<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 For the quarterly period ended
JUNE 30, 2000 or
[ ] Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 For the transition period from
___________ to _________
Commission file number 1-12410
SIMULA, INC.
--------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
ARIZONA 86-0320129
-------------------------------- ---------------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
2700 NORTH CENTRAL AVENUE, SUITE 1000, PHOENIX, ARIZONA 85004
--------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(602) 631-4005
--------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
--------------------------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last
Report)
Indicate by check mark whether the registrant:
(1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports)
Yes X No
(2) has been subject to such filing requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
<TABLE>
<CAPTION>
Class Outstanding at June 30, 2000
------------------------------ ----------------------------
<S> <C>
Common Stock, $.01 par value 11,418,200
</TABLE>
<PAGE> 2
SIMULA, INC.
INDEX
PART I - FINANCIAL INFORMATION
<TABLE>
<CAPTION>
PAGE
<S> <C>
Item 1 - Financial Statements
Consolidated Balance Sheets
June 30, 2000 and December 31, 1999 .................... 2
Consolidated Statements of Operations
Three and Six Months Ended June 30, 2000 and 1999 ...... 3
Consolidated Statement of Shareholders' Equity
Six Months Ended June 30, 2000 ......................... 4
Consolidated Statements of Cash Flows
Six Months Ended June 30, 2000 and 1999 ................ 5
Notes to Interim Consolidated Financial Statements .......... 6 - 10
Item 2 - Management's Discussion and Analysis of
Results of Operations and Financial Condition .......... 11 - 15
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports ........................................ 16
SIGNATURES ........................................................... 17
</TABLE>
1
<PAGE> 3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
SIMULA, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
------------- -------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 851,585 $ 5,223,236
Contract and trade receivables - Net 23,986,777 24,756,984
Inventories 8,594,572 7,540,570
Deferred income taxes 2,621,000 2,621,000
Prepaid expenses and other 829,362 728,772
Net assets held for sale 12,036,242
------------- -------------
Total current assets 36,883,296 52,906,804
PROPERTY, EQUIPMENT and LEASEHOLD IMPROVEMENTS - Net 12,607,795 13,947,099
DEFERRED INCOME TAXES 33,103,000 33,438,000
DEFERRED FINANCING COSTS 4,272,499 4,897,773
INTANGIBLES - Net 1,801,128 1,788,057
OTHER ASSETS 375,222 362,368
------------- -------------
TOTAL $ 89,042,940 $ 107,340,101
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Revolving line of credit $ 5,923,817 $ 12,751,595
Trade accounts payable 5,356,455 6,104,583
Accrued restructuring costs 3,066,362 6,742,000
Other accrued liabilities 6,382,799 8,267,305
Advances on contracts 1,896,163 2,121,232
Current portion of long-term debt 5,986,358 11,908,303
------------- -------------
Total current liabilities 28,611,954 47,895,018
LONG-TERM DEBT - Less current portion 54,378,434 53,820,177
------------- -------------
Total liabilities 82,990,388 101,715,195
------------- -------------
REDEEMABLE CONVERTIBLE 6% SERIES A PREFERRED STOCK,
$.05 par value - issued 1,900 shares 1,900,000 2,250,000
------------- -------------
SHAREHOLDERS' EQUITY
Preferred stock, $.05 par value - authorized 50,000,000 shares;
issued 1,900 shares redeemable convertible 6% series A preferred stock
Common stock, $.01 par value - authorized, 50,000,000 shares;
issued 11,418,200 and 11,103,827, respectively 114,181 111,038
Additional paid-in capital 60,547,616 59,987,309
Accumulated deficit (55,951,030) (56,384,215)
Accumulated other comprehensive income (558,215) (339,226)
------------- -------------
Total shareholders' equity 4,152,552 3,374,906
------------- -------------
TOTAL $ 89,042,940 $ 107,340,101
============= =============
</TABLE>
See Notes to consolidated financial statements
2
<PAGE> 4
SIMULA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
-------------------------------- ---------------------------------
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenue $ 23,946,849 $ 34,026,137 $ 48,505,707 $ 65,954,399
Cost of revenue 16,071,566 25,161,644 33,016,868 48,575,753
------------ ------------ ------------ ------------
Gross margin 7,875,283 8,864,493 15,488,839 17,378,646
Administrative expenses 5,033,692 5,944,406 10,087,802 11,994,250
------------ ------------ ------------ ------------
Operating income 2,841,591 2,920,087 5,401,037 5,384,396
Interest expense (2,302,531) (1,728,358) (4,566,169) (3,384,398)
------------ ------------ ------------ ------------
Income before taxes 539,060 1,191,729 834,868 1,999,998
Income tax expense (231,000) (476,000) (335,000) (800,000)
------------ ------------ ------------ ------------
Net Income 308,060 715,729 499,868 1,199,998
Preferred stock dividends 33,025 111,205 66,683 111,205
------------ ------------ ------------ ------------
Net earnings available for common shareholders $ 275,035 $ 604,524 $ 433,185 $ 1,088,793
============ ============ ============ ============
Income (loss) per common share - basic $ 0.02 $ 0.06 $ 0.04 $ 0.11
Income (loss) per common share - assuming dilution $ 0.02 $ 0.06 $ 0.04 $ 0.10
</TABLE>
See Notes to consolidated financial statements
3
<PAGE> 5
SIMULA, INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 2000
<TABLE>
<CAPTION>
Accumulated
Additional Other Total
Common Stock Paid-in Accumulated Comprehensive Shareholders' Comprehensive
Shares Amount Capital Deficit Income Equity Income
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, January 1, 2000 11,103,827 $ 111,038 $ 59,987,309 $(56,384,215) $ (339,226) $ 3,374,906
Net earnings (loss) 499,868 499,868 $ 499,868
Issuance of common shares 127,125 1,271 207,577 208,848
Conversion of redeemable
convertible Series A
Preferred Stock 187,248 1,872 352,730 354,602
Preferred Stock Dividends (66,683) (66,683)
Currency translation adjustment (218,989) (218,989) (218,989)
---------- --------- ------------ ------------ ---------- ------------ ---------
BALANCE, June 30, 2000 11,418,200 $ 114,181 $ 60,547,616 $(55,951,030) $ (558,215) $ 4,152,552 $ 280,879
========== ========= ============ ============ ========== ============ =========
</TABLE>
See Notes to consolidated financial statements
4
<PAGE> 6
SIMULA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30,
---------------------------------
2000 1999
------------ ------------
<S> <C> <C>
Cash flows used for operating activities:
Net income $ 499,868 $ 1,199,998
Adjustment to reconcile net income to net cash used by operating activities:
Depreciation and amortization 2,382,491 2,855,397
Deferred income taxes 335,000 800,000
Capitalized interest 228,945
Gain on sale of assets -- (365,714)
Currency translation adjustment (218,989) (754,817)
Changes in net assets and liabilities:
Contract and trade receivables - net of advances 545,138 (6,185,447)
Inventories (1,054,002) (5,106,061)
Prepaid expenses and other (100,590) (446,619)
Deferred costs -- (377,765)
Other assets (12,854) 5,557
Net assets held for sale 677,582 (3,226,397)
Trade accounts payable (748,128) 544,320
Restructuring reserve (2,875,639) --
Other accrued liabilities (1,884,506) 1,532,074
------------ ------------
Net cash used by operating activities (2,225,684) (9,525,474)
------------ ------------
Cash flows used by investing activities:
Proceeds from sale 11,358,660 2,860,362
Purchase of property and equipment (139,566) (1,352,661)
Costs incurred to obtain intangibles (175,715) (276,643)
------------ ------------
Net cash used in investing activities 11,043,379 1,231,058
------------ ------------
Cash flows from financing activities:
Net borrowings under line of credit (6,827,778) 3,700,000
Principal payments under other debt arrangements (6,508,336) (1,568,717)
Dividends paid (62,080) (111,205)
Issuance of common shares 208,848 295,997
Issuance of preferred shares -- 7,500,000
------------ ------------
Net cash provided by financing activities (13,189,346) 9,816,075
------------ ------------
Net (decrease) increase in cash and cash equivalents (4,371,651) 1,521,659
Cash and cash equivalents at beginning of period 5,223,236 933,462
------------ ------------
Cash and cash equivalents at end of period $ 851,585 $ 2,455,121
============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
In June 2000, $350,000 of Series A Preferred
Stock plus accrued dividends of $4,602 were
exchanged for 187,248 shares of the Company's
common stock.
In June 2000, the Company executed a note
payable in the amount of $800,000 in exchange
for termination of one of its facility operating
leases related to the airliner seat operation
which was disposed of in January 2000.
Interest paid $ 3,794,364 $ 3,118,196
============ ============
Taxes paid $ 15,000
============
</TABLE>
See Notes to consolidated financial statements
5
<PAGE> 7
SIMULA, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION:
The accompanying interim consolidated financial statements of Simula, Inc.
(the "Company") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q. Accordingly, they do not include all of the
information and notes required by generally accepted accounting principles
for complete financial statements. In the opinion of Management, all
adjustments and reclassifications considered necessary for a fair and
comparable presentation have been included and are of a normal recurring
nature. Operating results for the three and six months ended June 30, 2000
are not necessarily indicative of the results that may be expected for the
year ending December 31, 2000.
NOTE 2 - INVENTORIES:
At June 30, 2000 and December 31, 1999, inventories consisted of the
following.
<TABLE>
<CAPTION>
2000 1999
---------- ----------
<S> <C> <C>
Raw materials $5,412,155 $5,101,426
Work in process 2,470,874 1,967,397
Finished goods 711,543 471,747
---------- ----------
Total inventories $8,594,572 $7,540,570
========== ==========
</TABLE>
NOTE 3 - DEBT:
On May 16, 2000, the Company received a notice asserting certain technical,
non-monetary, failures to comply with loan provisions. The Company disputed
the assertions from one of its senior lenders. As an accommodation to each
other, the Company and its senior lender entered into an Investment
Monitoring Agreement and First Amendment to the Securities Purchase
Agreement on May 25, 2000. Pursuant to these agreements, the senior lender
has agreed to (a) waive any non-compliance; (b) provide ongoing operating
overviews and consulting and (c) amend certain of the information reporting
obligations under the loan. As an accommodation to the senior lender, the
Company has agreed to pay an investment monitoring fee of $150,000 per
annum payable in equal monthly installments of $12,500 for a three year
period ending May 31, 2003. The total amount of the investment monitoring
fee fully earned.
NOTE 4 - REDEEMABLE CONVERTIBLE PREFERRED STOCK:
On March 29, 1999, the Company completed a private placement to an
accredited investor of $7.5 million of the Company's Series A Convertible
Preferred Stock (the "Series A"). Under the terms of this offering the
Series A bears a dividend rate of 6% per annum payable quarterly in cash,
or in stock that will be valued at 90% of fair market value at the time of
payment. The Series A may be converted into shares of the Company's Common
Stock at any time at 101% of the average closing price of any 15 out of the
30 consecutive trading days preceding conversion, up to a specified maximum
conversion price (the "Conversion Cap"). The Conversion Cap for the first
twelve months is $8.60 per share and is subject to an annual adjustment to
the lesser of the then existing Conversion Cap or 130% of the average of
the closing bid prices for 20 consecutive trading days immediately
proceeding the annual adjustment anniversary date. Conversion of the Series
A is limited to 10% of the initial amount per month, accumulating monthly
up to a maximum of 30% of the accumulated convertible amount in any month.
The Company may require the conversion of the Series A if the market price
of the Company's Common Stock exceeds the Conversion Cap by at least 50%
for at least 20 consecutive trading days, subject to the same conversion
limitations imposed upon the Series A holders.
6
<PAGE> 8
SIMULA, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Series A Preferred Stock is subject to a mandatory redemption of the
remaining outstanding shares on May 1, 2004 at which time the Company is
required to redeem all such shares at the greater of 130% of the preferred
stock stated value plus accrued and unpaid dividends, or the average of the
closing bid prices on the ten consecutive trading days immediately
preceding the redemption date. The holders of the Company's Series A
Preferred Stock have the option to require the Company to redeem all or a
portion of the Series A Preferred Stock at a redemption price equal to 105%
of the preferred stock stated value plus accrued and unpaid dividends if
the Company consolidates or merges with or into another company.
In June 2000, $350,000 of Series A Preferred Stock plus accrued dividends
of $4,602 were exchanged for 187,248 shares of the Company's common stock.
NOTE 5 - RESTRUCTURING
In December 1999, management of the Company, with the approval of the board
of directors, committed itself to a plan of restructuring and recorded a
charge to income of $18.3 million. The plan of restructuring included a
refinancing of its outstanding bank line of credit and certain term notes
and the divestiture of the Company's new airline seat manufacturing
operation. The Company entered into an agreement to sell substantially all
the assets of the airline seat manufacturing operation in December 1999 and
completed the transaction in January 2000 closing the operating facility at
that time terminating approximately 300 management and production
employees. During the six months ended June 30, 2000, the Company has
incurred and paid total restructuring costs of approximately $3.7 million
comprised of $1.5 million of employee severance, $1.8 million in
transaction and shut down costs, and $.5 million in lease termination
costs.
NOTE 6 - SEGMENT REPORTING
The Company is a holding company for wholly owned subsidiaries which
operate in two business segments. The Commercial Products segment includes
operations which primarily manufacture inflatable restraints and related
technology for automobiles, airline seating soft goods and polymer
materials. The Government and Defense segment includes operations that
design and manufacture crash resistant components, energy absorbing
devices, ballistic armor and composites principally in connection with
branches of the United States armed forces procurement. The remaining
segment, entitled Other, represents general corporate operations.
7
<PAGE> 9
SIMULA, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
For the three month period ended June 30, 2000 and 1999 inter-segment
sales were insignificant and total intercompany sales of $388,453 and
$1,158,729, respectively, have been eliminated.
<TABLE>
<CAPTION>
2000
Commercial Government
Products and Defense Other Total
----------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Revenue:
Contract revenue $13,606,890 $13,606,890
Product sales:
Airline seat systems $ 1,532,242 1,532,242
Automotive safety systems 8,171,386 8,171,386
Other 90,255 90,255
Technology sales and royalties 268,557 277,519 546,076
----------- ----------- ---------- -----------
Total revenue $10,062,440 $13,884,409 $ -- $23,946,849
=========== =========== ========== ===========
Operating (loss) income $ 2,207,778 $ 1,106,509 $ (472,696) $ 2,841,591
</TABLE>
<TABLE>
<CAPTION>
1999
Commercial Government
Products and Defense Other Total
----------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
Revenue:
Contract revenue $ 10,276,044 $10,276,044
Product sales:
Airline seat systems $16,068,159 16,068,159
Automotive safety systems 7,251,988 7,251,988
Other $ 199,549 199,549
Technology sales and royalties 230,397 230,397
----------- ------------- ----------- -----------
Total revenue $23,550,544 $ 10,276,044 $ 199,549 $34,026,137
=========== ============= =========== ===========
Operating (loss) income $ 2,167,490 $ 1,084,180 $ (331,583) $ 2,920,087
</TABLE>
8
<PAGE> 10
SIMULA, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
For the six months ended June 30, 2000 and 1999, inter-segment sales
were insignificant and total intercompany sales of $1,164,377 and
$2,728,790 respectively, have been eliminated.
<TABLE>
<CAPTION>
2000
Commercial Government
Products and Defense Other Total
----------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Revenue:
Contract revenue $24,501,075 $24,501,075
Product sales:
Airline seat systems $ 6,954,169 6,954,169
Automotive safety systems 15,992,371 15,992,371
Other 179,372 179,372
Technology sales and royalties 538,777 339,943 878,720
----------- ----------- ------------- -----------
Total revenue $23,664,689 $24,841,018 $ -- $48,505,707
=========== =========== ============= ===========
Operating (loss) income $ 4,052,472 $ 2,158,523 $ (809,958) $ 5,401,037
</TABLE>
<TABLE>
<CAPTION>
1999
Commercial Government
Products and Defense Other Total
----------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
Revenue:
Contract revenue $21,488,676 $21,488,676
Product sales:
Airline seat systems $28,822,838 28,822,838
Automotive safety systems 14,621,027 14,621,027
Other 591,913 $ 199,548 791,461
Technology sales and royalties 230,397 230,397
----------- ----------- ----------- -----------
Total revenue $43,674,262 $22,080,589 $ 199,548 $65,954,399
=========== =========== =========== ===========
Operating (loss) income $ 4,552,938 $ 1,682,490 $ (851,032) $ 5,384,396
</TABLE>
9
<PAGE> 11
SIMULA, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6 - EARNINGS PER SHARE:
The following is a reconciliation of the numerators and denominators of
basic and diluted per share computations. For the three month period
ended June 30, 2000, diluted earnings per share does not include the
effect of warrants and options to purchase common stock and shares to
be issued upon conversion of the Company's 8% Senior Subordinated
Convertible Notes (the "8% Notes") and Redeemable Convertible Preferred
Stock of 6,904,371 shares, because the result would be anti-dilutive.
For the six month period ended June 30, 2000, diluted earnings per
share does not include the effect of warrants to purchase common stock
and shares to be issued upon conversion of the Company's 8% Senior
Subordinated Convertible Notes (the "8% Notes") and Redeemable
Convertible Preferred Stock of 3,639,065 shares, because the result
would be anti-dilutive. For the three and six month period ended June
30, 1999, diluted earnings per share does not include the effect of
options to purchase common stock and shares to be issued upon
conversion of the Company's 8% Notes and 10% Notes of 5,179,784 and
5,186,861, respectively, because the result would be anti-dilutive.
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net Earnings $ 308,060 $ 715,729 $ 499,868 $ 1,199,998
Dividends on preferred stock 33,025 111,205 66,683 111,205
----------- ----------- ----------- -----------
Net earnings available to common shareholders $ 275,035 $ 604,524 $ 433,185 $ 1,088,793
=========== =========== =========== ===========
Basic weighted average shares outstanding 11,169,767 10,049,111 11,136,797 9,983,154
Effect of dilutive securities -- 1,425,245 4,598 1,458,076
----------- ----------- ----------- -----------
Diluted weighted average shares outstanding 11,169,767 11,474,356 11,141,395 11,441,230
=========== =========== =========== ===========
Basic per share amounts: $ 0.02 $ 0.06 $ 0.04 $ 0.11
=========== =========== =========== ===========
Diluted per share amounts: $ 0.02 $ 0.06 $ 0.04 $ 0.10
=========== =========== =========== ===========
</TABLE>
10
<PAGE> 12
SIMULA, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION.
GENERAL - The following discussion and analysis provides information that
management of Simula, Inc. (the "Company") believes is relevant to an assessment
and understanding of the Company's results of operations and financial condition
for the three and six month periods ended June 30, 2000 compared to the same
periods in 1999. This discussion should be read in conjunction with the Interim
Consolidated Financial Statements and the Notes thereto included elsewhere in
this Form 10-Q. This Form 10-Q contains certain forward-looking statements and
information. The cautionary statements contained below should be read as being
applicable to all related forward-looking statements wherever they appear. See
"Forward Looking Information and Risks of the Business."
OVERVIEW
Simula, Inc. is an acknowledged world leader in providing crash
resistant and energy absorption technologies that safeguard human lives. In its
role as a safety technology company, Simula invents, manufactures, and markets
advanced occupant seating and restraint systems installed in air, ground, and
sea transport vehicles for the military, aircraft, and automotive industries.
Simula, Inc. conducts its business through eight wholly-owned operating units.
As used herein, the terms "Company" or "Simula" refer collectively to Simula,
Inc. and its consolidated subsidiaries.
Simula is a holding company for operating units in two business
segments. The Commercial Products segment includes technology development,
manufacturing and assembly operations for safety systems for automobiles and
trucks, airline seating soft goods and polymer materials. The Company's
Government and Defense segment includes technology development and manufacturing
operations for military aircraft seating, armor, and crew safety systems sold
principally to U.S. and foreign armed forces.
During the period 1999 through early 2000, the Company completed major
steps in recapitalizing the Company to provide additional working capital and
focus the Company on its profitable core businesses. In August, 1999, the
Company completed the sale of its rail seating operation which was reported as a
discontinued operation. On December 31, 1999, the Company obtained a new credit
facility with an asset based lender to replace its existing bank line and issued
$20 million in secured senior notes in a transaction with a private investor. In
December, 1999 the Company entered into an agreement for the sale of the assets
of its operating unit engaged in the commercial airline seating business, for
cash and the assumption of liabilities. This transaction was completed in
January 2000. "See Management's Discussion and Analysis of Financial Results."
Through its operating divisions and subsidiaries, Simula develops,
manufactures, licenses, and sells products and technologies in six major
categories. The products and technologies are typically developed into a number
of different applications which are provided across a range of markets to
different types of customers:
- Inflatable Restraints - Simula has numerous patented inflatable
restraint devices, embodying technologies and designs that are
significantly different than the conventional airbag, which are used to
protect occupants in automobiles and aircraft. The products and
technologies are used in both military and commercial markets.
- Seating Systems - The Company has expertise in crash resistant, energy
absorbing, technologies used in protective seating systems for aircraft
pilots and crews. The systems are used principally in military aircraft
but also have commercial applications and customers.
- Sensors - The Company has developed and patented a variety of sensors
including one used to detect rollover incidents for land vehicles and
another used to detect crash incidents in aircraft. The sensors trigger
the deployment of safety devices, including inflatable restraints and
airbags. The sensors have application in both commercial and military
markets.
- Armor - In connection with its military seating systems, Simula
developed extensive technology and an array of armor products. Armor in
numerous designs is used in military aircraft and land vehicles.
Products are also sold and licensed in the civilian market, including
for vehicles and "body armor" for law enforcement and similar
personnel.
- Polymer Products - Simula sells and licenses a family of proprietary
polymer materials. The materials are transparent, high impact, and have
high optical properties. The materials are suited for a variety of
applications in both military and commercial markets, including
ophthalmic lenses, protective eyewear, and armor systems.
11
<PAGE> 13
SIMULA, INC.
- Protective Equipment and Parachutes - The Company has patented designs
for state-of-the-art parachutes with numerous competitive advantages.
Parachutes are marketed for pilots in military branches around the
world. Simula also has military customers for a related set of crew and
pilot protective equipment including inflatable life vests utilizing
the Company's inflatable restraint technology.
LIQUIDITY AND CAPITAL RESOURCES
The Company defines liquidity as the ability to access cash to meet
operating and capital needs. The Company's primary source of cash in the six
month period ended June 30, 2000 was from the sale of the Company's airline
seating operation.
The Company's ability to fund working capital requirements and debt
service during the next year will be dependent upon improved cash flow from the
remaining operating units. Following the 1999 restructuring, the remaining
operations have a recent history of profitability and positive cash flow. The
Company has significantly reduced its working capital needs and believes that
existing availability under its RLC is adequate to fund its operations. The
Company is continuing to work with its investment banker to address the
September 2000 maturity of the $5.0 million Term A Note discussed below. The
alternatives currently being considered include repayment of the note through a
combination of cash flow and availability under the RLC, refinance the note
through an expansion of a banking facility, work with the note holder to extend
the note beyond the current due date until one of the above is accomplished, or
strategic asset sales or technology licensing.
On December 30, 1999 the company executed a Financing Agreement (the
"Financing Agreement") with an asset based lender which provided a $17.0 million
Revolving Line of Credit (the "RLC") and a $5.0 million term note. The proceeds
from this financing, together with the proceeds from the Senior Secured Notes
discussed below, were used to retire the then existing Senior Credit Agreement
and two term notes payable to a bank and to retire $4.3 million of the Company's
Senior Subordinated Convertible Notes. The Company's availability under the RLC
is dependent upon the relative balances of accounts receivable and inventories
and each of their relative advance percentages. The RLC accrues interest payable
monthly at the Chase Manhattan prime rate or LIBOR plus 2.4% based upon the rate
selected by the Company. The RLC matures on December 30, 2003 and renews
automatically unless terminated by either party with 60 days notice prior to
each anniversary date of the agreement. If the Financing Agreement is terminated
at any other time, an early termination fee based upon the outstanding principal
under the revolving line of credit of 1-1/2% during the first year and -3/4%
after the first anniversary and before the second anniversary shall be assessed.
The Company had available borrowings of $13.7 million and $13.0 and outstanding
borrowings of $5.9 million and $8.9 at June 30 and July 31, 2000, respectively.
The Financing Agreement contains covenants that require the maintenance
of certain defined financial ratios and income and limits additional borrowings
and capital expenditures. The Financing Agreement is secured by the assets of
the Company. The $5.0 million term note was retired on February 2, 2000 with
proceeds received from the sale of the Company's airliner seat manufacturing
operation. At June 30, 2000 the Company was in compliance with all covenants
relating to the Financing Agreement.
On December 30, 1999, the Company executed an agreement with an
accredited investor for two Senior Secured Notes in the amounts of $5,000,000
(the "Term Note A") and $15,000,000 (the "Term Note B") (together the "Term
Notes") and a warrant to purchase 850,000 shares of common stock at $5.00 per
share. The warrant is immediately exercisable and expires in 7 years. The Term
Note A matures on September 30, 2000, accrues interest payable monthly at 15%
and provides for an additional monthly bridge fee of $25,000. The Term Note A
may be redeemed with a 30 day notice at any time without penalty. The Term Note
B matures on June 30, 2003 and provides for cash interest to be paid monthly at
12.25% and interest which is to be capitalized into the note principal balance
at 3% per annum. The Term Note B may be redeemed with a 30 day notice at certain
specified redemption prices plus accrued interest payable to the redemption
date. The Term Notes contain covenants that require the maintenance of certain
defined financial ratios and income and limits additional borrowings and capital
expenditures.
On May 16, 2000, the Company received a notice asserting certain
technical, non-monetary, failures to comply with the Term Note provisions. The
Company disputed the assertions. The Company and its senior lender entered into
an Investment Monitoring Agreement and First Amendment to the Securities
Purchase Agreement. Pursuant to these agreements, the senior lender has agreed
to (a) waive any non-compliance; (b) provide ongoing operating overviews and
consulting and (c) amend certain of the Company's information reporting
obligations. As an accommodation to the senior lender, the Company has agreed to
pay an investment monitoring fee of $150,000 per annum payable in equal monthly
installments of $12,500 for a three year period ending May 31, 2003. The total
amount of the investment monitoring fee is fully earned. The Term Notes are
12
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SIMULA, INC.
secured by the assets of the Company. At June 30, 2000 the Company was in
compliance with all covenants relating to the Term Notes.
The Company believes it has sufficient manufacturing capacity, at June
30, 2000, to meet its anticipated future delivery requirements.
The Company may, however, seek to obtain additional capital should
demand for its products exceed current capacity. The raising of capital in
public markets will be primarily dependent upon prevailing market conditions and
the demand for the Company's products and technologies.
The Company's liquidity is greatly impacted by the nature of the
billing provisions under its contracts. Generally, in the early period of
contracts, cash expenditures and accrued profits are greater than allowed
billings while contract completion results in billing previously unbilled costs
and profits. Contract and trade receivables, net of advances on contracts,
decreased approximately $0.5 million for the six months ended June 30, 2000.
This decrease is primarily attributable to a $2.7 million decrease in the
Government and Defense segment partially offset by a $1.1 million increase in
the Commercial Products segment. The Government and Defense segment increase is
primarily due to completion of certain contracts and the timing of collections
under those contracts. The increase in Commercial Products is attributable to
increased volume of the ITS.
Operating activities required the use of $2.2 million of cash during
the six months ended June 30, 2000, compared to the use of $9.5 million of cash
during the same period in 1999. Cash used by operating activities in the 2000
period was primarily used to increase inventories, satisfy costs related to the
disposal of the Company's new airline seating system product line and reduce
accounts payable and accrued liabilities.
Investing activities provided $11.0 million principally from the sale
of the Company's airline seating systems product line.
Financing activities used $13.2 million of cash during the six months
ended June 30, 2000 as a result of the Company's use of proceeds received in the
sale of its airline seating systems to retire $5 million in term debt and
reduction of its line of credit and other scheduled principal reductions.
RESULTS FROM CONTINUING OPERATIONS
Three and Six Months Ended June 30, 2000 Compared to 1999:
Revenue for the three months ended June 30, 2000 decreased 30% to $23.9
million from $34.0 million for the comparable period in 1999. Revenue for the
six months ended June 30, 2000 decreased 26% to $48.5 million from $66.0 million
for the comparable period in 1999. The decreases in revenue are attributable to
the Company's Commercial Products segment offset partially by increases in
revenue from the Government and Defense segment. Commercial Products revenue for
the three months ended June 30, 2000 decreased 57% to $10.1 million from $23.6
million and for the six month period ended June 30, 2000 decreased 46% to $23.7
million from $43.7 million principally due to a decrease in revenues related to
airliner new seating systems as a result of Company's sale of this product line
in January 2000. Government and Defense revenue for the three months ended June
30, 2000 increased 35% to $13.9 million from $10.3 million and for the six
months ended June 30, 2000 increased 13% to $24.8 million from $22.1 million.
The increase in Government and Defense revenue is primarily attributable to an
overall increase contracts.
Gross margin for the three months ended June 30, 2000 decreased 12% to
$7.8 million from $8.9 million and for the six months ended June 30, 2000
decreased 11% to $15.5 million from $17.4 million for the comparable period in
1999. Gross margin as a percent of sales for the three months ended increased 7%
to 33% from 26% and for the six months ended June 30, 2000 increased 6% to 32%
from 26%. Commercial Products gross margin for the three months ended June 30,
2000 decreased 29% to $3.8 million from $5.3 million and for the six months
ended June 30, 2000 decreased 28% to $7.6 million from $10.5 million. Commercial
Products gross margin as a percent of sales for the three months ended June 30,
2000 increased to 38% from 23% and for the six months ended June 30, 2000
increased to 32% from 24%. The changes in Commercial Products gross margins are
primarily attributable to disposal of the Company's airliner new seating system
product line in January 2000. Government and Defense gross margin for the three
months ended June 30, 2000 increased 19% to $4.0 million from $3.4 million and
for the six months ended June 30, 2000 increased 17% to $7.8 million from $6.7
million. Government and Defense gross margin as a percentage of sales for the
three months ended June 30, 2000 decreased to 29% from 33% and for the six
months ended June 30, 2000 increased to 31% from 30%.
13
<PAGE> 15
SIMULA, INC.
Administrative expenses for the three months ended June 30, 2000
decreased 15% to $5.0 million from $5.9 million and for the six months ended
June 30, 2000 decreased 17% to $10.0 million from $12.0 million for the
comparable periods in 1999. Commercial Products administrative expenses for the
three months ended June 30, 2000 decreased 50% to $1.6 million from $3.1 million
and for the six months ended June 30, 2000 decreased 41% to $3.5 million from
$5.9 million. The decreases in the Commercial Products administrative expenses
are primarily attributable to the disposal of the Company's airliner new seating
system product line in January 2000. Commercial Products administrative expenses
as a percentage of sales for the three months ended June 30, 2000 increased to
16% from 13% and for the six months ended June 30, 2000 increased to 15% from
14%. Government and Defense administrative expenses for the three months ended
June 30, 2000 increased 27% to $2.9 million from $2.3 million and increased 13%
to $5.7 million from $5.0 million for the comparable periods in 1999. Government
and Defense administrative expenses as a percentage of sales for the three
months ended June 30, 2000 decreased to 21% from 22% and remained constant at
23% for the six months ended June 30, 2000 and 1999.
Interest expense increased 33% to $2.3 million from $1.7 million for
the three months ended June 30, 2000 and 1999, respectively, and increased 35%
to $4.6 million from $3.4 million for the six months ended June 30, 2000 and
1998, respectively. The increase in interest expense is primarily attributable
to the Company's increased cost of capital associated with its debt refinancing
which was completed in December 1999 and an overall increase in outstanding
borrowings.
The effective income tax rate for the three and six month periods ended
June 30, 2000 and 1999 approximated 35% and 40%, respectively.
Three and Six Months Ended June 30, 1999 Compared to 1998
Revenue for the three months ended June 30, 1999 increased 32% to $34.0
million from $25.7 million for the comparable period in 1998. Revenue for the
six months ended June 30, 1999 increased 37% to $66.0 million from $48.3 million
for the comparable period in 1998. The increases in revenue are attributable to
both of the Company's business segments. Commercial Transportation Products
revenue for the three months ended June 30, 1999 increased 33% to $23.6 million
from $17.7 million and for the six month period ended June 30, 1999 increased
36% to $43.7 million from $32.1 million for the comparable periods in 1998. The
Commercial Transportation Products revenue increases are due to increased
deliveries of ITS(R) and 16g Seats. Government and Defense revenue for the three
months ended June 30, 1999 increased 27% to $10.3 million from $8.1 million and
for the six month period ended June 30, 1999 increased 36% to $22.1 million from
$16.2 million for the comparable periods in 1998. The increase in Government and
Defense revenue is attributable to increased overall contracts and the timing of
material costs incurred on contracts.
Gross margin for the three months ended June 30, 1999 increased 33% to
$8.9 million from $6.7 million and for the six months ended June 30, 1999
increased 38% to $17.4 million from $12.6 million for the comparable period in
1998. Gross margin as a percent of sales for the three and six months ended June
30, 1999 remained consistent with the comparable 1998 periods in each of the
Company's segments. Commercial Transportation Products gross margin for the
three months ended June 30, 1999 increased 30% to $5.3 million from $4.1 million
and for the six months ended June 30, 1999 increased 34% to $10.5 million from
$7.8 million for the comparable periods in 1998. Government and Defense gross
margin increased 30% to $3.4 million from $2.6 million and for the six months
ended June 30, 1999 increased 40% to $6.7 million from $4.8 million for the
comparable periods in 1998. The increase in gross margin is attributable to the
increase in revenue noted above.
Administrative expenses for the three months ended June 30, 1999
increased 27% to $5.9 million from $4.7 million and for the six months ended
June 30, 1999 and increased 32% to $12.0 million from $9.1 million for the
comparable periods in 1998. Commercial Transportation Products administrative
expenses for the three months ended June 30, 1999 increased 68% to $3.1 million
from $1.9 million and for the six months ended June 30, 1999 increased 52% to
$5.9 million from $3.9 million for the comparable periods in 1998. The increases
in Commercial Transportation Products administrative expenses is attributable to
an increased support structure required to support revenue growth. Commercial
Transportation Products administrative expenses as a percentage of sales for the
three and six month periods ended June 30, 1999 was 13% and 14%, respectively,
as compared to 11% and 12% for the three and six month periods ended June 30,
1998, respectively. Government and Defense administrative expenses for the three
month period ended June 30, 1999 decreased 3% to $2.3 million from $2.4 million
for the comparable 1998 period and is principally related to a decrease in
efforts related to internally funded research and development due to increased
demand of technical resources applied to third party contracts. Government and
Defense administrative expenses for the six month period ended June 30, 1999
increased 14% to $5.0 million from $4.4 million for the comparable period in
1998 and is principally related to increases during the first quarter of
internally funded research and development and pre-production parachute costs.
Administrative expenses as a percentage of sales was 22% and 23% for the three
and six month period ended June 30, 1999 as compared to 29% and 27% in the
comparable 1998 period.
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SIMULA, INC.
Interest expense increased 46% to $1.7 million from $1.2 million for
the three months ended June 30, 1999 and 1998, respectively, and increased 42%
to $3.4 million from $2.4 million for the six month period ended June 30, 1999
and 1998, respectively. The increase in interest expense is primarily
attributable to increased outstanding borrowing.
The effective income tax rate for the three and six month periods ended
June 30, 1999 and 1998 approximated the Company's combined statutory rate of
40%.
INFLATION
The Company does not believe that it is significantly impacted by
inflation.
RESEARCH AND DEVELOPMENT
The Company's research and development occurs under fixed-price,
government-funded contracts and Company-sponsored efforts. Historically,
research and development efforts have fluctuated based upon available
government-funded contracts and available Company funding. The Company
anticipates that future fluctuations may also occur as a result of efforts to
expand its inflatable restraint, commercial airliner and helicopter seating, and
other technologies.
SEASONALITY
The Company does not believe that it is currently significantly
impacted by seasonal factors.
FORWARD LOOKING INFORMATION AND RISKS OF THE BUSINESS
The Company believes that in 1999 and early 2000 it successfully
addressed the manufacturing inefficiencies, operating losses, cash flow and
liquidity problems that Simula experienced in recent years. The Company believes
that it has significant competitive advantages based on its current and
developing technologies and products, and that Simula will continue to benefit
from its worldwide recognition as a premier safety technology company.
Management believes the Company is positioned for consistent revenue and
earnings growth during the next five years.
This forward looking information is subject to, and qualified by, the
trends and uncertainties in the Company's business described below and elsewhere
in this Report.
Projected operating results will be affected by a wide variety of
factors which could adversely impact revenues, profitability and cash flows. The
Company's liquidity and available working capital will be dependent upon cash
flow from operations, availability of funds under its credit agreement, and
extensions or refinancings of certain indebtedness or, potentially, proceeds
from asset sales or licensing. Other factors pertinent to the Company's ability
to meet its current and five year financial projections include its leveraged
status and the level and cost of debt; reduction of fixed expenses; ability to
maintain margins or grow volumes in its automotive segment; success in building
strategic alliances with large prime contractors and first tier suppliers to
OEMs; competition and competitive pressures on pricing including from first tier
supplier partners; customer order patterns and seasonality; the cyclical nature
of the automobile industry and other markets addressed by the Company's
products; the level and makeup of military expenditures; the costs of legal
proceedings; contract mix and shifting production and delivery schedules among
the Company's two business segments; amount of resources committed to
independent research and development from time to time; proof of concept and
production validation of certain of the Company's new technologies and proposed
products; technological changes; the level of orders which are received and can
be shipped and invoiced in a quarter; manufacturing capacity and yield; costs of
labor, raw materials, supplies, and equipment; reliability of vendor base, and
economic conditions in the United States and worldwide markets.
As used throughout this report, the words "estimate," "anticipate,"
"expect," "should," "intend," "project," "target," or other expressions that
indicate future events identify forward looking statements which are made
pursuant to safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Actual results and trends may differ materially. Risks include
those described herein and in the Company's registration statements and periodic
reports filed with the U.S. Securities and Exchange Commission.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
15
<PAGE> 17
SIMULA, INC.
In February 1998, the Company filed a complaint in United States
District Court for the District of Arizona against Autoliv, Inc., seeking
injunctive relief from alleged anti-competitive acts and practices by Autoliv.
The complaint alleges numerous unlawful actions taken by Autoliv in connection
with a license from the Company to market and distribute the Company's ITS(R).
The legal action asserts that Autoliv has suppressed technology and is
unlawfully interfering with the Company's rights to market the ITS(R) and
related products to other first tier automotive safety equipment suppliers and
to automobile manufacturers. In 1998, the District Court stayed the proceedings
and ruled that the dispute between the parties was a contractual one and was
subject to arbitration pursuant to a contract provision. On November 3, 1998,
the Company filed a separate complaint against Autoliv in the United States
District Court for the District of Delaware seeking injunctive relief and
damages for patent infringement. The Company's complaint alleges that Autoliv
developed, offered, and sold a side impact head protection device in the United
States that infringes the patent that Simula owns for the ITS(R). The Company
became aware of the potential infringement in early October 1998 as Autoliv
introduced this device into production automobiles being offered for the first
time in the United States. In late 1999, the Delaware court similarly stayed the
proceedings pending arbitration. In 1999, the Company commenced an international
arbitration proceeding under the rules of the International Chamber of Commerce.
The arbitration includes the same legal claims as made in the U.S. litigation.
The forum is in Zurich, Switzerland. This arbitration is pending.
The Company has assumed the defense and agreed to indemnify Coach and
Car Equipment Corporation ("CCEC") in a lawsuit instituted in 1999. This
obligation was assumed as part of the negotiated sale of the assets of CCEC
which was completed in August 1999. CCEC was sued in Washington state court by
Talgo, Inc., a customer of CCEC, on February 12, 1999. The lawsuit consisted of
a motion for preliminary injunction, seeking specific performance under a
contract between the parties for the provision by CEC of rail seats to Talgo,
and a complaint accompanying such motion seeking unspecified monetary damages
stemming from alleged missed deliveries by CCEC and defects in seats previously
shipped under the contract. CCEC disputed such allegation. At the time the
lawsuit was filed, Talgo had a $400,000 balance remaining to be paid to CCEC
under the terms of the contract. Before CCEC filed an answer in the litigation,
the parties entered into a stipulated settlement agreement that was entered with
the court on March 18, 1999, pursuant to which the lawsuit was stayed pending
performance by both parties under the settlement agreement and contract. CCEC
believes that it has satisfied the terms of the settlement agreement and
contract however, Talgo continues to withhold payment of the outstanding
remaining balance to CCEC. As a result, settlement has been abandoned and the
stay on the stay on the litigation has been lifted. CCEC has filed a
counterclaim against Talgo for nonpayment of the receivable. This litigation is
currently in the discovery phase.
In addition, the Company is involved in other litigation in the
ordinary course of business from time to time. The Company presently is not a
party to any threatened or pending litigation, the negative outcome of which
would be material to the Company.
16
<PAGE> 18
SIMULA, INC.
PART IV
ITEM 6. EXHIBITS AND REPORTS
a) The following Exhibits are included pursuant to Item 601 of Regulation S-K.
<TABLE>
<CAPTION>
No. Description Reference
---- ----------- ---------
<S> <C> <C>
3.1 Articles of Incorporation of Simula, Inc., as amended and restated....................................... (2)
3.2 Bylaws of Simula, Inc., as amended and restated.......................................................... (1)
4.7 Indenture dated April 1, 1997, in connection with the Company's issuance of the 8% Senior
Subordinated Convertible Notes due May 1, 2004........................................................... (15)
10.11 1992 Stock Option Plan, as amended effective September 15, 1998.......................................... (8)
10.12 1992 Restricted Stock Plan............................................................................... (1)
10.21 1994 Stock Option Plan, as amended effective September 15, 1998.......................................... (8)
10.26 Simula, Inc. Employee Stock Purchase Plan................................................................ (2)
10.29 Form of Change of Control Agreements, as amended, between the Company and Donald W.
Townsend, Bradley P. Forst, and James A. Saunders........................................................ (6)
10.30 Form of Employment Agreements between the Company and Donald W. Townsend, Bradley P.
Forst, and James A. Saunders............................................................................. (7)
10.32 Employment Agreement between the Company and James C. Dodd dated March 2, 1999........................... (10)
10.33 Change of Control Agreement between the Company and James C. Dodd dated March 2,
1999..................................................................................................... (10)
10.37 Simula, Inc. 1999 Incentive Stock Option Plan............................................................ (11)
10.38 Amended and Restated Asset Purchase Agreement for the sale of Coach and Car Equipment
Corporation, a wholly-owned subsidiary of the Company, dated August 31, 1999 and Note
Refinancing Agreement dated October 21, 1999............................................................. (12)
10.40 Asset Purchase Agreement for the sale of Airline Interiors, Inc., a wholly-owned subsidiary
of the Company, dated December 24, 1999.................................................................. (15)
10.41 Financing Agreement with The CIT Group/Business Credit, Inc. dated December 30, 1999..................... (15)
10.42 Securities Purchase Agreement with Levine Leichtman Capital Partners II, L.P. dated
December 31, 1999........................................................................................ (14)
10.43 Employment Agreement between the Company and Joseph W. Coltman dated February 1,
2000..................................................................................................... (15)
10.44 Change of Control Agreement between the Company and Joseph W. Coltman dated
February 1, 2000......................................................................................... (15)
10.45 Promissory Note between the Company and Stanley P. Desjardins dated December 31, 1999,
effective December 14, 1999.............................................................................. (15)
18. Preference Letter re: change in accounting principles.................................................... (3)
21. Subsidiaries of the Company..............................................................................
24. Powers of Attorney -- Directors.......................................................................... (5)(9)(15)
*27. Financial Data Schedule
</TABLE>
---------------------------------
*Filed herewith.
(1) Filed with Registration Statement on Form S-18, No. 33-46152-LA, under
the Securities Act of 1933, effective April 13, 1992.
(2) Filed with Definitive Proxy on May 15, 1996, for the Company's Annual
Meeting of Shareholders held on June 20, 1996.
(3) Filed with report on Form 10-Q/A for the quarter ended June 30, 1996.
(4) Filed with Registration Statement on Form S-3/A, No. 333-13499, under
the Securities Act of 1933, effective April 21, 1997.
(5) Filed with report on Form 10-K for the year ended December 31, 1997.
(6) Filed with report on Form 10-Q for the quarter ended March 31, 1998. The
Change of Control Agreements for Messrs. Townsend, Forst and Saunders
are substantially identical and differ materially only in that Mr.
Townsend is entitled to an amount equal to five (5) years base salary
and benefits upon a change of control while Messrs. Forst and Saunders
are entitled to an amount equal to four (4) years base salary and
benefits upon a change of control.
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<PAGE> 19
SIMULA, INC.
(7) Filed with report on Form 10-Q for the quarter ended March 31, 1998. The
Employment Agreements for Messrs. Townsend, Forst and Saunders are
substantially identical and differ materially only in the following two
respects: (i) the initial term of the agreement with Mr. Townsend is five
(5) years while the initial term of the agreement with Messrs. Forst and
Saunders is three (3) years; and (ii) the post-termination non-compete
period with Mr. Townsend is thirty (30) months while it is eighteen (18)
months with Messrs. Forst and Saunders.
(8) Filed with report on Form 10-Q for the quarter ended September 30, 1998.
(9) Filed with report on Form 10-K for the year ended December 31, 1998.
(10) Filed with report on Form 10-Q for the quarter ended March 31, 1999.
(11) Filed as Appendix A with Definitive Proxy on May 14, 1999, for the
Company's Annual Meeting of Shareholders held on June 17, 1999.
(12) Filed with report on Form 8-K, under the Securities Act of 1933, effective
October 25, 1999.
(13) Filed with report on Form 10-Q for the quarter ended September 30, 1999.
(14) Filed with Schedule 13D, under the Securities Exchange Act of 1934, on
January 10, 2000 effective December 31, 1999 by Levine Leichtman Capital
Partners II, L.P.
(15) Filed with report on Form 10-K for the year ended December 31, 1999.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report on Form 10-Q for the quarter ended
March 31, 2000 to be signed on its behalf by the undersigned thereunto duly
authorized.
SIMULA, INC.
DATE: August 14, 2000 /s/ Donald W. Townsend
---------------------------------------
DONALD W. TOWNSEND
President
Chief Executive Officer
/s/ James C. Dodd
---------------------------------------
JAMES C. DODD
Executive Vice President
Chief Financial Officer
18
