SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
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Date
of report (Date of earliest event reported): March 31,
2009
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SILICON
GRAPHICS, INC.
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(Exact
Name of Registrant
as
Specified in Charter)
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Delaware
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(State
or Other Jurisdiction of Incorporation)
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001-10441
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94-2789662
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(Commission
File Number)
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(IRS
Employer Identification No.)
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1140
East Arques Ave.
Sunnyvale,
California
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94085
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code:
(408)
524-1980
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n/a
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(Former
Name or Former Address, if Changed Since Last
Report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01. Entry into a Material Definitive Agreement.
On March
31, 2009, Silicon Graphics, Inc. (“SGI”) entered into an Asset Purchase
Agreement (the “Asset Purchase Agreement”) with Rackable Systems, Inc.
(“Rackable”). Under this agreement, Rackable will purchase
substantially all the assets, except for certain excluded assets, of SGI for $25
million, subject to adjustment in certain circumstances, plus the assumption of
certain liabilities associated with the acquired assets. The Asset
Purchase Agreement has been approved by the respective boards of directors of
Rackable and SGI.
Completion
of the transaction is subject to a number of closing conditions, including the
approval of the Court (as defined below). Subject to such conditions
and uncertainties, the transaction is expected to close within approximately 60
days. The assets to be acquired do not include certain non-core
patents, which will be retained by SGI. It is expected that the net
proceeds of the transaction will be distributed for the benefit of the secured
creditors of SGI, and that SGI stockholders will not receive any proceeds in
respect of the sale.
Item
1.03. Bankruptcy or Receivership.
On April
1, 2009, Silicon Graphics, Inc. (“SGI”) and certain of its subsidiaries
(collectively, the “Debtors”) filed voluntary petitions for reorganization under
Chapter 11 of Title 11, United States Code (the “Bankruptcy Code”), in the
United States Bankruptcy Court for the Southern District of New York (the
“Court”) (Case No. 09-11701). The Debtors will continue to operate
their business as “debtors-in-possession” under the jurisdiction of the Court
and in accordance with the applicable provisions of the Bankruptcy Code and
orders of the Court.
On April
1, 2009, SGI issued a press release announcing that it had filed a voluntary
petition for reorganization under Chapter 11 of the Bankruptcy
Code. In this press release, SGI announced that it had reached an
agreement to sell substantially all of its assets, except for certain excluded
assets, to Rackable for $25 million. A copy of the press release is
incorporated herein by reference and attached hereto as Exhibit
99.1.
Item
2.04. Triggering Events That Accelerate or Increase a Direct
Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement.
The filing of the bankruptcy petitions
described above constitutes an event of default under the Senior Secured Credit
Agreement, dated October 17, 2006, as amended, (the “Credit Agreement”) with
Morgan Stanley Senior Funding, Inc. as administrative agent and revolving agent,
Morgan Stanley & Co., Incorporated as collateral agent, and the other
Lenders and Credit Parties thereto (as defined therein) and resulted in the
acceleration of all amounts due under the Credit Agreement. The
ability of the creditors to seek remedies to enforce their rights under the
Credit Agreement is automatically stayed as a result of the filing of Chapter 11
cases, and the creditors’ rights of enforcement are subject to the applicable
provisions of the Bankruptcy Code. The automatic stay invoked by
filing the Chapter 11 cases effectively precludes any actions against SGI
resulting from such acceleration.
As of March 31, 2009, under the Credit
Agreement, the total principal amount of the outstanding obligations under the
term loan was approximately $141.7 million and the total principal amount of the
outstanding obligations under the revolving loan was approximately $20.7
million.
Item
9.01. Financial Statements and Exhibits.
(d) Exhibits
99.1:
Press
Release issued by Silicon Graphics, Inc. dated April 1, 2009.
Forward-Looking
Statements.
In
addition to historical information, this Current Report on Form 8-K contains
“forward-looking statements” within the meaning of the Securities Act of 1933,
as amended, and the Securities Exchange Act of 1934, as amended. These
statements involve risks and uncertainties that could cause the Company’s actual
results to differ materially from the future results expressed or implied by the
forward-looking statements. All statements other than statements of historical
facts included in this Current Report on Form 8-K, including statements
regarding the Company’s future financial position and results, are
forward-looking statements. Factors that might cause such a difference in
results include, but are not limited to: the effects of our Chapter 11 filing;
the risk that the bankruptcy court may not approve the proposed acquisition; and
negotiations with Rackable or conditions to closing of the acquisition may
fail.
All information set forth herein is
current as of the date of this Current Report on Form 8-K. The Company
undertakes no duty to update any statement in light of new information or future
events. For further information regarding risks and uncertainties associated
with the Company’s business, please refer to the “Risk Factors” section of the
Company’s SEC filings, including, but not limited to, its Form 10-Q for the
quarter ended December 26, 2008.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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SILICON
GRAPHICS, INC.
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Date:
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April
1, 2009
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By:
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/s/
Gregory S. Wood
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Name:
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Gregory
S. Wood
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Title:
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Senior
Vice President and Chief Financial Officer
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