Item 9A. Controls and Procedures
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Management is required to evaluate our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Disclosure controls and procedures are controls and other procedures designed to provide reasonable assurance that information required to be disclosed in our reports filed under the Exchange Act, such as this Annual Report on Form 10-K, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to provide reasonable assurance that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures include components of our internal control over financial reporting, which consists of control processes designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles in the U.S. To the extent that components of our internal control over financial reporting are included within our disclosure controls and procedures, they are included in the scope of our periodic controls evaluation. Based on our management’s evaluation (with the participation of our principal executive officer and principal financial officer), our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of the end of the period covered by this report.
Management’s Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:
● pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting.
Management conducted an assessment of Power Integrations’ internal control over financial reporting as of December 31, 2020, based on the framework established by the Committee of Sponsoring Organization (COSO) of the Treadway Commission in Internal Control - Integrated Framework issued in 2013. Based on this assessment, management concluded that, as of December 31, 2020, our internal control over financial reporting was effective.
The effectiveness of Power Integrations’ internal control over financial reporting as of December 31, 2020, has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report which appears below.
Changes in Internal Control over Financial Reporting
There were no changes in our internal controls over financial reporting during the fourth quarter of 2020, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
64
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and the Board of Directors of Power Integrations, Inc.
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Power Integrations, Inc. and subsidiaries (the “Company”) as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2020, of the Company and our report dated February 5, 2021 expressed an unqualified opinion on those consolidated financial statements and included an explanatory paragraph relating to the Company’s adoption of Accounting Standards Update (ASU) 2016-02, Leases (Topic 842).
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ DELOITTE & TOUCHE LLP
San Jose, California
February 5, 2021
65
Table of Contents
Item 9B. Other Information.
Compensation Matters
On February 1, 2021, the Compensation Committee of the Board of Directors of Power Integrations, Inc. (the “Company”) took the following compensation actions with respect to the Company’s chief executive officer, chief financial officer, and other “named executive officers” as defined in Rule 402 of SEC Regulation S-K (collectively, the “Officers”).
2021 Performance-based Incentive Plan
Approved the 2021 Performance-based Incentive Plan (the “2021 PSU Plan”) as follows:
Each Officer, as described below, was granted performance stock units, referred to as “PSUs,” which will vest (referred to as a “payout” below) based on Company performance as against the 2021 PSU Plan’s established net revenue targets, non-GAAP operating income targets and strategic goals, each as established by the Compensation Committee. The 2021 target net revenue and non-GAAP operating income levels are intended to have difficulty in attainment levels consistent with the Company’s 2020 PSU Plan.
The portion of the performance stock units granted under the 2021 PSU Plan that will vest will be calculated independently for each of its net revenue, non-GAAP operating income and strategic goals components. “Net revenue” is as set forth in the Company’s annual report for 2021 to be filed with the Securities and Exchange Commission (“SEC”). “Non-GAAP operating income” means operating income for 2021 determined in accordance with GAAP but excluding the following items: (i) stock-based compensation expenses recorded under Accounting Standards Codification 718; (ii) amortization of acquisition-related intangible assets, and the fair-value write-up of acquired inventory; (iii) any other mergers and acquisitions related expenses; and (iv) any other adjustment made to arrive at the Company’s non-GAAP financial information as presented in the Company’s SEC filings. Further, in the event of any mergers, acquisitions or divestitures, or any patent or other litigation settlements or judgments, during the performance period, the net revenue and non-GAAP operating income targets shall be adjusted based on a revised plan approved by the Board of Directors. The strategic goals component is made up of five different strategic goals for the Company.
Weighting of the target components is as follows:
Net revenue
40
%
Non-GAAP operating income
30
%
Strategic goals
30
%
Total
100
%
Net Revenue Component of the 2021 PSU Plan:
No payout will be made under the net revenue component of the 2021 PSU Plan if the Company’s 2021 actual net revenue does not exceed at least the established minimum amount of net revenue as set forth in the 2021 PSU Plan. To the extent 2021 actual net revenue is above the minimum amount of net revenue, the payout increases linearly from zero at the minimum amount of net revenue as set forth in the 2021 PSU Plan up to 100% of the net revenue component of the target when actual net revenue equals target net revenue in the 2021 PSU Plan. If 2021 actual net revenue is above the target amount of net revenue, then the payout for performance above target increases linearly from the target amount up to a maximum of 200% of the net revenue component of the target when actual net revenue equals or exceeds the established target to achieve the maximum payout under the net revenue component of the 2021 PSU Plan.
Non-GAAP Operating Income Component of the 2021 PSU Plan:
No payout will be made under the non-GAAP operating income component of the 2021 PSU Plan if the Company’s 2021 actual non-GAAP operating income does not exceed at least the established minimum amount of non-GAAP operating income as set forth in the 2021 PSU Plan. To the extent 2021 actual non-GAAP operating income is above the minimum amount of non-GAAP operating income, the payout increases linearly from zero at the minimum amount of non-GAAP operating income as set forth in the 2021 PSU Plan up to 100% of the non-GAAP operating income component of the target when actual non-GAAP operating income equals target non-GAAP operating income in the 2021 PSU Plan. If 2021 actual non-GAAP operating income is above the target amount of non-GAAP operating income, then
66
Table of Contents
the payout for performance above target increases linearly from the target amount up to a maximum of 200% of the non-GAAP operating income component of the target when actual non-GAAP operating income equals or exceeds the established target to achieve the maximum payout under the non-GAAP operating income component of the 2021 PSU Plan.
Strategic Goals Component of the 2021 PSU Plan:
Each of the five goals in the strategic goals component of the 2021 PSU Plan is assigned a weighting percentage, which percentages range from 2% to 14%, and which collectively add up to 30%. If the Company’s 2021 actual achievement of a goal does not exceed at least the established minimum requirement for a particular goal, then no amount is earned for that goal. To the extent 2021 actual performance for a goal is better than the established minimum for the goal, then the payout increases linearly from zero at the minimum amount of performance as set forth in the 2021 PSU Plan up to 100% of the amount for that goal when actual performance equals target performance for that goal in the 2021 PSU Plan. To the extent 2021 actual performance for a goal is better than the established target for the goal, then the payout for performance above target increases linearly from the target amount actual performance, up to a maximum of 200% for the specific goal when actual performance equals or exceeds the established target to achieve the maximum payout under the specific goal as set forth in the 2021 PSU Plan.
2021 Target Performance Stock Units
Approved the 2021 target performance stock units for the Officers as follows:
Executive Officer
Title
2021 Target PSUs
Balu Balakrishnan
President and Chief Executive Officer
11,000
Sandeep Nayyar
Chief Financial Officer
3,500
Radu Barsan
Vice President, Technology
3,000
David “Mike” Matthews
Vice President, Product Development
2,300
Ben Sutherland
Vice President, Worldwide Sales
2,300
The actual number of shares subject to the performance stock units is twice the target level shown in the table above to enable the payout of up to 200% of the target amount if the actual net revenue, non-GAAP operating income and strategic goals achievement equal or exceed the established levels to achieve the maximum amount of the 2021 PSU Plan.
2021 Restricted Stock Unit Grants
Approved restricted stock units, referred to as “RSUs,” grants to the following Officers:
Executive Officer
Title
2021 RSU Grants
Balu Balakrishnan
President and Chief Executive Officer
30,000
Sandeep Nayyar
Chief Financial Officer
12,000
Radu Barsan
Vice President, Technology
9,900
David “Mike” Matthews
Vice President, Product Development
7,500
Ben Sutherland
Vice President, Worldwide Sales
7,500
The RSU grants will be effective on the grant date. Twenty-five percent (25%) of the RSUs vest on the one-year anniversary of the vesting commencement date (as specified in the Officers’ RSU award agreements), and an additional twenty-five percent (25%) of the RSUs vest annually over the next three (3) years thereafter, subject to the respective Officer’s continuous service.
2021 Long-term Performance-Based Incentive Plan
Approved the 2021 Long-term Performance-Based Incentive Plan (“2021 PRSU Plan”) as follows:
Each Officer, as described below, was granted long term performance stock units, referred to as “PRSUs,” which will vest (referred to as a “payout” below) based on Company revenue performance as against the 2021 PRSU Plan’s established three-year (years 2021, 2022 and 2023) compound annual growth rate (“CAGR”) of revenue as measured against a specified index of the analog semiconductor industry CAGR (the “Index”). The level of performance of the Company’s three-year revenue CAGR as against the Index is intended to have a difficulty in attainment level consistent
67
Table of Contents
with the Company’s 2020 PRSU Plan. The portion of the performance stock units that will vest will be calculated based on the Company’s actual three-year revenue CAGR as compared to the Index and awarded in early 2024 upon approval by the Compensation Committee. In the event of any mergers, acquisitions or divestitures, or any patent or other litigation settlements or judgments, during the performance period, the Company’s target three-year revenue CAGR as against the Index shall be adjusted based on a revised plan approved by the Board of Directors.
No payout will be made in early 2024 under the 2021 PRSU Plan if the Company’s actual three-year revenue CAGR does not exceed at least the established minimum amount as measured against the Index as set forth in the 2021 PRSU Plan. To the extent the Company’s actual three-year revenue CAGR exceeds at least the established minimum amount as measured against the Index as set forth in the 2021 PRSU Plan, the payout increases linearly from zero at the minimum CAGR performance level as measured against the Index as set forth in the 2021 PRSU Plan up to 100% when the Company’s actual three-year revenue CAGR equals the target at the specified level as set forth in the 2021 PRSU Plan. If the Company’s actual three-year revenue CAGR exceeds the target, then the payout for performance above target increases linearly from the target amount up to a maximum of 200% of the target when the Company’s actual three-year revenue CAGR equals or exceeds the established amount to achieve the maximum payout as set forth in the 2021 PRSU Plan. Except to the extent provided in the executive officer benefits agreements between the Company and each Officer, each Officer must be employed by the Company through the end of the performance period to receive stock pursuant to the PRSUs under the 2021 PRSU Plan.
2021 Target PRSUs
Approved the target 2021 PRSUs for the Officers as follows:
Executive Officer
Title
2021 Target PRSUs
Balu Balakrishnan
President and Chief Executive Officer
30,000
Sandeep Nayyar
Chief Financial Officer
4,000
Radu Barsan
Vice President, Technology
3,300
David “Mike” Matthews
Vice President, Product Development
2,500
Ben Sutherland
Vice President, Worldwide Sales
2,500
The actual number of shares subject to the PRSUs is twice the target level shown in the table above to enable the payout of up to 200% of the target amount if actual net revenue equals or exceeds the established level to achieve the maximum amount of the 2021 PRSU Plan.
2021 Salaries
Approved the 2021 salaries for the Officers, to be effective at the end of March 2021, as follows:
Executive Officer
Title
2021 Salary
Balu Balakrishnan
President and Chief Executive Officer
$
665,000
Sandeep Nayyar
Chief Financial Officer
$
410,000
Radu Barsan
Vice President, Technology
$
385,000
David “Mike” Matthews
Vice President, Product Development
$
350,000
Ben Sutherland
Vice President, Worldwide Sales
$
350,000
68
Table of Contents
PART III
Item 10. Directors, Executive Officers and Corporate Governance.
The names of our executive officers and their ages, titles and biographies as of the date hereof are set forth under the caption “Information About our Executive Officers” in Part I, Item 1, above.
The following information is included in our Notice of Annual Meeting of Stockholders and Proxy Statement to be filed within 120 days after our fiscal year end of December 31, 2020, or the Proxy Statement, and is incorporated herein by reference:
● Information regarding our directors and any persons nominated to become a director is set forth under the caption “Proposal 1 Election of Directors.”
● Information regarding our audit committee and our designated “audit committee financial expert” is set forth under the captions “Information Regarding the Board and its Committees” and “Audit Committee” under “Proposal 1 Election of Directors” and “Report of the Audit Committee of the Board.”
● Information on our code of business conduct and ethics for directors, officers and employees is set forth under the caption “Code of Business Conduct and Ethics” under “Proposal 1 Election of Directors.”
● Information regarding Section 16(a) beneficial ownership reporting compliance, if any, will be set forth under the caption “Delinquent Section 16(a) Reports.”
● Information regarding procedures by which stockholders may recommend nominees to our board of directors is set forth under the caption “Nominating and Governance Committee” under “Proposal 1 Election of Directors.”
Item 11. Executive Compensation.
Information regarding compensation of our named executive officers is set forth under the caption “Compensation of Executive Officers” in the Proxy Statement, which information is incorporated herein by reference.
Information regarding compensation of our directors is set forth under the caption “Compensation of Directors” in the Proxy Statement, which information is incorporated herein by reference.
Information relating to compensation policies and practices as they relate to risk management is set forth under the caption “Compensation Policies and Practices as They Relate to Risk Management” under “Proposal 1 Election of Directors” in the Proxy Statement, which information is incorporated herein by reference.
Information regarding compensation committee interlocks is set forth under the caption "Compensation Committee Interlocks and Insider Participation" in the Proxy Statement, which information is incorporated herein by reference.
The Compensation Committee Report is set forth under the caption “Compensation Committee Report” in the Proxy Statement, which report is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
Information regarding security ownership of certain beneficial owners, directors and executive officers is set forth under the caption “Security Ownership of Certain Beneficial Owners and Management” in the Proxy Statement, which information is incorporated herein by reference.
Information regarding our equity compensation plans, including both stockholder approved plans and non-stockholder approved plans, is set forth under the caption “Equity Compensation Plan Information” in the Proxy Statement, which information is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Information regarding certain relationships and related transactions is set forth under the caption “Certain Relationships and Related Transactions” in the Proxy Statement, which information is incorporated herein by reference.
Information regarding director independence is set forth under the caption “Proposal 1 - Election of Directors” in the Proxy Statement, which information is incorporated herein by reference.
Item 14. Principal Accounting Fees and Services.
Information regarding principal auditor fees and services is set forth under “Principal Accountant Fees and Services” in the Proposal with the caption “Ratification of Selection of Independent Registered Public Accounting Firm” in the Proxy Statement, which information is incorporated herein by reference.
69
Table of Contents
PART IV
Item 15. Exhibits, Financial Statement Schedules
(a)
1. The financial statements required by Item 15(a) are included in Item 8 of this Annual Report on Form 10-K.
2. The financial statement schedule required by Item 15(a) (Schedule II, Valuation and Qualifying Accounts) is included in Item 8 of this Annual Report on Form 10-K.
All other schedules are omitted because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.
(b) Exhibits
Incorporation by Reference
Exhibit
Number
Exhibit Description
Form
File
Number
Exhibit/Appendix
Reference
Filing Date
Filed
Herewith
3.1
Restated Certificate of Incorporation
10-K
000-23441
3.1
2/29/2012
3.2
Amended and Restated Bylaws
8-K
000-23441
3.1
4/26/2013
4.1
Description of Power Integrations, Inc. Common Stock
10-K
000-23441
4.1
2/6/2020
4.2
Reference is made to Exhibits 3.1 to 3.2
10.1*
Form of Indemnity Agreement for directors and officers
S-1
333-35421
10.1
9/11/1997
10.2*
Power Integrations, Inc. Compliance Policy Regarding IRC Section 409A
10-K
000-23441
10.63
3/2/2009
10.3*
1997 Employee Stock Purchase Plan, as amended
10-Q
000-23441
10.1
10/29/2020
10.4*
Forms of agreement under 1997 Employee Stock Purchase Plan
S-1
333-35421
10.5
9/11/1997
10.5*
1997 Outside Directors Stock Option Plan
10-Q
000-23441
10.2
10/29/2020
10.6*
Forms of agreement under 1997 Outside Directors Stock Option Plan
S-1
333-35421
10.4
9/11/1997
10.7*
Form of Director Option Grant Agreement.
10-Q
000-23441
10.9
5/6/2009
10.8*
Director Equity Compensation Program
10-K
000-23441
10.1
2/7/2020
10.9*
Forms of Stock Option Agreements to be used in Director Equity Compensation Program
10-Q
000-23441
10.5
11/7/2008
10.10*
Outside Director Cash Compensation Arrangements
10-K
000-23441
10.12
2/7/2020
10.11*
2007 Equity Incentive Plan, as amended and restated
10-Q
000-23441
10.3
10/29/2020
10.12*
Forms of Option Agreements under the 2007 Equity Incentive Plan
Schedule TO
000-23441
99.(D)(4)
12/3/2008
70
Table of Contents
10.13*
Form of Restricted Stock Unit Grant Notice and Form of Restricted Stock Unit Award Agreement under the 2007 Equity Incentive Plan
10-Q
000-23441
10.1
5/6/2010
10.14*
Form of Performance Stock Unit Grant Notice and Performance Stock Unit Agreement (as used after to January 1, 2013) under the 2007 Equity Incentive Plan
10-K
000-23441
10.29
2/22/2013
10.15*
Form of Long Term Performance Stock Unit Notice and Agreement under the 2007 Equity Incentive Plan
10-K
000-23441
10.84
2/10/2015
10.16*
Power Integrations, Inc. Amended and Restated 2016 Incentive Award Plan
10-Q
000-23441
10.4
10/29/2020
10.17*
Form of Restricted Stock Unit Grant Notice and Agreement under the 2016 Incentive Award Plan
10-K
000-23441
10.25
2/8/2017
10.18*
Form of Performance Stock Unit Notice and Agreement under the 2007 Equity Incentive Plan
10-K
000-23441
10.26
2/8/2017
10.19*
Form of Long Term Performance Stock Unit Notice and Agreement under the 2007 Equity Incentive Plan
10-K
000-23441
10.27
2/8/2017
10.21†
Wafer Supply Agreement between us and ZMD Analog Mixed Signal Services GmbH & Co. KG, dated as of May 23, 2003
10-Q
000-23441
10.32
8/7/2003
10.22†
Amended and Restated Wafer Supply Agreement between us and OKI Electric Industry Co., Ltd., dated as of April 1, 2003
10-Q
000-23441
10.31
8/7/2003
10.23†
Amendment Number One to the Amended and Restated Wafer Supply Agreement between us and OKI Electric Industry Co., Ltd., effective as of August 11, 2004
8-K
000-23441
10.22
4/18/2006
10.24
Amendment Number Two to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Electric Industry Co., Ltd., effective as of April 1, 2008
10-Q
000-23441
10.5
8/8/2008
10.25
Amendment Number Three to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Electric Industry Co., Ltd., effective as of June 9, 2008
10-Q
000-23441
10.6
8/8/2008
10.26†
Amendment Number Four to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Electric Industry Co., Ltd., dated September 15, 2008
10-Q
000-23441
10.2
11/7/2008
71
Table of Contents
10.27†
Amendment Number Five to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Semiconductor Co., Ltd., effective as of November 14, 2008
10-K
000-23441
10.61
3/2/2009
10.28†
Amendment Number Six to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Semiconductor Co., Ltd., effective as of November 1, 2015
10-K
000-23441
10.32
2/11/2016
10.29†
Amendment Number Seven to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Semiconductor Co., Ltd., effective as of August 8, 2016
10-Q
000-23441
10.1
11/1/2016
10.30†
Amendment Number Eight to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and OKI Semiconductor Co., Ltd., effective as of July 26, 2017
10-Q
000-23441
10.1
10/26/2017
10.31††
Amendment Number Nine to the Amended and Restated Wafer Supply Agreement, between Power Integrations International, Ltd. and Lapis Semiconductor Co., Ltd. (formerly OKI Semiconductor Co., Ltd.), effective as of February 6, 2019
10-Q
000-23441
10.2
4/25/2019
10.32†
Wafer Supply Agreement, between Seiko Epson Corporation and Power Integrations International, Ltd. effective as of April 1, 2005
10-Q
000-23441
10.1
11/7/2008
10.33†
Amendment Number One to the Wafer Supply Agreement between Power Integrations International, Ltd. and Seiko Epson Corporation, with an effective date of December 19, 2008
10-Q
000-23441
10.1
5/6/2009
10.34†
Amendment Number Two to Wafer Supply Agreement, between Seiko Epson Corporation and Power Integrations International, Ltd., entered into on January 5, 2011
10-K
000-23441
10.47
2/25/2011
10.35†
Amendment Number Three to Wafer Supply Agreement, effective as of February 1, 2012, by Power Integrations International Ltd. and Seiko Epson Corporation
X
10.36†
Development Addendum to Wafer Supply Agreement, dated September 22, 2013, between Seiko Epson Corporation and Power Integrations International Ltd
X
72
Table of Contents
10.37†
Amendment Number Four to Wafer Supply Agreement, effective as of April 1, 2015, by Power Integrations International Ltd. and Seiko Epson Corporation
X
10.38†
Amendment Number Five to Wafer Supply Agreement, effective as of November 2, 2015, by Power Integrations International Ltd. and Seiko Epson Corporation
X
10.39†
Amendment Number Six to Wafer Supply Agreement, effective as of December 8, 2015, by Power Integrations International Ltd. and Seiko Epson Corporation
X
10.40†
Amendment Number Seven to Wafer Supply Agreement, effective as of October 3, 2016, by Power Integrations International Ltd. and Seiko Epson Corporation
10-K
000-23441
10.46
2/8/2017
10.41†
Amendment Number Eight to Wafer Supply Agreement, effective as of November 8, 2016 by Power Integrations International Ltd. and Seiko Epson Corporation
10-K
000-23441
10.47
2/8/2017
10.42†
Amendment Number One to the Amended and Restated Wafer Supply Agreement between Power Integrations International, Ltd. and XFAB Dresden GmbH & Co. KG, effective as of July 20, 2005
10-K
000-23441
10.66
2/26/2010
10.43†
Wafer Supply Agreement, made and entered into as of October 1, 2010, by and between Power Integrations International, Ltd., and X-FAB Semiconductor Foundries AG
10-Q
000-23441
10.2
5/8/2012
10.44†
Amendment Number One to Wafer Supply Agreement, effective as of January 1, 2014, between Power Integrations International, Ltd., and X-FAB Semiconductor Foundries AG
10-Q/A
000-23441
10.2
9/19/2014
10.45†
Amendment Number Two to the Wafer Supply Agreement, effective as of December 1, 2018, between Power Integrations International, Ltd., and X-FAB Semiconductor Foundries GmbH (formerly X-FAB Semiconductor Foundries AG)
10-K
000-23441
10.52
2/13/2019
10.46
Credit Agreement, dated July 27, 2016, by and between Power Integrations Inc. and Wells Fargo Bank, National Association
10-Q
000-23441
10.1
7/29/2016
10.47
First Amendment to Credit Agreement, dated April 30, 2018 by and between Power Integrations, Inc. and Wells Fargo Bank, National Association
10-Q
000-23441
10.1
7/26/2018
73
Table of Contents
10.48*
2019 Executive Officer Compensation Arrangements and 2019 Performance Based Incentive Plan
10-K
000-23441
Item 9B
2/13/2019
10.49*
2018 Executive Officer Cash Compensation Arrangements and 2018 Performance Based Incentive Plan
10-K
000-23441
Item 9B
2/14/2018
10.50*
Form of Restricted Stock Unit Grant Notice and Form of Restricted Stock Unit Award Agreement for executive officers for use prior to January 2013
10-Q
000-23441
10.6
8/6/2010
10.51*
Form of Restricted Stock Unit Grant Notice and Form of Restricted Stock Unit Award Agreement for executive officers for use after January 2013
10-K
000-23441
10.48
2/22/2013
10.52*
Amended and Restated Chief Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Balu Balakrishnan
10-Q
000-23441
10.3
5/5/2014
10.53*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Cliff Walker
10-Q
000-23441
10.5
5/5/2014
10.54*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Doug Bailey
10-Q
000-23441
10.6
5/5/2014
10.55*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Ben Sutherland
10-Q
000-23441
10.7
5/5/2014
10.56*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Sandeep Nayyar
10-Q
000-23441
10.8
5/5/2014
10.57*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Mike Matthews
10-Q
000-23441
10.10
5/5/2014
10.58*
Amended and Restated Executive Officer Benefits Agreement, dated as of May 1, 2014, between Power Integrations, Inc. and Radu Barsan
10-Q
000-23441
10.11
5/5/2014
10.60††
ON Semiconductor Corporation Settlement Agreement
10-K
000-23441
10.61
2/7/2020
10.61††
ON Semiconductor Corporation Term Sheet
10-K
000-23441
10.62
2/7/2020
10.62†
Amendment Number Ten to the Amended and Restated Wafer Supply Agreement,
10-Q
000-23441
10.1
5/7/2020
74
Table of Contents
between Power Integrations International, Ltd. and Lapis Semiconductor Co., Ltd. (formerly OKI Semiconductor Co., Ltd.), effective as of December 16, 2019
10.63†
Amendment Number Eleven to the Amended and Restated Wafer Supply Agreement, between Power Integrations International, Ltd. and Lapis Semiconductor Co., Ltd. (formerly OKI Semiconductor Co., Ltd.), effective as of December 20, 2019
10-Q
000-23441
10.2
5/7/2020
10.64†
Amendment Number Nine to Wafer Supply Agreement, effective as of November 1, 2017 by Power Integrations International Ltd. and Seiko Epson Corporation
10-Q
000-23441
10.3
5/7/2020
10.65*
2020 Compensation Arrangements with Named Executive Officers
10-K
000-23441
Item 9B
2/7/2020
10.66*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Balu Balakrishnan
10-Q
000-23441
10.2
7/30/2020
10.67*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Douglas Bailey
10-Q
000-23441
10.3
7/30/2020
10.68*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Radu Barsan
10-Q
000-23441
10.4
7/30/2020
10.69*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Ben Sutherland
10-Q
000-23441
10.5
7/30/2020
10.70*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Mike Matthews
10-Q
000-23441
10.6
7/30/2020
10.71*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Sandeep Nayyar
10-Q
000-23441
10.7
7/30/2020
10.72*
Amendment to the Amended and Restated Executive Officer Benefits Agreement, dated as of June 1, 2020, between Power Integrations, Inc. and Clifford Walker
10-Q
000-23441
10.9
7/30/2020
10.73*
Executive Officer Benefits Agreement, dated as of February 1, 2020, between Power Integrations, Inc. and Sunil Gupta
X
75
Table of Contents
10.74
Amendment Number Ten to Wafer Supply Agreement, effective as of August 26, 2020 by Power Integrations International Ltd. and Seiko Epson Corporation
10-Q
000-23441
10.5
10/29/2020
21.1
List of subsidiaries
X
23.1
Consent of Independent Registered Public Accounting Firm
X
24.1
Power of Attorney (see signature page)
X
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.2
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
32.1**
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.2**
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
101.INS
XBRL Instance Document
X
101.SCH
XBRL Taxonomy Extension Schema Document
X
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document
X
101.DEF
XBRL Taxonomy Extension Definition Linkbase Document
X
101.LAB
XBRL Taxonomy Extension Label Linkbase Document
X
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document
X
104
The cover page from this Annual Report on Form 10-K, formatted in Inline XBRL.
X
All references in the table above to previously filed documents or descriptions are incorporating those documents and descriptions by reference thereto.
†
This Exhibit has been filed separately with the Commission pursuant to an application for confidential treatment. The confidential portions of this Exhibit have been omitted and are marked by an asterisk.
††
Portions of this exhibit have been omitted as being immaterial and would be competitively harmful if disclosed.
*
Indicates a management contract or compensatory plan or arrangement.
**
The certifications attached as Exhibits 32.1 and 32.2 accompanying this Form 10-K, are not deemed filed with the SEC, and are not to be incorporated by reference into any filing of Power Integrations, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-K, irrespective of any general incorporation language contained in such filing.
Item 16. Form 10-K Summary
Not provided.
76
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
POWER INTEGRATIONS, INC.
Dated:
February 5, 2021
By:
/s/ SANDEEP NAYYAR
Sandeep Nayyar
Chief Financial Officer (Duly Authorized Officer, Principal Financial Officer and Chief Accounting Officer)
77
Table of Contents
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Balu Balakrishnan and Sandeep Nayyar his or her true and lawful attorney-in-fact and agent, with full power of substitution and, for him or her and in his or her name, place and stead, in any and all capacities to sign any and all amendments to this Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS REPORT HAS BEEN SIGNED BY THE FOLLOWING PERSONS ON BEHALF OF THE REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED.
Dated:
February 5, 2021
By:
/s/ BALU BALAKRISHNAN
Balu Balakrishnan
President, Chief Executive Officer
(Principal Executive Officer)
Dated:
February 5, 2021
By:
/s/ SANDEEP NAYYAR
Sandeep Nayyar
Chief Financial Officer
(Principal Financial and Principal Accounting Officer)
Dated:
February 5, 2021
By:
/s/ WILLIAM GEORGE
William George
Director and Chairman of the Board
Dated:
February 5, 2021
By:
/s/ WENDY ARIENZO
Wendy Arienzo
Director
Dated:
February 5, 2021
By:
/s/ NICHOLAS E. BRATHWAITE
Nicholas E. Brathwaite
Director
Dated:
February 5, 2021
By:
/s/ ANITA GANTI
Anita Ganti
Director
Dated:
February 5, 2021
By:
/s/ BALAKRISHNAN S. IYER
Balakrishnan S. Iyer
Director
Dated:
February 5, 2021
By:
/s/ NECIP SAYINER
Necip Sayiner
Director
Dated:
February 5, 2021
By:
/s/ STEVEN J. SHARP
Steven J. Sharp
Director
78