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As filed with the Securities and Exchange Commission on April 19, 2001
Registration No. 333-57972
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 1 to
Form S-3 Registration Statement
Under the Securities Act of 1933
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CRAY INC.
(Exact name of registrant as specified in its charter)
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WASHINGTON 93-0962605
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
411 First Avenue South
Suite 600
Seattle, WA 98104
(206) 701-2000 (telephone)
(206) 701-2500 (facsimile)
(Address, including zip code, and telephone and facsimile numbers,
including area code, of principal executive offices)
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Kenneth W. Johnson, Chief Financial Officer
Cray Inc.
411 First Avenue South
Suite 600
Seattle, WA 98104
(206) 701-2000 (telephone)
(206) 701-2500 (facsimile)
(Name, address, including zip code, and telephone and
facsimile numbers, including area code, of agent for service)
Copy to:
Christopher J. Voss
Stoel Rives LLP
One Union Square, 36th Floor
Seattle, WA 98101-3197
(206) 624-0900 (telephone)
(206) 386-7500 (facsimile)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this registration statement becomes effective
If the only securities being registered on this Form are to be offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
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If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with a dividend or
interest reinvestment plan, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
The Registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said section 8(a), may determine.
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PROSPECTUS, Subject to Completion, dated April 19, 2001
CRAY INC.
5,139,408 shares of Common Stock
These shares of Common Stock are issuable upon exercise of common stock
purchase warrants owned by one of our current securityholders and are being
offered and sold from time to time by him.
The selling securityholder may sell the shares from time to time at
fixed prices, market prices, prices computed with formulas based on market
prices, or at negotiated prices, and may engage a broker or dealer to sell the
shares. For additional information on the selling securityholder's possible
methods of sale, you should refer to the section of this prospectus entitled
"Plan of Distribution" on page 4. We will not receive any proceeds from the sale
of the shares, but will bear the costs relating to the registration of the
shares.
Our Common Stock is traded on the Nasdaq National Market under the
symbol "CRAY." On April 12, 2001, the closing price for our Common Stock was
$1.91 per share.
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THE SHARES OFFERED IN THIS PROSPECTUS INVOLVE A HIGH DEGREE OF RISK. YOU
SHOULD CAREFULLY CONSIDER THE "FACTORS THAT COULD AFFECT FUTURE RESULTS"
CONTAINED IN OUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDING DECEMBER 31,
2000 AND IN OUR FUTURE FILINGS MADE WITH THE SECURITIES AND EXCHANGE COMMISSION,
WHICH ARE INCORPORATED BY REFERENCE IN THIS PROSPECTUS, IN DETERMINING WHETHER
TO PURCHASE SHARES OF OUR COMMON STOCK.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THE SHARES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this Prospectus is ____________ ___, 2001.
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TABLE OF CONTENTS
Section Page
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Our Business .................................................... 3
Selling Shareholder ............................................. 3
Plan of Distribution ............................................ 4
Experts ......................................................... 5
Limitation of Liability and Indemnification ..................... 5
Information Incorporated by Reference ........................... 6
Available Information ........................................... 7
You should rely only on information contained or incorporated by
reference in this prospectus. See "Information Incorporated by Reference" on
page 6. Neither Cray nor the selling shareholder has authorized any other person
to provide you with information different from that contained in this
prospectus.
The shares of Common Stock are not being offered in any jurisdiction
where the offering is not permitted.
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OUR BUSINESS
Cray Inc. designs, builds, sells and services high-performance computer
systems, sometimes referred to as "supercomputers." Our executive offices are
located at Merrill Place, Suite 600, 411 First Avenue South, Seattle, WA
98104-2860, and our telephone number is (206) 701-2000.
SELLING SHAREHOLDER
On June 21, 1999, we issued a warrant to Terren S. Peizer in exchange
for $200,000. The warrant presently is exercisable for 5,139,408 shares of our
common stock at an exercise price of $2.53 per share. As of March 21, 2001, the
warrant is exercisable for 4,496,982 of these shares; the remaining shares
become exercisable ratably per month over the next three months so that the
warrant is exercisable in full on June 21, 2001. If certain events occur prior
to June 21, 2001, such as a merger or consolidation in which we are not the
surviving entity or a sale of all or substantially all of our assets, or if we
terminate our relationship with Mr. Peizer, the vesting provisions accelerate.
The issuance of the warrant to Mr. Peizer is described more fully in our
Current Report on Form 8-K for the event of June 21, 1999, as filed with the
Securities and Exchange Commission (the "SEC") on June 30, 1999.
As of March 23, 2001, Mr. Peizer held no shares of our Common Stock. The
shares covered by this prospectus include only the shares of common stock
issuable to Mr. Peizer pursuant to the exercise of the warrant described above.
All of the shares covered by this prospectus are being sold for the account of
Mr. Peizer. As of March 23, 2001, we had 39,375,541 shares outstanding.
Ownership After Offering
if All Shares Offered
Shares Hereby Are Sold
Owned Prior Shares Being --------------------------
Selling Shareholder to Offer Offered Shares Percent
------------------- ----------- ------------ ---------- -----------
Terren S. Peizer - 0 - 5,139,408 - 0 - n/a
Mr. Peizer served as our Chairman of the Board from June 25, 1999 to
December 21, 2000.
In recognition of the fact that Mr. Peizer may wish to be legally
permitted to sell its shares when it deems appropriate, we have agreed with Mr.
Peizer to file with the SEC, under the Securities Act of 1933 (the "Securities
Act"), a registration statement on Form S-3, of which this prospectus forms a
part, with respect to the resale of the shares issuable upon exercise of the
warrant, and have agreed to prepare and file such amendments and supplements to
the registration statement as may be necessary to keep the registration
statement effective until such shares are no longer required to be registered
for sale by Mr. Peizer.
PLAN OF DISTRIBUTION
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Cray is registering the shares covered by this prospectus for Mr.
Peizer. Mr. Peizer or his pledgees, donees, transferees or other successors in
interest may sell the shares in the over-the-counter market or otherwise, at
market prices prevailing at the time of sale, at prices related to prevailing
market prices, or at negotiated prices. In addition, the shares may be sold by
one or more of the following methods:
o a block trade in which a broker or dealer so engaged will
attempt to sell the shares as agent but may position and resell
a portion of the block, as principal, in order to facilitate the
transaction;
o purchases by a broker or dealer, as principal, in a market maker
capacity or otherwise and resale by the broker or dealer for its
account pursuant to their prospectus; or
o ordinary brokerage transactions and transactions in which a
broker solicits purchases.
Cray will pay the costs and fees of registering the shares, but Mr.
Peizer will pay any brokerage commissions, discounts or other expenses relating
to the sale of the shares. Cray and Mr. Peizer each have agreed to indemnify the
other against certain liabilities, including liabilities arising under the
Securities Act, that relate to statements or omissions in the registration
statement of which this prospectus forms a part.
Regulation M under the Securities Exchange Act of 1934 provides that
during the period that any person is engaged in the distribution, as so defined
in Regulation M, of our common stock, such person generally may not purchase
shares of our common stock. Mr. Peizer is subject to applicable provisions of
the Securities Act and the Securities Exchange Act of 1934 and the rules and
regulations thereunder, including, without limitation, Regulation M, which
provisions may limit the timing of purchases and sales of shares of our common
stock by Mr. Peizer. The foregoing may affect the marketability of our common
stock.
Mr. Peizer may negotiate and pay brokers or dealers commissions,
discounts or concessions for their services. In effecting sales, brokers or
dealers engaged by Mr. Peizer may allow other broker or dealers to participate.
However, Mr. Peizer and any brokers or dealers involved in the sale or resale of
the shares may qualify as "underwriters" within the meaning of the Section
2(a)(11) of the Securities Act. In addition, the brokers' or dealers'
commissions, discounts or concessions may qualify as underwriters' compensation
under the Securities Act. If Mr. Peizer qualifies as an "underwriter," it will
be subject to the prospectus delivery requirements of Section 5(b)(2) of the
Securities Act.
In addition to selling its shares under this prospectus, Mr. Peizer may:
o agree to indemnify any broker or dealer or agent against certain
liabilities related to the selling of the shares, including
liabilities arising under the Securities Act;
o transfer its shares in other ways not involving market makers or
established trading markets, including directly by gift,
distribution, or other transfer; or
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o sell its shares under Rule 144 of the Securities Act rather than
under this prospectus, if the transaction meets the requirements
of Rule 144.
Upon notification by Mr. Peizer that any material arrangement has been
entered into with a broker or dealer for the sale of the shares through a block
trade, special offering, exchange distribution or secondary distribution or a
purchase by a broker or dealer, we will file a supplement to this prospectus, if
required, pursuant to Rule 424(b) under the Securities Act, disclosing the
material terms of the transaction.
LEGAL MATTERS
For purposes of this offering, Kenneth W. Johnson, the Company's General
Counsel, is giving an opinion on the validity of the common shares. As of the
date of this prospectus, Mr. Johnson held 39,713 shares of the Company's common
stock and options exercisable for 270,000 shares of the Company's common stock.
EXPERTS
The financial statements incorporated in this prospectus by reference
from the Company's annual report on Form 10-K for the year ended December 31,
2000, have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report, which is incorporated herein by reference, and have
been so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
LIMITATION OF LIABILITY AND INDEMNIFICATION
Our Restated Articles of Incorporation provide that, to the fullest
extent permitted by the Washington Business Corporation Act, our directors will
not be liable for monetary damages to Cray or its shareholders, excluding,
however, liability for acts or omissions involving intentional misconduct or
knowing violations of law, illegal distributions or transactions from which the
director receives benefits to which the director is not legally entitled. Our
Restated Bylaws provide that Cray will indemnify its directors and, by action of
the Board of Directors, may indemnify its officers, employees and other agents
to the fullest extent permitted by applicable law, except for any legal
proceeding that is initiated by such directors, officers, employees or agents
without authorization of the Board of Directors.
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Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of Cray
pursuant to the foregoing provisions, or otherwise, we have been advised that,
in the opinion of the SEC, such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" our publicly-filed
reports into this prospectus, which means that information included in those
reports is considered part of this prospectus. Information that we file with the
SEC subsequent to the date of this prospectus will automatically update and
supersede the information contained in this prospectus. We incorporate by
reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until the selling shareholders have sold all the shares.
The following documents filed with the SEC are incorporated by reference
in this prospectus:
1. Our Annual Report on Form 10-K for the year ended December 31,
2000;
2. Our Definitive Proxy Statement, as filed with the SEC on April
9, 2001;
3. Our Current Report on Form 8-K for the event of April 3,
2001, as filed on April 13, 2001; and
4. The description of our common stock set forth in our
Registration Statement on Form SB-2 (Registration No.
33-95460-LA), including any amendment or report filed for the
purpose of updating such description, as incorporated by
reference in our Registration
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Statement on Form 8-A (Registration No. 0-26820), including the
amendment thereto on Form 8-A/A.
We will furnish without charge to you, on written or oral request, a
copy of any or all of the documents incorporated by reference, other than
exhibits to such documents. You should direct any requests for documents to
Investor Relations, Cray Inc., 411 First Avenue South, Suite 600, Seattle,
Washington 98104, Telephone (206) 701-2000.
The information relating to Cray contained in this prospectus is not
comprehensive and should be read together with the information contained in the
incorporated documents.
AVAILABLE INFORMATION
This prospectus is part of a Registration Statement on Form S-3 that we
filed with the SEC. Certain information in the Registration Statement has been
omitted from this prospectus in accordance with SEC rules.
We file annual, quarterly and special reports and other information with
the SEC. You may read and copy the Registration Statement and any other document
that we file at the SEC's public reference rooms located at Room 1024, Judiciary
Plaza, 450 Fifth Street N.W., Washington, D.C. 20549; 7 World Trade Center,
Suite 1300, New York, New York 10048; and Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to you free of charge at the SEC's web site at
http://www.sec.gov.
Statements contained in this prospectus as to the contents of any
contract or other document referred to are not necessarily complete. You should
refer to the copy of such contract or other document filed as an exhibit to the
Registration Statement.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The Company will pay all expenses in connection with the issuance and
distribution of the securities being registered. The following is an itemized
statement of these expenses (all amounts are estimated except for the SEC fees):
SEC Registration fee............................. $3,251
Legal fees....................................... $5,000
Accountant's Fees................................ $2,500
Miscellaneous.................................... $2,249
Total............................................ $13,000
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Item 15. Indemnification of Officers and Directors.
Article XII of the Company's Restated Articles of Incorporation and
Section 11 of the Company's Restated Bylaws require indemnification of
directors, officers, employees and agents of the Company to the fullest extent
permitted by the Washington Business Corporation Act (the "Act"). Sections
23B.08.500 through 23B.08.600 of the Act authorize a court to award, or a
corporation's board of directors to grant, indemnification to directors and
officers on terms sufficiently broad to permit indemnification under certain
circumstances for liabilities arising under the Securities Act.
Section 23B.08.320 of the Act authorizes a corporation to limit a
director's liability to the corporation or its shareholders for monetary damages
for acts or omissions as a director, except in certain circumstances involving
intentional misconduct, self-dealing or illegal corporate loans or
distributions, or any transaction from which the director personally receives a
benefit in money, property or services to which the director is not legally
entitled. Article XI of the Company's Restated Articles of Incorporation
contains provisions implementing, to the fullest extent permitted by Washington
law, such limitations on a director's liability to the Company and its
shareholders.
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Item 16 Exhibits.
4.1 Form of Warrant issued to Terren S. Peizer(1)
5 Opinion on Legality(1)
23 Consent of Deloitte & Touche LLP
24 Power of Attorney (included on signature page hereof)(1)
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(1) Incorporated by reference to the Company's Registration Statement on
Form S-3 Registration No. 333-57972, filed with the Commission on March 30,
2001.
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
Registration Statement
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this
Registration Statement (or the most recent
post-effective amendment thereof) that,
individually or in the aggregate, represent a
fundamental change in the information set forth
in this Registration Statement; and
(iii) To include any material information with respect
to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement;
provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to
be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with
or furnished to the Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange
Act that are incorporated by reference in the
registration statement;
(2) That, for the purpose of determining any liability under
the Securities Act, each post-effective amendment shall
be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered that
remain unsold at the termination of the offering.
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(b) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933,
each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that
in the opinion of the Commission such indemnification is against
public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question, whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Seattle, State of Washington, on April 19, 2001.
CRAY INC.
By: /s/
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James E. Rottsolk
Chief Executive Officer
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Each of the undersigned hereby constitutes and appoints James E.
Rottsolk and Burton J. Smith, and each of them, the undersigned's true and
lawful attorney-in-fact and agent, with full power of substitution, for the
undersigned and in his or her name, place and stead, in any and all capacities,
to sign any or all amendments or post-effective amendments to this Registration
Statement, and any other instruments or documents that said attorneys-in-fact
and agents may deem necessary or advisable, to enable Cray Inc. to comply with
the Securities Act of 1933, as amended, and any requirements of the Securities
and Exchange Commission in respect thereof, and to file the same, with all
exhibits thereto, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents and each of them full power and authority to
do and perform each and every act and thing requisite and necessary to be done,
as fully to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all that each such attorney-in-fact and
agent, or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated below on the 19th day of April, 2001:
Signature and Title
/s/ *
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James E. Rottsolk, Chairman of the Daniel J. Evans, Director
Board of Directors and Chief Executive
Officer
* *
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Burton J. Smith, Director Stephen C. Kiely, Director
* *
-------------------------------------- ---------------------------------------
Terren S. Peizer, Director Kenneth W. Kennedy, Director
* *
-------------------------------------- ---------------------------------------
David N. Cutler, Director William A. Owens, Director
* /s/
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Dean D. Thornton, Director Kenneth W. Johnson, Chief Financial
Officer
/s/
-------------------------------------------
Douglas C. Ralphs, Chief Accounting Officer
/s/
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*James E. Rottsolk
Attorney-in-Fact