Friday, February 27, 2009

Cypress Semiconductor 10K

Growth in Programmable System-on-Chip (“PSoC®”): "Cypress grew its PSoC customer base by 42% in fiscal 2008 to approximately 8,800 customers."

Employees: "
As of December 28, 2008, we had approximately 4,100 employees worldwide. Geographically, approximately 1,500 employees were located in the Philippines, 1,700 employees were located in the United States and 900 employees were located in other countries. Of the total employees, approximately 2,300 employees were associated with manufacturing, 800 employees were associated with research and development, and 1,000 employees were associated with selling, general and administrative functions."

Patent foundation and forecast:
"As of the end of fiscal 2008, we had approximately 1,600 issued patents and approximately 1,200 additional patent applications on file domestically and internationally. In addition, in fiscal 2009, we are preparing to file up to 120 new patent applications in the United States and 20 foreign applications in countries such as China, Taiwan, Korea and India."

Relationships with Grace Semiconductor (foundry): "In December 2005, Cypress entered into a strategic foundry partnership with Grace Semiconductor Manufacturing Corporation (“Grace”), located in Shanghai, China. Under the terms of the agreement, Cypress transferred certain of its proprietary process technologies to Grace and provides additional production capacity to augment output from Cypress’s manufacturing facilities. During fiscal 2006 and 2007, Cypress completed the transfer of its 0.35-micron SONOS, 0.13-micron SRAM and LOGIC processes and began purchasing products from Grace that were manufactured using these processes........As of December 28, 2008, we were continuing to serve as guarantor for approximately $32.4 million in lease payments due by Grace Semiconductor Manufacturing Corporation, a strategic foundry of Cypress. In conjunction with the master lease agreement, we have entered into a series of guarantees with a financing company for the benefit of Grace. If Grace fails to pay any of the quarterly rental payments, we will be obligated to pay such outstanding amounts within 10 days of a written demand from the financing company. If we fail to pay such amount, interest will accrue at a rate of 9% per annum on any unpaid amounts. To date, we have not been required to make any payments under these guarantees. However, if Grace were to default on the leases, it could have a negative impact on our financial position and results of operations."