Press Archive

Tera Installs Initial MTA System at San Diego Supercomputer Center

Private Placement Raises $9.5 Million

Published 01/01/1998

Contacts:
Lisa Samuelson, lisas@parkerlepla.com, 206-285-5280
Public Relations, Parker LePla
Laura Dayton, laura@stapleton.com, 650-470-0200
Investor Relations/Public Relations, Stapleton Communications Inc.

SEATTLE -- Dec. 31, 1997 -- Tera Computer Company (Nasdaq: TERA), a Seattle-based supercomputer company, today announced that it has installed a single processor Multithreaded Architecture (MTA) system at the San Diego Supercomputer Center (SDSC), a part of the University of California, San Diego. The company planned to deliver a two processor system by the end of 1997 but did not receive production network boards for a multiprocessor system. Tera expects to receive the requisite boards shortly, and thereafter upgrade the system in stages to larger configurations.

In a separate development, Tera announced that it had received $9.5 million through a private sale of convertible preferred stock and 125,000 warrants. The preferred stock will be convertible into shares of common stock at the lower of $19.185 per share or the market price of the common stock at the time of conversion, and the warrants are exercisable at $19.185 per share. The company expects to file a registration statement with the Securities and Exchange Commission in January 1998 covering the resale of the shares of common stock underlying the preferred stock and warrants.

"The private placement funds augment our working capital, including inventory, as we prepare for more shipments of our MTA systems in 1998," said Ken Johnson, Tera's chief financial officer. " This financing helps solidify our financial position for the upcoming year."

Delivery of the MTA system to SDSC results from the National Science Foundation's multi-year award of $4.2 million to UC San Diego to fund the acquisition and evaluation of the Tera MTA system. UC San Diego has also received a $1.9 million, 18-month award from the Defense Advanced Research Projects Agency (DARPA) to implement, optimize and evaluate defense-related applications on the Tera MTA. SDSC's partners in the DARPA research project include The Boeing Company, NASA Jet Propulsion Laboratory, Lockheed Martin Company (Sanders division) and the California Institute of Technology.

Tera Computer Company designs, builds and sells high-performance general-purpose parallel computer systems. For more information about Tera and its MTA system, see http://www.tera.com or contact the company at 2815 Eastlake Avenue East, Seattle, WA 98102, phone: (206) 490-2000; fax: (206) 323-1318; email: info@tera.com.

SDSC is sponsored by the National Science Foundation through the National Partnership for Advanced Computational Infrastructure and by other federal agencies, the State and University of California and private organizations. For additional information about SDSC, see: http://www.sdsc.edu/ and http://www.npaci.edu/.

This press release contains forward-looking statements regarding, among other things, Tera's plans to deliver and install the MTA system at the San Diego Supercomputer Center. There are certain factors that could cause Tera's execution plans to differ materially from those anticipated by the statements made above. Among such factors are risks associated with integration of numerous modules into commercially configured systems, necessary modifications to hardware components, software and integrated systems, and timely availability of technology and components from third party suppliers. For a discussion of such risks, and other risks that could affect Tera's future performance, see "Risk Factors" in Tera's most recent SEC Form 10-KSB.