Summary of SILICON GRAPHICS INC

Entry into a Material Definitive Agreement, Financial Statements and Exhibit

Item 1.01. Entry into a Material Definitive Agreement

On December 24, 2008, Silicon Graphics, Inc. (the "Company") and certain of its subsidiaries (with the Company, the "Borrowers") entered into the Seventh Amendment to the Senior Secured Credit Agreement (the "Seventh Amendment") with Morgan Stanley Senior Funding, Inc. as administrative agent and revolving agent, Morgan Stanley & Co., Incorporated as collateral agent, and the other Lenders and Credit Parties thereto (as defined therein). The Senior Secured Credit Agreement, dated October 17, 2006, as amended (the "Credit Agreement"), provides the Borrowers with a term loan facility and a line of credit. Any capitalized terms not defined herein are used as defined in the original agreement (filed as exhibit to Form 8-K filed on October 20, 2006), the fifth amendment thereto (filed as exhibit to Form 10-K filed on September 22, 2008) and the Seventh Amendment (filed as an exhibit to this Form 8-K).

The Seventh Amendment modified the Credit Agreement to permit interest due to be paid-in-kind by adding the amount of such interest to the principal amount of the term loan or revolving advances, as applicable, in the period from December 24, 2008 through December 24, 2010, unless certain Consolidated EBITDA levels are reached. Principal repayments due on or prior to September 24, 2010 are deferred to the Credit Agreement Maturity Date (October 17, 2011). A new covenant regarding minimum required levels of Consolidated EBITDA was added, setting the minimum Consolidated EBITDA requirement at $1 million as of March 27, 2009; $5 million as of June 26, 2009; and $10 million on September 25, 2009 and for each fiscal quarter-end thereafter until and including September 30, 2011. The minimum liquidity required was amended to $10 million on an average weekly basis.

Under the Seventh Amendment, the Company has additional reporting requirements. The Company must offer Private Lenders bi-weekly conference calls with management and any financial advisors. The Seventh Amendment also includes other revisions that are administrative in nature.