SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15 (d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported) September 24, 1998
SIMTEK CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 0-19027 84-1057605
- --------------------------------------------------------------------------------
(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
1465 Kelly Johnson Boulevard
Colorado Springs, Colorado 80920
---------------------------------------- --------
(Address of principal executive offices) Zip Code
Registrant's telephone, including area code: (719) 531-9444
Not applicable
-----------------------------------------------------------
Former name or former address, if changed since last report
<PAGE>
Item 5: Other Information:
(1) The following Second Quarter 1998 Interim Report to Shareholders, dated
August 31, 1998, has been mailed by the Registrant to its Shareholders:
[OUTSIDE COVER OF REPORT]
Simtek Corporation
1465 Kelly Johnson Blvd. #301
Colorado Springs, CO 80920
[SIMTEK'S LOGO - GRAPHIC OMITTED]
SECOND
QUARTER 1998
INTERIM
REPORT
[END OF OUTSIDE COVER]
- --------------------------------------------------------------------------------
To Our Shareholders:
This report covers the quarter ended June 30, 1998. Shareholders who desire
further disclosure information may request the following reports from the
Securities and Exchange Commission or from Simtek Corporation: Annual Reports on
Form 10-KSB and Quarterly Reports on Form 10-QSB.
Simtek Corporation ("Simtek" or the "Company") recorded net product sales of
$1,801,948 for the second quarter of 1998 and $3,341,279 for the six months
ended June 30, 1998 up from the $1,536,243 recorded for the second quarter 1997
and the $3,301,761 for the six months ended June 30, 1997. The product sales
were from the Company's 4 kilobit, 16 kilobit, 64 kilobit and 256 kilobit nvSRAM
product families. The increases reflected continuing growth in demand for the
Company's nvSRAM products.
In the second quarter 1998, the Company purchased wafers built on 1.2 micron
technology from Chartered Semiconductor Manufacturing Plc. of Singapore
("Chartered") to support sales of its high end 64 kilobit industrial and
military devices and 16 kilobit commercial devices. The Company also purchased
wafers built on 0.8 micron technology from Chartered. Sales of devices built
with both types of wafers purchased from Chartered accounted for approximately
40% of the Company's revenue for the second quarter 1998. The balance of the
Company's revenue for the second quarter 1998, was from the sales of commercial
64 kilobit and 256 kilobit finished units purchased from Zentrum Mikroelektronik
Dresden GmbH ("ZMD").
The Company saw a decrease of approximately 2% in gross margins in the second
quarter 1998 as compared to the second quarter 1997. The decrease in gross
margin was due primarily to a decrease in average selling prices associated with
large production volume orders.
Selling, general and administrative expenses saw an increase in the second
quarter of 1998 of approximately $119,000 over the second quarter 1997. Of this
increase, $79,000 was mainly due to costs associated with the installation of
the 64 kilobit and 256 kilobit product based on 0.8 micron technology into
Chartered. Administration saw an approximate $49,000 increase which was
primarily due to headcount additions. The approximate $9,000 decrease in Sales
and Marketing was mainly due to better cost controls.
The Company recorded a net income of $53,288 in the second quarter of 1998 and a
net income of $178,309 for the six months ended June 30, 1998 as compared to a
net income of $99,579 for the second quarter of 1997 and a net income of
$197,359 for the six months ended June 30, 1997. The decrease in net income was
due to increased selling, general and administrative expenses and lower gross
margins.
August 31, 1998
-2-
<PAGE>
In June 1998, the Company closed a $1,500,000 financing transaction with two
funds advised by Renaissance Capital Group of Dallas, Texas ("Renaissance"). The
funding from Renaissance consists of $1,500,000 of convertible debentures with a
seven year term at a 9 percent per annum interest rate (the"Debenture"). The
debentures are convertible at the option of the holder into Simtek common stock
at 35 cents per share, subject to anti-dilution and other adjustment provisions.
Upon certain conditions, the Company may redeem the debentures or force
conversion. Please see Simteks' second quarter 1998 Form 10-QSB for details on
these provisions.
Many of you shareholders are aware that on August 5, 1998, I announced via a
press release that I was retiring from Simtek both as its Chief Financial
Officer and Chairman, effective August 31, 1998. A copy of the press release is
available from Simtek or on Simtek's website at http://www.simtek.com. In that
release I stated that Simtek is "in good strong hands and well-positioned for
the future. The company has posted two-plus years of sales and earnings growth.
What's more, we recently closed $1.5 million of financing to sustain our
long-term R&D; we're achieving good yields and high output from our Asian
foundry partner; and we have in place the highest caliber of people, led by
President and CEO Doug Mitchell, to ensure future success. This is the right
time for me to move on."
Doug Mitchell, who took over Simtek's CEO reins from Petritz in January this
year after being brought in as executive vice president and COO last July, said,
"Dr. Petritz's retirement is the culmination of a smooth transition that started
a year ago. Under his leadership, Simtek has accomplished much, setting the
groundwork for an even brighter future. Going forward, we have a strong
engineering and development team in place headed by director of engineering
Christian Herdt; a veteran sales organization led by director of sales Dee
Hockaday; and a seasoned operations group overseen by director of operations
Brian Stephens."
In closing, I wish to thank all of Simtek's shareholders for your continuing
support of the Company. It has been an honor and pleasure working with you the
past eleven years.
Sincerely,
RICHARD L. PETRITZ
Chairman and CFO
DOUGLAS MITCHELL
President and CEO
-3-
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
Balance Sheet
- ----------------------------------------------------------------------------------------------------
June 30, December 31,
1998 1997
-------------- -------------
ASSETS
------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 1,788,420 $ 1,475,599
Certificate of deposit 100,000 -
Accounts receivable - trade, net 1,331,151 921,798
Inventory, net 1,013,317 641,264
Deferred financing fees 8,248 -
Prepaid expenses and other 197,820 17,960
-----------------------------------------
Total current assets 4,438,956 3,056,621
Equipment and furniture, net 227,563 177,821
Deferred financing fees 48,798 -
-----------------------------------------
TOTAL ASSETS $ 4,715,317 $ 3,234,442
=========================================
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts payable:
ZMD $ 314,362 $ 716,716
Other 258,510 173,325
Accrued Expenses 367,883 269,592
Accrued Wages 221,475 222,022
Accrued Vacation payable 75,185 62,401
Payable to ZMD 130,153 130,153
-----------------------------------------
Total current Liabilities 1,367,568 1,574,209
Long term debt 1,500,000 -
-----------------------------------------
Total Liabilities 2,867,568 1,574,209
SHAREHOLDER'S EQUITY:
Preferred stock, $1.00 par value; 2,000,000 shares
authorized, none issued and outstanding - -
Common stock, $.01 par value; 80,000,000 shares
authorized, 28,745,226 and 28,679,185 shares
issued and outstanding at June 30, 1998 and
December 31, 1997, respectively 287,452 286,792
Additional paid-in capital 29,760,875 29,752,328
Accumulated deficit (28,200,578) (28,378,887)
-----------------------------------------
Shareholder's equity 1,847,749 1,660,233
-----------------------------------------
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY $ 4,715,317 $ 3,234,442
=========================================
- ----------------------------------------------------------------------------------------------------
OTC Electronic Bulletin Board Registrar and Transfer Agent
System Symbol: Continental Stock Transfer and Trust
SRAM 2 Broadway
New York, NY 10004
</TABLE>
-4-
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
Statement of Income and Comprehensive Income
- ----------------------------------------------------------------------------------------------------
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
1998 1997 1998 1997
---------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
NET SALES $ 1,801,948 $ 1,536,243 $ 3,341,279 $ 3,301,761
Cost of Sales 1,015,389 834,337 1,824,600 1,922,568
------------------------------------------------------------
GROSS MARGIN 786,559 701,906 1,516,679 1,379,193
SELLING, GENERAL & ADMINISTRATIVE
EXPENSE:
Design, research and development 416,484 336,932 715,884 666,041
Administrative 109,243 60,145 224,405 143,424
Sales and marketing 209,083 218,798 401,647 403,664
------------------------------------------------------------
Total selling, general and
administrative expenses 734,810 615,875 1,341,936 1,213,129
INCOME FROM OPERATIONS: 51,749 86,031 174,743 166,064
------------------------------------------------------------
OTHER INCOME (EXPENSE)
Interest income, net 4,352 14,800 18,769 27,044
Other income (expense), net (2,813) (1,252) (4,843) 4,251
------------------------------------------------------------
Total other income (expense) 1,539 13,548 13,926 31,295
------------------------------------------------------------
INCOME BEFORE INCOME TAXES 53,288 99,579 188,669 197,359
Provision for income taxes - - 10,360 -
------------------------------------------------------------
NET INCOME AND COMPREHENSIVE INCOME $ 53,288 $ 99,579 $ 178,309 $ 197,359
BASIC AND DILUTED EPS $ 0.0 $ 0.00 $ 0.0 $ 0.01
BASIC WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 28,708,826 28,521,740 28,708,826 28,521,740
EFFECTIVE OF DILUTIVE OPTIONS 1,969,713 2,278,203 2,056,008 1,782,730
------------------------------------------------------------
DILUTIVE SHARE OUTSTANDING 30,678,539 30,799,943 30,764,834 30,304,470
------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------
Directors and Officers
- ------------------------------------------------------------------------------------------------------
Dr. Richard L Petritz Dr Robert Keeley, Director
Chairman of the Board & CFO University of Colorado, Colorado Springs
Douglas Mitchell Mr Harold Blomquist, Director
CEO, Director
Dr Klaus Wiemer, Director
- -----------------------------------------------------------------------------------------------------
Home Page: E-Mail
http://www.simtek.com [email protected]
</TABLE>
-5-
<PAGE>
SIGNATURE
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 and hereunto duly authorized.
SIMTEK CORPORATION
September 24, 1998 By: /s/Douglas Mitchell
-------------------------------
DOUGLAS MITCHELL
Chief Executive Officer
-6-
