Redwood City Bankruptcy Attorney Discusses Bay Area Based-Silicon Graphics Reemergence From Chapter 11 Approved By U.S. Bankruptcy Court
Redwood City Bankruptcy Attorney Discusses Bay Area Based-Silicon Graphics Reemergence From Chapter 11 Approved By U.S. Bankruptcy Court
Silicon Graphics Inc. (SGI) plans to emerge from bankruptcy this month. The Mountain View-based computer business’s reorganization plan was approved by a US bankruptcy court last month.
SGI says it is receiving an $85 million term loan from Morgan Stanley Senior Funding Inc. and a $30 million credit line from General Electric Capital Corp. for its exit financing. SGI says the loan will pay off debtor-in-possession financing and provide working capital for its current operations.
SGI—the company that became famous for its high-powered graphic systems—filed for Chapter 11 protection last May when it reported $664 million in debt and $369 million in assets.
Filing Chapter 11 of the Bankruptcy code lets a bankrupt company reorganize it’s business so it can become profitable. The business continues running but must be supervised by a bankruptcy court.
The U.S. Securities and Exchange Commission lists the following steps for developing and implementing a reorganization plan once a company has filed Chapter 11.
Steps in Development of the Plan:
· The debtor company develops a plan with committees.
· Company prepares a disclosure statement and reorganization plan and files it with the court.
· SEC reviews the disclosure statement to be sure it's complete.
· Creditors (and sometimes the stockholders) vote on the plan.
· Court confirms the plan.
· Company carries out the plan by distributing the securities or payments called for by the plan.
The Law Offices of Scott Sagaria represents individuals and businesses in the San Francisco Bay area in need of legal assistance or advice when deciding whether to file for bankruptcy protection. For a free, no obligation consultation, contact the Law Offices of Scott Sagaria.
SGI Set To Exit Bankruptcy Protection, Cnetnews.com, September 19, 2006
SIlicon Graphics Emerges From Chapter 11 Bankruptcy, Mercurynews.com, September 19, 2006
Silicon Graphics Gets Okay to Exit Chapter 11 in October, CNN.com, September 19, 2006
Corporate Bankruptcy, U.S. Securities and Exchange Commission
Related Web Resources:
SGI Takes Action To Reduce Debt, SGI.com
An Overview of Corporate Bankruptcy, Investopedia.com
