Holders.
    Votes For
    
    Votes Against
    
    AbstainDouglas J. MacMaster, Jr.
    
    
    28,553,007
    
    
    
    88.7
    %
    
    
    678,685
    
    
    
    2.1
    %
    
    
    86,109
    
    
    
    0.3
    %Eugene H. Rotberg
    
    
    27,354,633
    
    
    
    85.0
    %
    
    
    1,879,601
    
    
    
    5.8
    %
    
    
    83,567
    
    
    
    0.3
    %
   Term ExpiresHarry J. DAndrea
    
    
    2008Polly B. Kawalek
    
    
    2008Jerome C. Keller
    
    
    2008Henry Linsert, Jr.
    
    
    2008James R. Beery
    
    
    2009Steve Dubin
    
    
    2009Robert J. Flanagan
    
    
    2009
 Proposal 2:
    
    Approval of the Amendment to the Companys Certificate of Incorporation to declassify
the Board so that beginning in 2008, directors will be elected for one-year terms:
  Votes For
    
    Votes Against
    
    Abstain
    
    Non-vote29,080,607
    
    
    90.3
    %
    
    
    161,187
    
    
    
    0.5
    %
    
    
    76,007
    
    
    
    0.2
    %
    
    
    
    
 35




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##### 



Proposal 3:
    
    Ratification of the appointment of Ernst & Young LLP as the Companys independent
registered public accounting firm for the fiscal year 2007:
  Votes For
    
    Votes Against
    
    Abstain29,145,248
    
    
    90.5
    %
    
    
    109,058
    
    
    
    0.3
    %
    
    
    63,495
    
    
    
    0.2
    %
 Item 5. Other Information.
  Item 6. Exhibits.
 31.01
    
    Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a).*31.02
    
    Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a).*32.01
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*32.02
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
 
 *
    
    Filed or furnished herewith. 36




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##### 



SIGNATURES
  MARTEK BIOSCIENCES CORPORATION
                    (Registrant)Date:  June 11, 2007
    /s/ Peter L. BuzyPeter L. BuzyChief Financial Officer, Treasurer and Executive Vice President
for Finance and Administration
(Principal Financial and Accounting Officer) 37