ITEM 1. BUSINESS
Xicor, Inc. ("Xicor" or the "Company") designs, develops, manufactures and markets reprogrammable nonvolatile semiconductor memory devices for use in commercial, industrial and military applications. Xicor's E(2)PROMs (Electrically Erasable Programmable Read-Only Memories), SerialFlash(TM) (Xicor's trademark) memory devices and NOVRAMs (Xicor's acronym for its Nonvolatile Random Access Memories) serve as support products to microprocessors and microcontrollers. Xicor's series of products called E(2)POT(R) (Xicor's trademark) electronically controlled potentiometers incorporate Xicor's nonvolatile memory technology and are digitally controlled replacements for mechanical potentiometers.
Xicor's devices offer a comprehensive set of features to its customers. By virtue of their nonvolatility, Xicor's devices retain their information content when power is lost or turned off. Reprogramming is accomplished by "writing" over the old data without a need for first "erasing" the old data. Xicor's devices can be reprogrammed bit by bit or in larger groups of bits called "words" and "pages" without being removed from the system, all using the 5-volt power source common in microcontroller and microprocessor-based systems, or lower voltages, making them suitable for hand-held and portable applications. Further, control and timing circuits are fully integrated "on-chip", thereby eliminating the need for such external support circuits. Xicor products are sold in a variety of packages, including plastic, ceramic and small outline surface mount packages for small footprint and height.
The combination of reprogrammability and nonvolatility has enabled Xicor's customers to develop products which have characteristics that can be altered from a remote location by a technician or on-site by a non-technical user through a keyboard, or which are automatically self-calibrating, thereby reducing field service costs. Microcontroller and microprocessor-based products incorporating Xicor's devices can be customized by either the distributor or the end user subsequent to the production process. This simplifies production control, reduces the lead time required for such customization and permits lower inventory levels to be maintained. Xicor products also offer programmable security locks enabling system producers to prevent changes to embedded programs.
Xicor is continuing to apply its electrically reprogrammable memory technology to develop innovative products combining nonvolatility and in-system data alterability. To address the large E(2)PROM commodities market, Xicor is also redesigning certain key commodity products for cost reduction through smaller chip sizes. Xicor products are used by manufacturers of electronic products throughout the world in a wide range of applications, including telecommunications, consumer, computer, industrial, automotive and military products.
SEMICONDUCTOR MEMORY DEVICES
Manufacturers have introduced a variety of nonvolatile semiconductor memories offering different degrees of programming flexibility. Currently available nonvolatile memory devices include read-only memories ("ROMs"), programmable read only memories ("PROMs"), electrically programmable read-only memories ("EPROMs"), electrically erasable programmable ROMs ("E(2)PROMs"), nonvolatile random access memories ("NOVRAMs"), Flash Memories and, most recently, SerialFlash memories. A brief description of these nonvolatile devices follows:
ROMs and PROMs are one time programmable. ROMs have the data permanently programmed into the memory during the manufacturing process according to customer specifications, making necessary long-range
planning before introducing a new product incorporating ROMs. PROMs are programmable one time after manufacture. However, programming a PROM is complex and in practice is only done at the factory or by distributors.
EPROMs can be reprogrammed several times. However, reprogramming an EPROM is a two-step process, erasing the old data by exposing it to ultraviolet light and then programming the new data into the system using voltages higher than 5 volts, the voltage most common in microprocessor-based products. Since ultraviolet light and an auxiliary power source are required, the erasure and reprogramming generally are performed outside the system, thus requiring physical removal of the EPROM from the printed circuit board.
The development of E(2)PROMs provided significant programming flexibility. These nonvolatile memories can be reprogrammed in-system tens of thousands of times and can be altered one byte or several bytes at a time. E(2)PROMs are termed serial or parallel depending on their connection to the system's processor. Serial E(2)PROM devices transmit data through a single input-output port while parallel devices transmit data through multiple ports concurrently.
Devices called Flash memories offer a middle ground in price and features between EPROMs and E(2)PROMs. Unlike EPROMs, Flash memories can be reprogrammed while in a system. However, unlike the more flexible E(2)PROMs that can be altered one byte or several bytes at a time, Flash memories can only be altered all at once or in larger groups of bytes. In nonvolatile reprogrammable memory chips containing less than 256K bits, the memory cell array takes up less than half of the chip area and the support circuitry the balance. Accordingly, manufacturers of Flash memories have focused on parallel interface high density devices where customers are willing to forgo the ease of use of the full featured E(2)PROMs for the lower cost of a Flash memory or where the Flash memory has achieved higher density due to its smaller memory cell size. SerialFlash memory devices offer lower memory density and smaller package size than the typical parallel interface Flash memories.
NOVRAMs were developed to combine the versatility and rapid data access of the RAM with the nonvolatility of the full-featured E(2)PROM on a single semiconductor. The complex dual-memory structure of the NOVRAM, while providing substantially greater functionality than the E(2)PROM, results in a significantly greater cost per memory bit.
XICOR PRODUCTS AND APPLICATIONS
Xicor's product line currently consists of enhanced and standard E(2)PROMs, SerialFlash memory devices and NOVRAMs as described above, together with E(2)POT electronically controlled potentiometers. E(2)POTs are digitally controlled electronic potentiometers that were developed by Xicor and incorporate its nonvolatile memory technology. Digitally controlled potentiometers are a popular replacement for mechanically adjustable devices and provide the user with capabilities not readily available with either mechanical potentiometers or digital-to-analog circuits.
All Xicor devices are nonvolatile, are reprogrammable using only a 5-volt or lower power supply and eliminate the need for external control and timing circuits by integrating such circuits "on-chip." Xicor's products operate over a wide speed and temperature range and are sold in a variety of package options, including plastic, ceramic and surface mount. Xicor uses the complementary metal oxide silicon ("CMOS") technology to manufacture Xicor's devices due to its low power consumption. For military applications, Xicor manufactures E(2)PROMs, NOVRAMs and E(2)POTs that are fully compliant with paragraph 1.2.1 of MIL-STD-883 Revision E for Class level B products as well as various Standard Microcircuit Drawings.
Xicor's products are sold worldwide for a broad range of applications, including telecommunications, consumer, computer, industrial, automotive and military applications.
The ease and flexibility with which Xicor's devices can be programmed allow a system incorporating such devices to be programmed after final production and reprogrammed in-the-field as required, either through a keyboard or from a remote location via telephone lines, satellite link or from a central database over a local area network. For example, a technician need no longer travel to the user's site to initialize a computer printer since this can be accomplished by the user through a keyboard. Similar advantages exist over products that
incorporate batteries to provide nonvolatility, since a site visit is still necessary to replace a run-down battery and then rewrite the data.
The ease of reprogrammability of Xicor's E(2)PROMs, SerialFlash memory devices and NOVRAMs also permits customized features to be implemented at a late stage of the manufacturing process or at the point of distribution, thereby reducing the lead time required for such customization and permitting lower inventory levels to be maintained. Xicor's E(2)PROMs, SerialFlash memory devices and NOVRAMs further enhance productivity and minimize service costs by enabling microprocessor-based products to perform self-diagnostics, adjust and recalibrate themselves and then store the parameters in Xicor's nonvolatile memories until subsequent self-diagnostics and adjustment. Process controllers and other equipment subject to harsh environmental conditions, as well as measurement and data recording instruments which routinely require calibration, can thereby be kept constantly and automatically calibrated.
Similarly, the E(2)POT potentiometer, as a solid state device, offers designers of equipment various benefits, including (i) automated assembly line calibration rather than mechanical "tweaking" of potentiometers; (ii) protection against parameter drift due to vibration or contamination; (iii) elimination of potentiometer access problems; and (iv) product enhancements such as keyboard adjustments for volume or brightness control and calibration of equipment from the front panel.
MARKETING AND SALES
In new applications, particularly for newly introduced devices, Xicor's products generally require long "design-in" cycles for customer applications with extensive field application engineering support by Xicor. Xicor considers close support of its customers' design efforts to be an important aspect of its marketing strategy.
Xicor markets its products directly from its headquarters in Milpitas, California and from regional domestic and foreign sales offices. Products are also marketed domestically through a national network of independent sales representatives, each of which has been granted an exclusive sales territory, and through national and regional stocking distributors which also handle competitive products. Xicor's products are also marketed abroad through an international network of independent non-exclusive stocking sales representatives. Generally, sales to distributors and stocking sales representatives are made under agreements allowing rights of return and price protection on unsold merchandise. Xicor's policy is to defer recognition of sales and related costs on such shipments until the products are sold by the distributors and stocking sales representatives.
During the years ended December 31, 1997, 1996 and 1995, Xicor's export sales constituted 44%, 45% and 47%, respectively, of revenues. Xicor's export sales are generally denominated in US dollars. Due to the magnitude of its international sales, Xicor is subject to risks common to all export activities, including currency fluctuations, governmental regulation and the risk of imposition of tariffs or other trade barriers. Further, export sales must be licensed by the Office of Export Administration of the US Department of Commerce.
One distributor accounted for 16% of Xicor's revenues in 1997 and 14% in both 1996 and 1995. Distributors are not themselves end users, but rather serve as a channel of sale to many end users of Xicor's products.
Although Xicor receives volume purchase orders, such orders do not necessarily result in sales as they are in most cases, consistent with industry practice, terminable by the customer without penalty. Consequently, backlog figures are not necessarily indicative of future sales.
MANUFACTURING
Wafers are fabricated in Xicor's six-inch wafer fabrication plant in Milpitas, California. The wafer fabrication processes for Xicor's products are highly complicated, utilize numerous highly toxic and corrosive chemicals and gases, and require stringent control of many extremely precise steps, similar to those used in the semiconductor industry for the production of other large scale integrated circuits. These steps include complex
processes such as microphotolithography, wet chemical and dry plasma etch, chemical vapor deposition, high temperature diffusion and oxidation, ion implantation and vacuum metallization, which are applied to silicon wafers to form several hundred to several thousand devices ("chips") per wafer depending on the product. Each chip, in turn, contains thousands to millions of individual transistors and other circuit elements. The sensitivity of the manufacturing process to dust and other contaminants requires the production process to take place in a highly controlled, clean environment. Xicor uses sophisticated computer-controlled testing equipment to test each chip on the wafer to identify those potentially meeting the desired electrical criteria.
Although Xicor's manufacturing process is highly controlled, minute impurities, difficulties in the process or defects in the masks can cause wafers to be rejected or a substantial percentage of individual chips to be non-functional, a problem indigenous to the semiconductor industry. Xicor from time to time experiences a variety of technical problems in its manufacturing processes which adversely affect manufacturing yields until they are corrected. Maintaining and improving manufacturing yields is essential for profitability.
Fabricated wafers are shipped for assembly to either a dedicated subcontract line in Taiwan or to other independent subcontractors located in South Korea, Thailand, the Philippines, China and Malaysia where the wafers are separated into individual chips. Each potentially functional chip is encapsulated in a plastic or ceramic package containing external leads to which the chip is connected by extremely fine wires. Completed packages then undergo inspection, sealing and limited testing. Xicor also makes limited use of assembly subcontractors in California to satisfy particular customer requirements and uses a small in-house assembly line to provide rapid turnaround for new product development.
Most of the assembled devices undergo comprehensive electrical testing offshore at one of Xicor's independent subcontractors located in Taiwan, Thailand, South Korea, the Philippines and China. Currently most military and new products undergo such testing by Xicor at its facility in Milpitas, California. Quality assurance testing for all products is also performed in Milpitas prior to shipment to customers. In accordance with industry practice, Xicor provides a limited warranty for its devices against defects in materials and workmanship for periods ranging from 90 days to one year.
Reliance on foreign assembly and test contractors and Xicor's maintenance of inventories and equipment at such contractors' facilities entails certain political and economic risks, including political instability and expropriation, currency controls and exchange fluctuations, and changes in tariff and freight rates. In the event Xicor's foreign assembly and test operations, or air transportation to or from foreign contractors, were disrupted, Xicor's operations would be materially adversely affected.
The principal raw materials utilized in the production process are polished silicon wafers, ultra-pure metals, chemicals and gases. Encapsulation materials that enclose the chip and provide the external connecting leads are provided by the independent assembly contractors or are purchased by Xicor and shipped to such contractors. Shortages could occur in various essential materials due to interruption of supply or due to increased demand in the industry. Shortages have occurred in the Company's history and lead times have been extended in the industry on occasion without materially adversely affecting the Company. However, there can be no assurance that future shortages, if any, would not have a material adverse effect on Xicor's operations.
Cost reduction is an important on-going activity at Xicor since continually lower selling prices are essential to maintain and improve Xicor's competitive position. Xicor's cost reduction program is designed to minimize defects, simplify testing and reduce the physical size of its chips.
Compliance with Environmental Regulations
The manufacture of semiconductors requires the use and storage of substantial amounts of toxic chemicals, solvents and gases. Government regulations impose various environmental controls on the storage, use and disposal of such materials. Such regulations have grown more complex and enforcement more rigorous over time as increasing attention has been focused on the environmental impact of semiconductor manufacturing operations. While Xicor to date has not experienced any materially adverse effect on its business from environmental regulations, there can be no assurance that changes in such regulations will not
necessitate the acquisition of more costly equipment or require more costly procedures or process changes to be initiated.
RESEARCH AND DEVELOPMENT
Xicor believes the continuing development of new and improved processes and products is essential in order to maintain and enhance its competitive position. Process development is an on-going activity designed to improve Xicor's technology. Product development is a difficult and lengthy process, the ultimate success of which is dependent upon Xicor's ability to transfer newly developed products to volume production in a timely fashion. There can be no assurance that any research and development efforts will be successfully completed or that future products will be available on a timely basis or achieve market acceptance.
Xicor's product development is currently focused on developing proprietary microchips incorporating Xicor's programmable technology which enable customers to rapidly bring to market products with improved efficiency, features and maintainability. To address the large E(2)PROM commodities market, Xicor is also redesigning certain key commodity products for cost reduction through smaller chip sizes. Research and development activities are requiring an increasing degree of complexity of design and manufacturing process and consequently a significant percentage of revenues is again expected to be invested in research and development in 1998.
During the years ended December 31, 1997, 1996 and 1995, Xicor expended $18,475,000, $15,074,000 and $15,270,000, respectively, on research and development. At December 31, 1997, 100 employees were engaged in research and development activities.
PATENTS AND LICENSES
Xicor holds numerous United States patents and corresponding foreign patents covering various circuit designs and the structure of its devices. Further, additional patent applications for such products are pending in the United States and abroad. However, there can be no assurance that the patents granted or pending will provide Xicor with any meaningful protection. Similar to other semiconductor manufacturers, Xicor has granted licenses under its patents and may continue to do so in the future. Xicor believes that, due to the rapidly changing technology in the semiconductor industry, its future success will be dependent primarily upon the technical expertise and creative skills of its personnel rather than patent protection.
As is the case with many companies in the semiconductor industry, it may become necessary or desirable for Xicor to obtain licenses relating to its products from others. Xicor has received notices claiming infringement of patents from several semiconductor manufacturers and other patent holders with respect to certain aspects of Xicor's processes, devices and equipment use and these matters are under investigation and review. Although patent holders typically offer licenses and Xicor has in prior years entered into such license agreements, there can be no assurance that licenses can be obtained on acceptable terms or that in all cases the dispute will be resolved without costly litigation.
COMPETITION
The semiconductor industry is highly competitive and characterized by steadily declining product prices. Numerous companies are currently selling products which compete with those of Xicor. Customers are extremely price sensitive and competitors often lower prices in an attempt to gain market share, causing responsive reductions by other manufacturers, including Xicor, and resulting in reduced profitability or losses. In addition to price, important elements determining success in competition include product performance, quality and reliability, delivery capability, diversity of product line, application support, financial strength and the ability to respond rapidly to technological innovations.
Xicor may be at a disadvantage in competing with major domestic and foreign concerns that have significant financial resources, established and diverse product lines, worldwide vertically integrated production facilities and extensive research and development staffs. Further, the industry is characterized by rapid
technological change and Xicor will be required to continually develop new and improved manufacturing processes and products to remain competitive.
EMPLOYEES
At December 31, 1997 Xicor had 738 employees. None of the employees are represented by a labor organization and Xicor considers its employee relations to be good. Many of Xicor's employees are highly skilled and Xicor's success will depend in significant part on its ability to attract and retain such employees in the highly competitive semiconductor industry.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth each executive officer of Xicor, their ages (as of December 31, 1997) and office with Xicor:
Raphael Klein, Chairman of the Board and Chief Executive Officer. From August 1987 until January 1998 Mr. Klein was Xicor's President and Chief Executive Officer. Since January 1998 Mr. Klein has shared the Office of the President with Mr. Bruce Gray. Mr. Klein is Xicor's Chief Executive Officer with primary responsibility for marketing, finance and administration and shared responsibility for the direction of the company. Mr. Klein has been a director of the Company since founding Xicor in August 1978 and its Chairman of the Board since August 1982. Mr. Klein received the degree of Master of Science in Physics from the Israeli Institute of Technology ("Technion") and is the inventor or co-inventor of two patented inventions.
Bruce Gray, President and Chief Operating Officer. Mr. Gray joined Xicor in September 1996 as Vice President, Wafer Operations and since January 1998 has shared the Office of the President with Mr. Raphael Klein. Mr. Gray is Xicor's President and Chief Operating Officer with principal profit and loss responsibility and shared responsibility for the direction of the Company. Mr. Gray has 26 years of experience in the semiconductor industry in engineering, manufacturing and management. From September 1994 through September 1996, Mr. Gray served as the Managing Director of the Advanced Technology Group at National Semiconductor Corporation. From August 1989 through September 1994, Mr. Gray was the Director of Santa Clara Operations and Services for National Semiconductor with operational responsibility for four high-volume wafer fabrication lines. Mr. Gray was also involved in advanced technology development and wafer foundry activities. Mr. Gray has a Bachelor of Science Degree in Metallurgy and Materials Science from the Massachusetts Institute of Technology (MIT) and is the inventor or co-inventor of three patented inventions.
Joseph Drori, Vice President, Product Design, Engineering, Quality and Reliability. Mr. Drori has been employed by Xicor since October 1979 and became a Vice President in June 1988. Mr. Drori received the degree of Master of Science in Electrical Engineering from the University of California at Los Angeles and is the inventor or co-inventor of several patented inventions in the semiconductor field.
Geraldine N. Hench, Vice President, Finance and Chief Financial Officer. Ms. Hench, a certified public accountant, joined Xicor in November 1987 as its Corporate Controller. Ms. Hench became a Vice President
in June 1993 and Xicor's Chief Financial Officer in January 1998. Ms. Hench received the degree of Bachelor of Science in Accounting from Santa Clara University.
Klaus G. Hendig, Vice President, Administration. Mr. Hendig, a certified public accountant, has been employed by Xicor since February 1981 and became a Vice President in January 1983. Mr. Hendig served as Xicor's Chief Financial Officer from September 1987 until January 1998. Mr. Hendig received the degree of Bachelor of Science in Accounting and Finance from San Jose State University.
Timothy D. Kanemoto, Vice President, Product Operations. Mr. Kanemoto joined Xicor in January 1990, and became a Vice President in June 1994. He received the Degree of Bachelor of Science in Business Administration from California State University, Hayward.
Michael P. Levis, Vice President, Marketing. Mr. Levis joined Xicor in January 1998 as Vice President, Marketing. Mr. Levis has 15 years of experience in marketing and business development. From 1996 through 1997, Mr. Levis served as General Partner at ASCII of America, a venture capital firm. From 1993 through 1996, Mr. Levis was the Vice President of Marketing at Crosspoint Solutions, Inc., a semiconductor company. Prior to 1993 Mr. Levis held various marketing and business development positions at Crosspoint Solutions, Inc., Samsung Semiconductors and Zilog, Inc. Mr. Levis received the degree of Bachelor of Science in Electrical Engineering from Purdue and the degree of Master of Science in Electrical Engineering from Stanford University.
William H. Owen, III, Vice President, Technology Development and Intellectual Properties. Mr. Owen, one of Xicor's founders, joined Xicor in October 1978, shortly after its formation to aid in the development of its advanced memory devices, with principal responsibility for circuit design. Mr. Owen is presently involved in process development and patent activities. Mr. Owen received the degree of Master of Science in Electrical Engineering from the University of Wisconsin and is the inventor or co-inventor of several patented inventions in the semiconductor field.
INSURANCE
Xicor presently carries various insurance coverages including property damage, business interruption and general liability including certain product liability coverage. Xicor has been unable to obtain pollution and earthquake insurance at reasonable costs and limits.
ITEM 2.
ITEM 2. PROPERTIES
Xicor leases a 43,834 square foot facility in Milpitas, California which contains Xicor's silicon wafer fabrication and process technology development operations. The lease, which expires in 2001, provides for an annual base rental of $626,145 and requires Xicor to pay all real estate taxes, utilities and insurance and to maintain the building and premises. Xicor has two successive five-year renewal options upon the same terms and conditions at increased rental rates based on the consumer price index, not to exceed 15% for the prior five-year period.
Xicor leases a 55,767 square foot facility near its wafer fabrication facility which houses its product testing operations and a small quick-turn assembly line. The lease, which expires in 1999, provides for an annual base rental of $401,520. Xicor has a five-year renewal option upon the same terms and conditions, except that the rental will be 95% of the then market rental rate in the industrial park where the property is located.
Xicor also leases a 73,622 square foot facility constructed to its specifications adjacent to its existing wafer fabrication facility. This facility, which could potentially be used for future expansion of silicon wafer fabrication, presently houses Xicor's design, research and development and reliability operations and executive, marketing and administrative offices and also serves as Xicor's main stockroom. This lease expires in 2000 and provides for an annual base rental of $1,285,776 and requires Xicor to pay all real estate taxes, utilities and insurance and to maintain the building and premises. Xicor has three successive five-year renewal options upon the same terms and conditions at increased rental rates based on the consumer price index, not to exceed 15% for the prior five-year period.
Xicor believes that its existing facilities should be adequate for its needs in the foreseeable future.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
Xicor is not a party, nor is its property subject, to any material pending legal proceedings.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
PART II
ITEM 5.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
The information required by this Item is incorporated by reference to page 19 of the Company's 1997 Annual Report to Shareholders.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
The selected financial data for the five years ended December 31, 1997, which appears on page 18 of the Company's 1997 Annual Report to Shareholders, is incorporated by reference in this Annual Report on Form 10-K.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information required by this Item is incorporated by reference to pages 6 to 9 of the Company's 1997 Annual Report to Shareholders.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements, together with the report thereon of Price Waterhouse LLP dated January 21, 1998, appearing on pages 10 to 17 and the unaudited financial information by quarter appearing on page 19 of the Company's 1997 Annual Report to Shareholders, are incorporated by reference in this Annual Report on Form 10-K.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None
With the exception of the information incorporated in Items 5, 6, 7, 8 and 14 of Parts II and IV of this Form 10-K, the Company's 1997 Annual Report to Shareholders is not to be deemed filed as a part of this Annual Report on Form 10-K.
PART III
Certain information required by Part III is omitted from this Report in that the Registrant will file a definitive proxy statement pursuant to Regulation 14A (the "Proxy Statement") not later than 120 days after the end of the fiscal year covered by this Report, and certain information included therein is incorporated herein by reference.
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information concerning the Company's directors required by this Item is incorporated by reference to the information contained in the section captioned "Election of Directors" in the Company's Proxy Statement.
The information concerning the Company's executive officers required by this Item is included in Part I hereof under the caption "Executive Officers of the Registrant".
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item is incorporated by reference to the information contained in the section captioned "Executive Compensation" in the Company's Proxy Statement.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this Item is incorporated by reference to the information contained in the section captioned "Security Ownership of Certain Beneficial Owners and Management" in the Company's Proxy Statement.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is incorporated by reference to the information contained in the section captioned "Election of Directors" in the Company's Proxy Statement.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The following documents are filed as a part of this report:
(1)FINANCIAL STATEMENTS. The following Consolidated Financial Statements of Xicor, Inc. and the Report of Independent Accountants are incorporated by reference from the indicated pages of the Company's 1997 Annual Report to Shareholders:
(2) FINANCIAL STATEMENT SCHEDULE.
All other schedules have been omitted since the required information is not applicable, not significant or because the information required is included in the consolidated financial statements or notes thereto.
(3)EXHIBITS. The exhibits listed in the accompanying Index to Exhibits are filed or incorporated by reference as part of this Annual Report.
(b)REPORTS ON FORM 8-K
None.
REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors of Xicor, Inc.
Our audits of the consolidated financial statements referred to in our report dated January 21, 1998, appearing on page 17 of the 1997 Annual Report to Shareholders of Xicor, Inc. (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the Financial Statement Schedule listed in Item 14(a) of this Form 10-K. In our opinion, this Financial Statement Schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements.
PRICE WATERHOUSE LLP
San Jose, California January 21, 1998
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Milpitas, State of California, on the 20th day of March 1998.
XICOR, INC. Registrant
By: /s/ RAPHAEL KLEIN ------------------------------------ Raphael Klein Chairman of the Board and Chief Executive Officer (Principal Executive Officer)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Raphael Klein and Klaus G. Hendig, and each of them, jointly and severally, his attorneys-in-fact, each with the power of substitution, for him in any and all capacities, to sign any and all amendments to this Report on Form 10-K and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:
XICOR, INC.
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
XICOR, INC.
INDEX TO EXHIBITS ITEM 14(A)3.