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<SEC-DOCUMENT>0000724910-11-000003.txt : 20110119
<SEC-HEADER>0000724910-11-000003.hdr.sgml : 20110119
<ACCEPTANCE-DATETIME>20110119161730
ACCESSION NUMBER:		0000724910-11-000003
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20101231
FILED AS OF DATE:		20110119
DATE AS OF CHANGE:		20110119

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NVE CORP /NEW/
		CENTRAL INDEX KEY:			0000724910
		STANDARD INDUSTRIAL CLASSIFICATION:	SEMICONDUCTORS & RELATED DEVICES [3674]
		IRS NUMBER:				411424202
		STATE OF INCORPORATION:			MN
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-12196
		FILM NUMBER:		11536006

	BUSINESS ADDRESS:	
		STREET 1:		11409 VALLEY VIEW ROAD
		CITY:			EDEN PRAIRIE
		STATE:			MN
		ZIP:			55344
		BUSINESS PHONE:		9528299217

	MAIL ADDRESS:	
		STREET 1:		11409 VALLEY VIEW ROAD
		CITY:			EDEN PRAIRIE
		STATE:			MN
		ZIP:			55344

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PREMIS CORP
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>q3q11.htm
<DESCRIPTION>QUARTERLY REPORT FOR THE PERIOD ENDED DEC. 31, 2010
<TEXT>
<html><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;</font>
<p align="center"><b><font face="Times New Roman" size="5">UNITED STATES<br> SECURITIES AND EXCHANGE COMMISSION</font><font style="font-size: 10pt; font-family: Times New Roman"><br>
Washington, D.C.&nbsp;&nbsp;20549</font></b>
<p align="center"><b><font face="Times New Roman" size="5">FORM 10-Q</font></b>
<p align="left"><font style="font-size: 8pt; font-family: Times New Roman">(Mark
One)</font>
<br><font style="font-size: 10pt; font-family: Times New Roman">[X]
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934<br> For the quarterly period ended &nbsp;&nbsp;<b><u>December 31, 2010</u></b><br>
<div align="center">or</div>[&nbsp;&nbsp;&nbsp;] TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934<br> For the transition
period from <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>to&nbsp;<u>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>
<br>Commission File Number: <b><u>000-12196</u></b>
<br><br><br></font>
<div align="center"><img src="nve-logo.gif" width="276" height="54" alt="NVE Logo"><br>
<b><font style="font-size: 22pt; font-family: Arial; Helvetica; sans-serif;">NVE CORPORATION</font></b><br>
<font style="font-size: 10pt; font-family: Times New Roman">(Exact name of registrant as specified in its charter)</font></div><font style="font-size: 10pt; font-family: Times New Roman"><br>
&nbsp;</font> <table style="font-size: 10pt; font-family: Times New Roman" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr align="center"> <td width="48%"> <b><u>Minnesota</u></b></td><td>&nbsp;</td><td width="48%">
<b><u>41-1424202</u></b> </td></tr> <tr align="center"> <td>(State or other jurisdiction of incorporation or organization)
</td><td>&nbsp;</td><td>(I.R.S. Employer Identification No.) </td></tr> <tr> <td colspan="3">&nbsp;</td></tr> <tr align="center"> <td> <b><u>11409
Valley View Road, Eden Prairie, Minnesota</u></b> </td><td>&nbsp;</td><td> <b><u>55344</u></b>
</td></tr> <tr align="center"> <td> (Address of principal executive offices) </td><td>&nbsp;</td><td>(Zip Code) </td></tr> <tr> <td colspan="3">&nbsp;</td></tr> <tr> <td colspan="3" align="center">&nbsp;<b><u>(952)
829-9217</u></b>&nbsp; </td></tr> <tr> <td colspan="3" align="center">(Registrant&#146;s
telephone number, including area code) </td></tr> </table><font style="font-size: 10pt; font-family: Times New Roman"><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Indicate by check mark whether the registrant
(1)&nbsp;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)&nbsp;has
been subject to such filing requirements for the past 90 days. <div align="right">[X]&nbsp;Yes&nbsp;&nbsp;[&nbsp;&nbsp;&nbsp;]&nbsp;No</div><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405
of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post
such files). <br> <div align="right">[&nbsp;&nbsp;&nbsp;]&nbsp;Yes&nbsp;&nbsp;[&nbsp;&nbsp;&nbsp;]&nbsp;No<br>
<br> </div>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or
a smaller reporting company. See the definitions of &#147;large accelerated filer,&#148;
&#147;accelerated filer&#148; and &#147;smaller reporting company&#148; in Rule
12b-2 of the Exchange Act.</font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td width="70%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Large accelerated filer [&nbsp;&nbsp;&nbsp;]</td><td>Accelerated filer [X]</td></tr>
<tr> <td> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-accelerated&nbsp;filer&nbsp;[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;(Do&nbsp;not&nbsp;check&nbsp;if&nbsp;a&nbsp;smaller&nbsp;reporting&nbsp;company)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td><td>Smaller
reporting company [&nbsp;&nbsp;&nbsp;]</td></tr> </table><font style="font-size: 10pt; font-family: Times New Roman"><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indicate by check mark whether the registrant is
a shell company (as defined in Rule 12b-2 of the Exchange Act).&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[&nbsp;&nbsp;&nbsp;]&nbsp;Yes&nbsp;&nbsp;[X]&nbsp;No<br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indicate the number of shares outstanding of
each of the issuer&#146;s classes of common stock, as of the latest practicable
date.<br>
 <b>Common Stock, $0.01 Par Value &#150; 4,766,198
shares outstanding as of January 14, 2011<br>
 </b><br> </font> <hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<a href="#TOC"></a><a name="TOC"></a><br>
<div align="center"><b>NVE CORPORATION<br> QUARTERLY REPORT ON FORM 10-Q<br> TABLE
OF CONTENTS</b></div><br> <br> <br> <a href="#Part1"><b>PART I. FINANCIAL INFORMATION</b></a><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Part1">Item 1. Financial Statements</a><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Part1">Balance
Sheets</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#QIncome">Statements
of Income for the Quarters Ended December 31, 2010 and 2009</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#YTDIncome">Statements
of Income for the Nine Months Ended December 31, 2010 and 2009</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#CashFlows">Statements
of Cash Flows</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Notes">Notes
to Financial Statements</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#MDA">Item
2. Management&#146;s Discussion and Analysis of Financial Condition and Results
of Operations</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#MarketRisk">Item
3. Quantitative and Qualitative Disclosures About Market Risk</a><br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Controls">Item
4. Controls and Procedures</a><br> <br> <a href="#Part2"><b>PART II. OTHER INFORMATION</b></a><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Risks">Item 1A. Risk Factors</a><br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#Exhibits">Item 6. Exhibits</a><br>
<br> <a href="#Signatures"><b>SIGNATURES</b></a><br> <br> <br> <div align="center">2<br></div></font>
<hr> <br clear="all" style="page-break-before:always;"> <font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><a name="Part1"></a>
<br><br><div align="center">PART I&#150;FINANCIAL
INFORMATION</div><br><br>Item 1. Financial Statements.</b><div align="center"><b>NVE
CORPORATION<br> BALANCE SHEETS<br> <br> </b></div></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td></td><td style="border-bottom: 1px solid black;" colspan="3" valign="bottom" align="center"><b>(Unaudited)<br>
Dec.&nbsp;31, 2010</b></td><td width="2%"></td><td style="border-bottom: 1px solid black;" colspan="3" valign="bottom" align="center"><b>March
31, 2010*</b></td></tr> <tr bgcolor="#ccdaef"> <td colspan="8">ASSETS</td></tr>
<tr> <td colspan="8">Current assets</td></tr> <tr bgcolor="#ccdaef"><td> <div style="margin-left: 9pt;">Cash
and cash equivalents</div></td><td width="1%">$</td><td align="right" width="11%">1,178,409</td><td width="1%"></td><td></td><td width="1%">$</td><td align="right" width="11%">1,389,288</td><td width="1%"></td></tr>
<tr> <td> <div style="margin-left: 9pt;">Marketable securities, short term</div></td><td>&nbsp;</td><td align="right">4,455,249</td><td></td><td></td><td></td><td align="right">1,566,666</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Accounts receivable,
net of allowance for uncollectible accounts of $15,000</div></td><td>&nbsp;</td><td align="right">3,471,435</td><td></td><td></td><td></td><td align="right">4,221,564</td><td></td></tr>
<tr> <td> <div style="margin-left: 9pt;">Inventories</div></td><td>&nbsp;</td><td align="right">3,164,158</td><td></td><td></td><td></td><td align="right">1,706,427</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Prepaid expenses and
other assets</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">1,102,838</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">781,294</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td>Total current assets</td><td>&nbsp;</td><td align="right">13,372,089</td><td></td><td></td><td></td><td align="right">9,665,239</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td colspan="8">Fixed assets</td></tr> <tr> <td> <div style="margin-left: 9pt;">Machinery
and equipment&nbsp;</div></td><td>&nbsp;</td><td align="right">5,954,570</td><td></td><td></td><td></td><td align="right">5,617,136</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Leasehold improvements</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">612,682</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">450,546</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td>&nbsp;</td><td></td><td align="right">6,567,252</td><td></td><td></td><td></td><td align="right">6,067,682</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Less accumulated depreciation&nbsp;</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">5,146,230</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">4,857,819</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td>Net fixed assets</td><td></td><td align="right">1,421,022</td><td></td><td></td><td></td><td align="right">1,209,863</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td>Marketable securities, long term</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">52,677,162</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">46,587,812</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr valign="top"> <td>Total assets</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">67,470,273</td><td style="border-bottom: 3px double black;">&nbsp;</td><td></td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">57,462,914</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
<tr> <td colspan="8">&nbsp;</td></tr> <tr bgcolor="#ccdaef"> <td colspan="8">LIABILITIES
AND SHAREHOLDERS&#146; EQUITY</td></tr> <tr> <td colspan="8">Current liabilities</td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Accounts payable</div></td><td>$</td><td align="right">482,412</td><td></td><td></td><td>$</td><td align="right">665,782</td><td></td></tr>
<tr> <td> <div style="margin-left: 9pt;">Accrued payroll and other&nbsp;</div></td><td>&nbsp;</td><td align="right">833,615</td><td></td><td></td><td></td><td align="right">720,867</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Deferred taxes</div></td><td colspan="2" align="right">130,445</td><td></td><td></td><td colspan="2" align="right">102,138</td><td></td></tr>
<tr> <td> <div style="margin-left: 9pt;">Deferred revenue</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">-</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">20,833</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr bgcolor="#ccdaef"> <td>Total current liabilities</td><td></td><td align="right">1,446,472</td><td></td><td></td><td></td><td align="right">1,509,620</td><td></td></tr>
<tr> <td colspan="8">&nbsp;</td></tr> <tr bgcolor="#ccdaef"> <td colspan="8">Shareholders&#146;
equity</td></tr> <tr> <td> <div style="margin-left: 9pt;">Common stock</div></td><td>&nbsp;</td><td align="right">47,662</td><td></td><td></td><td></td><td align="right">47,006</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Additional paid-in
capital</div></td><td>&nbsp;</td><td align="right">20,565,148</td><td></td><td></td><td></td><td align="right">20,169,924</td><td></td></tr>
<tr> <td> <div style="margin-left: 9pt;">Accumulated other comprehensive income</div></td><td></td><td align="right">1,113,327</td><td></td><td></td><td></td><td align="right">1,129,726</td><td>&nbsp;
</td></tr> <tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;">Retained
earnings</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">44,297,664</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">34,606,638</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td>Total shareholders&#146; equity</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">66,023,801</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">55,953,294</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr valign="top" bgcolor="#ccdaef"> <td>Total liabilities and shareholders&#146;
equity</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">67,470,273</td><td style="border-bottom: 3px double black;">&nbsp;</td><td></td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">57,462,914</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman"><br> *The
March 31, 2010 Balance Sheet is derived from the audited financial statements
contained in our Annual Report on <font style="white-space: nowrap;">Form 10-K</font>
for the fiscal year ended March&nbsp;31, 2010.<br> <br> <div align="center">See
accompanying notes.<br> <br> <br> 3<br> </div></font> <hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><a name="QIncome"></a> <div align="center"> <br> NVE CORPORATION<br>
STATEMENTS OF INCOME<br> (Unaudited)</div></b><br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="7" style="border-bottom: 1px solid black;" align="center"><b>Quarter&nbsp;Ended&nbsp;Dec.&nbsp;31</b></td></tr>
<tr> <td style="border-bottom: 1px solid black;" colspan="3" align="center"> <b>2010</b></td><td width="2%"></td><td style="border-bottom: 1px solid black;" colspan="3" align="center">
<b>2009</b></td></tr> <tr> <td colspan="8" bgcolor="#ccdaef">Revenue</td></tr>
<tr> <td> <div style="margin-left: 9pt;">Product sales</div></td><td width="1%">$</td><td align="right" width="11%">6,686,451</td><td width="1%">&nbsp;</td><td>&nbsp;</td><td width="1%">$</td><td align="right" width="11%">5,292,228</td><td width="1%"></td></tr>
<tr> <td bgcolor="#ccdaef"> <div style="margin-left: 9pt;">Contract research and
development</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">1,277,057</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT" bgcolor="#ccdaef">1,332,629</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Total revenue</td><td></td><td align="right">7,963,508</td><td>&nbsp;</td><td>&nbsp;</td><td align="RIGHT">&nbsp;</td><td align="RIGHT">6,624,857</td><td></td></tr>
<tr> <td bgcolor="#ccdaef">Cost of sales</td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">2,461,798</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT" bgcolor="#ccdaef">2,102,855</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Gross profit</td><td></td><td align="right">5,501,710</td><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td><td align="right">4,522,002</td><td></td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">Expenses</td></tr> <tr> <td> <div style="margin-left: 9pt;">Selling,
general, and administrative</div></td><td></td><td align="right">638,223</td><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td><td align="right">548,973</td><td></td></tr>
<tr> <td bgcolor="#ccdaef"><div style="margin-left: 9pt;">Research and development</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">330,681</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT" bgcolor="#ccdaef">251,625</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Total expenses</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">968,904</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" align="RIGHT">&nbsp;</td><td style="border-bottom: 1px solid black;" align="RIGHT">800,598</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td bgcolor="#ccdaef">Income from operations</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">4,532,806</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td colspan="2" align="RIGHT" bgcolor="#ccdaef">3,721,404</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td>Interest income</td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT">512,203</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" align="RIGHT" colspan="2">414,669</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td bgcolor="#ccdaef">Income before taxes</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">5,045,009</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td colspan="2" align="RIGHT" bgcolor="#ccdaef">4,136,073</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td>Provision for income taxes</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">1,661,090</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">1,368,590</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td valign="top" bgcolor="#ccdaef">Net income</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">3,383,919</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">&nbsp;</td><td valign="top" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">2,767,483</td><td style="border-bottom: 3px double black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td valign="top">Net income per share &#150; basic</td><td style="border-bottom: 3px double black;" valign="top">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top">0.71</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td><td valign="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top">0.59</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
<tr> <td valign="top" bgcolor="#ccdaef">Net income per share &#150; diluted</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">0.70</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">&nbsp;</td><td valign="top" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">0.57</td><td style="border-bottom: 3px double black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td colspan="8">Weighted average shares outstanding</td></tr> <tr> <td bgcolor="#ccdaef"><div style="margin-left: 9pt;">Basic</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">4,743,643</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef">&nbsp;</td><td align="right" bgcolor="#ccdaef">4,700,583</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td><div style="margin-left: 9pt;">Diluted</div></td><td></td><td align="right">4,866,617</td><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td><td align="right">4,855,948</td><td></td></tr>
</table><div align="center"><font style="font-size: 10pt; font-family: Times New Roman"><br>
<br>See accompanying notes.<br> <br> <br>4<br> </font> </div><hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><a name="YTDIncome"></a> <div align="center"> <br> NVE CORPORATION<br>
STATEMENTS OF INCOME<br> (Unaudited)</div></b><br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="7" style="border-bottom: 1px solid black;" align="center"><b>Nine&nbsp;Months&nbsp;Ended&nbsp;Dec.&nbsp;31</b></td></tr>
<tr> <td style="border-bottom: 1px solid black;" colspan="3" align="center"> <b>2010</b></td><td width="2%"></td><td style="border-bottom: 1px solid black;" colspan="3" align="center">
<b>2009</b></td></tr> <tr> <td colspan="8" bgcolor="#ccdaef">Revenue</td></tr>
<tr> <td> <div style="margin-left: 9pt;">Product sales</div></td><td width="1%">$</td><td align="right" width="11%">19,290,839</td><td width="1%">&nbsp;</td><td></td><td width="1%">
$</td><td align="right" width="11%">16,003,710</td><td width="1%"></td></tr> <tr>
<td bgcolor="#ccdaef"> <div style="margin-left: 9pt;">Contract research and development</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">3,723,123</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">3,964,180</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Total revenue</td><td>&nbsp;</td><td align="right">23,013,962</td><td>&nbsp;</td><td></td><td></td><td align="right">19,967,890</td><td></td></tr>
<tr> <td bgcolor="#ccdaef">Cost of sales</td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">7,142,528</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" width="11%" bgcolor="#ccdaef">5,979,378</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Gross profit</td><td></td><td align="right">15,871,434</td><td>&nbsp;</td><td></td><td></td><td align="right">13,988,512</td><td></td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">Expenses</td></tr> <tr> <td> <div style="margin-left: 9pt;">Selling,
general, and administrative</div></td><td></td><td align="right">1,901,156</td><td>&nbsp;</td><td></td><td></td><td align="right">1,807,050</td><td></td></tr>
<tr> <td bgcolor="#ccdaef"><div style="margin-left: 9pt;">Research and development</div></td><td style="border-bottom: 1px solid black;" colspan="2" align="right" bgcolor="#ccdaef">982,217</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">810,486</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td>Total expenses</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">2,883,373</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">2,617,536</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td bgcolor="#ccdaef">Income from operations</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">12,988,061</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">11,370,976</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td>Interest income</td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT">1,485,664</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="RIGHT">1,177,892</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td bgcolor="#ccdaef">Income before taxes</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">14,473,725</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">12,548,868</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td>Provision for income taxes</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">4,782,699</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">4,148,270</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td valign="top" bgcolor="#ccdaef">Net income</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">9,691,026</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">&nbsp;</td><td valign="top" bgcolor="#ccdaef"></td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">8,400,598</td><td style="border-bottom: 3px double black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td valign="top">Net income per share &#150; basic</td><td style="border-bottom: 3px double black;" valign="top">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top">2.06</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top">1.79</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
<tr> <td valign="top" bgcolor="#ccdaef">Net income per share &#150; diluted</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">2.00</td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">&nbsp;</td><td valign="top" bgcolor="#ccdaef"></td><td style="border-bottom: 3px double black;" valign="top" bgcolor="#ccdaef">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top" bgcolor="#ccdaef">1.73</td><td style="border-bottom: 3px double black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td colspan="8">Weighted average shares outstanding</td></tr> <tr> <td bgcolor="#ccdaef"><div style="margin-left: 9pt;">Basic</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">4,714,989</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">4,689,849</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td><div style="margin-left: 9pt;">Diluted</div></td><td></td><td align="right">4,837,963</td><td></td><td></td><td></td><td align="right">4,845,150</td><td></td></tr>
</table><div align="center"><font style="font-size: 10pt; font-family: Times New Roman"><br>
<br>See accompanying notes.<br> <br> &nbsp;<br>5<br> </font> </div><hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><a name="CashFlows"></a> <br> <div align="center"> <br> NVE CORPORATION<br>
STATEMENTS OF CASH FLOWS<br> (Unaudited)</div></b><br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="7" style="border-bottom: 1px solid black;">
<div align="center"><b>Nine Months Ended Dec. 31</b></div></td></tr> <tr> <td style="border-bottom: 1px solid black;" colspan="3" align="center"><b>2010</b></td><td></td><td style="border-bottom: 1px solid black;" colspan="3" align="center"><b>2009</b></td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">OPERATING ACTIVITIES</td></tr> <tr> <td>Net
income</td><td width="1%">$</td><td align="right" width="11%">9,691,026</td><td width="1%"></td><td width="2%">&nbsp;</td><td width="1%">$</td><td align="right" width="11%">8,400,598</td><td width="1%"></td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef"> Adjustments to reconcile net income to
net cash <div style="margin-left: 9pt;">provided by operating activities:</div></td></tr>
<tr> <td> <div style="margin-left: 18pt;">Depreciation</div></td><td></td><td align="right">290,798</td><td></td><td></td><td></td><td align="right">274,137</td><td></td></tr>
<tr> <td bgcolor="#ccdaef"> <div style="margin-left: 18pt;">Stock-based compensation</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">76,720</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">100,842</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td> <div style="margin-left: 18pt;">Excess tax benefits</div></td><td></td><td align="right">(160,015</td><td>)</td><td></td><td></td><td align="right">(280,448</td><td>)</td></tr>
<tr> <td bgcolor="#ccdaef"><div style="margin-left: 18pt;">Deferred income taxes</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">174,391</td><td bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">271,281</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td colspan="8"> <div style="margin-left: 18pt;">Changes in operating assets
and liabilities:</div></td></tr> <tr><td bgcolor="#ccdaef"><div style="margin-left: 36pt;">Accounts
receivable</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">750,129</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">438,350</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td> <div style="margin-left: 36pt;">Inventories</div></td><td></td><td align="right">(1,457,731</td><td>)</td><td></td><td></td><td align="right">455,404</td><td></td></tr>
<tr> <td bgcolor="#ccdaef"><div style="margin-left: 36pt;">Prepaid expenses and
other assets</div></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">(321,544</td><td bgcolor="#ccdaef">)</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">(318,885</td><td bgcolor="#ccdaef">)</td></tr>
<tr> <td> <div style="margin-left: 36pt;">Accounts payable and accrued expenses</div></td><td></td><td align="right">(70,622</td><td>)</td><td></td><td></td><td align="right">
112,742</td><td></td></tr> <tr><td bgcolor="#ccdaef"><div style="margin-left: 36pt;">Deferred
revenue</div></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">(20,833</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">)</td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">(62,500</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">)</td></tr>
<tr> <td>Net cash provided by operating activities</td><td></td><td align="right">8,952,319</td><td></td><td></td><td></td><td align="right">9,391,521</td><td></td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">&nbsp;</td></tr> <tr> <td colspan="8">INVESTING
ACTIVITIES</td></tr> <tr> <td colspan="2" bgcolor="#ccdaef">Purchases of fixed
assets</td><td align="right" bgcolor="#ccdaef">(501,957</td><td bgcolor="#ccdaef">)</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">(257,952</td><td valign="bottom" bgcolor="#ccdaef">)</td></tr>
<tr><td>Purchases of marketable securities</td><td></td><td align="right">(10,553,771</td><td>)</td><td></td><td></td><td align="right">(10,922,540</td><td width="2%">)</td></tr>
<tr> <td bgcolor="#ccdaef">Proceeds from maturities and sales of marketable securities</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">1,573,370</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">175,256</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef" width="2%">&nbsp;</td></tr>
<tr><td>Net cash used in investing activities</td><td></td><td align="right">(9,482,358</td><td>)</td><td></td><td></td><td align="right">(11,005,236</td><td width="2%">)</td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">&nbsp;</td></tr> <tr> <td colspan="8">FINANCING
ACTIVITIES</td></tr> <tr> <td bgcolor="#ccdaef">Net proceeds from sale of common
stock</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">159,145</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef">&nbsp;</td><td align="right" bgcolor="#ccdaef">622,423</td><td bgcolor="#ccdaef"></td></tr>
<tr> <td>Excess tax benefits</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">160,015</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">280,448</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td bgcolor="#ccdaef">Net cash provided by financing activities</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">319,160</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td><td bgcolor="#ccdaef"></td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef"">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" bgcolor="#ccdaef">902,871</td><td style="border-bottom: 1px solid black;" bgcolor="#ccdaef">&nbsp;</td></tr>
<tr> <td colspan="8">&nbsp;</td></tr> <tr>
<td bgcolor="#ccdaef">Decrease
in cash and cash equivalents</td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef">(210,879</td><td bgcolor="#ccdaef">)</td><td bgcolor="#ccdaef"></td><td bgcolor="#ccdaef"></td><td align="right" bgcolor="#ccdaef" width="11%">(710,844</td><td bgcolor="#ccdaef" width="2%">)</td></tr>
<tr> <td>Cash and cash equivalents at beginning of period</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">1,389,288</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right" width="11%">1,875,063</td><td style="border-bottom: 1px solid black;" width="2%">&nbsp;</td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">&nbsp;</td></tr> <tr> <td valign="top">Cash and
cash equivalents at end of period</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">1,178,409</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">1,164,219</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td></tr>
<tr> <td colspan="8" bgcolor="#ccdaef">&nbsp;</td></tr> <tr> <td colspan="8">Supplemental
disclosures of cash flow information:</td></tr> <tr> <td><div style="margin-left: 18pt;">Cash
paid during the period for income taxes</div></td><td>$</td><td align="right">4,794,742</td><td></td><td></td><td>$</td><td align="right">4,067,438</td><td></td></tr>
</table><div align="center"><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>&nbsp;<br>
See accompanying notes.<br> <br> <br>6<br> </font></div><hr><br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><a name="Notes"></a> <br> <br> <div align="center">NVE CORPORATION<br>
NOTES TO FINANCIAL STATEMENTS<br> (Unaudited)</div><br> <br> NOTE 1. DESCRIPTION
OF BUSINESS</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We develop and sell devices
that use spintronics, a nanotechnology that relies on electron spin rather than
electron charge to acquire, store, and transmit information.<br> <br> <b>NOTE
2. INTERIM FINANCIAL INFORMATION</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The accompanying
unaudited financial statements of NVE Corporation are prepared consistent with
accounting principles generally accepted in the United States and in accordance
with Securities and Exchange Commission rules and regulations. In the opinion
of management, these financial statements reflect all adjustments, consisting
only of normal and recurring adjustments, necessary for a fair presentation of
the financial statements. Although we believe that the disclosures are adequate
to make the information presented not misleading, it is suggested that these unaudited
financial statements be read in conjunction with the audited financial statements
and the notes included in our latest annual financial statements included in our
Annual Report on <font style="white-space: nowrap;">Form 10-K</font> for the fiscal
year ended March&nbsp;31, 2010. The results of operations for the quarter or nine
months ended December&nbsp;31, 2010 are not necessarily indicative of the results
that may be expected for the full fiscal year ending March&nbsp;31, 2011.<br>
<br> <b>NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have adopted all recently issued accounting pronouncements. The adoption of the
accounting pronouncements, including those not yet effective, is not anticipated
to have a material effect on our financial position or results of operations.<br>
<br> <b>NOTE 4. NET INCOME PER SHARE</b><br>
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income per basic share is computed based on the weighted-average number of common
shares issued and outstanding during each period. Net income per diluted share
amounts assume conversion, exercise or issuance of all potential common stock
instruments (stock options and warrants). Stock options and warrants totaling
1,000 for the quarter and nine months ended
December&nbsp;31, 2010 and 5,000 for the quarter
and nine months ended December&nbsp;31, 2009 were not included in the computation
of diluted earnings per share because the exercise prices of the options and warrants
were greater than the market price of the common stock. The following table reflects
the components of common shares outstanding:<br>
<br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="3" style="border-bottom: 1px solid black;" align="center"><b>Quarter
Ended Dec. 31</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" width="11%">
<b>2010</b></td><td></td><td style="border-bottom: 1px solid black;" align="center" width="11%">
<b>2009</b></td></tr> <tr bgcolor="#ccdaef"> <td>Weighted average common shares
outstanding &#150; basic</td><td align="right">4,743,643</td><td width="2%"></td><td align="right" width="11%">4,700,583</td></tr>
<tr> <td colspan="4">Effect of dilutive securities:</td></tr> <tr bgcolor="#ccdaef">
<td><div style="margin-left: 9pt;" align="left">Stock options</div></td><td align="right">115,789</td><td></td><td align="right">149,309</td></tr>
<tr> <td> <div style="margin-left: 9pt;" align="left">Warrants</div></td><td style="border-bottom: 1px solid black;" align="right">7,185</td><td></td><td style="border-bottom: 1px solid black;" align="right">6,056</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Shares used in computing net income per
share &#150; diluted</td><td style="border-bottom: 3px double black;" align="right" valign="top">4,866,617</td><td></td><td style="border-bottom: 3px double black;" align="right" valign="top">4,855,948</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>
</font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="3" style="border-bottom: 1px solid black;" align="center"><b>Nine
Months Ended Dec. 31</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" width="11%">
<b>2010</b></td><td></td><td style="border-bottom: 1px solid black;" align="center" width="11%">
<b>2009</b></td></tr> <tr bgcolor="#ccdaef"> <td>Weighted average common shares
outstanding &#150; basic</td><td align="right">4,714,989</td><td width="2%"></td><td align="right" width="11%">4,689,849</td></tr>
<tr> <td colspan="4">Effect of dilutive securities:</td></tr> <tr bgcolor="#ccdaef">
<td><div style="margin-left: 9pt;" align="left">Stock options</div></td><td align="right">115,789</td><td></td><td align="right">149,245</td></tr>
<tr> <td> <div style="margin-left: 9pt;" align="left">Warrants</div></td><td style="border-bottom: 1px solid black;" align="right">7,185</td><td></td><td style="border-bottom: 1px solid black;" align="right">6,056</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Shares used in computing net income per
share &#150; diluted</td><td style="border-bottom: 3px double black;" align="right" valign="top">4,837,963</td><td></td><td style="border-bottom: 3px double black;" align="right" valign="top">4,845,150</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>
&nbsp;<br> <div align="center">7</div></font> <hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><br> <br> NOTE 5. MARKETABLE SECURITIES</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Marketable
securities with remaining maturities less than one year are classified as short-term,
and those with remaining maturities greater than one year are classified as long-term.
The fair value of our marketable securities as of December&nbsp;31, 2010 were
as follows:<br> <br> </font> <table style="font-size: 10pt; font-family: Times New Roman" border="0" cellpadding="0" cellspacing="0" width="50%" align="center">
<tr> <td style="border-bottom: 1px solid black;" colspan="2" align="center"> <b>Total</b></td><td width="4%"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>&lt;1
Year</b></td><td width="4%"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>1&#150;3
Years</b></td><td width="4%"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>3&#150;5
Years</b></td></tr> <tr> <td width="1%">$</td><td width="12%" align="right">57,132,411</td><td></td><td width="1%">$</td><td align="right" width="12%">4,455,249</td><td></td><td width="1%">$</td><td align="right" width="12%">30,449,543</td><td width="2%"></td><td width="1%">$</td><td align="right" width="12%">22,227,619</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of December&nbsp;31 and March&nbsp;31, 2010,
our marketable securities were as follows:<br> &nbsp;<br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="12"><b>As
of December&nbsp;31, 2010</b></td><td style="border-bottom: 1px solid black;" rowspan="2" width="1"></td><td style="border-bottom: 1px solid black;" align="center" colspan="12"><b>As
of March&nbsp;31, 2010</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" colspan="2">
<b><br> Adjusted<br> Cost</b></td><td width="1">&nbsp;</td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Gross<br>
Unrealized<br> Gains</b></td><td width="1">&nbsp;</td><td style="border-bottom: 1px solid black;" align="center" colspan="3"><b>Gross<br>
Unrealized<br> Losses</b></td><td width="1">&nbsp;</td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Fair<br>
Market<br> Value</b></td><td style="border-bottom: 1px solid black;" align="center" colspan="2">
<b><br> Adjusted<br> Cost</b></td><td width="1"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Gross<br>
Unrealized<br> Gains</b></td><td width="1"></td><td style="border-bottom: 1px solid black;" align="center" colspan="3"><b>Gross<br>
Unrealized<br> Losses</b></td><td width="1"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Fair<br>
Market<br> Value</b></td></tr> <tr bgcolor="#ccdaef"> <td valign="bottom"> U.S.
agency<br> <div style="margin-left: 9pt;">securities</div></td><td valign="bottom">$</td><td valign="bottom" align="right">90,002</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">1,527</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">-</td><td valign="bottom">&nbsp;</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">91,529</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td valign="bottom" align="right">702,992</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">19,240</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">-</td><td valign="bottom">&nbsp;
</td><td>&nbsp;&nbsp;</td><td valign="bottom">$</td><td align="right" valign="bottom">722,232</td></tr>
<tr> <td valign="bottom"> Corporate&nbsp;bonds</td><td>&nbsp;</td><td align="right" valign="bottom">33,624,646</td><td>&nbsp;</td><td>&nbsp;</td><td align="right" valign="bottom">1,271,950</td><td>&nbsp;</td><td align="RIGHT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td><td align="right" valign="bottom">(112,646</td><td valign="bottom">)</td><td>&nbsp;</td><td>&nbsp;</td><td align="right" valign="bottom">34,783,950</td><td></td><td></td><td align="right" valign="bottom">23,807,375</td><td>&nbsp;</td><td>&nbsp;</td><td align="right" valign="bottom">1,029,273</td><td>&nbsp;</td><td>&nbsp;</td><td align="right" valign="bottom">(23,601</td><td valign="bottom">)</td><td>&nbsp;</td><td>&nbsp;</td><td align="right" valign="bottom">24,813,047</td></tr>
<tr bgcolor="#ccdaef"> <td valign="bottom"> Municipal&nbsp;bonds&nbsp;&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">21,653,378</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">608,723</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,169</td><td style="border-bottom: 1px solid black; valign="bottom">)</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">22,256,932</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">21,877,258</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">747,483</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,542</td><td style="border-bottom: 1px solid black; valign="bottom valign="bottom"">)</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">22,619,199</td></tr>
<tr> <td valign="top">Total</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">55,368,026</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">1,882,200</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">(117,815</td><td style="border-bottom: 3px double black;">)</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">57,132,411</td><td></td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">46,387,625</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">1,795,996</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">
(29,143</td><td style="border-bottom: 3px double black;">)</td><td>&nbsp;</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">48,154,478</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table shows the gross unrealized losses and fair value of our investments
with unrealized losses, aggregated by investment category and length of time that
individual securities had been in a continuous unrealized loss position as of
December&nbsp;31 and March&nbsp;31, 2010:<br> &nbsp;<br></font> <table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%" align="center">
<tr> <td rowspan="2" colspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="6">
<b>Less Than 12 Months</b></td><td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="6">
<b>12 Months or Greater</b></td><td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="6">
<b>Total</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Fair<br>
Market<br> Value</b></td><td></td><td style="border-bottom: 1px solid black;" align="center" colspan="3"><b>Gross<br>
Unrealized<br> Losses</b></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Fair<br>
Market<br> Value</b></td><td></td><td style="border-bottom: 1px solid black;" align="center" colspan="3"><b>Gross<br>
Unrealized<br> Losses</b></td><td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>Fair<br>
Market<br> Value</b></td><td></td><td style="border-bottom: 1px solid black;" align="center" colspan="3"><b>Gross<br>
Unrealized<br> Losses</b></td></tr> <tr> <td colspan="22">As of December 31, 2010</td></tr>
<tr bgcolor="#ccdaef"> <td width="9pt">&nbsp;</td><td>U.S.&nbsp;agency&nbsp;securities&nbsp;</td><td width="1%">$</td><td align="right" width="9%">-</td><td width="2%"></td><td width="1%">$</td><td align="right" width="8%">-</td><td valign="bottom" width="1%">&nbsp;</td><td width="4%"></td><td width="1%">$</td><td align="right" width="9%">-</td><td width="2%"></td><td width="1%">$</td><td align="right" width="8%">-</td><td width="1%"></td><td width="4%"></td><td width="1%">$</td><td align="right" width="9%">-</td><td width="2%"></td><td width="1%">$</td><td align="right" width="8%">-</td><td valign="bottom" width="1%">&nbsp;</td></tr>
<tr> <td>&nbsp;</td><td>Corporate bonds</td><td colspan="2" align="right">4,910,424</td><td colspan="3" align="right">(112,646</td><td>)</td><td colspan="3" align="right">-</td><td colspan="3" align="right">-</td><td></td><td colspan="3" align="right">4,910,424</td><td colspan="3" align="right">(112,646</td><td>)
</td></tr> <tr bgcolor="#ccdaef"> <td>&nbsp;</td><td>Municipal bonds</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">946,449</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,169</td><td style="border-bottom: 1px solid black;">)</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">-</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">-</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">946,449</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,169</td><td style="border-bottom: 1px solid black;">)</td></tr>
<tr> <td>&nbsp;</td><td valign="top">Total</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">5,856,873</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">(117,815</td><td style="border-bottom: 3px double black;" valign="top">)</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">-</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">-</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td><td valign="top"></td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">5,856,873</td><td valign="top"></td>
<td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">(117,815</td><td style="border-bottom: 3px double black;" valign="top">)</td></tr>
<tr> <td colspan="22">As of March 31, 2010</td></tr> <tr bgcolor="#ccdaef"> <td></td><td>U.S.&nbsp;agency&nbsp;securities&nbsp;</td><td>$</td><td align="right">-</td><td>&nbsp;</td><td>$</td><td align="right">-</td><td></td><td>&nbsp;</td><td>$</td><td align="right">-</td><td>&nbsp;</td><td>$</td><td align="right">-</td><td></td><td>&nbsp;</td><td>$</td><td align="right">-</td><td>&nbsp;</td><td>$</td><td align="right">-</td><td>&nbsp;
</td></tr> <tr> <td></td><td>Corporate bonds</td><td colspan="2" align="right">2,032,306</td><td colspan="3" align="right">(23,601</td><td>)</td><td colspan="3" align="right">-</td><td colspan="3" align="right">-</td><td>&nbsp;</td><td colspan="3" align="right">2,032,306</td><td colspan="3" align="right">(23,601</td><td>
)</td></tr> <tr bgcolor="#ccdaef"> <td></td><td>Municipal bonds</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">1,564,416</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,542</td><td style="border-bottom: 1px solid black;">)</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">-</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">-</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">1,564,416</td><td>&nbsp;</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(5,542</td><td style="border-bottom: 1px solid black;">)</td></tr>
<tr> <td></td><td valign="top">Total</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">3,596,722</td><td valign="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">(29,143</td><td style="border-bottom: 3px double black;" valign="top">)</td><td valign="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">-</td><td valign="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">-</td><td style="border-bottom: 3px double black;" valign="top">&nbsp;</td><td valign="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">3,596,722</td><td v
align="top">&nbsp;</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">(29,143</td><td style="border-bottom: 3px double black;" valign="top">)</td></tr></table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross unrealized losses totaled $117,815 as of December&nbsp;31, 2010,
and were attributable to four corporate bonds and one municipal bond out of a
portfolio of 55 bonds. The gross unrealized losses were due to market-price decreases
after the bonds were purchased. All of the bonds with an unrealized loss were
rated A1/A+ or better by Moody&#146;s or Standard and Poor&#146;s, none had been
downgraded since they were purchased, and none had been in a continuous unrealized
loss position for 12 months or more. For each bond with an unrealized loss, we
expect to recover the entire cost basis of each security based on our consideration
of factors including their credit ratings, the underlying ratings of insured bonds,
and historical default rates for securities of comparable credit rating. Because
we expect to recover the entire cost basis of the securities,
and because we do not intend to sell the securities and it is not more likely
than not that we will be required to sell the securities before recovery of the
cost basis, which may be maturity, we did not consider any of our marketable securities
to be other-than-temporarily impaired at December&nbsp;31, 2010.<br><br><br></font>
<div style="width: 100%; text-align: center;"><font style=" font-size: 10pt; font-family: Times New Roman">8</font></div><hr>
<br clear="all" style="page-break-before:always;"> <font style="font-size: 10pt; font-family: Times New Roman"><a href="#TOC"><b>Table
of Contents</b></a><br> <br><b>NOTE 6. COMPREHENSIVE INCOME</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
components of comprehensive income are as follows:<br> <br></font>
<table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="7" style="border-bottom: 1px solid black;">
<div align="center">&nbsp;<b>Quarter Ended Dec. 31</b></div></td></tr> <tr> <td style="border-bottom: 1px solid black;" colspan="3" align="center">
<div style="margin-left: 0px; text-indent: 0px; margin-right: 0px;" align="center"><b>2010</b></div></td><td width="2%"></td><td style="border-bottom: 1px solid black;" colspan="3" align="center">
<div style="margin-left: 0px; text-indent: 0px; margin-right: 0px;" align="center"><b>2009</b></div></td></tr>
<tr bgcolor="#ccdaef"> <td>Net income</td><td width="1%">$</td><td align="right" width="11%">3,383,919</td><td width="1%"></td><td></td><td width="1%">
$</td><td align="right" width="11%">2,767,483</td><td width="1%"></td></tr> <tr>
<td>Unrealized (loss) gain from marketable securities, net of tax</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(533,498</td><td style="border-bottom: 1px solid black;">)</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">35,175</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Comprehensive income</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">2,850,421</td><td style="border-bottom: 3px double black;" valign="top"></td><td valign="top"></td><td style="border-bottom: 3px double black;" width="1%" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">2,802,658</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br></font>
<table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td colspan="7" style="border-bottom: 1px solid black;">
<div align="center">&nbsp;<b>Nine Months Ended Dec. 31</b></div></td></tr> <tr>
<td style="border-bottom: 1px solid black;" colspan="3" align="center"> <div style="margin-left: 0px; text-indent: 0px; margin-right: 0px;" align="center"><b>2010</b></div></td><td width="2%"></td><td style="border-bottom: 1px solid black;" colspan="3" align="center">
<div style="margin-left: 0px; text-indent: 0px; margin-right: 0px;" align="center"><b>2009</b></div></td></tr>
<tr bgcolor="#ccdaef"> <td>Net income</td><td width="1%">$</td><td align="right" width="11%">9,691,026</td><td width="1%"></td><td></td><td width="1%">
$</td><td align="right" width="11%">8,400,598</td><td width="1%"></td></tr> <tr>
<td>Unrealized (loss) gain from marketable securities, net of tax</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(16,399</td><td style="border-bottom: 1px solid black;">)</td><td></td><td style="border-bottom: 1px solid black;">&nbsp;</td><td style="border-bottom: 1px solid black;" align="right">1,284,997</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Comprehensive income</td><td style="border-bottom: 3px double black;" valign="top">$</td><td style="border-bottom: 3px double black;" align="right" valign="top">9,674,627</td><td style="border-bottom: 3px double black;" valign="top"></td><td valign="top"></td><td style="border-bottom: 3px double black;" width="1%" valign="top">
$</td><td style="border-bottom: 3px double black;" align="right" valign="top">9,685,595</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman"><br><b>NOTE
7. INVENTORIES</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories consisted of
the following:<br> &nbsp;<br></font>
<table style="font-size: 10pt; font-family: Times New Roman" cellpadding="0" cellspacing="0" width="50%" align="center">
<tr> <td></td><td style="border-bottom: 1px solid black;" colspan="3" align="center"><b>Dec.
31<br> 2010</b></td><td></td><td style="border-bottom: 1px solid black;" colspan="3" align="center"><b>March
31<br> 2010</b></td></tr> <tr bgcolor="#ccdaef"> <td>Raw materials</td><td width="1%">$</td><td align="right" width="22%">1,799,146</td><td width="1%">&nbsp;</td><td width="4%"></td><td width="1%">$</td><td align="right" width="22%">595,032</td><td width="1%"></td></tr>
<tr> <td>Work in process</td><td></td><td align="right">1,089,106</td><td>&nbsp;</td><td></td><td></td><td align="right">794,091</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td>Finished goods</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">575,906</td><td style="border-bottom: 1px solid black;">&nbsp;</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">617,304</td><td style="border-bottom: 1px solid black;">&nbsp;</td></tr>
<tr> <td></td><td></td><td align="right">3,464,158</td><td>&nbsp;</td><td></td><td></td><td align="right">2,006,427</td><td></td></tr>
<tr bgcolor="#ccdaef"> <td>Less inventory reserve</td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(300,000</td><td style="border-bottom: 1px solid black;">)</td><td></td><td style="border-bottom: 1px solid black;" colspan="2" align="right">(300,000</td><td style="border-bottom: 1px solid black;">
)</td></tr> <tr valign="top"> <td> Total inventories</td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">3,164,158</td><td style="border-bottom: 3px double black;">&nbsp;</td><td></td><td style="border-bottom: 3px double black;">$</td><td style="border-bottom: 3px double black;" align="right">1,706,427</td><td style="border-bottom: 3px double black;">&nbsp;</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br>
&nbsp;<br>
<b>NOTE 8. STOCK-BASED COMPENSATION</b>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
was no stock-based compensation expense for
the third quarters of fiscal 2011 or 2010. Stock-based compensation expense was
$76,720 for the first nine months of fiscal
2011 compared to $100,842 for the first nine months of fiscal 2010. Stock-based
compensation expenses for the nine months ended
December&nbsp;31, 2010 and 2009 were non-cash and primarily due to the issuance
of automatic stock options to our non-employee directors on their reelection to
our Board. The decrease in stock-based compensation for the nine months ended
December&nbsp;31, 2010 compared to the prior-year period was primarily due to
a lower stock price at the date of grant compared to the prior year. We calculate the share-based
compensation expense on a straight-line basis over the vesting periods of the
related share-based awards.<br>
&nbsp;<br>
&nbsp;<br>
<b>NOTE 9. INCOME TAXES</b><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes reflect the net tax effects
of temporary differences between the carrying amount of assets and liabilities
for financial reporting purposes and the amounts used for income tax purposes.
Tax provisions of $160,015 for the nine months ended December&nbsp;31, 2010 and $280,448
for the nine months ended December&nbsp;31, 2009 were credited to &#147;Additional
paid-in capital.&#148;
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We had no unrecognized tax benefits as of December&nbsp;31, 2010,
and we do not expect any significant unrecognized tax benefits within 12&nbsp;months of the reporting date.
We recognize interest and penalties related to income tax matters in income tax
expense. As of December&nbsp;31, 2010 we had no
accrued interest related to uncertain tax positions. The tax years 1999 through 2009 remain open to examination
by the major taxing jurisdictions to which we are subject.<br>
<br><br>
<b>NOTE
10. FAIR VALUE MEASUREMENTS</b><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Generally accepted
accounting principles establish a framework for measuring fair value, provide
a definition of fair value and prescribe required disclosures about fair-value
measurements. Generally accepted accounting principles define fair value as the
price that would be received to sell an asset or paid to transfer a liability.
Fair value is a market-based measurement that should be determined using assumptions
that market participants would use in pricing an asset or liability. Generally
accepted accounting principles utilize a valuation hierarchy for disclosure of
fair value measurements. The categorization within the valuation hierarchy is
based on the lowest level of input that is significant to the fair value measurement.
The categories within the valuation hierarchy are described as follows: <br>
 <br>

<br>
 </font>
<div align="center"><font style="font-size: 10pt; font-family: Times New Roman">9</font></div><hr>
<br clear="all" style="page-break-before:always;"> <font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a></b><br> <br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Level 1 &#150; Financial
instruments with quoted prices in active markets for identical assets or liabilities.
Our Level&nbsp;1 financial instruments consist of publicly-traded marketable debt
securities that are classified as available-for-sale. On the balance sheets, available-for-sale
securities are classified as &#147;Marketable securities, short term&#148; and
&#147;Marketable securities, long term.&#148; The fair value of our available-for-sale
securities was $57,132,411 at December&nbsp;31,
2010 and $48,154,478 at March&nbsp;31, 2010.<br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Level
2 &#150; Financial instruments with quoted prices in active markets for similar
assets or liabilities. Level&nbsp;2 fair value measurements are determined using
either prices for similar instruments or inputs that are either directly or indirectly
observable, such as interest rates. We do not have any financial assets or liabilities
being measured at fair value that are classified as Level&nbsp;2 financial instruments.<br>
<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Level 3 &#150; Inputs to the fair value measurement
are unobservable inputs or valuation techniques. We do not have any financial
assets or liabilities being measured at fair value that are classified as Level&nbsp;3
financial instruments.<br> <br><br> <b>NOTE 11. STOCK REPURCHASE PLAN</b><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On January&nbsp;21, 2009 we announced that our Board
of Directors authorized the repurchase of up to $2,500,000 of our Common Stock.
The repurchase program may be modified or discontinued at any time without notice.
 We did not repurchase any of our Common Stock
during the quarter ended December&nbsp;31, 2010. <br><br><br> <b><a name="MDA"></a>Item
2. Management&#146;s Discussion and Analysis of Financial Condition and Results
of Operations.<br> <br> Forward-looking statements<br> </b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
of the statements made in this Report or in the documents incorporated by reference
in this Report and in other materials filed or to be filed by us with the Securities
and Exchange Commission (&#147;SEC&#148;) as well as information included in verbal
or written statements made by us constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. These statements
are subject to the safe harbor provisions of the reform act. Forward-looking statements
may be identified by the use of the terminology such as may, will, expect, anticipate,
intend, believe, estimate, should, or continue, or the negatives of these terms
or other variations on these words or comparable terminology. To the extent that
this Report contains forward-looking statements regarding the financial condition,
operating results, business prospects or any other aspect of NVE, you should be
aware that our actual financial condition, operating results and business performance
may differ materially from that projected or estimated by us in the forward-looking
statements. We have attempted to identify, in context, some of the factors that
we currently believe may cause actual future experience and results to differ
from their current expectations. These differences may be caused by a variety
of factors, including but not limited to risks associated with competition, progress
in research and development activities by us and others, decreased sales, failure
of suppliers to meet our requirements, inability to meet customer technical requirements,
inability to consummate license agreements, ineligibility for SBIR awards, inability
to renew agreements with large customers, risks of losses on our marketable securities,
and other specific risks that may be alluded to in this Report or in the documents
incorporated by reference in this Report.<br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Further
information regarding our risks and uncertainties are contained in Part&nbsp;I,
Item 1A &#147;Risk Factors&#148; of our Annual Report on <font style="white-space: nowrap;">Form
10-K</font> for the year ended March&nbsp;31,&nbsp;2010, as updated in Part&nbsp;II,
Item 1A of our Quarterly Report on <font style="white-space: nowrap;">Form 10-Q</font>
for the quarter ended June&nbsp;30,&nbsp;2010, Part&nbsp;II, Item 1A of our Quarterly
Report on <font style="white-space: nowrap;">Form 10-Q</font> for the quarter
ended September&nbsp;30,&nbsp;2010, and Part&nbsp;II, Item 1A of this Quarterly
Report on <font style="white-space: nowrap;">Form 10-Q</font>.
<br><br><b>General</b><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NVE
Corporation, referred to as NVE, we, us, or our, develops and sells devices that
use spintronics, a nanotechnology that relies on electron spin rather than electron
charge to acquire, store and transmit information. We manufacture high-performance
spintronic products including sensors and couplers that are used to acquire and
transmit data. We have also licensed our spintronic magnetoresistive random access
memory technology, commonly known as MRAM.<br> <br> <b>Critical accounting policies</b><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A description of our critical accounting policies
is provided in Management&#146;s Discussion and Analysis of Financial Condition
and Results of Operations in our Annual Report on <font style="white-space: nowrap;">Form
10-K</font> for the year ended March&nbsp;31, 2010. At December&nbsp;31, 2010
our critical accounting policies and estimates continued to include research and
development contract percentage of completion estimation, inventory valuation,
allowance for doubtful accounts estimation, and deferred tax assets estimation.<br>
<br> <br> <div align="center">10</div></font> <hr><br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><br> <br> Quarter ended December&nbsp;31, 2010 compared to quarter
ended December&nbsp;31, 2009</b><br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The table shown
below summarizes the percentage of revenue and quarter-to-quarter changes for
various items:<br> <br> </font> <table style="font-size: 10pt; font-family: Times New Roman" border="0" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="5"><b>Percentage
of Revenue<br> Quarter Ended Dec. 31</b></td><td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2" rowspan="2"><b>Quarter-<br>
to-Quarter<br> Change</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>2010</b></td><td></td><td style="border-bottom: 1px solid black;"align="center" colspan="2"><b>2009</b></td></tr>
<tr bgcolor="#ccdaef"> <td colspan="9">Revenue</td></tr> <tr> <td> <div style="margin-left: 9pt;" align="left">Product
sales</div></td><td align="right" width="9%">84.0</td><td width="1%">
%</td><td width="4%"></td><td align="right" width="9%">79.9</td><td width="1%">
%</td><td width="4%"></td><td align="right" width="9%">26.3</td><td width="1%">
%</td></tr> <tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;" align="left">Contract&nbsp;research&nbsp;and&nbsp;development</div></td><td style="border-bottom: 1px solid black;" align="right">16.0</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">20.1</td><td style="border-bottom: 1px solid black;">
%</td><td></td><td align="right">(4.2</td><td>)%</td></tr> <tr> <td> Total revenue</td><td align="right">100.0</td><td>%</td><td></td><td align="right">100.0</td><td>%</td><td></td><td align="right">20.2</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td>Cost of sales</td><td style="border-bottom: 1px solid black;" align="right">30.9</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">31.7</td><td style="border-bottom: 1px solid black;">%</td><td></td><td align="right">17.1</td><td>%</td></tr>
<tr> <td> Gross profit</td><td align="right">69.1</td><td>%</td><td></td><td align="right">68.3</td><td>
%</td><td></td><td align="right">21.7</td><td>
%</td></tr> <tr bgcolor="#ccdaef"> <td colspan="9">Expenses</td></tr> <tr> <td>
<div style="margin-left: 9pt;" align="left">Selling, general, and administrative</div></td><td align="right">8.0</td><td>%</td><td></td><td align="right">8.3</td><td>%</td><td></td><td align="right">16.3</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;" align="left">Research&nbsp;and&nbsp;development</div></td><td style="border-bottom: 1px solid black;" align="right">4.2</td><td style="border-bottom: 1px solid black;" align="left">
%</td><td></td><td style="border-bottom: 1px solid black;" align="right">3.8</td><td style="border-bottom: 1px solid black;">%</td><td></td><td align="right">31.4</td><td>%</td></tr>
<tr> <td>Total expenses</td><td style="border-bottom: 1px solid black;" align="right">12.2</td><td style="border-bottom: 1px solid black;" align="left">
%</td><td></td><td style="border-bottom: 1px solid black;" align="right">12.1</td><td style="border-bottom: 1px solid black;">%</td><td></td><td align="right">21.0</td><td>
%</td></tr> <tr bgcolor="#ccdaef"> <td>Income from operations</td><td align="right">56.9</td><td>%</td><td></td><td align="right">56.2</td><td>
%</td><td></td><td align="right">21.8</td><td>
%</td></tr> <tr> <td>Interest and other income</td><td style="border-bottom: 1px solid black;" align="right">6.5</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">6.2</td><td style="border-bottom: 1px solid black;">%</td><td></td><td align="right">23.5</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td>Income before taxes</td><td align="right">63.4</td><td>%</td><td></td><td align="right">62.4</td><td>%</td><td></td><td align="right">22.0</td><td>
%</td></tr> <tr> <td>Provision for income taxes</td><td style="border-bottom: 1px solid black;" align="right">20.9</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">20.6</td><td style="border-bottom: 1px solid black;">%</td><td></td><td align="right">21.4</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Net income</td><td style="border-bottom: 3px double black;" align="right" valign="top">42.5</td><td style="border-bottom: 3px double black;" valign="top">%</td><td valign="top"></td><td style="border-bottom: 3px double black;" align="right" valign="top">41.8</td><td style="border-bottom: 3px double black;" valign="top">%</td><td valign="top"></td><td align="right" valign="top">22.3</td><td valign="top">%</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenue for the quarter ended ended December&nbsp;31,
2010 (the third quarter of fiscal 2011) increased 20%
to $7,963,508 compared to $6,624,857 for the
quarter ended ended December&nbsp;31, 2009 (the third quarter of fiscal 2010).
The increase was due to a 26% increase in
product sales, partially offset by a 4%
decrease in contract research and development revenue.<br><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The increase in product sales
from the prior-year quarter was due to the addition of
new customers and increased purchase volume by existing customers. Until last fiscal year, our product sales had been less in quarters ended
December&nbsp;31 than the immediately preceding quarters in every year since fiscal
2007. This seasonality may have been due in part to distributor ordering patterns or customer vacations
and shutdowns late in calendar years. This sequential decrease did not occur in fiscal 2010 or 2011, possibly due to the addition of
new customers, increased purchase volume by existing customers, or improved economic environments. We cannot predict whether seasonal weakness
in quarters ending December&nbsp;31 will return in future fiscal years, and we cannot predict the possible impact of economic conditions
on future results of operations. Furthermore,
in every year since fiscal 2007 our product sales have increased in quarters ended
March&nbsp;31 from the quarters ended December&nbsp;31, but we cannot predict
whether this pattern will continue this fiscal year.<br>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
decrease in research and development revenue was due to the completion of certain
contracts and contract activities. Contract research and development
activities can fluctuate for a number of reasons, some of which are beyond our
control, and there can be no assurance of additional or follow-on contracts for
expired or completed contracts.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit margin increased to 69%
of revenue for the third quarter of fiscal 2011 compared to 68% for the third
quarter of fiscal 2010, due to a more favorable revenue mix.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total expenses increased
21% for the third quarter of fiscal 2011 compared to the third
quarter of fiscal 2010 due to a 16% increase
in selling, general, and administrative expense and a 31%
increase in research and development expense.
The increase in selling, general, and administrative expense was due to an increase in performance-based compensation and commissions, and the timing of professional services. The increase in research and development expense
was due to increased product development activities. Research and development
expense can fluctuate significantly depending on staffing, project requirements,
and contract research and development activities.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income increased 24%
to $512,203 for the third quarter of fiscal 2011 compared to $414,669 for the third quarter of fiscal 2010.
The increase was due to an increase in interest-bearing marketable securities.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The provision for income taxes was $1,661,090
for the third quarter of fiscal 2011 compared to $1,368,590 for the third quarter
of fiscal 2010. The effective tax rate was 33%
of income before taxes for the third quarter of fiscal 2011, which
was approximately the same rate as the prior-year quarter. Our effective tax rate
can fluctuate, however, due to a number of factors, some of which are outside
our control.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
22% increase in net income in the second quarter
of fiscal 2011 compared to the prior-year quarter was primarily due to increased product sales.
<br><br><br>
<div align="center">11</div></font><hr>
<br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a>
<br><br>Nine months ended December&nbsp;31, 2010 compared to nine months December&nbsp;31, 2009</b>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The table
shown below summarizes the percentage of revenue and period-to-period changes
for various items:<br> <br></font> <table style="font-size: 10pt; font-family: Times New Roman" border="0" cellpadding="0" cellspacing="0" width="100%">
<tr> <td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="5"><b>Percentage
of Revenue<br>Nine Months Ended Dec.&nbsp;31</b></td><td rowspan="2"></td><td style="border-bottom: 1px solid black;" align="center" colspan="2" rowspan="2"><b>Period-<br>
to-Period<br> Change</b></td></tr> <tr> <td style="border-bottom: 1px solid black;" align="center" colspan="2"><b>2010</b></td><td></td><td style="border-bottom: 1px solid black;"align="center" colspan="2"><b>2009</b></td></tr>
<tr bgcolor="#ccdaef"> <td colspan="9">Revenue</td></tr> <tr> <td> <div style="margin-left: 9pt;" align="left">Product
sales</div></td><td align="right" width="9%">83.8</td><td width="1%">
%</td><td width="4%"></td><td align="right" width="9%">80.1</td><td width="1%">%</td><td width="4%"></td><td align="right" width="9%">20.5</td><td width="1%">%</td></tr>
<tr bgcolor="#ccdaef"> <td><div style="margin-left: 9pt;" align="left">Contract&nbsp;research&nbsp;and&nbsp;development</div></td><td style="border-bottom: 1px solid black;" align="right">16.2</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">19.9</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">(6.1</td><td>)%</td></tr>
<tr> <td>Total revenue</td><td align="right">100.0</td><td>%</td><td></td><td align="right">100.0</td><td width="1%">%</td><td></td><td align="right">15.3</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td>Cost of sales</td><td style="border-bottom: 1px solid black;" align="right">31.0</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">29.9</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">19.5</td><td>%</td></tr>
<tr> <td> Gross profit</td><td align="right">69.0</td><td>%</td><td></td><td align="right">70.1</td><td>
%</td><td></td><td align="right">13.5</td><td>
%</td></tr> <tr bgcolor="#ccdaef"> <td colspan="9">Expenses</td></tr> <tr> <td>
<div style="margin-left: 9pt;" align="left">Selling, general, and administrative</div></td><td align="right">8.3</td><td>%</td><td></td><td align="right">9.0</td><td>%</td><td></td><td align="right">5.2</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td> <div style="margin-left: 9pt;" align="left">Research&nbsp;and&nbsp;development</div></td><td style="border-bottom: 1px solid black;" align="right">4.3</td><td style="border-bottom: 1px solid black;" align="left">
%</td><td></td><td style="border-bottom: 1px solid black;" align="right">4.1</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">21.2</td><td>%</td></tr>
<tr> <td>Total expenses</td><td style="border-bottom: 1px solid black;" align="right">12.6</td><td style="border-bottom: 1px solid black;" align="left">
%</td><td></td><td style="border-bottom: 1px solid black;" align="right">13.1</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">10.2</td><td>
%</td></tr> <tr bgcolor="#ccdaef"> <td>Income from operations</td><td align="right">56.4</td><td>%</td><td width="2%"></td><td align="right">57.0</td><td width="1%">
%</td><td></td><td align="right">14.2</td><td>
%</td></tr> <tr> <td>Interest and other income</td><td style="border-bottom: 1px solid black;" align="right">6.5</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">5.9</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">26.1</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td>Income before taxes</td><td align="right">62.9</td><td>%</td><td width="2%"></td><td align="right">62.9</td><td width="1%">%</td><td></td><td align="right">15.3</td><td>
%</td></tr> <tr> <td>Provision for income taxes</td><td style="border-bottom: 1px solid black;" align="right">20.8</td><td style="border-bottom: 1px solid black;" align="left">%</td><td></td><td style="border-bottom: 1px solid black;" align="right">20.8</td><td style="border-bottom: 1px solid black;" width="1%">%</td><td></td><td align="right">15.3</td><td>%</td></tr>
<tr bgcolor="#ccdaef"> <td valign="top">Net income</td><td style="border-bottom: 3px double black;" align="right" valign="top">42.1</td><td style="border-bottom: 3px double black;" valign="top">%</td><td width="2%" valign="top"></td><td style="border-bottom: 3px double black;" align="right" valign="top">42.1</td><td style="border-bottom: 3px double black;" valign="top">%</td><td valign="top"></td><td align="right" valign="top">15.4</td><td valign="top">%</td></tr>
</table><font style="font-size: 10pt; font-family: Times New Roman">&nbsp;<br><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenue for the nine months ended December&nbsp;31,
2010 increased 15% to $23,013,962 compared to $19,967,890 for the nine months ended December&nbsp;31, 2009. The
increase was due to a 21% increase in product sales, partially offset by a 6%
decrease in contract research and development revenue.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The increase in product sales from the prior-year period was due to the addition of
new customers and increased purchase volume by existing customers.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The decrease in research and development revenue was due to the completion of certain
contracts and contract activities. Contract research and development activities
can fluctuate for a number of reasons, some of which are beyond our control, and
there can be no assurance of additional or follow-on contracts for expired or
completed contracts.<br> <br>
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit margin
decreased to 69%
of revenue for the first nine months of fiscal 2011 compared to 70% for the first
nine months of fiscal 2010, due to a less favorable product sales mix.<br>
 <br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total expenses increased 10%
for the first nine months of fiscal 2011 compared to the first nine months of
fiscal 2010 due primarily to a 21% increase in research
and development expense. The increase in research and development expense was
due to increased product development activities, and a decrease in contract research and development activities, which caused
resources to be reallocated to expensed research and development activities. Research and development expense can
fluctuate significantly depending on staffing, project requirements, and contract
research and development activities.<br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest
income increased 26% to $1,485,664 for the first nine months of fiscal 2011 compared
to $1,177,892 for the first nine months of fiscal 2010. The increase was due to an increase in interest-bearing
marketable securities.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The provision for
income taxes was $4,782,699 for the first
nine months of fiscal 2011 compared to $4,148,270 for the first nine months of
fiscal 2010. The effective tax rate was 33% of income before taxes for the first
nine months of fiscal 2011, which was approximately the same rate as
the prior-year period. Our effective
tax rate can fluctuate, however, due to a number of factors, some of which are
outside our control.<br> <br>
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The 15%
increase in net income in the first nine months of fiscal 2011 compared to the
prior-year period was primarily due to increased product
sales and increased interest income.<br>
 <br> <br><div align="center">12</div></font>
<hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a> <br><br>Liquidity and capital resources</b>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
December&nbsp;31, 2010 we had $58,310,820
in cash plus short-term and long-term marketable securities compared to $49,543,766
at March&nbsp;31,&nbsp;2010. Our entire portfolio of short-term and long-term
marketable securities is classified as available for sale. The increase in cash
plus marketable securities in the first nine months of fiscal 2011 was primarily
due to $8,952,319 in net cash provided by
operating activities.<br>
<br>
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The $2,888,583
increase in short-term marketable securities in the first nine months of fiscal
2011 was due to marketable securities previously classified as long-term approaching
maturity. We expect short-term marketable securities to increase in the remaining
quarter of the fiscal year as more of our securities approach maturity.
<br><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable decreased $750,129 dollars due to
the timing of payments by our customers.
<br>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories increased by $1,457,731
due to raw material purchase timing and to support an increased rate of product
sales.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We had no deferred revenue as of
December&nbsp;31, 2010 compared to $20,833 at March&nbsp;31,&nbsp;2010. Deferred
revenue at March&nbsp;31,&nbsp;2010 was due to a nonrefundable payment of $250,000
by Avago to us under the terms of Amendment No.&nbsp;2 to an agreement between
us and Agilent. We recognized revenue from the payment over the term of Amendment
No.&nbsp;2, which was effective as of June&nbsp;27, 2007 and ended June&nbsp;27,
2010.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases of fixed assets were $501,957
during the nine months ended December&nbsp;31, 2010, primarily for production
equipment.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from maturities and sales of marketable securities were $1,573,370 for the nine months ended December&nbsp;31, 2010 compared to $175,256
for the nine months ended December&nbsp;31, 2009. The increase was due to the maturation of marketable securities.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We currently believe our working capital is adequate for our needs at least for the
next 12&nbsp;months.
<br><br><a name="MarketRisk"></a><b>Item 3. Quantitative
and Qualitative Disclosures About Market Risk.</b> <br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
primary objective of our investment activities is to preserve principal while
at the same time maximizing after-tax yields without significantly increasing
risk. To achieve this objective, we maintain our portfolio of cash equivalents
and marketable securities in a variety of securities including government agency
obligations, municipal obligations, corporate obligations, and money market funds.
Short-term and long-term marketable securities are generally classified as available-for-sale
and consequently are recorded on the balance sheet at fair value with unrealized
gains or losses reported as a separate component of accumulated other comprehensive
income, net of estimated tax. Marketable securities as of December&nbsp;31, 2010
had remaining maturities between five and 58&nbsp;months.
Our short-term and long-term marketable securities had a fair market value of
$57,132,411 at December&nbsp;31, 2010, representing
approximately 85% of our total assets. We
have not used derivative financial instruments in our investment portfolio.<br>
<br>
<a name="Controls"></a><b>Item 4. Controls and Procedures.</b> <br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management,
with the participation of the Chief Executive Officer and Chief Financial Officer,
has performed an evaluation of our disclosure controls and procedures (as defined
in <font style="white-space: nowrap;">Rules 13a-15(e)</font> and <font style="white-space: nowrap;">15d-15(e)</font>
of the Securities Exchange Act of 1934 (Exchange Act)) as of the end of the period
covered by this report. This evaluation included consideration of the controls,
processes and procedures that are designed to ensure that information required
to be disclosed by us in the reports we file under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the SEC&#146;s
rules and forms and 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. Based
on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded
that, as of the end of the period covered by this report, our disclosure controls
and procedures were effective.<br> <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the
quarter ended December&nbsp;31, 2010, there was no change in our internal control
over financial reporting that materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.<br> &nbsp;<br>
&nbsp;<br> <div align="center">13</div></font> <hr> <br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a><br> <br></b><div align="center"><b><a name="Part2"></a>PART II&#150;OTHER
INFORMATION</b></div><b><br><a name="Risks"></a>Item 1A. Risk Factors.<br> </b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
have been no material changes from the risk factors disclosed in our Annual Report
on <font style="white-space: nowrap;">Form 10-K</font> for the fiscal year ended
March&nbsp;31, 2010 as updated in our Quarterly Reports on <font style="white-space: nowrap;">Form
10-Q</font> for the quarters ended June&nbsp;30, 2010 and September&nbsp;30, 2010,
except the risk factors titled &#147;We may lose revenue
if we are unable to renew agreements with large customers&#148; and &#147;We could
incur losses on our marketable securities&#148; are replaced in their entirety
by the following:
<br><br><b><i>We may lose revenue if we are unable
to renew agreements with large customers.</i></b>
<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Supplier Partnering Agreement with St.&nbsp;Jude Medical, as amended, expires December&nbsp;31, 2011; our agreement with
Avago Technologies, Inc., as amended, expires June&nbsp;27, 2013; and our Phonak
AG Supply Agreement, as amended, expires March&nbsp;31, 2015. We cannot predict if any of these agreements will be renewed, or if renewed, under
what terms. Although it is possible we could continue to sell products to these
customers without formal agreements, an inability to agree on mutually acceptable
terms or the loss of any of these large customers could have a significant adverse
impact on our revenue and our profitability.
<br><br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
risk factor is being updated because we executed an amendment that extended the term
of our Phonak AG Supply Agreement.
<br><br><b><i>We could incur losses on our marketable securities.</i></b><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At December&nbsp;31, 2010, we held $57,132,411
in short-term and long-term marketable securities, representing approximately
85% of our total assets. For the first nine
months of the fiscal year ending March&nbsp;31, 2011 we earned $1,485,664
in interest, virtually all of which was from those securities. During the past
two fiscal years a number of the securities we hold were downgraded by Moody&#146;s
or Standard and Poor&#146;s indicating a possible increase in default risk. The
credit crisis may have caused or contributed to many of these downgrades. Conditions
and circumstances beyond our control or ability to anticipate can cause downgrades
and increases in default risk. For example, in fiscal 2011 guaranteed global notes
issued by BP Capital Markets plc that we hold were downgraded due to the impact
of BP&#146;s Macondo subsea well oil spill on BP&#146;s financial profile. Although
we recovered an unrealized loss in BP securities, downgrades of any of our marketable
securities are possible at any time for reasons beyond our control, which could
cause us to incur losses on those securities. Additionally, the assignment of
a high credit rating does not preclude the risk of default on any marketable security.
Losses for any reason on our marketable securities could have a material adverse
impact on our financial condition, income, or cash flows.<br> <br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
value of our marketable securities, the portion of our total assets in marketable
securities, and interest earned are being updated in this risk factor.
<br><br><br><b><a name="Exhibits"></a>Item
6. Exhibits.</b>
<br><br></font>
<table style="font-size: 10pt; font-family: Times New Roman" width="100%" border="0" cellspacing="0" cellpadding="0">
<tr> <td width="1%"> <div align="center"><b><u>Exhibit&nbsp;#</u></b></div></td><td width="88%">
<div align="center"><b><u>Description</u></b></div></td></tr> <tr> <td colspan="2">&nbsp;</td></tr><tr> <td valign="top">&nbsp;&nbsp;10.1+</td><td>Amendment
to Supply Agreement by and between NVE Corporation and Phonak AG (incorporated
by reference to our Current Report on Form 8-K/A filed January&nbsp;12,
2011).<br>
&nbsp;&nbsp;</td></tr>
<tr> <td valign="top">&nbsp;&nbsp;31.1</td><td> Certification by Daniel A. Baker
pursuant to Rule 13a-14(a)/15d-14(a).<br> &nbsp; </td></tr> <tr> <td valign="top">
&nbsp;&nbsp;31.2</td><td valign="top">Certification by Curt A. Reynders pursuant
to Rule 13a-14(a)/15d-14(a).<br> &nbsp; </td></tr> <tr> <td valign="top">&nbsp;&nbsp;32</td><td valign="top">Certification
by Daniel A. Baker and Curt A. Reynders pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</td></tr></table><font style="font-size: 10pt; font-family: Times New Roman"><br>
+Confidential portions of this exhibit were deleted and filed separately with
the SEC under a request for confidential treatment pursuant to Rule 24b-2 or Rule
406.<br> <br> <br> </font> <div align="center"><font style="font-size: 10pt; font-family: Times New Roman">14</font></div><hr>
<br clear="all" style="page-break-before:always;">
<font style="font-size: 10pt; font-family: Times New Roman"><b><a href="#TOC">Table
of Contents</a></b><br> <br><div align="center"><a name="Signatures"></a><b>SIGNATURES</b></div><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.<br> <br> </font> <table style="font-size: 10pt; font-family: Times New Roman" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr> <td rowspan="2"></td><td><b><u>NVE CORPORATION</u></b></td></tr> <tr> <td>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Registrant)</td></tr>
<tr> <td colspan="2"><br> &nbsp; </td></tr> <tr> <td width="25%"><div align="center"><b><u>January
19, 2011</u></b></div></td><td><u>/s/ DANIEL A. BAKER&nbsp;</u></td></tr> <tr>
<td><div align="center">Date</div></td><td>Daniel A. Baker </td></tr> <tr> <td></td><td>President
and Chief Executive Officer</td></tr> <tr> <td colspan="2"><br> &nbsp; </td></tr>
<tr> <td> <div align="center"><b><u>January 19, 2011</u></b></div></td><td> <div align="left"><u>/s/
CURT A. REYNDERS&nbsp;</u></div></td></tr> <tr> <td> <div align="center">Date</div></td><td>Curt
A. Reynders</td></tr> <tr> <td></td><td>Chief Financial Officer</td></tr> </table><font style="font-size: 10pt; font-family: Times New Roman"><br>
<br> <div align="center">15<br></div></font> <hr>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>2
<FILENAME>ex31-car.htm
<DESCRIPTION>CERTIFICATION BY CURT A. REYNDERS PURSUANT TO RULE 13A-14(A)/15D-14(A)
<TEXT>
<html> <div style="font-size: 10pt; font-family: Times New Roman;"> <p align="right"><b>Exhibit
31.2</b> <p align="center"><b>CERTIFICATION</b> <p>I, Curt A. Reynders, certify
that:<br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">1.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> I have reviewed this Quarterly Report
on Form 10-Q of NVE Corporation; <p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp;
<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">2.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> Based on my knowledge, this report
does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period covered
by this report; <p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp; <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">3.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> Based on my knowledge, the financial
statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this report;
<p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp; <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">4.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> The registrant&#146;s other certifying
officer(s) and I are responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
and 15d-15(f)) for the registrant and have: <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(a)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the period
in which this report is being prepared; <br> <br> <p style="margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(b)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
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;&nbsp; <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(c)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>Evaluated the effectiveness of the registrant&#146;s disclosure controls
and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(d)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Disclosed in this report any change in the registrant&#146;s internal
control over financial reporting that occurred during the registrant&#146;s most
recent fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant&#146;s internal control over financial reporting;
and <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">5.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> The registrant&#146;s other certifying
officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant&#146;s auditors and the audit
committee of the registrant&#146;s board of directors (or persons performing the
equivalent functions): <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(a)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant&#146;s ability to record, process, summarize
and report financial information; and <p style="margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">&nbsp;
<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(b)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>Any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant&#146;s internal control over financial
reporting. <p>Date: January 19, 2011<p>&nbsp; <table style="font-size: 10pt; font-family: Times New Roman;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr> <td valign="top" style="padding:0in 0in 0in 0in;width:50%;"> <p>&nbsp; </td><td valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:25%;">
/s/ CURT A. REYNDERS</td><td valign="top" style="padding:0in 0in 0in 0in;"> </td></tr>
<tr> <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.62%;">
</td><td width="45%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:45.38%;">
Curt A. Reynders </td></tr> <tr> <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.62%;">
</td><td width="45%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:45.38%;">
Chief Financial Officer</td></tr></table></div>
</body>
</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>3
<FILENAME>ex31-dab.htm
<DESCRIPTION>CERTIFICATION BY DANIEL A. BAKER PURSUANT TO RULE 13A-14(A)/15D-14(A)
<TEXT>
<html> <div style="font-size: 10pt; font-family: Times New Roman;"> <p align="right"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit
31.1</font></b> <p align="center"><b>CERTIFICATION</b> <p>I, Daniel A. Baker,
certify that:<br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">1.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> I have reviewed this Quarterly Report
on Form 10-Q of NVE Corporation; <p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp;
<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">2.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> Based on my knowledge, this report
does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period covered
by this report; <p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp; <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">3.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> Based on my knowledge, the financial
statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this report;
<p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">&nbsp; <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">4.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> The registrant&#146;s other certifying
officer(s) and I are responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
and 15d-15(f)) for the registrant and have: <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(a)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the period
in which this report is being prepared; <br> <br> <p style="margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(b)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
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;&nbsp; <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(c)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>Evaluated the effectiveness of the registrant&#146;s disclosure controls
and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(d)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> Disclosed in this report any change in the registrant&#146;s internal
control over financial reporting that occurred during the registrant&#146;s most
recent fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant&#146;s internal control over financial reporting;
and <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;">5.<font size="1" style="font-size:3.0pt;"><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>&#160;&#160;&#160;&#160;&#160; </font> The registrant&#146;s other certifying
officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant&#146;s auditors and the audit
committee of the registrant&#146;s board of directors (or persons performing the
equivalent functions): <br> <br> <p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(a)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font> All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant&#146;s ability to record, process, summarize
and report financial information; and <p style="margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">&nbsp;
<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-indent:-.5in;">(b)<font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>Any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant&#146;s internal control over financial
reporting. <p>Date: January 19, 2011<p>&nbsp; <table style="font-size: 10pt; font-family: Times New Roman;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr> <td valign="top" style="padding:0in 0in 0in 0in;width:50%;"> </td><td valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:25%;">
/s/ DANIEL A. BAKER </td><td valign="top" style="padding:0in 0in 0in 0in;"> </td></tr>
<tr> <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.62%;">
</td><td width="45%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:45.38%;">
Daniel A. Baker </td></tr> <tr> <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.62%;">
</td><td width="45%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:45.38%;">
President and Chief Executive Officer </td></tr></table></div>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>4
<FILENAME>ex32.htm
<DESCRIPTION>CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
<TEXT>
<html> <div style="font-family:Times New Roman;"> <p align="right"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit
32</font></b><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CERTIFICATION
PURSUANT TO SECTION 906</font></b></p><p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">OF
THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C. SECTION 1350)</font></b></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
undersigned certify pursuant to 18 U.S.C. Section 1350, that to the undersigned&#146;s
knowledge:</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>The accompanying Quarterly Report of NVE Corporation (the &#147;Company&#148;)
on Form 10-Q for the quarter ended December&nbsp;31, 2010, fully complies with
the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and</p><p style="margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font>The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.</p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:
January 19, 2011</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
<tr> <td valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:25%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/
DANIEL A. BAKER</font></p></td><td valign="top" style="padding:0in 0in 0in 0in;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p></td></tr>
<tr> <td colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Daniel
A. Baker</font></p></td></tr> <tr> <td colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">President
and Chief Executive Officer</font></p></td></tr> </table><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
<tr> <td valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:25%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/
CURT A. REYNDERS</font></p></td><td wvalign="top" style="padding:0in 0in 0in 0in;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p></td></tr>
<tr> <td width="100%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Curt
A. Reynders</font></p></td></tr> <tr> <td width="100%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Chief
Financial Officer</font></p></td></tr> </table><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p><p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A
signed original of this written statement required by Section 906 has been provided
to the Company and will be retained by the Company and furnished to the Securities
and Exchange Commission or its staff upon request.</font></p></div>
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