<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): APRIL 2, 2000
CRAY INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
<TABLE>
<S> <C> <C>
WASHINGTON 0-26820 93-0962605
(STATE OR OTHER JURISDICTION (COMMISSION FILE NUMBER) (IRS EMPLOYER
OF INCORPORATION) IDENTIFICATION NO.)
</TABLE>
411 FIRST AVENUE SOUTH, SUITE 600
SEATTLE, WASHINGTON 98104-2860
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(206) 701-2000
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
This Amendment No. 1 to our Current Report on Form 8-K dated April 2,
2000 relates to our acquisition of the Cray Research business unit from Silicon
Graphics, Inc. ("SGI") pursuant to an Asset Purchase Agreement dated March 1,
2000, as amended and closed on April 2, 2000. The purpose of this amendment is
to provide the financial information required by Items 7(a) and 7(b) of Form
8-K, which information was excluded from the original filing in reliance upon
Item 7(a)(4) of Form 8-K.
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired
Audited Financial Statements
(i) Report of Independent Auditors.
(ii) Statement of Assets Acquired and Liabilities Assumed
as of March 31, 2000.
(iii) Statements of Revenue and Direct Operating Expenses
for the years ended June 30, 1998 and 1999 and the
nine months ended March 31, 2000.
(iv) Notes to Financial Statements for the years ended
June 30, 1998 and 1999 and the nine months ended
March 31, 2000.
(b) Pro Forma Financial Information
Pro Forma Financial Statements (unaudited).
(i) Pro Forma Statement of Operations for the year ended
December 31, 1999.
(ii) Pro Forma Statement of Operations for the three month
period ended March 31, 2000.
(iii) Pro Forma Balance Sheet as of March 31, 2000.
(iv) Notes to Pro Forma Financial Statements.
(c) Exhibits.
2.1 Asset Purchase Agreement between the Company
and SGI, dated as of March 1, 2000. (1)
2.2 Amendment No. 1 to the Asset Purchase
Agreement between the Company and SGI, dated
as of March 31, 2000. (1)
2.3 Technology Agreement between the Company and
SGI, effective as of March 31, 2000. (2)
2.4 Services Contract Agreement between the
Company and SGI, dated as of March 31, 2000.
(2)
2.5 Transition Services Agreement between the
Company and SGI, dated as of March 31, 2000.
(2)
<PAGE> 3
2.6 Registration Rights Agreement between the
Company and SGI, dated as of March 31, 2000.
(2)
(1) Incorporated by reference to the Company's report on
Form 8-K, as filed with the Commission on April 17,
2000.
(2) Incorporated by reference to the Company's report on
Form 10-Q, as filed with the Commission on May 15,
2000.
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders of Cray Inc.
Seattle, Washington
We have audited the accompanying statement of assets acquired and
liabilities assumed of the Cray Research business unit of Silicon Graphics Inc.
(the "Company") as of March 31, 2000, and the related statements of revenues and
direct operating expenses for the years ended June 30, 1998 and 1999 and for the
nine month period ended March 31, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As described in Note 1, the accompanying financial statements were prepared
solely to present the assets acquired and liabilities assumed of the Cray
Research business unit by Cray Inc. pursuant to the purchase agreement, dated
March 1, 2000, and the related revenue and direct operating expenses of the Cray
Research business unit, and are not intended to be a complete presentation of
the assets and liabilities or the results of operations of the Cray Research
business unit of Silicon Graphics Inc.
The accompanying financial statements have been prepared from the records
maintained by Silicon Graphics, Inc. and may not necessarily be indicative of
the conditions that would have existed or the results of operations if Cray
Research Business Unit had been operated as an unaffiliated entity. Portions of
certain expenses represent allocations made from and applicable to Silicon
Graphics, Inc. as a whole.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets acquired and liabilities assumed of the Cray
Research business unit of Silicon Graphics Inc. as of March 31, 2000, and the
related statements of revenue and direct operating expenses for the years ended
June 30, 1998 and 1999 and for the nine month period ended March 31, 2000, in
conformity with accounting principles generally accepted in the United States of
America.
/s/ DELOITTE & TOUCHE LLP
-------------------------
Seattle, Washington
June 15, 2000
<PAGE> 4
Cray Research Business Unit of Silicon Graphics, Inc.
Statement of Assets Acquired and Liabilities Assumed
<TABLE>
<CAPTION>
March 31,
2000
--------------
(in thousands)
<S> <C>
Accounts receivable $ 3,906
Inventory, net 27,750
Prepaid expenses and other assets 1,737
Property and equipment, net 10,773
Spares inventory, net 28,816
Intangible assets, net 845
-------
Assets acquired $73,827
=======
Warranty reserves $47,334
Accrued payroll and related expenses 4,550
-------
Liabilities assumed $51,884
=======
</TABLE>
See accompanying notes to financial statements
Cray Research Business Unit of Silicon Graphics, Inc.
Statements of Revenue and Direct Operating Expenses
(in thousands)
<TABLE>
<CAPTION>
Nine Months
Years Ended June 30, Ended March
1998 1999 31, 2000
-------- -------- --------
<S> <C> <C> <C>
Revenue:
Product revenue $420,459 $197,401 $104,162
Service revenue 131,045 77,420
-------- -------- --------
420,459 328,446 181,582
-------- -------- --------
Direct operating expenses:
Cost of product revenue 303,980 140,501 52,769
Cost of service revenue 79,707 57,537
Research and development 57,136 19,776 20,099
Marketing and sales 16,910 7,434 6,319
General and administrative 9,713 3,879 5,350
-------- -------- --------
Total direct operating expenses 387,739 251,297 142,074
-------- -------- --------
Revenue less direct operating expenses $ 32,720 $ 77,149 $ 39,508
======== ======== ========
</TABLE>
See accompanying notes to financial statements
<PAGE> 5
Cray Research Business Unit of Silicon Graphics Inc.
Notes to Financial Statements
Years Ended June 30, 1998 and 1999 and the Nine Months Ended March 31, 2000
(in thousands)
1. BASIS OF PRESENTATION
The Cray Research business unit ("the Cray Business") has operated as a product
line business unit within Silicon Graphics Inc. ("SGI"). The Cray Business
designs, develops, manufactures, markets, and services general purpose
supercomputers for computing scientific simulations through the use of
processors. The Cray Business' customers include automotive and aerospace
companies, weather forecasting centers, major academic research centers, and a
host of government agencies in the U.S. and abroad. The accompanying financial
statements were prepared to present the assets acquired and liabilities assumed
of the Cray Business, which was sold to Cray Inc. (formerly Tera Computer
Company), pursuant to a purchase agreement dated March 1, 2000, and the related
revenue and direct operating expenses of the Cray Business and are not intended
to be a complete presentation of the financial position and results of
operations of the Cray Business. The related revenue and direct operating
expenses include product and service revenue, cost of product and service
revenue, and indentified operating expenses for the Cray Business.
The Cray Business had no separate legal status as it was an integral part of
SGI's overall operations. As a result, separate financial statements have not
been maintained for the operations sold to Cray Inc. The accompanying financial
statements have been prepared from the historical accounting records of SGI and
do not purport to reflect the assets, liabilities, revenue, and direct operating
expenses that would have resulted if the Cray Business had operated as an
unaffiliated independent company. Since only certain assets are being sold and
only certain liabilities are being assumed, statements of cash flows are not
applicable.
Prior to July 1, 1998, SGI did not maintain separate financial records for
service revenues to distinguish between Cray Business products and other SGI
products. Also, the cost of service revenue was in one cost pool and was not
allocated to specific product lines. Therefore, service revenue and cost of
service revenue for fiscal 1998 have been omitted from the statement for direct
revenue and direct expense
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.
<PAGE> 6
INVENTORY
Inventory is stated at the lower of cost or market on a first-in, first-out
basis. Inventory obsolescence reserves are recorded based on estimated usage
versus current inventory levels. The components of inventory at March 31, 2000
are:
<TABLE>
<S> <C>
Raw materials $ 44,239
Work-in-process 1,770
Finished goods 1,818
Reserves (20,077)
--------
Total $ 27,750
========
</TABLE>
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost, net of accumulated depreciation.
Depreciation is computed using the straight-line method over the estimated
useful lives of the assets. Useful lives of two to five years are used for
computer software, data processing equipment, and furniture, fixtures and other;
leasehold improvements are depreciated over the shorter of their useful lives or
the term of the lease. Buildings are depreciated over twenty-five to forty years
and improvements over eight to fifteen years. Direct operating expenses include
depreciation expense related to the Cray business of $661, $649 and $1,962 for
the years ended June 30, 1998 and 1999, and for the nine months ended March 31,
2000, respectively. Major classes of property and equipment at March 31, 2000 is
summarized as follows:
<TABLE>
<S> <C>
Land $ 195
Buildings 10,513
Computer software 2,145
Data processing equipment 16,302
Furniture, fixtures and other 8,451
Leasehold improvements 95
Construction in progress 608
--------
38,309
Accumulated depreciation (27,536)
--------
$ 10,773
========
</TABLE>
LONG-LIVED ASSETS
As circumstances dictate, management periodically evaluates intangible and other
long-lived assets, consisting primarily of property and equipment, to determine
whether there has been any impairment of the assets and the appropriateness of
their remaining useful lives. Management assesses the recoverability by
comparing the projected undiscounted net cash flows associated with such assets
against their respective carrying values. Impairment, if any, is based on the
excess of the carrying value over the fair value.
In the year ended June 30, 1998, SGI implemented a restructuring program, which
resulted in the downsizing of the vector supercomputer business and an
evaluation of the ongoing value of the associated plant and equipment and
intangible assets. Based on this evaluation, an impairment loss of
approximately $47,000 was recorded for the associated assets (principally a
specific-use manufacturing facility; supercomputers used in product design,
support and manufacturing and other machinery and equipment). Fair value was
principally based on estimated exchange and resale value.
<PAGE> 7
SPARES INVENTORY
Spares inventory stated at cost, net of accumulated depreciation. Depreciation
is taken against spares inventory for technological obsolesence and is computed
using the straight-line method over the estimated useful lives of the assets of
three or four years.
INTANGIBLE ASSETS
Intangible assets consists of purchased technologies, the trade name, customer
list and the workforce related to the acquisition of Cray Research by SGI in
1996 which are amortized on a straight-line basis over its estimated life.
Amortization expense was $11,580, $3,610 and $2,765 for the years ended June 30,
1998 and 1999, and for the nine months ended March 31, 2000, respectively, and
is included in direct operating expenses.
WARRANTY RESERVES
Included in warranty reserves is Cray's estimate of an accrual of $46.3 million
for estimated losses on service contracts covering the Cray Business' T90
product line. The reserve is calculated as the excess of estimated service costs
over estimated service revenues for the term of the related contracts. Estimated
service costs include cost of repair parts, direct costs of service, indirect
labor, and overhead allocations based on management estimates of time dedicated
to service T-90 contracts. Stated contract terms are adjusted for management
estimates of when T-90 products will be replaced before the expiration of the
service contract term.
REVENUE RECOGNITION
Product revenue is generally recognized upon acceptance by the customer and when
SGI has no additional significant performance obligations. Revenue related to
future commitments under service contracts is deferred and recognized ratably
over the related contract term.
DIRECT OPERATING EXPENSES
The caption "Direct Operating Expenses" on the accompanying financial statements
represents that portion of the total direct expenses of SGI incurred by the Cray
Business. SGI maintains separate accounts to capture product revenue, service
revenue, cost of product revenue and direct operating expenses.
Cost of product revenue includes direct manufacturing costs, and the Cray
Business allocation of various manufacturing overhead costs. SGI did not
maintain records by cost center for the Cray Business for the cost of service
revenue. Those costs have been allocated based on the percentage of the Cray
Business service revenue to total SGI service revenue. These costs of product
and service revenue are not necessarily indicative of the costs that would have
been incurred by an independent
<PAGE> 8
third-party purchaser. These direct expenses are not necessarily indicative of
the expenses that would have been incurred had the Cray Business operated as a
stand-alone business.
Operating expenses include research and development, sales and service,
marketing, and administrative expenses directly attributable to the Cray
Business. Operating expenses do not include corporate services, information
services, advertising, other selling, and general and administrative services
incurred at the corporate level and allocated to SGI's various business units.
Additionally, there is no allocation of interest income, interest expense, or
income taxes.
2. COMMITMENTS
The Cray Business has an outstanding purchase commitment with a vendor of $8,575
to purchase certain processors used in the manufacturing of its T3E product from
June 2000 through December 2001. T3E product purchase commitments with other
vendors amounted to approximately $5,063 through purchase orders dated in the
first quarter of 2000 with delivery dates throughout the year 2000.
In addition to the T3E purchase commitments, the Cray Business has ongoing
purchase commitments for assemblies on order for which a third party has
committed to produce. These commitments as of March 31, 2000 were approximately
$3,215.
3. SALE TO CRAY INC.
On March 31, 2000, the assets and liabilities reflected in the accompanying
Statement of Assets Acquired and Liabilities Assumed were acquired by Cray Inc.
Cray Inc. paid to SGI cash of $15 million, transferred one million shares of
unregistered common stock valued at approximately $6.7 million, and issued a
short-term non-interest bearing promissory note in the amount of $36.3 million.
SGI and Cray Inc. have agreed upon a balance of $39.5 million for the T90
product reserve for the purpose of determining the purchase price.
Beginning April 1, 2000, SGI and Cray Inc. will work together in accordance with
a Transition Services Agreement to ensure a smooth transition of the operations
to Cray Inc. SGI will provide certain accounting services, logistics
fulfillment, and other operational and support activities until such time as
Cray Inc. takes over these activities, expected to be no later than September
30, 2000.
In addition, pursuant to a Services Contract Agreement, SGI will contract with
Cray Inc. to provide the services under the existing service contracts
pertaining to the Cray product line sold to Cray Inc., generally until such
contracts expire or are renewed. This arrangement is expected to continue
through March 31, 2001.
UNAUDITED PRO FORMA FINANCIAL STATEMENTS
On March 31, 2000, Cray Inc. ("Cray Inc." or the "Company") completed
its acquisition of the Cray Research business unit ("the Cray Business") from
Silicon Graphics Inc. ("SGI") pursuant to an Asset Purchase Agreement dated
March 1, 2000. Under the terms of the agreement, the Company paid to SGI $15
million in cash, issued one million shares of common stock valued at
approximately $6.7
<PAGE> 9
million and issued a short-term non-interest bearing promissory note in the
amount of $36.3 million. SGI and Cray Inc. have agreed upon a balance of $39.5
million for the T90 product reserve for the purpose of determining the purchase
price.
The following unaudited pro forma financial statements of Cray Inc.
present the unaudited pro forma combined statements of operations for the twelve
months ended December 31, 1999, the three months ended March 31, 2000, and the
unaudited pro forma combined balance sheet at March 31, 2000, as if the
acquisition of the Cray Business from SGI had occurred January 1, 1999.
The pro forma adjustments represent, in the opinion of management, all
adjustments necessary to present the Company's pro forma results of operations
and financial position in accordance with Article 11 of SEC Regulation S-X based
upon available information and certain assumptions considered reasonable under
the circumstances. The Cray Business was not a subsidiary or a reportable
segment of SGI. SGI maintains separate accounts to capture product revenue,
service revenue, cost of product revenue and operating expenses. These direct
expenses include research and development, marketing and sales and general and
administrative expenses directly attributable to the Cray Business, which have
been included in operating expenses. SGI did not maintain separate accounts to
capture corporate services, information services, advertising, other selling,
and general and administrative services incurred at the corporate level and
allocated to SGI's various business units. Additionally, there is no allocation
of interest income, interest expense, or income taxes. Cost of revenues includes
direct manufacturing costs, and the Cray Business allocation of various
manufacturing overhead costs.
These costs are forward-looking and are not necessarily indicative of
the costs that would have been incurred if Cray Inc. had operated the business
for the periods presented. The expenses charged to the Cray Business by SGI are
not necessarily indicative of the expenses that would have been incurred had the
Cray Business operated as a stand-alone business.
The unaudited pro forma financial statements presented herein do not
purport to present what the Company's financial position or results of
operations would actually have been had the events leading to the pro forma
adjustments in fact occurred on the date or at the beginning of the periods
indicated or to project the Company's financial position or results of
operations for any future date or period.
The Cray Business Statement of Revenue and Direct Operating Expenses
included in the accompanying pro forma statement of operations were derived from
unaudited quarterly financial data.
The unaudited pro forma financial statements should be read in
conjunction with the audited financial statements of Cray Inc. and the notes
thereto and management's discussion and analysis thereof, included in the
Company's annual and quarterly reports and the Cray Business financial
statements included herein.
<PAGE> 10
Cray Inc.
Unaudited Pro Forma Statement of Operations
For the Twelve Months Ended December 31, 1999
(in thousands)
<TABLE>
<CAPTION>
Cray Business
Cray Inc. Statement of
Statement of Revenue and Direct Pro Forma Pro
Operations Operating Expenses Adjustments Forma
------------ ------------------- ----------- ---------
<S> <C> <C> <C> <C>
Revenue:
Product revenue $ 1,991 $ 167,062 $ $ 169,053
Service revenue 123 116,383 116,506
--------- --------- --------- ---------
2,114 283,445 285,559
--------- --------- --------- ---------
Operating expenses:
Cost of product revenue 1,779 108,019(2) 162 109,960
Cost of service revenue 92 72,654 72,746
Manufacturing costs and
inventory adjustments 6,978 6,978
Inventory obsolescence charge 6,589 6,589
Research and development 15,216 20,767(2) 1,404 37,387
Marketing and sales 2,517 7,288(2) 589 10,394
General and administrative 3,091 3,925(2) 996 8,012
Amortization of intangible assets (1) 5,830 5,830
--------- --------- --------- ---------
Total operating expenses 36,262 212,653 8,891 257,896
Income (loss) from operations (34,148) 70,792 (8,891) 27,663
Other expense (384) (3) (5,523) (5,907)
--------- --------- --------- ---------
Net income (loss) $ (34,532) $ 70,792 $ (14,504) $ 21,756
========= ========= ========= =========
</TABLE>
See accompanying notes to unaudited pro forma statement of operations
<PAGE> 11
Cray Inc.
Unaudited Pro Forma Statement of Operations
For the Three Months Ended March 31, 2000
(in thousands)
<TABLE>
<CAPTION>
Cray Business
Cray Inc. Statement of
Statement of Revenue and Direct Pro Forma Pro
Operations Operating Expenses Adjustments Forma
------------ ------------------ ----------- ---------
<S> <C> <C> <C> <C>
Revenue:
Product revenue $ $ 40,948 $ $ 40,948
Service revenue 43 24,776 24,819
-------- -------- -------- --------
43 65,724 65,767
-------- -------- -------- --------
Operating expenses:
Cost of product revenue 16,264(2) 40 16,304
Cost of service revenue 26 11,156 11,182
Manufacturing costs and
inventory adjustments 2,003 2,003
Research and development 4,483 6,458(2) 352 11,293
Marketing and sales 768 2,260(2) 147 3,175
General and administrative 1,101 992(2) 249 2,342
Amortization of intangible assets (1) 1,457 1,457
-------- -------- -------- --------
Total operating expenses 8,381 37,130 2,245 47,756
Income (loss) from operations (8,338) 28,594 (2,245) 18,011
Other income/(expense) 332 (3) (1,381) (1,049)
-------- -------- -------- --------
Net income (loss) $ (8,006) $ 28,594 $ (3,626) $ 16,962
======== ======== ======== ========
</TABLE>
See accompanying notes to unaudited proforma statement of operations
<PAGE> 12
Cray Inc.
Unaudited Pro Forma Balance Sheet
March 31, 2000
(in thousands)
<TABLE>
<CAPTION>
Cray Business
Assets Acquired
and Liabilities Pro Forma Pro
Cray Inc. Assumed Adjustments Forma
----------- --------------- ----------- -----------
<S> <C> <C> <C> <C>
Cash and equivalents $ 30,188 $ (1) $ (10,000) $ 20,188
Restricted cash 1,042 1,042
Accounts receivable 313 3,906 4,219
Related party receivable 346 346
Inventory, net 4,483 27,750 32,233
Deposit to SGI 5,000 (1) (5,000) -
Advances to suppliers 197 197
Prepaid expenses and other assets 860 1,737 2,597
----------- ----------- ----------- -----------
Total current assets 42,429 33,393 (15,000) 60,822
Property and equipment, net 7,158 10,773(2) 7,628 25,559
Spares inventory, net 28,816 28,816
Intangible assets, net 845(3) 29,152 29,997
Lease deposits 499 499
Patents 260 260
----------- ----------- ----------- -----------
Total assets $ 50,346 $ 73,827 $ 21,780 $ 145,953
=========== =========== =========== ===========
Accounts payable 5,210 5,210
Accrued payroll and related expenses 1,831 4,550 6,381
Accrued interest 20 20
Deferred revenue 25 25
Current portion - warranty reserves 10,375 10,375
Contract adjustment reserve 200 200
Current portion - leases 561 561
Current portion - notes 296 (1) 37,023 37,319
----------- ----------- ----------- -----------
Total current liabilities 8,143 14,925 37,023 60,091
Warranty reserves 36,959 36,959
Capital lease obligations 333 333
Notes payable 496 496
Convertible notes payable 458 458
Common stock 146,057 (1) 6,700 152,757
Accumulated deficit (105,141) (105,141)
Excess of assets acquired -
over liabilities assumed 21,943(1) (21,943) -
----------- ----------- ----------- -----------
Total stockholders' equity 40,916 21,943 (15,243) 47,616
----------- ----------- ----------- -----------
Total liabilities and
stockholders' equity $ 50,346 $ 73,827 $ 21,780 $ 145,953
=========== =========== =========== ===========
</TABLE>
See accompanying notes to unaudited proforma balance sheet
<PAGE> 13
NOTES TO UNAUDITED PRO FORMA
STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1999 AND
THREE MONTHS ENDED MARCH 31, 2000
(1) Represents the amortization of goodwill and other acquired
intangibles from the Cray Business acquisition using a five
year life.
(2) Represents the additional expenses the Company estimates would
have been incurred had it operated the Cray Business since
January 1, 1999. Expenses include additional personnel,
professional services, and capital expenditures.
These costs are forward-looking and are not necessarily
indicative of the costs that would have been incurred if Cray
Inc. had operated the business for the periods presented. The
expenses charged to the Cray Business by SGI are not
necessarily indicative of the expenses that would have been
incurred had the Cray Business operated as a stand-alone
business.
(3) Represents interest expense at 12% on estimated capital
expenditures of $9 million and imputed interest at 12% related
to the $36.3 million nine-month promissory note.
NOTES TO UNAUDITED PRO FORMA
BALANCE SHEET
AS OF MARCH 31, 2000
(1) The pro forma adjustment represents the purchase price paid
for the Cray Business. The Company paid $58.0 million for the
Cray Business, including cash payments of $15.0 million at
closing, one million shares of the Company's common stock
valued at $6.7 million and the issuance of a short-term
promissory note in the amount of $36.3 million.
(2) Represents the recording of the Company's preliminary
estimates of the tangible assets acquired at fair value.
(3) Represents the recording of goodwill.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
CRAY INC.
By: /s/ KENNETH W. JOHNSON
-------------------------
Kenneth W. Johnson
Chief Financial Officer
<PAGE> 14
Dated: June 15, 2000
<TABLE>
<CAPTION>
EXHIBIT LIST
<S> <C>
2.1 Asset Purchase Agreement between the Company and SGI, dated as of March 1,
2000. (1)
2.2 Amendment No. 1 to the Asset Purchase Agreement between the Company and SGI,
dated as of March 31, 2000. (1)
2.3 Technology Agreement between the Company and SGI, effective as of March
31, 2000. (2)
2.4 Services Contract Agreement between the Company and SGI, dated as of March
31, 2000. (2)
2.5 Transition Services Agreement between the Company and SGI, dated as of
March 31, 2000. (2)
2.6 Registration Rights Agreement between the Company and SGI, dated as of
March 31, 2000. (2)
</TABLE>
(1) Incorporated by reference to the Company's report on Form 8-K,
as filed with the Commission on April 17, 2000.
(2) Incorporated by reference to the Company's report on Form
10-Q, as filed with the Commission on May 15, 2000.
