SCIENCE

Company on Track to Emerge from Chapter 11 in October 2006: SGI today announced that its Plan of Reorganization has received judicial confirmation, setting the stage for the company's emergence from Chapter 11 in October 2006. At today's hearing, Judge Burton Lifland ruled that all the necessary requirements have been met for SGI to implement its Plan of Reorganization. Every voting class of creditors voted overwhelmingly in favor of the plan. "This is a great day for SGI. We have accomplished so much in just five months, reaching our confirmation on the fast track that we expected," said Dennis P. McKenna, CEO and Chairman. "As we emerge, the recapitalization of the company will be complete. We have eliminated the legacy debt, improved our liquidity and stabilized the business. We have also taken out significant costs—$150 million on an annualized basis. We have re-engineered the company and have a strong leadership team that will be executing this plan. Also of significance to the growth of the company is that during this time, we retooled and aligned our product portfolio to the strategic direction of the company. I want to thank our customers, vendors and employees for supporting the company through this challenging period." Today SGI also announced it has received commitments for exit financing. The financing facility consists of an $85 million term loan from Morgan Stanley Senior Funding Inc. and a $30 million line of credit from General Electric Capital Corp. that will be used to pay off the existing DIP financing, make distributions pursuant to the plan, and provide working capital for the Company's ongoing operations. The Plan of Reorganization is available at its Web site. The documents also will be available via the court's website at its Web site. Please note that a PACER password is required to access the documents via the court's website. SGI's bankruptcy case number is 06-10977 (BRL).