##### Table of Contents



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 June 30, 2005
 OR
 o
    
    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission File Number: 000-50798
 Color Kinetics Incorporated
  Delaware
    
    04-3391805(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 
 
 
 þ o
 o þ




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COLOR
KINETICS INCORPORATED
 FORM 10-Q
FOR THE THREE MONTHS ENDED JUNE 30, 2005
INDEX
 Page No.PART I. FINANCIAL INFORMATIONItem 1.
    
    Unaudited Condensed Consolidated Financial StatementsCondensed Consolidated Balance Sheets as of June 30, 2005 and December 31, 2004
    
    
    3Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2005
and 2004
    
    
    4Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2005 and 2004
    
    
    5Notes to Unaudited Condensed Consolidated Financial Statements
    
    
    6Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    11Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    18Item 4.
    
    Controls and Procedures
    
    
    18PART II. OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    18Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    19Item 3.
    
    Defaults Upon Senior Securities
    
    
    19Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    19Item 5.
    
    Other Information
    
    
    20Item 6.
    
    Exhibits
    
    
    20Signatures
    
    
    
    
    21Exhibit Index
    
    
    
    
    22EX-31.1 Section 302 Certification of C.E.O.EX-32.2 Section 302 Certification of C.F.O.EX-32.1 Section 906 Certification
 
 2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Unaudited Condensed Consolidated Financial Statements
 Color Kinetics Incorporated
 
 Condensed Consolidated Balance Sheets  (In thousands, except per share data)
 June 30,
    
    December 31,2005
    
    2004ASSETSCURRENT ASSETS:Cash and equivalents
    
    $
    29,235
    
    
    $
    26,198Investments
    
    
    25,337
    
    
    
    29,022Restricted cash
    
    
    100
    
    
    
    100Accounts receivable, net of allowance for doubtful accounts of approximately $461 and $421 in 2005
and 2004, respectively
    
    
    5,832
    
    
    
    5,346Accounts receivable from related parties
    
    
    
    
    
    
    31Inventory
    
    
    6,727
    
    
    
    4,730Prepaid expenses and other current assets
    
    
    2,044
    
    
    
    2,076Total current assets
    
    
    69,275
    
    
    
    67,503PROPERTY AND EQUIPMENT  net
    
    
    1,197
    
    
    
    1,147INVESTMENT IN JOINT VENTURE
    
    
    658
    
    
    
    557RESTRICTED CASH  Long-term portion
    
    
    1,000
    
    
    
    1,000TOTAL ASSETS
    
    $
    72,130
    
    
    $
    70,207LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Accounts payable
    
    $
    1,275
    
    
    $
    1,681Accounts payable to related parties
    
    
    126
    
    
    
    48Accrued expenses
    
    
    1,481
    
    
    
    1,458Accrued compensation
    
    
    1,351
    
    
    
    1,731Accrued restructuring
    
    
    395
    
    
    
    405Accrued warranty
    
    
    732
    
    
    
    860Deferred revenue
    
    
    442
    
    
    
    379Total current liabilities
    
    
    5,802
    
    
    
    6,562ACCRUED RESTRUCTURING
    
    
    436
    
    
    
    628COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS EQUITY:Common stock, $0.001 par value
    
    
    18
    
    
    
    18Additional paid-in capital
    
    
    98,165
    
    
    
    97,059Accumulated other comprehensive income
    
    
    (74
    )
    
    
    (122
    )Accumulated deficit
    
    
    (32,217
    )
    
    
    (33,938
    )Total stockholders equity
    
    
    65,892
    
    
    
    63,017TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    72,130
    
    
    $
    70,207
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Color Kinetics Incorporated
 
 Condensed Consolidated Statements of Income  (In thousands, except per share data)
 Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004REVENUES (1):Lighting systems
    
    $
    10,672
    
    
    $
    8,734
    
    
    $
    20,311
    
    
    $
    15,492OEM and licensing
    
    
    2,181
    
    
    
    1,424
    
    
    
    4,058
    
    
    
    2,884Total revenues
    
    
    12,853
    
    
    
    10,158
    
    
    
    24,369
    
    
    
    18,376COST OF REVENUES:Lighting systems
    
    
    5,045
    
    
    
    4,279
    
    
    
    9,688
    
    
    
    7,646OEM and licensing
    
    
    1,065
    
    
    
    771
    
    
    
    1,966
    
    
    
    1,453Total cost of revenues
    
    
    6,110
    
    
    
    5,050
    
    
    
    11,654
    
    
    
    9,099GROSS PROFIT
    
    
    6,743
    
    
    
    5,108
    
    
    
    12,715
    
    
    
    9,277OPERATING EXPENSES:Selling and marketing
    
    
    2,833
    
    
    
    2,065
    
    
    
    5,253
    
    
    
    3,893Research and development
    
    
    1,175
    
    
    
    804
    
    
    
    2,207
    
    
    
    1,605General and administrative (2)
    
    
    2,025
    
    
    
    1,729
    
    
    
    4,252
    
    
    
    3,104Total operating expenses
    
    
    6,033
    
    
    
    4,598
    
    
    
    11,712
    
    
    
    8,602INCOME FROM OPERATIONS
    
    
    710
    
    
    
    510
    
    
    
    1,003
    
    
    
    675INTEREST INCOME
    
    
    365
    
    
    
    46
    
    
    
    704
    
    
    
    77EQUITY IN EARNINGS (LOSS) OF JOINT VENTURE
    
    
    (26
    )
    
    
    19
    
    
    
    14
    
    
    
    152NET INCOME
    
    $
    1,049
    
    
    $
    575
    
    
    $
    1,721
    
    
    $
    904EARNINGS PER SHARE:Basic
    
    $
    0.06
    
    
    $
    0.13
    
    
    $
    0.10
    
    
    $
    0.25Diluted
    
    $
    0.05
    
    
    $
    0.04
    
    
    $
    0.09
    
    
    $
    0.06WEIGHTED AVERAGE SHARES OUTSTANDING:Basic
    
    
    18,126
    
    
    
    4,295
    
    
    
    18,043
    
    
    
    3,549Diluted
    
    
    19,468
    
    
    
    15,772
    
    
    
    19,502
    
    
    
    15,416
 Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004(1) Includes revenues from related parties as follows:Lighting systems
    
    $
    1,398
    
    
    $
    1,039
    
    
    $
    2,663
    
    
    $
    1,919OEM and licensing
    
    
    16
    
    
    
    30
    
    
    
    16
    
    
    
    60Total related party revenues
    
    $
    1,414
    
    
    $
    1,069
    
    
    $
    2,679
    
    
    $
    1,979(2) Includes stock-based compensation of
    
    $
    8
    
    
    $
    269
    
    
    $
    16
    
    
    $
    331
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Color Kinetics Incorporated
 
 Condensed Consolidated Statements of Cash Flows  (In thousands)
 Six Months Ended June 30,2005
    
    2004CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    1,721
    
    
    $
    904Adjustments to reconcile net income to cash from operating activities:Depreciation and amortization
    
    
    470
    
    
    
    381Loss on disposal of property and equipment
    
    
    3
    
    
    
    Stock-based compensation
    
    
    16
    
    
    
    331Equity in earnings of joint venture
    
    
    (14
    )
    
    
    (152
    )Common stock issued for services
    
    
    13Changes in assets and liabilities:Accounts receivable
    
    
    (455
    )
    
    
    (705
    )Inventory
    
    
    (1,997
    )
    
    
    (775
    )Prepaid expenses and other current assets
    
    
    32
    
    
    
    (746
    )Accounts payable
    
    
    (328
    )
    
    
    1,548Accrued expenses
    
    
    (485
    )
    
    
    520Deferred revenue
    
    
    63
    
    
    
    59Accrued restructuring
    
    
    (202
    )
    
    
    (213
    )Net cash flows from operating activities
    
    
    (1,163
    )
    
    
    1,152CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of investments
    
    
    (17,569
    )
    
    
    Maturities of investments
    
    
    21,215
    
    
    
    Purchase of property and equipment
    
    
    (523
    )
    
    
    (374
    )Net cash flows from investing activities
    
    
    3,123
    
    
    
    (374
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from the exercise of stock options
    
    
    924
    
    
    
    24Proceeds from issuance of redeemable convertible preferred
stock  net of issuance costs
    
    
    
    
    
    
    13,003Proceeds from issuance of common stock  net of
issuance costs
    
    
    153
    
    
    
    35,227Net cash flows from financing activities
    
    
    1,077
    
    
    
    48,254EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    
    
    
    
    (43
    )INCREASE IN CASH AND EQUIVALENTS
    
    
    3,037
    
    
    
    48,989CASH AND EQUIVALENTS  Beginning of period
    
    
    26,198
    
    
    
    5,686CASH AND EQUIVALENTS  End of period
    
    $
    29,235
    
    
    $
    54,675SUPPLEMENTAL DISCLOSURE OF NONCASH
INVESTING AND FINANCING ACTIVITIES:Conversion of redeemable convertible preferred stock
    
    $
    
    
    
    $
    61,082Common stock issued for services
    
    $
    13
    
    
    $
    
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Color Kinetics Incorporated
 
 Notes to Unaudited Condensed Consolidated Financial Statements
 1. Nature of Business and Basis of Presentation
 Nature of Business 
 Basis of Presentation  
  Reclassification 
 2. Revenue Recognition
   3. Stock-Based Compensation
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in thousands, except per share data
 Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004Net income, as reported
    
    $
    1,049
    
    
    $
    575
    
    
    $
    1,721
    
    
    $
    904Add: stock-based compensation determined under
intrinsic value method for employee awards
    
    
    8
    
    
    
    
    
    
    
    16
    
    
    
    Less: pro forma compensation expense related to
the ESPP
    
    
    (25
    )
    
    
    
    
    
    
    (50
    )
    
    
    Less: pro forma stock-based compensation
expense related to option plans
    
    
    (411
    )
    
    
    (105
    )
    
    
    (777
    )
    
    
    (176
    )Pro forma net income
    
    $
    621
    
    
    $
    470
    
    
    $
    910
    
    
    $
    728Basic earnings per shareAs reported
    
    $
    0.06
    
    
    $
    0.13
    
    
    $
    0.10
    
    
    $
    0.25Pro forma
    
    $
    0.04
    
    
    $
    0.11
    
    
    $
    0.05
    
    
    $
    0.21Diluted earnings per shareAs reported
    
    $
    0.05
    
    
    $
    0.04
    
    
    $
    0.09
    
    
    $
    0.06Pro forma
    
    $
    0.03
    
    
    $
    0.03
    
    
    $
    0.05
    
    
    $
    0.05
  2005
    
    2004ESPP (1):Risk-free interest rate
    
    
    3
    %
    
    
    Volatility
    
    
    65
    %
    
    
    Dividend yield
    
    
    0
    %
    
    
    Expected life in years
    
    
    0.5
    
    
    
    Stock Options:Risk-free interest rate
    
    
    3.8
    %
    
    
    3.6
    %Volatility
    
    
    65
    %
    
    
    50
    %Dividend yield
    
    
    0
    %
    
    
    0
    %Expected life in years
    
    
    4
    
    
    
    4
    7




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Share-Based Payment Accounting for Stock-Based Compensation, Accounting for Stock Issued to Employees,
  4. Inventory
 in thousands
 June 30,
    
    December 31,2005
    
    2004Finished goods
    
    $
    6,563
    
    
    $
    4,270Raw material components
    
    
    164
    
    
    
    460Total
    
    $
    6,727
    
    
    $
    4,730
 5. Warranty Reserve
 in thousands
 2005
    
    2004Balance, beginning of period
    
    $
    860
    
    
    $
    404Provisions in cost of revenues
    
    
    279
    
    
    
    311Expenditures
    
    
    (407
    )
    
    
    (14
    )Balance, end of period
    
    $
    732
    
    
    $
    701
 6. Earnings per Share
  in thousands
 8




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Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004Weighted average shares for basic computation
    
    
    18,126
    
    
    
    4,295
    
    
    
    18,043
    
    
    
    3,549Potential common shares from:Options
    
    
    917
    
    
    
    983
    
    
    
    1,026
    
    
    
    893Warrants
    
    
    425
    
    
    
    409
    
    
    
    433
    
    
    
    394Redeemable convertible preferred stock
    
    
    
    
    
    
    10,085
    
    
    
    
    
    
    
    10,580Weighted average shares for diluted computation
    
    
    19,468
    
    
    
    15,772
    
    
    
    19,502
    
    
    
    15,416
  7. Segment Information
   in thousands
 Three Months Ended June 30,
    
    2005
    
    2004Lighting
    
    OEM and
    
    
    
    
    
    Lighting
    
    OEM andSystems
    
    Licensing
    
    Total
    
    Systems
    
    Licensing
    
    TotalRevenues
    
    $
    10,672
    
    
    $
    2,181
    
    
    $
    12,853
    
    
    $
    8,734
    
    
    $
    1,424
    
    
    $
    10,158Cost of revenues
    
    
    5,045
    
    
    
    1,065
    
    
    
    6,110
    
    
    
    4,279
    
    
    
    771
    
    
    
    5,050Gross profit
    
    
    5,627
    
    
    
    1,116
    
    
    
    6,743
    
    
    
    4,455
    
    
    
    653
    
    
    
    5,108Other direct costs
    
    
    2,913
    
    
    
    315
    
    
    
    3,228
    
    
    
    1,984
    
    
    
    169
    
    
    
    2,153Direct contribution margin
    
    $
    2,714
    
    
    $
    801
    
    
    
    3,515
    
    
    $
    2,471
    
    
    $
    484
    
    
    
    2,955Reconciling items to income from operations:Unallocated selling and marketing
    
    
    
    
    
    
    
    
    
    
    328
    
    
    
    
    
    
    
    
    
    
    
    334Unallocated research and development
    
    
    
    
    
    
    
    
    
    
    452
    
    
    
    
    
    
    
    
    
    
    
    382Unalloacted general and administrative
    
    
    
    
    
    
    
    
    
    
    2,025
    
    
    
    
    
    
    
    
    
    
    
    1,729Income from operations
    
    
    
    
    
    
    
    
    
    $
    710
    
    
    
    
    
    
    
    
    
    
    $
    510
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Six Months Ended June 30,
    
    2005
    
    2004Lighting
    
    OEM and
    
    
    
    
    
    Lighting
    
    OEM andSystems
    
    Licensing
    
    Total
    
    Systems
    
    Licensing
    
    TotalRevenues
    
    $
    20,311
    
    
    $
    4,058
    
    
    $
    24,369
    
    
    $
    15,492
    
    
    $
    2,884
    
    
    $
    18,376Cost of revenues
    
    
    9,688
    
    
    
    1,966
    
    
    
    11,654
    
    
    
    7,646
    
    
    
    1,453
    
    
    
    9,099Gross profit
    
    
    10,623
    
    
    
    2,092
    
    
    
    12,715
    
    
    
    7,846
    
    
    
    1,431
    
    
    
    9,277Other direct costs
    
    
    5,336
    
    
    
    561
    
    
    
    5,897
    
    
    
    3,744
    
    
    
    386
    
    
    
    4,130Direct contribution margin
    
    $
    5,287
    
    
    $
    1,531
    
    
    
    6,818
    
    
    $
    4,102
    
    
    $
    1,045
    
    
    
    5,147Reconciling items to loss from operations:Unallocated selling and marketing
    
    
    
    
    
    
    
    
    
    
    697
    
    
    
    
    
    
    
    
    
    
    
    626Unallocated research and development
    
    
    
    
    
    
    
    
    
    
    866
    
    
    
    
    
    
    
    
    
    
    
    742Unalloacted general and administrative
    
    
    
    
    
    
    
    
    
    
    4,252
    
    
    
    
    
    
    
    
    
    
    
    3,104Income from operations
    
    
    
    
    
    
    
    
    
    $
    1,003
    
    
    
    
    
    
    
    
    
    
    $
    675
 8. Comprehensive Income
 in thousands
 Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004Net income
    
    $
    1,049
    
    
    $
    575
    
    
    $
    1,721
    
    
    $
    904Foreign currency translation adjustments
    
    
    66
    
    
    
    (17
    )
    
    
    88
    
    
    
    18Unrealized holding gains (losses)
on investments
    
    
    22
    
    
    
    
    
    
    
    (40
    )
    
    
    Total comprehensive income
    
    $
    1,137
    
    
    $
    558
    
    
    $
    1,769
    
    
    $
    922
 9. Contingencies
 Super Vision International, Inc.
     10




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TIR Systems, Ltd.
  
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Cautionary Statements
  
    
    Our limited history of profitability, and the difficulty in evaluating the
likelihood of maintaining profitability;
    
    Whether there will be market acceptance of solid-state lighting in general, and
our solid-state lighting systems in particular;
    
    Whether advances in LED technology will continue;
    
    Our ability to respond effectively as new lighting technologies and market trends emerge;
    
    Incurrence of substantial costs or losses as a result of litigation or other
proceedings relating to patent and other intellectual property rights;
    
    Our ability to obtain and maintain patent protection for our technology and to
otherwise protect our intellectual property;
    
    Availability of critical components that we currently purchase from a small number of suppliers;
    
    Failure of our manufacturing partners to meet our requirements for quality, quantity and timeliness;
    
    Inability to increase production capacity for our products in a timely manner;
    
    Unavailability of one of our facilities;
    
    Whether demand for our intelligent white light products in the general lighting market will emerge;
    
    Our ability to compete effectively;
    
    Additional risks and volatility beyond those we currently face associated with
expansion of our OEM business;
    
    Our ability to manage our growth effectively;
    
    Significant costs to evaluate our internal control over financial reporting, and
our ability to avoid significant deficiencies or material weaknesses in our
internal controls;
    
    Changes in the accounting treatment of stock options;
    
    The loss of services of any members of our key management team;
    
    Our limited experience conducting business internationally;
    
    A reliance on a joint venture in Japan, Color Kinetics Japan, to distribute products in Japan;
    
    Defects in our products;
    
    Ability to obtain additional capital as needed;
    
    Volatility of the market price for our common stock;
    
    Securities class action litigation due to future stock price volatility; and
    
    Anti-takeover provisions in our charter documents and Delaware law which could
prevent or delay a change in control.
 11




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Overview
  
    
    Lighting systems:we offer intelligent solid-state lighting systems under the Color
Kinetics brand for installation in lighting projects where their use has typically been
specified by a designer or architect.
    
    OEM and licensing:we offer a standard line of intelligent solid-state lighting modules,
custom and basic components and other products that can be incorporated by manufacturers in
products sold under their own brands. We also license our technology.
      Description of Our Revenues, Costs and Expenses
  12




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Critical Accounting Estimates
   Revenue Recognition.
 
    
    evidence exists of an arrangement with the customer, typically consisting of a purchase
order;
    
    our products have been delivered and risk of loss has passed to the customer, which
typically occurs when a product is shipped under our customary terms, generally FOB
shipping point;
    
    the amount of revenue to which we are entitled is fixed or determinable; and
    
    we believe it is probable that we will be able to collect the amount due us from our customer.
   13




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Allowance for Doubtful Accounts.
 Product Warranty.
 Inventory Reserves.
 Accounting for Income Taxes.
 Stock-Based Compensation.
 Share-Based Payment Accounting for Stock-Based Compensation, Accounting for Stock Issued to Employees,
  14




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Results of Operations
  Percentage of Total RevenuesThree Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Revenues:Lighting systems
    
    
    83
    %
    
    
    86
    %
    
    
    83
    %
    
    
    84
    %OEM and licensing
    
    
    17
    
    
    
    14
    
    
    
    17
    
    
    
    16Total revenues
    
    
    100
    
    
    
    100
    
    
    
    100
    
    
    
    100Cost of revenues:Cost of lighting systems, as a percentage of
lighting systems revenues
    
    
    47
    
    
    
    49
    
    
    
    48
    
    
    
    49Cost of OEM and licensing, as a percentage of
OEM and licensing revenues
    
    
    49
    
    
    
    54
    
    
    
    48
    
    
    
    50Total cost of revenues
    
    
    48
    
    
    
    50
    
    
    
    48
    
    
    
    50Gross profit
    
    
    52
    
    
    
    50
    
    
    
    52
    
    
    
    50Operating expenses:Selling and marketing
    
    
    22
    
    
    
    20
    
    
    
    22
    
    
    
    21Research and development
    
    
    9
    
    
    
    8
    
    
    
    9
    
    
    
    8General and administrative
    
    
    16
    
    
    
    17
    
    
    
    17
    
    
    
    17Total operating expenses
    
    
    47
    
    
    
    45
    
    
    
    48
    
    
    
    46Income from operations
    
    
    5
    
    
    
    5
    
    
    
    4
    
    
    
    4Interest income
    
    
    3
    
    
    
    1
    
    
    
    3
    
    
    
    Equity in earnings of joint venture
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Net income
    
    
    8
    %
    
    
    6
    %
    
    
    7
    %
    
    
    5
    %
 Revenues.
    15




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##### Table of Contents



Gross Profit.
   Selling and Marketing Expenses.
 Research and Development Expenses.
 16




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##### Table of Contents



General and Administrative Expenses.
 Interest Income.
 Equity in Earnings (Loss) of Joint Venture.
 Provision for Income Taxes.
 Liquidity and Capital Resources
     17




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
   
 Item 4. Controls and Procedures
 (a)
    
    Evaluation of disclosure controls and procedures.Our management, including our Chief Executive Officer and our Chief Financial Officer, carried out
an evaluation of the effectiveness of our disclosure controls and procedures as of the end the
period covered by this quarterly report. Based on this evaluation, our Chief Executive Officer and
Chief Financial Officer concluded that our disclosure controls and procedures were effective to
provide a reasonable level of assurance that the information required to be disclosed in the
reports filed or submitted by us under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported within the requisite time periods.The effectiveness of any system of disclosure controls and procedures and internal control over
financial reporting is subject to various inherent limitations, including cost limitations,
judgments used in decision making, assumptions about the likelihood of future events, the soundness
of internal systems, the possibility of human error, and the risk of fraud. Moreover, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions and the risk that the degree of compliance with
policies or procedures may deteriorate over time. Because of these limitations, any system of
disclosure controls and procedures and internal control over financial reporting may not be
successful in preventing all errors or fraud or in making all material information known in a
timely manner to the appropriate levels of management.(b)
    
    Changes in internal control over financial reporting.There were no changes in our internal control over financial reporting that occurred during the
last fiscal quarter that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.
 
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
 Super Vision International, Inc.
  18




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##### Table of Contents



TIR Systems, Ltd.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Items 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
    
    To elect the following three Class I directors: Noubar B. Afeyan, Michael Hawley and James F. OConnor:
 Nominee
    
    For
    
    Withhold AuthorityNoubar B. Afeyan
    
    
    15,331,272
    
    
    
    6,627Michael Hawley
    
    
    15,236,389
    
    
    
    101,510James F. OConnor
    
    
    15,331,747
    
    
    
    6,152
 
    
    To approve an Amendment of the 2004 Stock Incentive Plan to increase
the number of shares currently available for issuance under the plan
from 1,000,000 to 1,500,000. The effect of this amendment will be to
increase the maximum number of shares issuable under the Stock
Incentive Plan from 1,750,000 to 2,250,000:
 19




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##### Table of Contents



For
    
    Against
    
    Abstain
    
    Broker Non-Votes7,489,846
    
    
    3,720,599
    
    
    
    1,200,800
    
    
    
    2,926,654
 
 Item 5. Other Information
  
 Item 6. Exhibits
 ExhibitNumber
    
    Description* 3.2
    
    Seventh Amended and Restated Certificate of Incorporation of Color Kinetics Incorporated* 3.4
    
    Second Amended and Restated By-Laws of Color Kinetics Incorporated31.1
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  William J. Sims31.2
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  David K. Johnson32.1
    
    Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   20




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##### Table of Contents



SIGNATURES
  Date: August 02, 2005
    
    
    
    COLOR KINETICS INCORPORATED(Registrant)By:
    
    /s/ William J. SimsWilliam J. SimsChief Executive OfficerBy:
    
    /s/ David K. JohnsonDavid K. JohnsonChief Financial Officer
 21