 GigOptix GigOptix (GGOX.OB) (GGOX.OB) Corporate Presentation Corporate Presentation February 2011 February 2011 FILED BY GIGOPTIX, INC. AND ENDWAVE CORPORATION PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933 SUBJECT COMPANY: GIGOPTIX, INC. AND ENDWAVE CORPORATION Exhibit 99.2 |
 © 2011 GigOptix, Inc. All Rights Reserved 2 2 2 Disclaimer Disclaimer Forward Looking Statements: This presentation contains statements regarding operating trends, future results, new projects, and other market, business and product trends that are forward- looking. We undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Additional factors that could cause actual results to differ are discussed under the heading "Risk Factors" and in other sections of the GigOptix and Endwave filings with the SEC, and in GigOptix’s and Endwave’s other current and periodic reports filed or furnished from time to time with the SEC. Use of Non-GAAP and Adjusted EBITDA Financial Measures: These materials include references to non-GAAP revenue, non-GAAP net income/loss, Adjusted consolidated non-GAAP net income/loss, and Adjusted EBITDA. GigOptix believes that these non-GAAP financial measures are important indicators of the ongoing operations of its business and provide better comparability between reporting periods and provide a better baseline for analyzing trends in GigOptix’s operations. GigOptix does not, nor does it suggest that investors should, consider such non-GAAP and Adjusted EBITDA financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. GigOptix believes the disclosure of the effects of these items increases the reader’s understanding of the underlying performance of the business and that such non-GAAP and Adjusted EBITDA financial measures provide investorswith an additional tool to evaluate our financial results and assess our prospects for future performance. Additional Information About This Transaction: This presentation shall not constitute an offer of any securities for sale. In connection with the proposed transaction, GigOptix will file with the Securities and Exchange Commission a Registration Statement on Form S-4 that will include a proxy statement of Endwave and a prospectus of GigOptix. The definitive proxy statement/prospectus will be mailed to stockholders of Endwave. GigOptix and Endwave urge investors and security holders to read the proxy statement/prospectus regarding the proposed transaction when it becomes available because it will contain important information about the proposed transaction. You may obtain a free copy of the proxy statement/prospectus (when available) and other related documents filed by GigOptix and Endwave with the SEC at the SEC’s web site at www.sec.gov. The proxy statement/prospectus (when it is available) and other documents filed by GigOptix or Endwave with the SEC relating to the proposed transaction may also be obtained for free by accessing GigOptix’s web site at www.gigoptix.com by clicking on the link for “Investor”, then clicking on the link for “SEC Filings”, or by accessing Endwave’s web site at www.endwave.com and clicking on the “Company” link and then clicking on the link for “SEC Filings” underneath the heading “Investor Relations”. Participants in the Merger: GigOptix, Endwave and their respective directors, executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies from Endwave stockholders in connection with the proposed transaction. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of Endwave stockholders in connection with the proposed transaction, including the interests of such participants in the proposed transaction, will be set forth in the proxy statement/prospectus when it is filed with the SEC. You can find information about GigOptix’s executive officers and directors in GigOptix’s definitive proxy statement filed with the SEC on October 28, 2010. You can find information about Endwave’s executive officers and directors in Endwave’s definitive proxy statement filed with the SEC on June 11, 2010. You can obtain free copies of these documents from GigOptix or Endwave, respectively, using the contact information below. |
        3 3 3 © 2011 GigOptix, Inc. All Rights Reserved Leading supplier of network interface devices enabling high speed data communication Solution portfolio spanning communication spectrum from fiber optics to high speed wireless mobile backhaul Core DWDM Core Routers Metro Routers Satellite Ground Station Satellite Communication Airborne Communication Base Station Backhaul Submarine Networks Access Metro Enterprise & Datacenter GigOptix, Inc. GigOptix, Inc. Latest Development: Acquisition of Endwave Latest Development: Acquisition of Endwave (ENWV) (ENWV) Served Markets: Optical Communications Datacom and Telecom Networks Military/Aerospace High Speed Wireless Communications Point-to-Point radio for mobile back haul Military/Aerospace/Automotive Products: High speed analog ICs High frequency analog ICs High speed optical modulators High speed wireless front ends Structured and Standard Cell ASICs SLIDE REFLECTS GIGOPTIX, INC. UPON COMPLETION OF MERGER WITH ENDWAVE |
 © 2011 GigOptix, Inc. All Rights Reserved 4 4 4 Market Demand for More Bandwidth Market Demand for More Bandwidth 2010 mobile data traffic was three times the size of the entire global Internet in 2000 (Cisco) 2014 mobile data traffic will be 40 times what it was in 2010 Movies Online TV Music Online Games Social Networking Increasing use of data intense services escalate bandwidth demand HD displays Pictures Increasing use of mobile infrastructure for delivery of data Source:Ovum |
 © 2011 GigOptix, Inc. All Rights Reserved 5 5 5 GigOptix Growth Strategy GigOptix Growth Strategy Since 2007 GigOptix has invested $15M in developing and acquiring assets that leverage a prior investment of more than $300M. GigOptix is a fast growing fabless high-speed optical and high frequency wireless semiconductor device company, leveraging prior investment in acquired companies Over the last 3 years through internal development and building on our strategic efforts we have built a portfolio of more than 90 products and 100 patents April 2007 Inception of GigOptix LLC. July 2007 January 2008 December 2008 November 2009 1H 2011 GigOptix, Inc. Products: High speed electro-optics: Drivers High speed electro-optics: Amplifiers & Drivers High speed electro-optics: Polymer Modulators High speed electronics: Mixed-Signal ASIC High Speed electronics: MMICs & Transceivers 90+ analog semiconductor & High Speed Wireless and ASICs products 2007 2008 2009 2011 |
 © 2011 GigOptix, Inc. All Rights Reserved 6 6 6 Company Overviews Company Overviews Description a leading supplier of high performance electronic and electro-optic components that enable next generation 40G and 100G optical networks a leading provider of high-frequency RF solutions and semiconductor products for the wireless mobile backhaul communications, satellite communications, electronic instruments and defense and security markets Products High Speed Optical: Drivers, Amplifiers, Modulators ASIC High Frequency RF: MMIC, Modules/Transceivers Target Markets Telecom, Datacom, Defense, Instrumentation, Consumer, Military, Aerospace Point-to-Point Back-Haul Wireless Communications, Military, Aerospace, Automotive |
   © 2011 GigOptix, Inc. All Rights Reserved 7 7 7 GigOptix GigOptix + Endwave + Endwave Combination Combination 1. Enhances revenue growth and strengthens balance sheet with substantial cost savings 2. Addresses customers’ growing needs for high speed solutions in optical networks and wireless mobile backhaul Same customer base, same technology – new application Jointly capitalizes on the increasing network bandwidth demands 3. Leverages highly complementary product and technology portfolios in high speed fiber and wireless communications Further increases the level of integration, functionality and cost reductions for products targeting microwave/millimeter wave and broadband fiber optic applications Strengthens IC design capabilities in both GaAs and SiGe processes 4. Expands penetration of targeted and new markets Increases penetration of commercial and military applications Potential for expansion into the high speed instrumentation market |
         © 2011 GigOptix, Inc. All Rights Reserved 8 8 8 Optical & High Speed Wireless Technology Optical & High Speed Wireless Technology Many similarities between Optical and High Speed Wireless solutions exist: Operate in the same microwave and millimeter wave frequencies Utilize the same semiconductor process technologies and design expertise Next generation optical transceiver will employ the same proven wireless communication techniques to increase channel capacity Optical Transceiver Module Wireless Transceiver Module Modem Rx Tx Upconv Modem Tx Local Osc Rx Downconv Low Noise Amplifier Power Amplifier DEMUX PD MUX Optical Modulator |
     © 2011 GigOptix, Inc. All Rights Reserved 9 9 9 Optical & High Speed Wireless Customers Optical & High Speed Wireless Customers Increases business with current and targeted customers High Speed Wireless Optical Network Equipment Market Source: Ovum, Jan 2011 Source: Maravedis Research, Oct 2010 |
       © 2011 GigOptix, Inc. All Rights Reserved 10 10 10 GigOptix’s GigOptix’s High Speed Network End to End Solutions High Speed Network End to End Solutions TODAY: Fiber Optics Networks: 10Gb/s to 100Gb/s and beyond GigOptix components upon completion of merger GigOptix potential extension Included after the completion of merger: High Speed Wireless Mobile Backhaul: 100Mb/s to 2.5Gb/s MUX Up Convertor Low Noise Amplifier Power Amplifier DEMUX Local Oscillato r Local Oscillato r PD MUX Optical Modulato r Optical Amplifier Optical Amplifier Optical Amplifier Optical Amplifier DEMUX |
           11 11 11 © 2011 GigOptix, Inc. All Rights Reserved 2007 2008 2009 2010 2011 2012 10G ULH Drivers 100G RZ Polymer Modulator 10G Ultralow Power VCSEL Driver//TIAs 25G CDR 65nm Hybrid 4 &12ch 5G Parallel Driver & Receiver 4 &12ch 14G Parallel Driver & Receiver 40G DQPSK MZ Driver 100G DPQPSK Driver 100G DPQPSK Polymer Modulator 100G ETH Driver 25G VCSEL Driver/TIAs High Speed Mixed-Signal Platform MUX/Modem 100G DPQPSK Integrated Driver/ Modulator 10G LH & Metro Drivers Family of 10G & 20G TIAs 40G DPSK Polymer Modulator E-Band T/R E-Band MMIC 400G DPQPSK Driver Optical Front End Transceiver Module GigOptix’s Product Portfolio GigOptix’s Product Portfolio |
 12 12 12 © 2011 GigOptix, Inc. All Rights Reserved Building a Valuable Global Channel Building a Valuable Global Channel |
 13 13 13 © 2011 GigOptix, Inc. All Rights Reserved Leveraging a Global Supply Chain Leveraging a Global Supply Chain GigOptix’s fabless business model utilizes industry leading semiconductor foundries and packaging contract manufacturers Efficient technology transfer from in-house prototype fab to contract manufacturers ISO 9000 and 14001 standard compliance; AS-9100, RoHS, Telcordia |
    14 14 14 © 2011 GigOptix, Inc. All Rights Reserved GigOptix GigOptix Senior Management – Senior Management – Post Merger Post Merger Dr. Avi Katz: Chairman & Chief Executive Officer Ms. Julie Tipton: Chief Operations Officer Mr. Andrea Betti-Berutto: Chief Technical Officer Mr. Curt Sacks: Chief Financial Officer |
 15 15 15 © 2011 GigOptix, Inc. All Rights Reserved GigOptix, Inc. Financial Performance GigOptix, Inc. Financial Performance Financials provided are expected 2010 financial results and are in millions. Final numbers will be provided on or about March 2nd in GigOptix’s SEC Form 10-K. Adjusted EBITA is defined as income or loss from operations net of depreciation, amortization, stock-based compensation expense and restructuring expenses |
 16 16 16 GigOptix, Inc. Consolidated Balance Sheet Q410 GigOptix, Inc. Consolidated Balance Sheet Q410 (in thousands) (in thousands) December 31, December 31, 2010 2009 $ % ASSETS Current assets: Cash and cash equivalents 4,502 $ 3,583 $ 919 $ 26% Accounts receivable, net 5,366 3,750 1,616 43% Inventories 1,609 1,457 152 10% Prepaid and other current assets 405 816 (411) (50%) Total current assets 11,882 9,606 2,276 24% Property and equipment, net 3,718 4,334 (616) (14%) Intangible assets, net 3,861 4,716 (855) (18%) Goodwill 7,407 7,307 100 1% Restricted cash 356 601 (245) (41%) Other assets 652 758 (106) (14%) Total assets 27,876 $ 27,322 $ 554 $ 2% LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 2,960 $ 4,376 $ (1,416) $ (32%) Accrued and other current liabilities 4,301 5,403 (1,102) (20%) Line of credit 3,226 1,324 1,902 144% Total current liabilities 10,487 11,103 (616) (6%) Pension liabilities 211 186 25 13% Other long-term liabilities 1,788 2,035 (247) (12%) Total liabilities 12,486 13,324 (838) (6%) Stockholders' Equity Common stock, $0.001 par value; 50,000,000 shares authorized as of December 31, 2010; 12,210,264 and 9,289,682 issued and outstanding as of December 31, 2010 and December 31, 2009, respectively. Common stock, $0.001 par value 12 9 3 33% Additional paid-in capital 89,554 82,814 6,740 8% Accumulated deficit (73,353) (68,993) (4,360) 6% Accumulated other comprehensive income 177 168 9 5% Total stockholders' equity 16,390 13,998 2,392 17% Total liabilities and stockholders' equity 28,876 $ 27,322 $ 1,554 $ 6% Net Change |
 17 17 17 GigOptix, Inc. Consolidated Statement of Operations GigOptix, Inc. Consolidated Statement of Operations Q410 Q410 (in thousands) (in thousands) December 31, December 31, Revenue 2010 2009 Product 6,580 $ 81% 3,708 $ 118% Government contract 1,520 19% 703 22% - 0% (1,275) -41% Total revenue 8,100 100% 3,136 100% Cost of revenue Product 3,301 41% 2,896 92% Government Contract 365 5% 372 12% Total cost of revenue 3,666 45% 3,268 104% Gross profit (loss) 4,434 55% (132) -4% Research and development expense 2,603 32% 2,345 75% Selling, general and administrative expense 1,928 24% 3,752 120% Restructuring expense - 0% 884 28% Total operating expenses 4,531 56% 6,981 223% Loss from operations (97) -1% (7,113) -227% Interest income (expense) (115) -1% (66) -2% Other income (expense) (115) -1% (3) 0% Loss before provision for (benefit from) income taxes (327) -4% (7,182) -229% Provision for (benefit from) income taxes 28 0% 38 1% Net loss (355) -4% (7,220) -230% Net loss per share - basic and diluted (0.03) $ (0.98) $ Weighted average number of shares used in per share calculations - basic and diluted 12,203 7,391 Effect of change in estimated billing rates under government contracts % % Three months ended |
    18 18 18 © 2011 GigOptix, Inc. All Rights Reserved Summary Summary The combination of GigOptix and Endwave creates a leading supplier of high speed and high frequency analog semiconductors, modulators and wireless mobile backhaul World class high speed product portfolio: High speed analog ICs High frequency analog ICs High speed optical modulators High speed wireless front ends Structured and Standard Cell ASICs Trusted supplier to Tier-1 OEMs for critical high performance communication devices Successful history of generating value for investors and customers through strategic plan of growing both organically and through synergistic acquisitions and mergers Highly scalable fabless manufacturing model partnering with best in class contract manufacturers Strong IP portfolio with more than 100 patents granted and over 40 applications on file Solid revenue growth in 2010 with good revenue growth opportunities for 2011 Strong balance sheet with solid cash position and no long term debt Leading supplier of high performance network interface devices, enabling high speed optical and wireless networks for Tier-1 Telecom and Datacom OEMs |
   © 2011 GigOptix, Inc. All Rights Reserved 19 19 19 Transaction Overview Transaction Overview What will be the conversion ratio be for ENWV to GGOX common stock? The actual conversion ratio in the merger cannot be determined until immediately before the consummation of the merger. However, if the merger were consummated on February 7, 2011, each outstanding share of Endwave common stock would convert into approximately 0.89 shares of GGOX common stock. How many shares will the combined company have? Approximately 21 million outstanding shares What is the status of GigOptix being listed on a Major Exchange? We will continue our best efforts to list GigOptix common stock on NYSE Amex or another national securities exchange, with the intent to receive conditional listing approval so we may be able to commence trading concurrent with the merger closing. The Press Release (dated 2/7/2011) noted the combined company had approximately $28M in cash and investments at 12/31/2010 but that cash at the close of the transaction would be approx. $16M. What are the factors behind the $12M reduction? The cash and investment balance will be reduced by transaction related fees, restructuring related payments, the pay down of GGOX AR line and cash used in operations during the period between 12/31/10 and the close of the deal. We will continue to work hard to reduce our cash usage during the period. The Press Release (dated 2/7/2011) noted the combined company would see savings of approx. $1M/quarter in 2012. What are the items that make up these savings? The savings will come from a number of different areas including public company related expenses, the consolidation of personnel, facilities and the reduction of overhead. The Answers to your Questions |
 20 20 20 © 2011 GigOptix, Inc. All Rights Reserved Thank you! Thank you! |