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U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For The Fiscal Year Ended January 3, 2003

Commission File Number 1-16137

WILSON GREATBATCH TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)

Delaware
(State of incorporation)

16-1531026
(I.R.S. employer identification no.)

9645 Wehrle Drive
Clarence, New York
14031
(Address of principal executive offices)

(716) 759-6901
(Registrant's telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act:

Securities Registered Pursuant to Section 12(g) of the Act:
None

          Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

          Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes [X] No [ ]

          Indicate by check mark whether the Registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes [X] No [ ]

          Aggregate market value of voting stock of Wilson Greatbatch Technologies, Inc. held by nonaffiliates as of June 28, 2002, based on the last sale price of $25.48, as reported on the New York Stock Exchange: $534.7 million. Solely for the purpose of this calculation, shares held by directors and officers and 10 percent shareholders of the Registrant have been excluded. Such exclusion should not be deemed a determination by or an admission by the Registrant that these individuals are, in fact, affiliates of the Registrant.

          Shares of common stock outstanding on March 11, 2003: 21,001,363

Portions of the company's definitive Proxy Statement for its 2003 Annual Meeting of Stockholders are incorporated by reference into Part III.

PART I

We are a leading developer and manufacturer of batteries, capacitors, feedthroughs, enclosures, and other components used in implantable medical devices. We offer technologically advanced, highly reliable and long lasting products for implantable medical devices and enable our customers to introduce implantable medical devices that are progressively smaller, longer lasting, more efficient and more functional. We also leverage our core competencies in technology and manufacturing to develop and produce power sources for commercial applications that demand high performance and reliability, including oil and gas exploration, oceanographic equipment and aerospace. We believe that our proprietary technology, close customer relationships, market leadership and dedication to quality provide us with competitive advantages and create a barrier to entry for potential market entrants.

In 1970, Mr. Wilson Greatbatch, the inventor of the implantable pacemaker, founded Wilson Greatbatch Ltd., our predecessor. Our company was incorporated in connection with the 1997 leveraged buyout to acquire Wilson Greatbatch Ltd., which is now our wholly-owned subsidiary. We acquired Hittman Materials and Medical Components, Inc., now Greatbatch-Hittman, Inc., in August 1998 to expand and complement our product lines. Greatbatch-Hittman produces feedthroughs and electrodes. We acquired the Sierra-KD Components Division of Maxwell Technologies, Inc., now Greatbatch-Sierra, in June 2001 to broaden the product line we offer to include electromagnetic interference filters and capacitors. In July 2002, we acquired Globe Tool and Manufacturing Company, Inc., now Greatbatch-Globe, to further broaden our product offering to include enclosures.

Segment information including revenues from external customers, profit or loss, and assets by segment as well as revenues from external customers and long-lived assets by geographic area are incorporated by reference to Note 14 - Business Segment Information of the Notes to Consolidated Financial Statements.

An implantable medical device is an instrument that is surgically inserted into the body to provide diagnosis or therapy. The largest and fastest growing segment of the implantable medical device market is cardiac rhythm management (CRM), which includes devices such as pacemakers and implantable cardioverter defibrillators (ICDs). Pacemakers treat bradycardia, a condition that occurs when a patient has an abnormally slow heartbeat, by stimulating the heart with regular electrical pulses. ICDs treat tachycardia, a condition that occurs when a patient has a rapid and irregular heartbeat, by delivering concentrated and time electrical energy to the heart to restore a normal heart rate.

The following table sets forth the main categories of battery-powered implantable medical devices and the principal illness or symptom treated by each device:

The implantable medical device industry is expected to grow primarily as a result of:

Cardiovascular Device Update has predicted that ICD implants will grow at a faster rate than pacemaker implants in the next three to five years. The faster growth predicted for the ICD market is based on continued penetration of existing clinical indications and anticipated expansion into new indications. We believe that our company will continue to be well positioned to meet the requirements of manufacturers of these products.

We design and manufacture a variety of batteries, capacitors, feedthroughs, enclosures, and other components used in implantable medical devices. Our commercial power sources are used in oil and gas exploration, oceanographic equipment and aerospace. The following table provides information about our principal products:

A battery is an electrochemical device that stores energy and releases it in the form of electricity. To generate an electrical current, electrons are first released from one part of the battery, called the anode or negative electrode. This flow of electrons, known as a current, travels to a load or device outside the battery. After powering the device, the electron flow reenters another part of the battery, called the cathode or positive electrode. As electrons flow from the anode to the device being powered by the battery, ions released from the anode cross through an electrolyte, which consists of one or more chemical compounds that facilitate the flow of ions to the cathode. The ions react with the cathode in order to complete the circuit. Separators are typically used inside the battery as electrical insulators to divide the anode and the cathode to prevent mechanical contact between them, which would result in the rapid depletion of the battery cell.

From the late 1950s to the early 1970s, zinc/mercuric oxide batteries powered implantable pacemakers. These batteries typically lasted two to three years, often failed without warning, were large and bulky and generated hydrogen gas, making it impossible to seal the battery. In the early 1970s, we introduced lithium/iodine batteries to power implantable pacemakers. Lithium batteries manufactured by us and manufactured by others under license from us are now the principal power source for pacemakers. Pacemaker batteries utilizing our technology last up to 12 years under certain conditions and provide high reliability and predictability. In the mid 1980s, we introduced lithium/silver vanadium oxide (SVO) batteries for powering ICDs. These batteries provide the higher power levels required by an ICD with a high degree of reliability and have demonstrated a five-year battery life in certain device designs. Lithium/SVO batteries manufactured by us and manufactured by others under license from us are now the principal power source for ICDs.

In 1996, we introduced a lighter weight titanium-encased lithium/carbon monofluoride battery as a next generation battery for pacemakers and other types of implantable devices. These batteries offer improved pacemaker performance in several areas, including weight reduction, improved electrical performance and longer life.

In 1996, we introduced a new process for cathode manufacturing that enabled the production of significantly thinner cathodes than previously possible. As a result of this new cathode manufacturing process and other design improvements, our newest generation of ICD batteries is the thinnest commercially available. Over the past few years, the decrease in battery size has contributed significantly to decreases in the size of ICDs, making these devices easier to implant.

Capacitors, which are used in ICDs, perform the critical function of storing electrical current before delivery to the heart. Historically, ICDs utilized two aluminum-based capacitors. In the fourth quarter of 1999, we introduced wet tantalum hybrid capacitors commercially for use in ICDs, which provide a number of advantages over aluminum-based capacitors. Our wet tantalum hybrid capacitors, which combine liquid electrolytes and ruthenium oxide cathode material with a tantalum anode, provide a unique combination of high voltage and high energy storage capacity. This combination enables energy density not achievable with competing technologies. Our capacitors can be manufactured in many sizes and shapes to meet the specific needs of our customers.

To produce our capacitors, we have licensed a key patent for the basic technology used in our defibrillator capacitors from the Evans Capacitor Company. We have also developed our own portfolio of patents and patent applications covering improvements that we have made to Evans' capacitor technology. We believe that we are the only supplier of wet tantalum capacitors for the implantable medical device industry. In 1997, we entered into an agreement with a major ICD manufacturer to use our capacitor technology in its generation of ICDs that was launched in the first quarter of 2000. In 2002, we received purchase orders for our capacitors from two additional major ICD manufacturers.

Electromagnetic interference filters and capacitors for implantable medical devices limit or eliminate electromagnetic interference, or EMI, which is any undesirable emission or disturbance generated by products such as cell phones and two-way pagers. EMI may cause an undesirable response, malfunctioning or degradation in the performance of electronic equipment including medical devices.

We offer EMI filtering products and technology to our customers through Greatbatch-Sierra, which holds several key patents relative to its differentiated EMI filtering technology. Prior to our acquisition of Greatbatch-Sierra in June 2001, they were a component customer, who shared a similar customer base for medical devices. The vertical integration of Greatbatch-Sierra represented an opportunity to increase our importance to these customers and to position us to participate in the growing demand for EMI protection on medical devices. The U.S. Food and Drug Administration, or FDA, is focusing on issues created by EMI. Currently, labels for new pacemakers and ICDs must disclose the level of EMI protection. We expect that over time the majority of implantable electronic medical devices will incorporate EMI protection.

Greatbatch-Sierra has leveraged its technology and manufacturing expertise to provide high quality, precision components for commercial applications that demand high performance and reliability, including aerospace, oil and gas exploration and telecommunications equipment.

Feedthroughs are components that transmit electrical signals from inside an implantable medical device to the electrodes that transmit the signals to the body. Feedthroughs consist of an outer metallic structure called a flange, an electrical insulator made of ceramic or glass material, and wire connectors called lead wires that carry electrical signals to and from the device. Our feedthroughs use a ceramic to metal seal that is substantially more durable than a traditional glass to metal seal.

We design and manufacture approximately 45 types of feedthroughs. Each of our feedthroughs is designed specifically for a particular customer device. We are often the sole source of feedthroughs for our customers. In 2002, approximately 89% of our feedthroughs were used in pacemakers and ICDs, with the balance used primarily in LVADs, hearing assist devices, drug pumps and neurostimulators. We are currently working with a number of medical device manufacturers to develop hermetic feedthroughs for the next generation of implantable medical devices and applications, including neurostimulators, middle ear devices, and muscle stimulation devices.

Electrodes are components used in pacemakers and ICDs that are attached to the heart tissue to deliver the electrical signal from the device. By coating the electrode with chemical compounds, we can enhance its electrical properties and therefore improve the delivery of energy to the heart. Some electrode tips are designed to contain medication, such as steroids, to prevent scarring of the heart tissue following electrode implantation.

We design and manufacture a variety of coated electrodes, some of which have tips that can contain medication. We believe that our experience with physical deposition processes, such as sputtering and powder metallurgic techniques, has enabled us to produce high quality coated surfaces utilizing almost any combination of biocompatible coating surfaces.

We design and manufacture miniature precision components and subassemblies primarily for pacemaker and ICD manufacturers. Our precision components are machined or molded to adhere to tolerances up to one ten-thousandth of an inch. To manufacture precision components, we typically use various alloys of stainless steel, platinum, titanium, aluminum and brass, as well as plastics and composites. Although our primary focus is to develop and manufacture precision components for implantable medical devices, we also serve the general medical equipment market and the aerospace industry.

We design and manufacture highly engineered metal enclosures for the medical device industry. The manufacturing process to make implantable grade enclosures involves drawing and forming thin metals such as titanium, stainless steel, and aluminum. We have developed and refined a trimming process that can hold thin metals to close profile tolerances. We also design tooling and processes to precise customer specifications. Our principal focus is to develop and manufacture high precision products for use in implantable medical devices including pacemakers and ICDs.

We have developed specialized power source technologies that are functional in high temperatures or under high shock and vibration. The majority of the commercial power sources that we sell are used in oil and gas exploration, including recovery equipment, pipeline inspection gauges, down-hole pressure measurement systems and seismic surveying equipment. We also supply power sources to NASA for its space shuttle program. In addition, our commercial power sources have been used for emergency position locating beacons and locator transmitters, classified governmental uses, electronic circuit breakers for industrial applications, weather balloon instrumentation, electricity transmission cable lighting detectors, wear monitors for train cables and scientific equipment used in Antarctica.

We have developed a line of rechargeable lithium ion batteries that is expected to broaden and complement our current lines of lithium primary batteries. A number of new medical devices require rechargeable batteries, including:

We have developed proprietary technology that has applications in implantable devices designed to deliver small quantities of drugs or other fluids to a patient. Several of our technologies are critical to these devices, including the power source, the feedthroughs and the pumping mechanism that moves the fluid. Currently, one of our customers has regulatory approval in Europe for a device that utilizes our implantable pump technology and intends to file with the FDA for regulatory approval in the United States in 2003.

Our position as a leading developer and manufacturer of components for implantable medical devices is largely the result of our long history of technological innovation. We invest substantial resources in research, development and engineering. Our scientists, engineers and technicians focus on improving existing products, expanding the use of our products and developing new products. In addition to our internal technology and product development efforts, we maintain close relationships with leading research organizations, including Alfred University, Clarkson University, the Jet Propulsion Laboratory, the applied physics department of Johns Hopkins University, NASA, Sandia-National Laboratories, the State University of New York at Buffalo and Villanova University. These relationships include funding research efforts, licensing researchers' technology and assisting in building prototypes. Our research, development and engineering team is responsible for a number of pioneering developments in the implantable medical device industry including:

We rely on a combination of patents, licenses, trade secrets and know-how to establish and protect our proprietary rights to our technologies and products. To date, we have been granted 212 U.S. patents and 214 foreign patents. We also have 143 U.S. and 303 foreign pending patent applications at various stages of approval. During the past three years, we have received 78 new U.S. patents, of which 28 were received in 2002. Corresponding foreign patents have been issued or are expected to be issued in the near future. Often, several patents covering various aspects of the design protect a single product. We believe this provides broad protection of the concepts employed. The following table provides a breakdown of our patents as of December 31, 2002 by product type:

Our active battery patents relate to process improvements and modifications to the original technology that was developed either by our Company, or others, the original technology is currently not patent protected.

We license the basic technology used in our wet tantalum capacitors from Evans Capacitor Company. The license extends throughout the lives of the related patents, which expire in 2010, 2013 and 2014. The license can be cancelled if we default under the license agreement and fail to cure the default. A cancellation of the license would seriously impair our ability to produce our entire line of capacitors.

The significant patents that we maintain for the Capacitor technology relate to ultrasonically coated substrate for use in a capacitor and method of manufacture; hermetically sealed wet tantalum capacitor; Electrolyte for use in a capacitor; and the anode for an electrolytic capacitor and they expire between 2017 and 2019.

The Company is currently developing its next generation battery technology to power implantable cardiac defibrillators. This technology has the potential to deliver the highest energy density and greatest longevity in the industry and provide stable charge time throughout its useful life. Company scientists pioneered this unique technology. The Company has over 20 patent applications that have been applied for relating to this technology.

In addition, we are also a party to several license agreements with third parties pursuant to which we have obtained, on varying terms, the exclusive or non-exclusive rights to patents held by them. We have also granted rights in our own patents to others under license agreements.

It is our policy to require our executive and technical employees, consultants and other parties to execute confidentiality agreements. These agreements prohibit disclosure of confidential information to third parties except in specified circumstances. In the case of employees and consultants, the agreements generally provide that all confidential information relating to our business is the exclusive property of our company.

Our manufacturing facilities are in Clarence, Cheektowaga, Wheatfield, and Amherst, New York; Carson City, Nevada; Canton, Massachusetts; Columbia, Maryland; and Minneapolis, Minnesota. Our New York facilities manufacture and test medical batteries, capacitors, precision components and a portion of our commercial batteries. Our Carson City, Nevada facility primarily manufactures EMI filtering capacitors. Our Canton, Massachusetts facility manufactures the remaining portion of our commercial batteries and battery packs. Our Columbia, Maryland facility manufactures feedthroughs, electrodes and other components. Our Minneapolis, Minnesota facility manufactures enclosures and related components.

In 2000 and 2001, we modernized our facilities and a number of our manufacturing lines, processes and equipment. These manufacturing improvements have enabled us to increase the quality and service life of our power sources and other components and increase our manufacturing capacity. Key resources that allow us to manufacture subassemblies include a full model shop, a precious metals machining area, injection molding equipment and a Class 10,000 clean room.

We primarily manufacture small lot sizes, as most customer orders range from a few hundred to thousands of units. As a result, our ability to remain flexible is an important factor in maintaining high levels of productivity. Each of our production teams receives assistance from a manufacturing support team, which typically consists of representatives from our quality control, engineering, manufacturing, materials and procurement departments.

Our quality system is based upon an ISO documentation system and is driven by a master validation plan that requires rigorous testing and validation of all new processes or process changes that directly impact our products. Our New York, Massachusetts and Nevada facilities are ISO-9001 certified, which requires compliance with regulations regarding quality systems of product design, supplier control, manufacturing processes and management review. Our Columbia, Maryland facility is ISO-9002 certified. In 2003, our Minnesota facility will be registered to ISO 9001. This certification can only be achieved after completion of an audit conducted by an independent authority. Our facilities are audited by the National Standards Authority of Ireland, an independent auditing firm and notified body that specializes in evaluating quality standards. To maintain certification, all facilities must be reexamined every six months by our certifying body.

We utilize a combination of direct and indirect sales methods, depending on the particular product. In 2002, approximately 75% of our products were sold in the United States.

We market and sell our medical components directly to manufacturers of implantable medical devices. The majority of our customers contract with us to develop custom components to fit their specific product specifications. As a result, we have established close working relationships between our internal program managers and our customers. We market our products and technologies at industry meetings and trade shows domestically and internationally, including North American Society of Pacing and Electrophysiology (NASPE), and CardioStim.

Internal sales managers support all activity, and involve engineers and materials professionals in the sales process to address customer requests appropriately.

We sell our commercial batteries and battery packs either directly to the end user, directly to manufacturers that incorporate our products into other devices for resale, or to distributors who sell our products to manufacturers and end users. Our sales managers are trained to assist our customers in selecting appropriate battery chemistries and configurations. We market our commercial power sources at various technical trade meetings. We also place print advertisements in relevant trade publications.

Firm backlog orders at December 31, 2002 and 2001, were $45.7 million and $46.3 million, respectively. Most of these orders are expected to be shipped within one year.

Our products are designed to provide reliable, long lasting solutions that meet the evolving requirements and needs of our customers and the end users of their products. Our medical customers include leading implantable medical device manufacturers such as Guidant, St. Jude Medical, Medtronic, Biotronik, and ELA/Sorin. In 2002, Guidant and St. Jude Medical, our two largest customers, collectively accounted for approximately 66% of our medical technology revenues. Our commercial customers are primarily companies involved in the oil and gas exploration, oceanographic and aerospace industries and include Halliburton and Baker-Hughes.

In February 1999, we entered into a supply agreement with Guidant pursuant to which Guidant purchases batteries from us for use in its implantable medical devices. Guidant also separately purchases components from us for use in its implantable medical devices. Our supply agreement with Guidant expires on December 31, 2004 and can be renewed for additional one-year periods upon mutual agreement.

In April 1997, we entered into a supply agreement with St. Jude Medical. In accordance with this agreement, we are the primary supplier of many components used in their pacemakers and ICDs, except for microprocessors and capacitors. We will also be the exclusive supplier of batteries to St. Jude Medical through the expiration of the supply agreement on December 28, 2003, with the ability of St. Jude to extend the agreement for two (2) one-year extensions.

We purchase certain critical raw materials for our business from a limited number of suppliers due to the lengthy process needed to qualify these materials with our customers before use in the products we produce. We cannot quickly establish additional or replacement suppliers for these materials because of these requirements. In the past, we have not experienced any significant interruptions or delays in obtaining these raw materials. We maintain minimum safety stock levels of critical raw materials.

For other raw material purchases, we utilize competitive pricing methods to secure supply such as bulk purchases, precious metal pool buys, blanket orders, and long term contracts at terms that are favorable to us. We believe that there are alternative suppliers or substitute products available for each of the materials we purchase at competitive prices.

Our existing or potential competitors in our medical components business include:

Medtronic produces batteries for use in implantable medical devices that it manufactures. However, to our knowledge Medtronic does not market or sell batteries to third parties. Biotronik produces batteries for use in implantable medical devices that it manufactures and has attempted to market those batteries to other device manufacturers. The Company, Medtronic and Biotronik are the major manufacturers of power sources for implantable medical devices. We also compete in the intensely competitive commercial battery market. Our principal competitors in this market are Eagle-Picher Industries and ECO-Tracer. While we believe that the industry perceives our products to be of the highest quality, there are suppliers whose products are perceived to be of comparable quality. Moreover, the commercial battery market is subject to volatility in oil and gas exploration activity. When oil and gas exploration activity has slowed, a number of our competitors have historically reduced battery prices to maintain or gain market share. Quality and technology are the principal bases upon which we compete in both the implantable medical devices market and the commercial power sources market.

Except as described below, our business is not subject to direct governmental regulation other than the laws and regulations generally applicable to businesses in the jurisdictions in which we operate, including those federal, state and local environmental laws and regulations governing the emission, discharge, use, storage and disposal of hazardous materials and the remediation of contamination associated with the release of these materials at our facilities and at off-site disposal locations. Our research, development and engineering activities involve the controlled use of, and our products contain, small amounts of hazardous materials. Liabilities associated with hazardous material releases arise principally under the Comprehensive Environmental Response, Compensation and Liability Act and analogous state laws which impose strict, joint and several liability on owners and operators of contaminated facilities and parties that arrange for the off-site disposal of hazardous materials. We are not aware of any material noncompliance with the environmental laws currently applicable to our business and we are not subject to any material claim for liability with respect to contamination at any company facility or any off-site location. We cannot assure you, however, that we will not be subject to such environmental liabilities in the future as a result of historic or current operations.

As a component manufacturer, our products are not subject to FDA pre-market approval. However, the FDA and related state and foreign governmental agencies regulate many of our customers' products as medical devices. In many cases, the FDA must approve those products prior to commercialization. In addition, because some of the products produced by our engineered components division may be considered finished medical devices, some of the operations within that division are subject to FDA inspection and must comply with current good manufacturing practices (CGMP) requirements.

We invest substantial resources to our recruiting efforts. Our internal recruiting efforts primarily focus on supplying quality personnel to our business. We have established a number of programs that are designed to challenge and motivate our employees and we encourage our employees to be proactive in contributing ideas and regularly survey them to collect feedback on ways that our business and operations can be improved. We also seek to meet our hiring needs through outside sources.

We provide an intensive training program to our new employees that is designed to educate them on safety, quality, our business strategy and the methodologies and technical competencies that are required for our business and our corporate culture. Our safety training programs focus on such areas as basic industrial safety practices and emergency response procedures to deal with fires or chemical spills. All of our employees are required to participate in a specialized training program that is designed to provide an understanding of our quality objectives. We offer our employees a tuition reimbursement program and encourage them to continue their education at local colleges. Many of our professionals attend seminars on topics that are related to our corporate objectives and strategies. We believe that comprehensive training is necessary to ensure that our employees work in a uniform and consistent manner and that best practices are effectively utilized.

As of December 31, 2002, we had 1,378 employees, including 237 research, development and engineering personnel, 936 manufacturing personnel and 213 support personnel. We also employ a number of temporary employees to assist us with various projects and service functions. Our employees are not represented by any union and, except for certain executive officers of our company and our subsidiaries, are retained on an at-will basis. We believe that we have a good relationship with our employees.

The Company makes available free of charge on or through its internet website its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after it electronically files such material with, or furnishes it to, the Securities and Exchange Commission. Our Internet address is http://www.greatbatch.com. The information contained on the Company's website is not incorporated by reference in this annual report on Form 10-K and should not be considered a part of this report.

Some of the statements contained in this Annual Report on Form 10-K and other written and oral statements made from time to time by us and our representatives, are not statements of historical or current fact. As such, they are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We have based these forward-looking statements on our current expectations, which are subject to known and unknown risks, uncertainties and assumptions. They include statements relating to:

You can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially from those suggested by these forward-looking statements. In evaluating these statements and our prospects generally, you should carefully consider the factors set forth below. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary factors and to others contained throughout this report. We are under no duty to update any of the forward-looking statements after the date of this report or to conform these statements to actual results.

Although it is not possible to create a comprehensive list of all factors that may cause actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors include the following: dependence upon a limited number of customers, product obsolescence, inability to market current or future products, pricing pressure from customers, reliance on third party suppliers for raw materials, products and subcomponents, fluctuating operating results, inability to maintain high quality standards for our products, challenges to our intellectual property rights, product liability claims, inability to successfully consummate and integrate acquisitions, unsuccessful expansion into new markets, competition, inability to obtain licenses to key technology, regulatory changes or consolidation in the healthcare industry, and other risks and uncertainties set forth in Exhibit 99.2 to this Annual Report on Form 10-K and those that arise from time to time and are described in the Company's periodic filings with the Securities and Exchange Commission.

We incorporate by reference the "Factors Possibly Affecting Future Operating Results" from Exhibit 99.2 into this filing.

Our executive offices are located in Clarence, New York. The building that houses our executive offices also contains warehouse operations, a variety of support services and capacity for light manufacturing or laboratory space.

The following table sets forth information about all of our principal manufacturing or testing facilities:

We believe these facilities are adequate for our current and foreseeable purposes and that additional space will be available when needed.

We are involved in various lawsuits and claims incidental to our business. We believe the ultimate outcome resulting from resolution of these lawsuits and claims will not materially affect our financial position, results of operations or cash flows.

None.

The Company's common stock has been traded on the New York Stock Exchange (NYSE), under the symbol "GB" since its initial public offering on September 29, 2000. The following table sets forth, for the periods indicated, the high and low closing prices per share for the common stock as reported on the NYSE Composite Tape.

As of March 7, 2003, there were 275 record holders of the Company's common stock. Our Employee Stock Ownership Plan (ESOP) is considered one record holder for the purposes of this calculation. There are approximately 1,500 participants in the ESOP.

The Company has not paid cash dividends since its initial public offering. We currently intend to retain any earnings to further develop and grow our business.

The following table provides selected financial data of our Company for the periods indicated. You should read the selected consolidated financial data set forth below in conjunction with Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," and with our consolidated financial statements and related notes appearing elsewhere in this report. The consolidated statement of operations data and the consolidated balance sheet data for the periods indicated have been derived from our financial statements and related notes.

YOU SHOULD READ THE FOLLOWING DISCUSSION AND ANALYSIS OF OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE IN THIS REPORT.

We are a leading developer and manufacturer of batteries, capacitors, filtered feedthroughs, engineered components and enclosures used in implantable medical devices. We also develop and manufacture high performance batteries and battery packs used in other demanding non-medical applications.

Our medical battery revenues are derived from sales of batteries for pacemakers, implantable cardioverter defibrillators (ICDs) and other implantable medical devices. Our capacitor revenues are derived from sales of our wet tantalum capacitors, which we developed for use in ICDs. Our component revenues are derived from sales of feedthroughs, electrodes, electromagnetic interference (EMI) filters, enclosures, and other precision components principally used in pacemakers and ICDs. Our commercial power sources revenues are derived primarily from sales of batteries and battery packs for use in oil and gas exploration. We also supply batteries to NASA for its space shuttle program and other similarly demanding commercial applications.

A substantial part of our business is conducted with a limited number of customers. Our two largest customers accounted for approximately 66% of revenues in 2002. We have entered into long-term supply agreements with most of our large customers. For each of our products, we recognize revenue when the products are shipped and title passes.

Cost of revenues includes materials, labor and other manufacturing costs associated with the products we sell. Selling, general, and administrative expenses include salaries, facility costs, professional service fees, and patent- related and other legal expenses. Research, development, and engineering costs include expenses associated with the design, development, testing, deployment and enhancement of our products. We record cost reimbursements received for research, development and engineering conducted on behalf of customers as an offset to research, development and engineering expenses.

We utilize a fifty-two, fifty-three week fiscal year ending on the Friday nearest December 31^st. For clarity of presentation, the Company describes all periods as if the year-end is December 31^st. Fiscal 2002 included 53 weeks.

The commentary that follows should be read in conjunction with our consolidated financial statements and related notes.