Exhibit 99.1
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FOR IMMEDIATE RELEASE
Media Contacts:
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WAM!NET Inc.
Kristin Tschida, 612-886-5894
kristin@wamnet.com
Silicon Graphics, Inc.
Kevin Burr, 650-933-5411
Kburr@corp.sgi.com
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John Cristofano, 650-933-2646
Cristofano@corp.sgi.com
WAM!NET INC. AND SILICON GRAPHICS, INC. FORM ALLIANCE
MINNEAPOLIS and MOUNTAIN VIEW, Calif. (March 8, 1999) -- WAM!NET Inc. and
Silicon Graphics, Inc. (NYSE:SGI) today announced a multifaceted, long-term
strategic alliance designed to support the growth of WAM!NET as the leading
digital network services company. Key aspects of the alliance include:
bullet An equity investment in WAM!NET by Silicon Graphics valued at $75
million in a combination of real estate and cash; in exchange for
an 8.6% fully diluted equity interest in WAM!NET. Following
receipt of regulatory approvals, Silicon Graphics will be
represented on the WAM!NET board of directors. MCI WorldCom made
an additional $25 million investment consisting of conversion of
existing debt and $15 million in cash;
bullet Silicon Graphics will be designated WAM!NET's preferred provider
of computing systems and related services over the next four
years, continuing the current relationship in which WAM!NET's
Industry Smart(TM) solutions are built utilizing Silicon
Graphics(R) products;
bullet Silicon Graphics will co-market WAM!NET managed data services
through their distribution channels and sales force to the
entertainment market and certain U.S. federal government and
commercial markets;
bullet WAM!NET has also acquired Silicon Graphics' campus and Advanced
Data Center in Eagan, Minnesota (the former headquarters of Cray
Research), valued at $40 million. Silicon Graphics will lease
back a portion of the facility.
"We are excited about the potential of the WAM!NET/SGI alliance. This
partnership enhances our ability to deliver solutions to the graphic arts,
medical and entertainment markets," said Ed Driscoll, president and CEO, WAM!NET
Inc. "The superior bandwidth of SGI workstations and servers, combined with
WAM!NET's robust network services, create one of the world's most powerful
computer networks. The unique power of this alliance is that it provides the
missing link
in digital workflow and will revolutionize the way creative professionals
assemble media into the next decade."
"WAM!NET has been a large and rapidly growing SGI customer since 1994 and we
expect that through this alliance our relationship will evolve into a major
strategic advantage for both companies," said Rick Belluzzo, chairman and CEO of
Silicon Graphics. "It's not just the revenue potential that makes this an
exciting opportunity for SGI. The alliance validates and supports our overall
strategic direction, particularly in the areas of media streaming and digital
asset management. WAM!NET benefits from our broad product line, applications,
software tools and computing architectures -- all optimized for high bandwidth
networks -- as well as our great support and professional services
capabilities."
"MCI WorldCom has had an investment in WAM!NET since its inception," said Susan
Mayer, senior vice president, MCI WorldCom. "And we welcome the addition of
SGI."
Silicon Graphics, Inc. is a leading supplier of visual computing and
high-performance systems. The company offers the broadest range of products in
the industry -- from low-end desktop workstations to servers and high-end
supercomputers. Key industries include communications, energy, entertainment,
government, manufacturing and sciences. Silicon Graphics and its subsidiaries
have offices throughout the world and headquarters in Mountain View, California.
WAM!NET Inc., with its digital networking service, provides the industry
standard for electronic collaboration in the graphic arts, advertising,
marketing and entertainment industries. WAM!NET's Industry Smart(TM) high-speed
transportation network, on-line archiving service and production workflow
application software allow subscribers to digitally collaborate with thousands
of global trading partners, in real-time, with one simple connection. WAM!NET
moves customers from a mechanical manufacturing environment, based on local
messengers and overnight couriers, to a totally digital production workflow --
cutting turnaround times by as much as 75-98 percent and costs by as much as
50-75 percent on the average size file. Since its incorporation in the state of
Minnesota in 1994, WAM!NET has signed over 2,500 blue-chip customers in over 14
countries.
WAM!NET has its headquarters in Minneapolis and offices throughout Europe and
Asia. The company has benefited from a technology partnership with Silicon
Graphics since 1995 and has had a strategic and financial relationship with MCI
WorldCom since 1996. For more information on WAM!NET, call 800.611.9006, or
visit the company's web site at www.wamnet.com.
This release contains forward-looking statements based on current expectations
or beliefs, as well as a number of assumptions about future events, that are
subject to risks and uncertainties that could cause actual results to differ
materially from those described in these forward-looking statements. The reader
is cautioned not to rely unduly on these forward-looking statements, which
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are not a guarantee of future performance. In particular, the impact of this
alliance on Silicon Graphics' future performance will be affected by a number of
factors, many of which are outside of Silicon Graphics' control, including
increased competition and technological change in the markets served by both
companies, WAM!NET's financial performance and business execution, and the other
risks detailed from time to time in Silicon Graphics' SEC reports, including its
Form 10-K for the year ended June 30, 1998 and its Form 10-Q for the quarter
ended December 31, 1998.
WAM!NET and the WAM!NET logo are registered trademarks, and Industry Smart is a
trademark, of WAM!NET Inc. Silicon Graphics is a registered trademark, and the
Silicon Graphics logo is a trademark, of Silicon Graphics, Inc. All other
trademarks mentioned herein are the property of their respective owners.
Press materials are available at www.sgi.com/newsroom and
www. wammnet.com/newsroom.html.
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