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Case Status:    SETTLED
On or around 01/04/2002 (Date of order of final judgment)

Filing Date: December 02, 1997

According to the Notice of Settlement dated October 17, 2001, and the docket dated April 14, 2003, the parties reached a settlement agreement. The settlement creates a fund in the principal amount of $4 million in cash and 8 million freely tradeable shares of SGI common stock and will include interest that accrues on the fund prior to distribution. On January 03, 2002, the Court granted motion for approval of plan of allocation and issued the Final Judgment and Order dismissing the case with prejudice.

The original Complaint alleges that defendants made false and misleading statements about Silicon Graphics' business and financial results, including the Company's results for the fourth quarter of 1997, in order to artificially inflate the price of Silicon Graphics stock to facilitate the exchange of a new Silicon Graphics convertible security for $200 million of outstanding zero coupon debentures, while the defendants sold 286,584 shares of their Silicon Graphics' stock, pocketing $7.4 million in illegal insider-trading proceeds. After Silicon Graphics successfully completed its exchange of convertible debt, the Company revealed that its strong fourth quarter fiscal 1997 results had been the result of pulling orders in from future quarters and that first quarter fiscal 1998 would suffer a huge revenue shortfall as would later quarters. The Company also announced that Silicon Graphics CEO and Chairman, Edward McCraken, had been fired and that the Company would be restructuring its organization. These revelations resulted in Silicon Graphics' stock price dropping to less than $14 from its Class Period high of $30-5/16.

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