Mips Technologies Inc – ‘PRES14A’ for 11/11/99

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Preliminary Proxy Solicitation Material — Special Meeting   —   Schedule 14A
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Document/Exhibit                   Description                      Pages   Size 

 1: PRES14A     Preliminary Proxy Solicitation Material -- Special    94    464K 
                          Meeting                                                

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PRES14A
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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) 
of the Securities Exchange Act of 1934

Filed by the Registrant /X/                                             
Filed by a Party other than the Registrant / /                          

Check the appropriate box:                                              
/X/  Preliminary Proxy Statement                                        
/ /  Confidential, for Use of the Commission Only (as permitted by Rule 
14a-6(e)(2))                                                  
/ /  Definitive Proxy Statement                                         
/ /  Definitive Additional Materials                                    
/ /  Soliciting Material Pursuant to Section240.14a-11(c) or            
Section240.14a-12                                             

    FILING BY:
   MIPS TECHNOLOGIES, INC.
    (NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Payment of Filing Fee (Check the appropriate box):                      
/X/  No fee required.                                                   
/ /  Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 
0-11.                                                         

1)  Title of each class of securities to which transaction applies:   
         -----------------------------------------------------------------------
2)  Aggregate number of securities to which transaction applies:      
         -----------------------------------------------------------------------
3)  Per unit price or other underlying value of transaction computed  
       pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):    
         -----------------------------------------------------------------------
4)  Proposed maximum aggregate value of transaction:                  
         -----------------------------------------------------------------------
5)  Total fee paid:                                                   
         -----------------------------------------------------------------------

   / /  Check box if any part of the fee is offset as provided by Exchange Act
      Rule 0-11(a)(2) and identify the filing for which the offsetting fee
   was paid previously. Identify the previous filing by registration
       statement number, or the Form or Schedule and the date of its filing.

1)  Amount Previously Paid:                                           
         -----------------------------------------------------------------------
2)  Form, Schedule or Registration Statement No.:                     
         -----------------------------------------------------------------------
3)  Filing Party:                                                     
         -----------------------------------------------------------------------
4)  Date Filed:                                                       
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MIPS TECHNOLOGIES, INC. 
1225 CHARLESTON ROAD
MOUNTAIN VIEW, CALIFORNIA 94043 

                                                                          , 1999

Dear Stockholder:                                                               

You are cordially invited to attend a Special Meeting of stockholders of
MIPS Technologies, Inc., a Delaware corporation ("MIPS Technologies"), to be    
held on    ,             , 1999 at                commencing at      , local    
time.                                                                           

At the Special Meeting, you will be asked to consider and vote upon a   
proposed recapitalization of MIPS Technologies, including the approval and      
adoption of certain changes to MIPS Technologies' certificate of incorporation  
and by-laws, pursuant to which each issued and outstanding share of MIPS        
Technologies common stock will be redesignated as one share of newly created and
issued Class A common stock of MIPS Technologies. Immediately upon the          
consummation of the recapitalization, Silicon Graphics, Inc., a Delaware        
corporation ("Silicon Graphics") and the holder of approximately 85% of the     
outstanding common stock of MIPS Technologies, will exchange each share of Class
A common stock it owns for one share of newly created and issued Class B common 
stock of MIPS Technologies. Following the recapitalization (if approved),       
holders of the Class A common stock, voting separately as a class, will be      
entitled to elect 20% of MIPS Technologies' Board of Directors, and in no event 
less than one director, and Silicon Graphics, as holder of all of the Class B   
common stock, will be entitled to elect the remaining directors. The            
accompanying Proxy Statement presents the details of the proposed               
recapitalization.                                                               

   The MIPS Technologies Board of Directors believes that the recapitalization
is fair to, and in the best interests of, MIPS Technologies and its stockholders
and has unanimously approved the recapitalization. Prior to the Board's         
approval, a specially constituted committee of the MIPS Technologies Board of   
Directors, composed of its two independent directors (the "Special Committee"), 
determined that the recapitalization is fair to MIPS Technologies and its public
stockholders and recommended the recapitalization to the MIPS Technologies Board
of Directors. THE SPECIAL COMMITTEE AND THE MIPS TECHNOLOGIES BOARD OF DIRECTORS
HAVE UNANIMOUSLY APPROVED THE RECAPITALIZATION AND RECOMMEND THAT YOU VOTE FOR  
ITS APPROVAL AND ADOPTION.                                                      

  YOUR PARTICIPATION AND VOTE IS IMPORTANT. THE RECAPITALIZATION WILL NOT BE
EFFECTED WITHOUT THE AFFIRMATIVE VOTE OF AT LEAST A MAJORITY OF THE OUTSTANDING 
COMMON STOCK HELD BY MIPS TECHNOLOGIES' PUBLIC STOCKHOLDERS (THE STOCKHOLDERS OF
MIPS TECHNOLOGIES OTHER THAN SILICON GRAPHICS), PRESENT AND VOTING AT THE       
SPECIAL MEETING.                                                                

FOR FURTHER INFORMATION REGARDING THE RECAPITALIZATION, I URGE THAT YOU 
CAREFULLY READ THE ACCOMPANYING PROXY STATEMENT, DATED             , 1999, AND, 
SPECIFICALLY, THE SECTIONS ENTITLED "THE RECAPITALIZATION--REASONS FOR THE      
RECAPITALIZATION; RECOMMENDATION OF THE SPECIAL COMMITTEE AND THE MIPS BOARD OF 
DIRECTORS" BEGINNING ON PAGE 16. If you have more questions about the           
recapitalization or would like additional copies of the accompanying Proxy      
Statement, you should contact: Kevin C. Eichler, Chief Financial Officer of MIPS
Technologies, 1225 Charleston Road, Mountain View, California, 94043; telephone:
(650) 567-5000. Even if you plan to attend the Special Meeting in person, please
complete, sign, date and promptly return the enclosed proxy card in the enclosed
postage-prepaid envelope. This will not limit your right to attend or vote at   
the Special Meeting.                                                            

              Sincerely,

                    John E. Bourgoin

                           CHIEF EXECUTIVE OFFICER
                 AND PRESIDENT

 The accompanying Proxy Statement is dated             , 1999 and is first
being mailed to stockholders on or about             , 1999.                    

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MIPS TECHNOLOGIES, INC. 
1225 CHARLESTON ROAD
MOUNTAIN VIEW, CALIFORNIA 94043 
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS 
TO BE HELD                , 1999

To the Stockholders of                                                          
MIPS TECHNOLOGIES, INC.:                                                        

NOTICE IS HEREBY GIVEN that a special meeting of stockholders of MIPS   
Technologies, Inc., a Delaware corporation ("MIPS Technologies"), will be held  
on    ,             , 1999, at                commencing at      , local time,  
for the following purposes:                                                     

  1.  To consider and vote upon a proposal (the "Recapitalization Proposal")
to recapitalize the authorized capital stock of MIPS Technologies,
 including (a) the approval and adoption of the proposed amended and
restated certificate of incorporation (the "Amended Certificate of
   Incorporation") and the proposed amended and restated by-laws of MIPS
    Technologies (the "Amended By-laws") pursuant to which each issued and
      outstanding share of MIPS Technologies common stock will be redesignated
   as one share of newly created and issued Class A common stock of MIPS
   Technologies and (b) the exchange by Silicon Graphics, Inc. ("Silicon
      Graphics"), upon the consummation of the recapitalization, of each share
    of Class A common stock it will own for one share of newly created and
issued Class B common stock of MIPS Technologies; and             

 2.  To transact such other business as may properly be brought before the
special meeting or any adjournment or postponement of the special 
meeting.                                                          

Copies of the forms of the Amended Certificate of Incorporation and the 
Amended By-laws, which will define certain of the rights of the Class A and     
Class B common stock if the recapitalization is approved, are attached as Annex 
A and Annex B, respectively, to the accompanying Proxy Statement. In addition,  
MIPS Technologies and Silicon Graphics will enter into an Exchange Agreement if 
the recapitalization is approved by MIPS Technologies' public stockholders. The 
form of the Exchange Agreement is attached as Annex C to the accompanying Proxy 
Statement.                                                                      

 Stockholders of record at the close of business on             , 1999 are
entitled to notice of, and to vote at, the special meeting and any adjournment  
or postponement of the special meeting. A complete list of stockholders entitled
to vote at the special meeting will be available for inspection by any          
stockholder for any purpose germane to the special meeting for 10 days prior to 
the special meeting during ordinary business hours at MIPS Technologies'        
headquarters located at 1225 Charleston Road, Mountain View, California 94043.  

All stockholders are cordially invited to attend the meeting in person. 
HOWEVER, TO ENSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE URGED TO         
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE 
IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE. THIS WILL NOT LIMIT YOUR RIGHT TO     
ATTEND OR VOTE AT THE SPECIAL MEETING.                                          

                                       By Order of the Board of Directors,

                   Sandy Creighton
             SECRETARY

Mountain View, California                                                       
, 1999                                                  

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, SIGN AND
DATE THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. DO
NOT SEND ANY STOCK CERTIFICATES WITH THE ENCLOSED PROXY CARD.                   

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TABLE OF CONTENTS 

                                                                [Download Table]
                                                  
SUMMARY................................          1
  The Company..........................          1
  Relationship with Silicon Graphics...          1
  The Recapitalization.................          2
  The Exchange Agreement...............          5
  The Special Meeting..................          7

COMPARISON OF CURRENT AND PROPOSED                
  PROVISIONS OF MIPS TECHNOLOGIES                 
  CERTIFICATE OF INCORPORATION.........          8

THE SPECIAL MEETING....................         12
  General; Date, Time and Place........         12
  Purposes of the Special Meeting......         12
  Recommendation of the MIPS Board and            
    Special Committee..................         12
  Stockholders Entitled to Vote; Vote             
    Required...........................         12
  Proxies..............................         13

THE RECAPITALIZATION...................         15
  Background of the Recapitalization...         15
  Reasons for the Recapitalization;               
    Recommendation of the Special                 
    Committee and the MIPS Board of               
    Directors..........................         17
  Effect of the Recapitalization.......         19
  The MIPS Board of Directors Following           
    the Recapitalization...............         22
  Interests of Certain Persons in the             
    Recapitalization...................         22
  Certain Federal Income Tax                      
    Consequences.......................         22
  Nasdaq Approvals.....................         23
  Federal Securities Laws                         
    Consequences.......................         23
  No Appraisal Rights..................         23

THE EXCHANGE AGREEMENT.................         24
  Exchange of Class A Shares for Class            
    B Shares by Silicon Graphics.......         24
  Silicon Graphics' Obligation to                 
    Purchase New MIPS Common Stock.....         24
  Tax Indemnification Agreement........         25
  Required Exchange of Class B Shares             
    for Class A Shares.................         25
  Indemnification and Expenses.........         26

CAUTIONARY STATEMENT CONCERNING                   
  FORWARD-LOOKING STATEMENTS...........         27

MIPS TECHNOLOGIES......................         28
  The Company..........................         28
  Stock Ownership of Certain Beneficial           
    Owners and Management..............         28
  Relationship with Silicon Graphics...         29

MARKET PRICE AND DIVIDEND                         
  INFORMATION..........................         31
  Market Prices........................         31
  Dividends............................         31

DESCRIPTION OF MIPS CAPITAL STOCK PRIOR           
  TO AND FOLLOWING THE                            
  RECAPITALIZATION.....................         32
  Authorized Capital Stock.............         32
  Common Stock.........................         32
  Preferred Stock......................         36
  Corporate Opportunities..............         36
  Certificate of Incorporation and                
    By-law Provisions That May Have an            
    Anti-Takeover Effect...............         38
  Section 203 of Delaware General                 
    Corporation Law....................         40
  Limitation of Liability..............         41
  Listing..............................         41
  Transfer Agent and Registrar.........         41

STOCKHOLDER PROPOSALS..................         42

EXPERTS................................         42

WHERE YOU CAN FIND MORE INFORMATION....         42

LIST OF DEFINED TERMS..................         44

                                                                [Download Table]
                                          
Annex A    -- Form of Amended and Restated
              Certificate of Incorporation
Annex B    -- Form of Amended and Restated
              By-laws                     
Annex C    -- Form of Exchange Agreement  

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SUMMARY 

   THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS DOCUMENT AND MAY NOT
CONTAIN ALL OF THE INFORMATION THAT IS IMPORTANT TO YOU. TO UNDERSTAND THE      
RECAPITALIZATION FULLY AND FOR A MORE COMPLETE DESCRIPTION OF THE LEGAL TERMS OF
THE RECAPITALIZATION, YOU SHOULD READ CAREFULLY THIS ENTIRE DOCUMENT AND THE    
DOCUMENTS TO WHICH WE HAVE REFERRED YOU. SEE "WHERE YOU CAN FIND MORE           
INFORMATION" (PAGE 42). THE PROPOSED AMENDED AND RESTATED CERTIFICATE OF        
INCORPORATION OF MIPS TECHNOLOGIES, THE AMENDED AND RESTATED BY-LAWS OF MIPS    
TECHNOLOGIES AND THE FORM OF EXCHANGE AGREEMENT ARE ATTACHED AS ANNEX A, ANNEX B
AND ANNEX C TO THIS DOCUMENT. WE ENCOURAGE YOU TO READ THE AMENDED AND RESTATED 
CERTIFICATE OF INCORPORATION, AMENDED AND RESTATED BY-LAWS AND THE EXCHANGE     
AGREEMENT, BECAUSE THEY ARE THE LEGAL DOCUMENTS THAT WILL GOVERN SOME OF THE    
RIGHTS OF THE CLASS A AND CLASS B COMMON STOCK IF THE RECAPITALIZATION IS       
APPROVED. FOR THE LOCATION OF DEFINITIONS OF CAPITALIZED TERMS USED IN THIS     
DOCUMENT, PLEASE SEE "LIST OF DEFINED TERMS" (PAGE 44).                         

THE COMPANY 

MIPS Technologies, Inc.                                                         
1225 Charleston Road                                                            
Mountain View, California 94043                                                 

MIPS Technologies is a leader in the design and licensing of            
high-performance, 32- and 64-bit RISC processor intellectual property and core  
technology for the digital consumer and embedded systems markets. MIPS          
Technologies and its licensees offer a variety of standard, custom, semi-custom 
and application specific processors. MIPS Technologies licenses its intellectual
property to semiconductor manufacturing and fabless design companies, as well as
system original equipment manufacturers. MIPS Technologies' licensees include,  
among others, NEC Corporation, Broadcom Corporation, Toshiba Corporation, LSI   
Logic Corporation, Philips Electronics N.V., Integrated Device Technology, NKK  
Corporation and Quantum Effect Design, Inc.                                     

  On July 6, 1998, MIPS Technologies completed an initial public offering of
5,500,000 shares of common stock, of which 4,250,000 shares were sold by Silicon
Graphics, Inc. and the remainder were sold by MIPS Technologies. Presently,     
Silicon Graphics owns approximately 85% of MIPS Technologies' outstanding common
stock. Prior to its initial public offering, MIPS Technologies was a wholly     
owned subsidiary of Silicon Graphics, and MIPS Technologies' business was       
conducted by Silicon Graphics primarily through its MIPS Technologies Group, a  
division of Silicon Graphics.                                                   

RELATIONSHIP WITH SILICON GRAPHICS

   As the beneficial owner of approximately 85% of the outstanding MIPS common
stock, Silicon Graphics presently has the ability to direct the election of all 
of the members of the board of directors of MIPS Technologies and to exercise a 
controlling influence over MIPS Technologies' business and affairs. Currently,  
the seven member Board of Directors of MIPS Technologies is composed of four    
employees of Silicon Graphics, the chief executive officer of MIPS Technologies,
and two independent directors.                                                  

In connection with MIPS Technologies' initial public offering and the   
separation of the businesses of MIPS Technologies and Silicon Graphics at that  
time, MIPS Technologies and Silicon Graphics entered into certain agreements    
governing various interim and ongoing relationships between them. Among these   
agreements is a corporate agreement, which includes, among other things,        
provisions granting Silicon Graphics registration rights with respect to the    
MIPS common stock it holds, as well as the right to purchase additional shares  
of capital stock of MIPS Technologies under certain circumstances. In addition, 
MIPS Technologies' current certificate of incorporation includes certain        
provisions regarding the allocation of business opportunities that may be       
suitable for both MIPS Technologies and Silicon Graphics.                       

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THE RECAPITALIZATION

BACKGROUND                                                                      

  Although it has not formulated definitive plans to do so, Silicon Graphics
has recently announced its intention to divest its interest in MIPS Technologies
by September 2000. Silicon Graphics expects that such a divestiture will include
a distribution of a significant portion of its interest in MIPS Technologies to 
the stockholders of Silicon Graphics in a transaction intended to qualify       
generally as a tax-free distribution under the Internal Revenue Code of 1986, as
amended. Unless certain requirements are met, Silicon Graphics would incur      
significant taxable gain if such a distribution to its stockholders were        
taxable. In addition, such a distribution generally would be taxable to Silicon 
Graphics' stockholders.                                                         

   To effect a distribution that would be tax-free to Silicon Graphics and its
stockholders, current tax law requires, among other things, that Silicon        
Graphics own, at the time of such a distribution, capital stock of MIPS         
Technologies representing at least 80% of the voting power of MIPS Technologies,
and that Silicon Graphics distribute all of such stock to its stockholders in a 
single transaction. Consequently, to effect a tax-free distribution if the      
recapitalization is not effected, Silicon Graphics would be required to         
distribute not less than 29.8 million shares of MIPS Technologies common stock  
(80% of the shares currently issued and outstanding) in a single transaction. If
the recapitalization is effected, Silicon Graphics could reduce its economic    
interest in MIPS Technologies below 80% through secondary market sales and other
transactions while preserving its ability to effect a tax-free distribution.    

If the recapitalization is approved, Silicon Graphics intends to sell a 
portion of the MIPS Technologies common stock it owns in underwritten public    
offerings and other transactions during 1999, subject to prevailing market and  
other conditions. Silicon Graphics is not obligated, and will not become        
obligated as a result of the recapitalization, to effect any sale or disposition
of the MIPS Technologies common stock it owns in multiple transactions or       
otherwise. There can be no assurance that any such sales or distributions will  
occur. If the recapitalization is not effected, Silicon Graphics expects to     
continue to hold all of the MIPS Technologies common stock it presently owns,   
although it is under no contractual obligation to do so other than pursuant to  
an agreement entered into in connection with MIPS Technologies' initial public  
offering in which Silicon Graphics agreed not to sell or dispose of any shares  
of MIPS Technologies common stock prior to June 30, 1999 without the consent of 
the representative of the underwriters of such offering.                        

   The proposed changes to MIPS Technologies' certificate of incorporation and
by-laws as described in this document are designed to permit an orderly,        
multi-step divestiture of Silicon Graphics' interest in MIPS Technologies, while
preserving Silicon Graphics' ability to effect a tax-free distribution of its   
investment in MIPS Technologies, and reflect only those changes that MIPS       
Technologies believes are appropriate to achieve this result.                   

In addition, if the recapitalization is approved, MIPS Technologies and 
Silicon Graphics will enter into the exchange agreement, which will govern      
certain of the terms of the recapitalization.                                   

REASONS FOR THE RECAPITALIZATION                                                

    A specially constituted committee of the MIPS board of directors, consisting
of MIPS Technologies' two independent directors, unanimously determined that the
recapitalization was fair to MIPS Technologies and its public stockholders, and 
recommended the recapitalization to the full board of directors of MIPS         
Technologies for approval. The board of directors of MIPS Technologies          
unanimously determined that the recapitalization is in the best interests of    
MIPS Technologies and its stockholders. In reaching their decisions to approve  
the recapitalization, the special committee and the board of directors of MIPS  
Technologies considered a number of factors, including the following:           

- the belief that the recapitalization may encourage Silicon Graphics to
divest its controlling interest in MIPS Technologies sooner than it 
otherwise might by providing                                        

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Silicon Graphics with additional flexibility with respect to its    
   investment in MIPS Technologies and the ability to consummate a tax and
   market efficient distribution of the shares of MIPS Technologies common
stock it owns;                                                      

- the potential benefits to MIPS Technologies' public stockholders of an
 orderly, multi-step increase in the public float of MIPS Technologies
      stock, which is expected to increase investor interest and enhance trading
efficiencies and liquidity in MIPS Technologies' common stock;      

- the potential benefits of the divestiture by Silicon Graphics of its  
     interest in MIPS Technologies in multiple transactions, which is expected
     to be less disruptive on the trading market for MIPS Technologies' common
  stock than if Silicon Graphics divested its entire present interest in
MIPS Technologies in a single transaction;                          

   - the ability of MIPS Technologies' public stockholders to elect 20% of its
     board of directors, and in no event less than one director, following the
      recapitalization compared to such stockholders' present inability to elect
any directors in light of Silicon Graphics' control;                

    - the terms of the recapitalization which require that, following a tax-free
    distribution, a person or group of persons acting in concert holding 10%
     or more of the Class B common stock must own at least an equal percentage
     of the Class A common stock in order to exercise its Class B common stock
voting rights;                                                      

- the automatic conversion and exchange features of the recapitalization
  which are designed, in part, to shorten the period of time following a
      tax-free distribution during which MIPS Technologies must continue to have
a dual class capital structure; and                                 

  - the "sunset" provisions designed to ensure that Silicon Graphics retains
   control of the board of directors of MIPS Technologies only if it has a
substantial economic interest in MIPS Technologies.                 

In addition, the special committee and the board of directors of MIPS   
Technologies also considered and balanced against the potential benefits of the 
recapitalization a number of potentially negative factors, including the        
following:                                                                      

    - the potential effect that the dual class capital structure may have on the
trading price and liquidity of the Class A common stock;            

- the potential impact of the dual class capital structure on MIPS      
Technologies' corporate governance and control issues; and          

- the potential impact of the recapitalization on MIPS Technologies'    
financial flexibility, including as a result of limitations on MIPS 
Technologies' ability to issue additional shares of its common stock
following a tax-free distribution.                                  

   To review the reasons for the recapitalization in greater detail, see pages
17 and 18.                                                                      

EFFECT OF THE RECAPITALIZATION                                                  

   MIPS Technologies currently has a single class of common stock outstanding,
and each share of existing common stock is entitled to one vote in all matters  
submitted to a vote of stockholders, including the election of directors. If the
recapitalization is approved, each share of MIPS Technologies common stock      
(including each share of MIPS Technologies common stock owned by Silicon        
Graphics) will be redesignated as one share of newly created and issued Class A 
common stock. Immediately upon consummation of the recapitalization and pursuant
to the exchange agreement, Silicon Graphics will exchange each share of Class A 
common stock it owns for one share of newly created and issued Class B common   
stock.                                                                          

If the recapitalization is approved, the holders of the Class A common  
stock, voting separately as a class, will be entitled to elect 20% of the       
members of board of directors of MIPS Technologies, and in no event less than   
one director, and the holders of the Class B common stock will be entitled to   
elect the remaining directors. After a tax-free distribution, a person or group 
of persons acting in concert holding 10% or more of the Class B common stock    
must own at least an equal percentage of the Class A common stock to exercise   
its Class B common stock voting rights.                                         

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The Class A common stock and the Class B common stock will have         
substantially identical rights and preferences in all other respects, including 
with respect to all other matters submitted to a vote of stockholders (except as
otherwise required by law) and with respect to dividend rights and rights upon  
liquidation.                                                                    

CONVERSION AND EXCHANGE OF CLASS B COMMON STOCK                                 

    Prior to a tax-free distribution by Silicon Graphics of its interest in MIPS
Technologies, shares of Class B common stock transferred to any entity, other   
than Silicon Graphics or its subsidiaries, will automatically convert into      
shares of Class A common stock on a one-for-one basis. After a tax-free         
distribution, shares of Class B common stock will not be converted upon transfer
by the holder thereof, but will only be converted into shares of Class A common 
stock under the circumstances and subject to the terms of the proposed amended  
and restated certificate of incorporation of MIPS Technologies.                 

At any time following a tax-free distribution by Silicon Graphics of its
interest in MIPS Technologies, pursuant to the proposed amended and restated    
certificate of incorporation of MIPS Technologies, MIPS Technologies may        
exchange all, but not less than all, of the outstanding shares of Class B common
stock for shares of Class A common stock on a one-for-one basis. This exchange  
provision will have no further force or effect if its inclusion in the amended  
and restated certificate of incorporation would have a material adverse effect  
on Silicon Graphics' ability to timely obtain a favorable ruling from the       
Internal Revenue Service regarding the tax-free status of the distribution of   
Silicon Graphics' interest in MIPS Technologies to its stockholders. Pursuant to
a tax indemnification agreement which will be entered into by MIPS Technologies 
and Silicon Graphics at the time of a tax-free distribution, Silicon Graphics   
may limit MIPS Technologies' ability to undertake such an exchange.             

Under current tax law, it is uncertain whether the automatic conversion 
provisions or the exchange provision discussed above would have a material      
adverse effect on Silicon Graphics' ability to timely obtain an Internal Revenue
Service tax ruling that the distribution would be tax-free.                     

   In the event that prior to a tax-free distribution by Silicon Graphics, the
Internal Revenue Code of 1986, as amended, is amended to require, among other   
things, that Silicon Graphics own, at the time of such a distribution, at least 
80% of the value of the capital stock of MIPS Technologies, Silicon Graphics    
will exchange each share of Class B common stock it owns for one share of Class 
A common stock.                                                                 

THE MIPS BOARD OF DIRECTORS FOLLOWING THE RECAPITALIZATION                      

If the recapitalization is approved, the MIPS board of directors will   
continue to have seven members and will consist of one Class A director and six 
Class B directors. The holders of Class A common stock will be entitled to elect
one Class A director at MIPS Technologies' 1999 annual meeting of stockholders, 
and the Class A director so elected will hold office until the expiration of his
or her initial term at the annual meeting of stockholders in 2002.              

RECOMMENDATION OF THE SPECIAL COMMITTEE AND THE MIPS BOARD OF DIRECTORS         

  The special committee and the board of directors of MIPS Technologies each
have unanimously approved the recapitalization and each unanimously recommends  
that you vote in favor of the approval and adoption of the recapitalization.    

FEDERAL INCOME TAX CONSEQUENCES                                                 

  Implementation of the recapitalization will be tax-free for federal income
tax purposes to MIPS Technologies and its stockholders based upon the facts and 
law as of the date of this document.                                            

STOCK EXCHANGE QUOTATION                                                        

    MIPS Technologies is in the process of obtaining the necessary approvals and
waivers from The Nasdaq Stock Market, Inc. in order to effect the               
recapitalization.                                                               

  MIPS Technologies will apply to The Nasdaq Stock Market to redesignate the
existing common stock as Class A common stock. In the event of a tax-free       
distribution, MIPS Technologies expects that the Class B common stock will be   
quoted on the Nasdaq National Market or on such other exchange on which the     
Class A common stock may then be listed or quoted.                              

NO APPRAISAL RIGHTS                                                             

   You have no right to an appraisal of the value of your shares in connection
with the recapitalization.                                                      

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THE EXCHANGE AGREEMENT

IF THE RECAPITALIZATION IS APPROVED BY THE PUBLIC STOCKHOLDERS OF MIPS  
TECHNOLOGIES, MIPS TECHNOLOGIES AND SILICON GRAPHICS WILL ENTER INTO AN EXCHANGE
AGREEMENT, WHICH WILL GOVERN SOME OF THE TERMS OF THE RECAPITALIZATION. WE      
ENCOURAGE YOU TO READ THE EXCHANGE AGREEMENT, A FORM OF WHICH IS ATTACHED TO    
THIS DOCUMENT AS ANNEX C, IN ITS ENTIRETY.                                      

EXCHANGE OF CLASS A SHARES FOR CLASS B SHARES BY SILICON GRAPHICS               

Immediately after the amended and restated certificate of incorporation 
becomes effective, each share of Class A common stock beneficially owned by     
Silicon Graphics and its affiliates will be exchanged for one share of Class B  
common stock.                                                                   

INDEMNIFICATION AND EXPENSES                                                    

   Silicon Graphics will indemnify and hold harmless MIPS Technologies and its
affiliates, officers, directors and employees from and against any and all      
liabilities, losses, damages, claims and costs (including attorneys' fees)      
arising out of or resulting from any claim of any third party to the extent     
arising out of the recapitalization or any distribution of Silicon Graphics'    
interest in MIPS Technologies.                                                  

Pursuant to the exchange agreement, Silicon Graphics will agree to pay  
certain expenses incurred by MIPS Technologies in connection with the           
recapitalization and tax-free distribution, including the fees of the financial 
advisor to the special committee, certain budgeted legal fees and other         
reasonable out-of-pocket expenses.                                              

TAX INDEMNIFICATION AGREEMENT                                                   

The exchange agreement will also contain a covenant obligating MIPS     
Technologies and Silicon Graphics to enter into a tax indemnification agreement 
prior to a tax-free distribution by Silicon Graphics of its interest in MIPS    
Technologies. Pursuant to the tax indemnification agreement, MIPS Technologies  
will indemnify Silicon Graphics against all taxes imposed on Silicon Graphics   
under section 355(e) of the Internal Revenue Code as a result of the issuance by
MIPS Technologies of its capital stock in an acquisition or in a public or      
private offering during the 30 months following a tax-free distribution or as a 
result of certain other actions by MIPS Technologies, in each case subject to   
certain exceptions. These limitations on the issuance of shares of MIPS         
Technologies' capital stock could have a negative impact on MIPS Technologies'  
financial flexibility following a tax-free distribution. Additional information 
regarding the tax indemnification agreement can be found on page 25.            

SILICON GRAPHICS' OBLIGATION TO PURCHASE MIPS COMMON STOCK                      

If Silicon Graphics has not disposed of its entire interest in MIPS     
Technologies prior to December 31, 2000, on the last day of each quarter        
beginning with the quarter ending December 31, 2000 (whether through a tax-free 
distribution or otherwise), Silicon Graphics will become obligated to purchase a
pre-determined number of shares of MIPS Technologies common stock within the 30 
day period immediately following the public announcement of financial results   
for such quarter. At its option, Silicon Graphics may satisfy this obligation by
purchasing shares of Class B common stock from MIPS Technologies or by          
purchasing shares of issued and outstanding Class A common stock from a third   
party. Silicon Graphics' obligation to make such purchases will end on the last 
day of the fiscal quarter immediately preceding the disposition by Silicon      
Graphics of its interest in MIPS Technologies and may be terminated upon the    
exchange by Silicon Graphics of its Class B shares for Class A shares following 
a change in tax law.                                                            

Silicon Graphics will not be required to purchase such shares of MIPS   
Technologies common stock if and to the extent that the independent directors   
and chief executive officer of MIPS Technologies unanimously determine that such
purchase is not in the interests of MIPS Technologies and its public            
stockholders. In addition, Silicon Graphics' obligations under this provision of
the exchange agreement will be subject to the terms of the exchange agreement as
discussed in this document.                                                     

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 Additional information regarding Silicon Graphics' obligation to purchase
shares of MIPS Technologies common stock can be found on pages 24 and 25.       

REQUIRED EXCHANGE OF SHARES BY SILICON GRAPHICS                                 

The exchange agreement will also provide that Silicon Graphics will be  
required to exchange all of its shares of Class B common stock for shares of    
Class A common stock if, prior to a tax-free distribution, there is a change in 
federal income tax law that would apply to Silicon Graphics which provides that 
in a tax-free spin-off of a subsidiary, the distributing company must hold not  
less than 80% of the value of all or a portion of the subsidiary's stock        
immediately prior to such spin-off.                                             

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THE SPECIAL MEETING 

PURPOSE OF THE SPECIAL MEETING                                                  

The purpose of the special meeting is to consider and vote upon:        

- a proposal to recapitalize the authorized capital stock of MIPS       
    Technologies, including the proposed amended and restated certificate of
   incorporation and amended and restated by-laws of MIPS Technologies and
     the exchange by Silicon Graphics of each share of Class A common stock it
will own for one share of Class B common stock; and                 

    - such other business as may properly be brought before the special meeting.

DATE, TIME AND PLACE OF THE SPECIAL MEETING                                     

  The special meeting will be held on    ,             , 1999, at          ,
commencing at      , local time.                                                

STOCKHOLDERS ENTITLED TO VOTE AT THE SPECIAL MEETING; VOTE REQUIRED             

Under Delaware law and MIPS Technologies' current certificate of        
incorporation, Silicon Graphics, as beneficial owner of approximately 85% of the
MIPS Technologies common stock, has the ability to approve the recapitalization 
(including approval of the proposed amended and restated certificate of         
incorporation and amended and restated by-laws of MIPS Technologies) without the
consent of any other stockholder of MIPS Technologies. Silicon Graphics intends 
to vote in favor of the recapitalization proposal.                              

However, although not required by law or MIPS Technologies' current     
certificate of incorporation, the board of directors of MIPS Technologies has   
determined that its stockholders, other than Silicon Graphics and its           
affiliates, will also have a separate vote on the recapitalization. Accordingly,
the recapitalization will not be effected without the affirmative vote of at    
least a majority of the outstanding common stock, present and voting at the     
special meeting, held by stockholders of MIPS Technologies other than Silicon   
Graphics and its affiliates.                                                    

INTERESTS OF CERTAIN PERSONS/STOCK OWNERSHIP BY DIRECTORS AND EXECUTIVE OFFICERS
OF MIPS                                                                     

   In determining how to vote at the special meeting, you should be aware that
certain officers and directors of MIPS Technologies are also officers and/or    
stockholders of Silicon Graphics and, therefore, may have interests in the      
recapitalization that are different from your own.                              

To review these interests in greater detail, see page 22.               

SURRENDER OF CERTIFICATES                                                       

After the recapitalization, your shares of MIPS common stock will be    
automatically redesignated as shares of Class A common stock. You will not need 
to exchange your stock certificates representing shares of MIPS common stock for
certificates representing shares of Class A common stock. YOU SHOULD NOT SEND   
ANY STOCK CERTIFICATES AT THIS TIME.                                            

MARKET PRICES OF THE COMMON STOCK                                               

 The MIPS Technologies common stock has been quoted on the Nasdaq National
Market under the symbol "MIPS" since June 30, 1998. On January 13, 1999, the    
last full trading day prior to the public announcement of the recapitalization  
proposal, the last reported sale price per share of the existing common stock on
the Nasdaq National Market was $32.25. On January 28, 1999, the most recent     
practicable date prior to the printing of this document, the last reported sale 
price of the MIPS Technologies common stock on the Nasdaq National Market was   
$36 per share. You should read the table on page 29 of this document which      
presents the range of high and low sales prices per share for the MIPS common   
stock during each of the calendar quarters since MIPS Technologies' initial     
public offering.                                                                

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COMPARISON OF CURRENT AND PROPOSED PROVISIONS 
OF MIPS TECHNOLOGIES CERTIFICATE OF INCORPORATION 

   THE FOLLOWING IS A GENERAL DESCRIPTION OF CERTAIN PROVISIONS OF THE CURRENT
MIPS TECHNOLOGIES' CERTIFICATE OF INCORPORATION AND THE SAME PROVISIONS AS THEY 
WILL BE AMENDED PURSUANT TO THE TERMS OF THE RECAPITALIZATION. WE ENCOURAGE YOU 
TO REVIEW THE PROPOSED AMENDED AND RESTATED CERTIFICATE OF INCORPORATION AND    
AMENDED AND RESTATED BY-LAWS ATTACHED TO THIS DOCUMENT AS ANNEX A AND ANNEX B.  

                                                        [Enlarge/Download Table]

                                             MIPS TECHNOLOGIES CERTIFICATE OF INCORPORATION                    

                                                                                                               
                                  CURRENT PROVISION                           PROPOSED PROVISION               
                         ------------------------------------  ------------------------------------------------
AUTHORIZED CAPITAL                                                                                             
  STOCK................. 200,000,000 shares authorized:        300,000,000 shares authorized:                  

COMMON STOCK............ - 150,000,000 shares of common stock  - 150,000,000 shares of Class A common stock    
                                                               - 100,000,000 shares of Class B common stock    

PREFERRED STOCK......... - 50,000,000 shares of preferred      - 50,000,000 shares of preferred stock, issuable
                           stock, issuable in series             in series                                     

VOTING RIGHTS                                                                                                  
  ELECTION OF                                                                                                  
  DIRECTORS............. Each share of common stock is         - Holders of Class A common stock, voting as a  
                         entitled to one vote in the election    separate class, will be entitled to elect 20% 
                         of directors and all shares of          of MIPS Technologies' directors, and in no    
                         common stock vote together as a         event less than one director.                 
                         single class.                                                                         
                                                               - Holders of Class B common stock, voting as a  
                                                                 separate class, will be entitled to elect the 
                                                                 remaining MIPS Technologies directors.        

ALL OTHER MATTERS....... Each share of common stock is         Each share of Class A common stock and Class B  
                         entitled to one vote in all other     common stock is entitled to one vote, voting    
                         matters submitted to a vote of        together as a single class, in all other matters
                         stockholders.                         submitted to a vote of stockholders (except as  
                                                               otherwise required by law). After a tax-free    
                                                               distribution, a holder of 10% or more of the    
                                                               Class B common stock must own at least an equal 
                                                               percentage of the Class A common stock to       
                                                               exercise their Class B common stock voting      
                                                               rights.                                         

DIVIDENDS............... Holders of common stock are entitled  Holders of Class A common stock and Class B     
                         to such dividends as may be declared  common stock will share, equally on a per share 
                         by the board of directors of MIPS     basis, in all dividends declared by the board of
                         Technologies.                         directors of MIPS Technologies; provided that   
                                                               with respect to dividends payable in MIPS       
                                                               Technologies common stock, holders of shares of 
                                                               Class A common stock will only receive such     
                                                               dividends in                                    

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                                             MIPS TECHNOLOGIES CERTIFICATE OF INCORPORATION                    

                                  CURRENT PROVISION                           PROPOSED PROVISION               
                         ------------------------------------  ------------------------------------------------
                                                                                                               
                                                               shares of Class A common stock and holders of   
                                                               shares of Class B common stock will only receive
                                                               such dividends in shares of Class B common      
                                                               stock. The number of shares of Class A common   
                                                               stock and Class B common stock so paid or       
                                                               distributed will be equal in number on a per    
                                                               share basis.                                    

CONVERSION.............. The common stock is not presently     Shares of Class B common stock are convertible  
                         convertible.                          into shares of Class A common stock upon the    
                                                               occurrence of certain events, including:        
                                                               - Automatically upon the transfer of shares of  
                                                                 Class B common stock to a person, other than  
                                                                 Silicon Graphics or one of its subsidiaries,  
                                                                 prior to a tax-free distribution.             
                                                               - Automatically if, prior to a tax-free         
                                                                 distribution, another entity acquires more    
                                                                 than 50% of the voting power of Silicon       
                                                                 Graphics.                                     
                                                               - Automatically if, prior to a tax-free         
                                                                 distribution, Silicon Graphics owns less than 
                                                                 50% of the outstanding shares of MIPS         
                                                                 Technologies common stock, unless the         
                                                                 independent directors and chief executive     
                                                                 officer of MIPS Technologies determine that   
                                                                 such automatic conversion is not in the       
                                                                 interests of MIPS Technologies or its public  
                                                                 stockholders,                                 
                                                               - Automatically if, prior to a tax-free         
                                                                 distribution, Silicon Graphics owns less than 
                                                                 30% of the outstanding shares of MIPS         
                                                                 Technologies common stock.                    
                                                               - Automatically if another entity acquires MIPS 
                                                                 Technologies, provided such automatic         
                                                                 conversion would not have a material adverse  
                                                                 effect on Silicon Graphics' ability to timely 
                                                                 obtain a favorable ruling from the Internal   
                                                                 Revenue Service that the distribution of its  
                                                                 interest in MIPS Technologies to its          
                                                                 stockholders would be tax-free.               
                                                               - Automatically on the fifth anniversary of a   
                                                                 tax-free distribution, provided such automatic
                                                                 conversion would not have a material adverse  
                                                                 effect on Silicon Graphics' ability to timely 
                                                                 obtain a favorable ruling from the Internal   

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                                             MIPS TECHNOLOGIES CERTIFICATE OF INCORPORATION                    

                                  CURRENT PROVISION                           PROPOSED PROVISION               
                         ------------------------------------  ------------------------------------------------
                                                                                                               
                                                                 Revenue Service that the distribution would be
                                                                 tax-free.                                     

                                                               Under current tax law, it is uncertain whether  
                                                               the last two automatic conversion provisions    
                                                               described above would have a material adverse   
                                                               effect on Silicon Graphics' ability to timely   
                                                               obtain an Internal Revenue Service tax ruling   
                                                               that a distribution of Silicon Graphics'        
                                                               interest in MIPS Technologies to its            
                                                               stockholders would be tax-free.                 

EXCHANGE................ The common stock is not presently     MIPS Technologies may exchange all (but not less
                         exchangeable.                         than all) of the Class B common stock for Class 
                                                               A common stock at any time following a tax-free 
                                                               distribution, provided, however, that this      
                                                               provision will have no further force or effect  
                                                               if its inclusion in the amended and restated    
                                                               certificate of incorporation would have a       
                                                               material adverse effect on Silicon Graphics'    
                                                               ability to timely obtain a favorable ruling from
                                                               the Internal Revenue Service that such          
                                                               distribution would be tax-free. Pursuant to a   
                                                               tax indemnification agreement which will be     
                                                               entered into by MIPS Technologies and Silicon   
                                                               Graphics at the time of such distribution,      
                                                               Silicon Graphics may limit MIPS Technologies'   
                                                               ability to undertake such an exchange.          

                                                               Under current tax law, it is uncertain whether  
                                                               this exchange provision would have a material   
                                                               adverse effect on Silicon Graphics' ability to  
                                                               timely obtain an Internal Revenue Service tax   
                                                               ruling that a distribution of Silicon Graphics' 
                                                               interest in MIPS Technologies to its            
                                                               stockholders would be tax-free.                 

MERGERS AND                                                                                                    
  REORGANIZATIONS....... All shares of common stock are        All shares of Class A common stock and Class B  
                         entitled to receive the same kind     common stock are entitled to receive equally on 
                         and amount of consideration in the    a per share basis the same kind and amount of   
                         event of any merger, reorganization   consideration in the event of any merger,       
                         or consolidation of MIPS              reorganization or consolidation of MIPS         
                         Technologies with any other company.  Technologies with any other company; provided,  
                                                               however, that, in the event that the shares of  
                                                               Class B common stock have not been converted    
                                                               into or                                         

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                                             MIPS TECHNOLOGIES CERTIFICATE OF INCORPORATION                    

                                  CURRENT PROVISION                           PROPOSED PROVISION               
                         ------------------------------------  ------------------------------------------------
                                                                                                               
                                                               exchanged for shares of Class A common stock, in
                                                               connection with a merger, reorganization or     
                                                               consolidation of MIPS Technologies in which all 
                                                               or substantially all of the common stock of MIPS
                                                               Technologies will be exchanged for stock of     
                                                               another entity and the transaction is required  
                                                               to be accounted for by the                      
                                                               "pooling-of-interests" method, the holders of   
                                                               Class A common stock and Class B common stock   
                                                               will be entitled to receive shares of stock of  
                                                               the acquiring entity based on the relative fair 
                                                               value of a share of the Class A common stock and
                                                               a share of Class B common stock as of the       
                                                               announcement date for such transaction.         

LIQUIDATION............. All shares of common stock are        All shares of Class A common stock and Class B  
                         entitled to receive, pro rata, all    common stock are entitled to receive equally on 
                         assets of MIPS Technologies           a per share basis all assets of MIPS            
                         available for distribution to         Technologies available for distribution to      
                         stockholders.                         stockholders.                                   

CORPORATE                                                                                                      
  OPPORTUNITIES......... Provisions allocating business        No change if the recapitalization is            
                         opportunities that may be suitable    consummated.                                    
                         for both MIPS Technologies and                                                        
                         Silicon Graphics.                                                                     

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THE SPECIAL MEETING 

GENERAL; DATE, TIME AND PLACE                                                   

    This Proxy Statement is being furnished by the Board of Directors (the "MIPS
Board of Directors") of MIPS Technologies, Inc. ("MIPS Technologies") to holders
of common stock, par value $0.001 per share, of MIPS Technologies (the "Existing
Common Stock") in connection with the solicitation of proxies by the MIPS Board 
of Directors for use at the Special Meeting of MIPS Technologies stockholders   
(the "Special Meeting") to be held on          , 1999 at           , commencing 
at       , local time, and at any adjournment or postponement thereof.          

This Proxy Statement and the accompanying form of proxy are first being 
mailed to stockholders of MIPS Technologies on or about     ,          , 1999.  

PURPOSES OF THE SPECIAL MEETING                                                 

  At the Special Meeting, holders of shares of Existing Common Stock will be
asked to consider and vote upon (i) a proposal (the "Recapitalization Proposal")
to approve and adopt the recapitalization of MIPS Technologies, including (a)   
the approval and adoption of the proposed Amended and Restated Certificate of   
Incorporation of MIPS Technologies (the "Amended Certificate of Incorporation") 
and the proposed Amended and Restated By-laws of MIPS Technologies (the "Amended
By-laws"), pursuant to which each share of Existing Common Stock, including such
shares held by Silicon Graphics, Inc. ("Silicon Graphics") and its affiliates,  
will be redesignated as one share of newly created and issued Class A common    
stock, par value $0.001 per share (the "Class A Common Stock"), of MIPS         
Technologies, and (b) the exchange by Silicon Graphics of each share of Class A 
Common Stock it will own for one share of newly created and issued Class B      
common stock, par value $0.001 per share (the "Class B Common Stock" and,       
together with the Class A Common Stock, the "New MIPS Common Stock"), of MIPS   
Technologies immediately upon the consummation of the recapitalization and      
pursuant to the Exchange Agreement (as defined below) (the "Recapitalization"), 
and (ii) such other matters as may properly be brought before the Special       
Meeting or any adjournment or postponement thereof.                             

RECOMMENDATION OF THE MIPS BOARD AND SPECIAL COMMITTEE                          

    The MIPS Board of Directors unanimously determined that the Recapitalization
is fair to, and in the best interests of, MIPS Technologies and its stockholders
and has unanimously approved the Recapitalization. Prior to the MIPS Board of   
Directors' approval, a specially constituted committee of the MIPS Board of     
Directors, comprised of certain non-management directors who are not affiliated 
with Silicon Graphics (the "Special Committee"), determined that the            
Recapitalization is fair to MIPS Technologies and its public stockholders, and  
recommended the Recapitalization to the MIPS Board of Directors. THE SPECIAL    
COMMITTEE AND THE MIPS BOARD OF DIRECTORS HAVE UNANIMOUSLY APPROVED THE         
RECAPITALIZATION AND RECOMMEND THAT YOU VOTE FOR ITS APPROVAL AND ADOPTION.     

STOCKHOLDERS ENTITLED TO VOTE; VOTE REQUIRED                                    

 The MIPS Board of Directors has fixed the close of business on          ,
1999 as the record date for the determination of the holders of Existing Common 
Stock entitled to notice of and to vote at the Special Meeting (the "Record     
Date"). Accordingly, only holders of record of Existing Common Stock on the     
Record Date will be entitled to notice of, and to vote at, the Special Meeting. 
As of the Record Date, there were outstanding and entitled to vote       shares 
of Existing Common Stock (constituting all of the voting stock of MIPS          
Technologies), which shares were held by approximately  holders of record. Each 
holder of record of shares of Existing Common Stock on the Record Date is       
entitled to one vote per share, which may be cast either in person or by        
properly executed proxy, at the Special Meeting. A complete list of stockholders
entitled to vote at the Special Meeting will be available for inspection by any 
stockholder for any purpose germane to the Special Meeting for 10 days prior to 
the Special Meeting                                                             

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during ordinary business hours at MIPS Technologies' headquarters located at    
1225 Charleston Road, Mountain View, California 94043. The presence, in person  
or by properly executed proxy, of the holders of a majority of the outstanding  
shares of Existing Common Stock entitled to vote at the Special Meeting is      
necessary to constitute a quorum at the Special Meeting. Silicon Graphics       
intends to be present at the Special Meeting; therefore a quorum will be        
present.                                                                        

Based on its ownership of approximately 85% of the currently outstanding
shares of Existing Common Stock, Silicon Graphics has the voting power to adopt 
and approve the Recapitalization Proposal without the vote of any other         
stockholder of MIPS Technologies. Silicon Graphics intends to vote all of the   
shares of Existing Common Stock it owns in favor of the Recapitalization        
Proposal.                                                                       

However, even though not required by law or the current Certificate of  
Incorporation of MIPS Technologies (the "Existing Certificate of                
Incorporation"), the MIPS Board of Directors has determined that in light of    
Silicon Graphics' control of MIPS Technologies, it is appropriate for the public
stockholders of MIPS Technologies (i.e., holders of Existing Common Stock other 
than Silicon Graphics and its affiliates) (the "MIPS Public Stockholders") to   
have a separate vote on the Recapitalization Proposal. Accordingly, the         
Recapitalization Proposal will not be adopted without the approval of the       
holders of at least a majority of Existing Common Stock held by the MIPS Public 
Stockholders present and voting on the Recapitalization Proposal at the Special 
Meeting.                                                                        

 Shares of Existing Common Stock represented in person or by proxy will be
counted for the purpose of determining whether a quorum is present at the       
Special Meeting. Shares which abstain from voting, and shares held by a broker  
nominee in "street name" which indicates on a proxy that it does not have       
discretionary authority to vote as to a particular matter, will be treated as   
shares that are present and entitled to vote at the Special Meeting for purposes
of determining whether a quorum exists, but will not be considered as votes cast
and, accordingly, will have no effect on the outcome of the vote with respect to
the Recapitalization Proposal.                                                  

PROXIES                                                                         

    This Proxy Statement is being furnished to MIPS Technologies stockholders in
connection with the solicitation of proxies by, and on behalf of, the MIPS Board
of Directors for use at the Special Meeting, and is accompanied by a form of    
proxy.                                                                          

All shares of Existing Common Stock which are entitled to vote and are  
represented at the Special Meeting by properly executed proxies received prior  
to or at the Special Meeting, and not revoked, will be voted at such Special    
Meeting in accordance with the instructions indicated on such proxies. If no    
instructions are indicated (other than in the case of broker non-votes), such   
proxies will be voted for approval and adoption of the Recapitalization         
Proposal.                                                                       

If any other matters are properly presented at the Special Meeting for  
consideration, including, among other things, consideration of a motion to      
adjourn such Special Meeting to another time and/or place (including, without   
limitation, for the purposes of soliciting additional proxies), the persons     
named in the enclosed forms of proxy and acting thereunder will have discretion 
to vote on such matters in accordance with their judgment.                      

  Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (i) filing  
with the Secretary of MIPS Technologies, at or before the taking of the vote at 
the Special Meeting, a written notice of revocation bearing a later date than   
the proxy, (ii) duly executing a later dated proxy relating to the same shares  
and delivering it to MIPS Technologies before the taking of the vote at the     
Special Meeting or (iii) attending the Special Meeting and voting in person     
(although attendance at the Special Meeting will not in and of itself constitute
a revocation of the proxy). Any written notice of revocation or subsequent proxy
should be sent to MIPS Technologies, Inc.,                                      

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1225 Charleston Road, Mountain View, California 94043, Attention: Secretary, or 
hand delivered to the Secretary of MIPS Technologies at or before the taking of 
the vote at the Special Meeting.                                                

   All expenses of MIPS Technologies' solicitation of proxies, and the cost of
preparing and mailing this Proxy Statement to MIPS Technologies stockholders,   
will be paid by Silicon Graphics pursuant to the terms of the Exchange Agreement
(as defined below), which MIPS Technologies and Silicon Graphics will enter into
if the Recapitalization is approved by the MIPS Public Stockholders. See "The   
Exchange Agreement--Indemnification and Expenses." In addition to solicitation  
by use of the mails, proxies may be solicited from MIPS Technologies            
stockholders by directors, officers and employees of MIPS Technologies in person
or by telephone, telegram or other means of communication. Such directors,      
officers and employees will not be additionally compensated, but may be         
reimbursed for reasonable out-of-pocket expenses in connection with such        
solicitation. MIPS Technologies has retained Innisfree to act as its information
agent to provide ministerial assistance in connection with the solicitation of  
proxies for the Special Meeting. Innisfree will be paid a flat fee of           
approximately $  , plus reimbursement of reasonable out-of-pocket expenses and  
will be specifically instructed that it may not make any recommendation         
regarding the approval or disapproval of any proposal to be voted on at the     
Special Meeting. Arrangements will be made with brokerage houses, custodians,   
nominees and fiduciaries for forwarding of proxy materials to beneficial owners 
of shares held of record by such brokerage houses, custodians, nominees and     
fiduciaries and for reimbursement of their reasonable expenses incurred in      
connection therewith.                                                           

   STOCKHOLDERS SHOULD NOT SEND ANY STOCK CERTIFICATES WITH THEIR PROXY CARDS.

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THE RECAPITALIZATION

BACKGROUND OF THE RECAPITALIZATION                                              

GENERAL.  On July 6, 1998, MIPS Technologies completed an initial public
offering (the "Offering") of 5,500,000 shares of Existing Common Stock. Of the  
shares of Existing Common Stock sold in the Offering, 4,250,000 shares were sold
by Silicon Graphics and the remainder were sold by MIPS Technologies. Presently,
Silicon Graphics owns approximately 85% of the outstanding Existing Common      
Stock. Prior to the Offering, MIPS Technologies was a wholly owned subsidiary of
Silicon Graphics, Inc. and MIPS Technologies' business was conducted by Silicon 
Graphics primarily through its MIPS Group, a division of Silicon Graphics.      

  Although it has not formulated definitive plans to do so, Silicon Graphics
has recently announced its intention to divest its interest in MIPS Technologies
by September 30, 2000. Silicon Graphics expects that such a divestiture will    
include a distribution of a significant portion of its interest in MIPS         
Technologies to the stockholders of Silicon Graphics in a transaction intended  
to generally qualify under Section 355 of the Internal Revenue Code of 1986, as 
amended (the "Code") (a "Tax-Free Distribution"). Unless certain requirements   
are met, Silicon Graphics would incur a significant taxable gain if such a      
distribution to its stockholders were taxable. In addition, such a distribution 
generally would be taxable to Silicon Graphics' stockholders. To effect a       
Tax-Free Distribution for Silicon Graphics and its stockholders, current tax law
requires, among other things, that Silicon Graphics own, at the time of such a  
transaction, capital stock of MIPS Technologies representing at least 80% of the
voting power of MIPS Technologies, and that Silicon Graphics distribute all of  
such stock to its stockholders in a single transaction. Consequently, to effect 
a Tax-Free Distribution if the Recapitalization is not effected, Silicon        
Graphics would be required to distribute not less than 29.8 million shares of   
Existing Common Stock (80% of the shares of Existing Common Stock currently     
issued and outstanding) in a single transaction. If the Recapitalization is     
effected, Silicon Graphics could reduce its economic interest in MIPS           
Technologies below 80% through secondary market sales and other transactions,   
while preserving its ability to effect a Tax-Free Distribution.                 

If the Recapitalization is approved, Silicon Graphics intends to sell a 
portion of the New MIPS Common Stock it owns in underwritten public offerings   
and other transactions during 1999, subject to prevailing market and other      
conditions. However, Silicon Graphics is not obligated, and will not become     
obligated as a result of the Recapitalization, to effect any sale or            
distribution of the New MIPS Common Stock it owns in multiple transactions or   
otherwise. There can be no assurance that any such sales or distributions will  
occur. If the Recapitalization is not effected, Silicon Graphics expects to     
continue to hold all of the Existing Common Stock it presently owns, although it
is under no contractual obligation to do so other than pursuant to a lock-up    
agreement entered into in connection with the Offering in which Silicon Graphics
agreed not to sell or dispose of any shares of Existing Common Stock prior to   
June 30, 1998 without the consent of the representative of the underwriters for 
the Offering.                                                                   

 The proposed changes to the Existing Certificate of Incorporation and the
current By-laws of MIPS Technologies (the "Existing By-laws") as described in   
this Proxy Statement are designed to permit an orderly, multi-step increase in  
the number of shares of MIPS Technologies common stock that are publicly traded 
while preserving the ability of Silicon Graphics to effect a Tax-Free           
Distribution of its investment in MIPS Technologies, and reflect only those     
changes that MIPS Technologies believes are appropriate to achieve this result. 
Following a Tax-Free Distribution, it is expected that MIPS Technologies would  
continue to have the dual class capital structure only for so long as may be    
required for Silicon Graphics to maintain the tax-free status of the Tax-Free   
Distribution.                                                                   

   THE SPECIAL COMMITTEE.  On November 23, 1998, a special meeting of the MIPS
Board of Directors was held. Five of the seven members of the MIPS Board of     
Directors were present, in person or telephonically. At the special meeting     
William M. Kelly outlined the proposed terms of the Recapitalization and Silicon
Graphics' reasons for proceeding with the transaction. The MIPS Board of        
Directors then approved the creation of a special committee of the MIPS Board of
Directors (the "Special Committee"),                                            

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consisting of Anthony B. Holbrook and Fred M. Gibbons, the two directors of MIPS
Technologies who are not directors, officers or employees of Silicon Graphics or
officers or employees of MIPS Technologies. The Special Committee was authorized
to review, evaluate and consider whether the terms of the Recapitalization would
be fair to the MIPS Public Stockholders, and to make a recommendation to the    
full MIPS Board of Directors with respect to the Recapitalization. The MIPS     
Board of Directors also authorized the Special Committee to retain legal counsel
and other advisors as it deemed appropriate.                                    

In late November 1998, the Special Committee retained an independent    
financial advisor and independent legal counsel to assist the Special Committee 
in its consideration of the proposed Recapitalization.                          

  On December 7, 1998, the Special Committee met with representatives of its
financial advisor and legal counsel. During this meeting, the proposed terms of 
the Recapitalization were summarized for the Special Committee. In addition, the
Special Committee's advisors made presentations on precedent transactions and   
issues faced by companies with a dual class capital structure. The Special      
Committee instructed its advisors to continue their analysis of the             
Recapitalization, including the effect of a dual class capital structure on MIPS
Technologies and the tax issues related to a possible Tax-Free Distribution by  
Silicon Graphics.                                                               

  On December 11, 1998, the Special Committee again met with representatives
of its advisors. The independent financial advisor reviewed with the Special    
Committee the historical trading information and capital structure of companies 
which had consummated transactions which the financial advisor deemed similar to
the proposed Recapitalization and the relative trading values of the dual       
classes of stock of such companies and other companies with dual classes of     
stock. Representatives of the Special Committee's legal counsel reviewed the    
possible effects of the Recapitalization and the dual class capital structure   
with respect to the corporate governance and financial flexibility of MIPS      
Technologies, as well as certain tax issues related to a possible Tax-Free      
Distribution by Silicon Graphics. The Special Committee's legal counsel were    
instructed to meet with counsel to Silicon Graphics to discuss the proposed     
terms of the Recapitalization.                                                  

During the period from December 12 through December 14, 1998,           
representatives of legal counsel for the Special Committee and Silicon Graphics 
had numerous conference calls to discuss the proposed terms of the              
Recapitalization.                                                               

   On December 14, 1998, the Special Committee met with representatives of its
legal counsel to review certain accounting issues relating to the               
Recapitalization. The Special Committee instructed its legal advisors to discuss
the Special Committee's concerns regarding the proposed terms of the            
Recapitalization with Silicon Graphics and its advisors.                        

On December 17, 1998, MIPS Technologies, Silicon Graphics and their     
respective legal counsel met to discuss the terms of the Recapitalization. A    
representative from MIPS Technologies' independent accountant also was at this  
meeting to address certain "pooling-of-interests" accounting issues.            

At a meeting of the Special Committee held on December 18, 1998, legal  
counsel to the Special Committee summarized the discussions from the meeting    
held on December 17, 1998 with Silicon Graphics and its advisors. The Special   
Committee instructed its legal counsel to present to Silicon Graphics and its   
advisors certain revised terms of the Recapitalization intended to address,     
among other things, the impact of a Tax-Free Distribution on the financial      
flexibility of MIPS Technologies, including the limitations on MIPS             
Technologies' ability to issue additional shares of New MIPS Common Stock, the  
impact of the proposed dual class capital structure on corporate governance and 
control issues and "pooling-of interests" accounting issues.                    

   From December 18 through January 3, 1999, the legal advisors of the Special
Committee and Silicon Graphics had numerous meetings and conference calls to    
negotiate the proposed terms of the Recapitalization.                           

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On January 4, 1999, the Special Committee held a meeting to review the  
status of the negotiations with representatives of its legal counsel. The       
Special Committee instructed its legal counsel to continue its negotiations with
Silicon Graphics.                                                               

   During the period from January 4 through January 10, the Special Committee,
Silicon Graphics and their respective legal advisors, held numerous meetings and
conference calls to negotiate the final terms of the proposed Recapitalization. 

  On January 11, 1999, the Special Committee met with representatives of its
financial advisor and legal advisors. The legal advisors reviewed the principal 
terms of Recapitalization. The financial advisor compared the final terms of the
Recapitalization with the terms of precedent transactions. After a full         
discussion, the Special Committee determined that the terms of the              
Recapitalization were fair to MIPS Technologies and the MIPS Public             
Stockholders. The Special Committee then unanimously determined to recommend to 
the MIPS Board of Directors that the Recapitalization be approved.              

At a special meeting of the MIPS Board of Directors held on January 13, 
1999, the MIPS Board of Directors unanimously determined that the               
Recapitalization was fair to, and in the best interests of, MIPS Technologies   
and its stockholders and recommended that its stockholders vote to approve and  
adopt the Recapitalization.                                                     

REASONS FOR THE RECAPITALIZATION; RECOMMENDATION OF THE SPECIAL COMMITTEE AND   
THE MIPS BOARD OF DIRECTORS                                                 

At a meeting held on January 11, 1999, the Special Committee unanimously
determined that the Recapitalization was fair to MIPS Technologies and the MIPS 
Public Stockholders, and unanimously determined to recommend the                
Recapitalization to the full MIPS Board of Directors. At a meeting held on      
January 13, 1999, at which all of the directors of MIPS Technologies were       
present, based on the unanimous recommendation of the Special Committee, the    
MIPS Board of Directors unanimously approved and adopted the terms of the       
Recapitalization, unanimously determined that the terms of the Recapitalization 
are fair to, and in the best interests of, MIPS Technologies and its            
stockholders, and unanimously determined to recommend to the MIPS Public        
Stockholders that they vote to approve and adopt the Recapitalization.          

THE SPECIAL COMMITTEE.  In determining to recommend to the MIPS Board of
Directors that it approve and adopt the terms of the Recapitalization, and in   
evaluating the fairness of the terms of the Recapitalization, the Special       
Committee considered a number of potential benefits, including without          
limitation, the following:                                                      

- the belief that the Recapitalization may encourage Silicon Graphics to
divest its controlling interest in MIPS Technologies sooner that it 
     otherwise might by providing Silicon Graphics with additional flexibility
  with respect to its investment in MIPS Technologies and the ability to
consummate a tax and market efficient distribution of the shares of 
Existing Common Stock that it owns;                                 

- the potential benefits to the MIPS Public Stockholders of an orderly, 
      multi-step increase in the public float of MIPS Technologies common stock,
which is expected to increase investor interest and enhance trading 
efficiencies and liquidity in MIPS Technologies common stock;       

- the potential benefits of the divestiture by Silicon Graphics of its  
     interest in MIPS Technologies in multiple transactions, which is expected
    to be less disruptive on the trading market for MIPS Technologies common
  stock than if Silicon Graphics divested its entire present interest in
MIPS Technologies in a single transaction;                          

- the terms of the Recapitalization which provide the MIPS Public       
      Stockholders the right to elect 20% of the MIPS Board of Directors, but in
     no event less than one director, following the Recapitalization, compared
   with such stockholders' present inability to elect any directors of the

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     MIPS Board of Directors in light of Silicon Graphics 85% ownership of the
outstanding Existing Common Stock;                                  

- the terms of the Recapitalization which require that, after a Tax-Free
    Distribution, a person or group of persons acting in concert holding 10%
 or more of the outstanding shares of Class B Common Stock must own at
 least an equal percentage of the outstanding shares of Class A Common
    Stock in order to exercise its Class B Common Stock voting rights, which
     are designed to ensure that a stockholder's voting rights in the election
of directors is not significantly disproportionate to its economic  
interest in MIPS Technologies;                                      

- the automatic conversion and exchange features of the Recapitalization
which are designed, in part, to provide MIPS Technologies with the  
      ability, if permitted under then existing tax law, to reduce the length of
      time following a Tax-Free Distribution during which MIPS Technologies must
continue to have a dual class capital structure; and                

- the 50% "sunset" provision designed to ensure that Silicon Graphics   
retains control of the MIPS Board of Directors only if it has a     
substantial economic interest in MIPS Technologies.                 

In reaching its determination that the Recapitalization is fair to MIPS 
Technologies and the MIPS Public Stockholders, and to recommend to the MIPS     
Board of Directors that it approve and adopt the terms of the Recapitalization, 
the Special Committee also considered and balanced against the potential        
benefits of the Recapitalization a number of factors, including, without        
limitation:                                                                     

  - the potential effect of two classes of common stock on the trading price
and liquidity of the Class A Common Stock;                          

- the potential impact of the dual class capital structure on MIPS      
Technologies' corporate governance and control issues; and          

- the potential impact of a Tax-Free Distribution on MIPS Technologies' 
financial flexibility, including as a result of limitations on MIPS 
      Technologies' ability to issue additional shares of New MIPS Common Stock.

After detailed consideration of these factors, the Special Committee concluded  
that the Recapitalization is fair to MIPS Technologies and the MIPS Public      
Stockholders.                                                                   

THE BOARD OF DIRECTORS.  The MIPS Board of Directors has considered the 
unanimous recommendation of the Special Committee, as well as the factors       
(enumerated above) considered by the Special Committee, and has unanimously     
determined that the Recapitalization is fair to, and in the best interests of,  
MIPS Technologies and its stockholders, has approved and adopted the terms of   
the Recapitalization and recommends that the MIPS Public Stockholders vote to   
approve and adopt the Recapitalization Proposal.                                

    The foregoing discussion and factors considered by the Special Committee and
the MIPS Board of Directors addressed the material factors considered by the    
Special Committee and the MIPS Board of Directors in their consideration of the 
Recapitalization. The Special Committee and the MIPS Board of Directors did not 
quantify or attach any particular weight to the various factors that it         
considered in reaching its determination that the Recapitalization is advisable 
and fair to MIPS Technologies and the MIPS Public Stockholders. Different       
Special Committee and MIPS Board of Directors members may have assigned         
different weights to different factors. In reaching its determination, the      
Special Committee and the MIPS Board of Directors took the various factors into 
account collectively. The Special Committee and the MIPS Board of Directors did 
not perform a factor-by-factor analysis, but rather its determination was made  
in consideration of all of the factors as a whole.                              

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EFFECT OF THE RECAPITALIZATION                                                  

GENERAL.  MIPS Technologies currently has a single class of common stock
outstanding, and each share of Existing Common Stock is entitled to one vote in 
all matters submitted to a vote of stockholders, including the election of      
directors. If the Recapitalization is adopted, each share of Existing Common    
Stock will be redesignated as one share of Class A Common Stock. Immediately    
thereafter and pursuant to the Exchange Agreement (the "Exchange Agreement")    
which MIPS Technologies and Silicon Graphics will enter if the Recapitalization 
is approved, Silicon Graphics will exchange each share of Class A Common Stock  
it owns for one share of Class B Common Stock. See "The Exchange Agreement--    
Exchange of Class A Shares for Class B Shares by Silicon Graphics." Immediately 
following the Recapitalization, Silicon Graphics would continue to own          
approximately 85% of the common equity of MIPS Technologies, consisting of      
31,750,000 shares of Class B Common Stock, and the MIPS Public Stockholders     
would continue to own approximately 15% of the common equity of MIPS            
Technologies, consisting of 5,542,286 shares of Class A Common Stock.           

  VOTING RIGHTS.  Pursuant to the terms of the Recapitalization, the current
share capital of MIPS Technologies will be converted into two classes of common 
stock: (i) the Class A Common Stock, which will entitle the holders thereof to  
vote, separately as a single class, for the election of 20% (rounded downward,  
if necessary, to the nearest whole number) of the directors of MIPS             
Technologies, but in no event less than one director (the "Class A Directors"); 
and (ii) the Class B Common Stock, which will entitle the holders thereof to    
vote, separately as a class, for the election of the remaining directors of MIPS
Technologies (the "Class B Directors"). In the event that all outstanding shares
of Class B Common Stock are converted into or exchanged for shares of Class A   
Common Stock, the Class A Common Stock will be the only class of common stock of
MIPS Technologies outstanding and the holders of the Class A Common Stock will  
be entitled to elect 100% of the MIPS Board of Directors. References to the     
number of directors on the MIPS Board of Directors will not include any         
directors whom the holders of any Preferred Stock have the exclusive right to   
elect.                                                                          

The holders of Class A Common and Class B Common Stock will in all other
matters vote together as a single class, with each share of Class A Common Stock
and Class B Common Stock having one vote, except as required by law and except  
with respect to any proposed amendment to the Amended Certificate of            
Incorporation which would alter the special rights of the Class A Common Stock  
or the Class B Common Stock, in which case the affected class shall also be     
entitled to vote on such amendment separately as a class.                       

    The Amended Certificate of Incorporation will also provide that, following a
Tax-Free Distribution, a person or group of persons acting in concert holding   
10% or more of the outstanding shares of Class B Common Stock will be required  
to own at least an equal percentage of the outstanding shares of Class A Common 
Stock in order to exercise its Class B Common Stock voting rights. This         
provision is designed to ensure that, following a Tax-Free Distribution and for 
as long as the Class B Common Stock retains its special voting rights, a holder 
of such shares will not have voting rights with respect to the MIPS Board of    
Directors that are significantly disproportionate to its economic interest in   
MIPS Technologies.                                                              

 DIVIDENDS.  Following the Recapitalization, the holders of Class A Common
Stock and the holders of Class B Common Stock will share equally, on a per-share
basis, all dividends and other distributions in cash, stock of any corporation  
other than MIPS Technologies or property of MIPS Technologies as such dividend  
or distribution is declared by the MIPS Board of Directors. In the case of      
dividends or other distributions payable in New MIPS Common Stock, only shares  
of Class A Common Stock will be paid with respect to shares of Class A Common   
Stock and only shares of Class B Common Stock will be paid with respect to      
shares of Class B Common Stock. The number of shares of Class A Common Stock and
Class B Common Stock so paid will be equal in number on a per-share basis.      

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 COMMON STOCK OWNED BY SILICON GRAPHICS.  Prior to a Tax-Free Distribution
and for so long as Silicon Graphics owns shares of Class B Common Stock, any    
shares of Class A Common Stock acquired by Silicon Graphics or any of its       
subsidiaries will automatically convert into Class B Common Stock, on a         
one-for-one basis. Following a Tax-Free Distribution, if Silicon Graphics       
acquires New MIPS Common Stock, Silicon Graphics may acquire and hold such      
shares of New MIPS Common Stock as Class A Common Stock or Class B Common Stock,
as such shares were designated immediately prior to Silicon Graphics'           
acquisition thereof.                                                            

CONVERSION.  Following the Recapitalization and prior to a Tax-Free     
Distribution, each share of Class B Common Stock transferred to any person or   
entity other than Silicon Graphics or any of its subsidiaries will automatically
convert into one share of Class A Common Stock upon such transfer; provided,    
however, that the shares of Class B Common Stock will not convert into shares of
Class A Common Stock in connection with a Tax-Free Distribution or upon transfer
by the holders of the Class B Common Stock to another party after a Tax-Free    
Distribution. Immediately after the consummation of a Tax-Free Distribution,    
Silicon Graphics' stockholders will be the holders of the Class B Common Stock. 

If at any time prior to a Tax-Free Distribution the number of shares of 
Class B Common Stock held by Silicon Graphics and/or its affiliates represents  
less than 50% of the aggregate number of shares of New MIPS Common Stock then   
outstanding, the Class B Common Stock will be automatically converted into      
shares of Class A Common Stock; provided, however, that such automatic          
conversion will not occur if the independent directors on the MIPS Board of     
Directors and the Chief Executive Officer of MIPS Technologies unanimously      
determine that such automatic conversion is not in the interests of MIPS        
Technologies and the MIPS Public Stockholders. In any event, the Class B Common 
Stock held by Silicon Graphics will automatically convert into Class A Common   
Stock if the number of shares of Class B Common Stock held by Silicon Graphics  
and/or its affiliates represents less than 30% of the aggregate number of shares
of New MIPS Common Stock then outstanding. These provisions are intended to     
ensure that Silicon Graphics retains control of the MIPS Board of Directors only
if it has a substantial economic interest in MIPS Technologies. These automatic 
conversion provisions will not apply following a Tax-Free Distribution.         

 In addition, prior to a Tax-Free Distribution and upon the closing of any
merger or consolidation involving Silicon Graphics or a tender offer for the    
capital stock of Silicon Graphics, if the stockholders of Silicon Graphics      
immediately prior to such transaction own less than 50% of the outstanding      
shares of Silicon Graphics (or, if the capital stock of Silicon Graphics is     
exchanged or converted in any such transaction for capital stock of another     
corporation, such corporation) immediately after such transaction, each share of
Class B Common Stock held by Silicon Graphics or its successor will             
automatically convert into one share of Class A Common Stock.                   

  Following a Tax-Free Distribution, each share of Class B Common Stock will
be automatically converted into one share of Class A Common Stock on the fifth  
anniversary of such Tax-Free Distribution unless, prior to such Tax-Free        
Distribution, Silicon Graphics delivers to MIPS Technologies an opinion of      
counsel, reasonably satisfactory to MIPS Technologies, to the effect that, based
in part on conversations with the IRS disclosed to MIPS Technologies, such      
conversion would have a material adverse effect on the ability of Silicon       
Graphics to timely obtain a favorable ruling from the Internal Revenue Service  
(the "IRS") regarding the tax-free status of such Tax-Free Distribution. If such
an opinion is received, the approval of a conversion of Class B Common Stock to 
Class A Common Stock will, subject to certain conditions, be submitted to a vote
of the holders of the Class A Common Stock and Class B Common Stock, voting     
together as a single class, unless, prior to such Tax-Free Distribution, Silicon
Graphics delivers an opinion of counsel, reasonably satisfactory to MIPS        
Technologies, to the effect that, based in part on conversations with the IRS   
disclosed to MIPS Technologies, such conversion would have a material adverse   
effect on the ability of Silicon Graphics to timely obtain a favorable ruling   
from the IRS regarding the tax-free status of the Tax-Free Distribution. See    
"Description of Capital Stock." Although Silicon Graphics has indicated its     
intent to distribute a significant portion of its interest in MIPS Technologies 
in a                                                                            

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future Tax-Free Distribution, it has not formulated definitive plans to do so   
and there can be no assurance that Silicon Graphics will effect any such        
Tax-Free Distribution whether or not the Recapitalization is adopted. Under     
current law, it is uncertain whether this automatic conversion provision would  
have a material adverse effect on Silicon Graphics' ability to timely obtain a  
favorable ruling from the IRS regarding the tax-free status of the Tax-Free     
Distribution.                                                                   

    Following the Recapitalization, if, pursuant to any merger, consolidation or
reorganization of MIPS Technologies with another entity, the stockholders of    
MIPS Technologies immediately prior to such transaction will own less than 50%  
of the outstanding stock of such other entity immediately after such            
transaction, each share of Class B Common Stock will automatically convert into 
one share of Class A Common Stock immediately prior to the effectiveness of such
transaction, unless, prior to a Tax-Free Distribution, Silicon Graphics delivers
an opinion of counsel, reasonably satisfactory to MIPS Technologies, to the     
effect that, based in part on conversations with the IRS disclosed to MIPS      
Technologies, such automatic conversion would have a material adverse effect on 
the ability of Silicon Graphics to timely obtain a favorable ruling from the IRS
regarding the tax-free status of the Tax-Free Distribution. Under current law,  
it is uncertain whether this automatic conversion provision would have a        
material adverse effect on Silicon Graphics' ability to timely obtain a         
favorable ruling from the IRS regarding the tax-free status of the Tax-Free     
Distribution.                                                                   

   EXCHANGE.  At any time following a Tax-Free Distribution, MIPS Technologies
may exchange all (but not less than all) of the outstanding shares of Class B   
Common Stock for shares of Class A Common Stock on a one-for-one basis (the     
"MIPS Exchange Right") unless, prior to a Tax-Free Distribution, Silicon        
Graphics delivers to MIPS Technologies an opinion of counsel, reasonably        
satisfactory to MIPS Technologies, to the effect that, based in part on         
conversations with the IRS disclosed to MIPS Technologies, the inclusion of the 
MIPS Exchange Right provision in the Amended Certificate of Incorporation would 
have a material adverse effect on the ability of Silicon Graphics to timely     
obtain a favorable ruling from the IRS regarding the tax-free status of the     
Tax-Free Distribution. In addition, Silicon Graphics may limit MIPS             
Technologies' ability to exercise the MIPS Exchange Right pursuant to the Tax   
Agreement (as defined below) which will be entered into by MIPS Technologies and
Silicon Graphics prior to a Tax-Free Distribution. See "The Exchange            
Agreement--Tax Indemnification Agreement." The MIPS Exchange Right is designed, 
in part, to provide additional flexibility to MIPS Technologies to reduce, if   
then existing tax laws so permit, the length of time following a Tax-Free       
Distribution during which MIPS Technologies must continue to have the dual class
capital structure. Under current law, it is uncertain whether this automatic    
conversion provision would have a material adverse effect on Silicon Graphics'  
ability to timely obtain a favorable ruling from the IRS regarding the tax-free 
status of the Tax-Free Distribution.                                            

MERGER OR REORGANIZATION.  The Amended Certificate of Incorporation will
provide that all shares of Class A Common Stock and Class B Common Stock are    
entitled to receive, equally on a per share basis, the same kind and amount of  
consideration in the event of any merger, consolidation or reorganization of    
MIPS Technologies with any other Company; provided, however, that, in the event 
that the shares of Class B Common Stock have not been converted into or         
exchanged for shares of Class A Common Stock, (i) in any such transaction, the  
holders of shares of Class A Common Stock and the holders of shares of Class B  
Common Stock may receive different kinds of shares of stock if the only         
difference in such shares is the inclusion of voting rights which maintain the  
different voting rights of the holders of Class A Common Stock and holders of   
Class B Common Stock with respect to the election of the applicable percentage  
of the authorized number of directors on the MIPS Board of Directors as         
described above and (ii) if all or substantially all of the New MIPS Common     
Stock is exchanged for capital stock of another entity and such transaction is  
required to be accounted for by the "pooling-of-interests" method, the holders  
of shares of Class A Common Stock and the holders of shares of Class B Common   
Stock shall receive shares of stock of the acquiring entity based on the        
relative fair value of a share of Class A Common Stock and a share of Class B   
Common Stock measured as of the announcement date for such                      

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transaction. See "Description of MIPS Capital Stock Prior to and Following the  
Recapitalization-- Common Stock--Merger or Reorganization."                     

THE MIPS BOARD OF DIRECTORS FOLLOWING THE RECAPITALIZATION                      

The MIPS Board of Directors presently consists of the following seven   
members: John E. Bourgoin, the Chief Executive Officer and President of MIPS    
Technologies; Dr. Forest Baskett, Kenneth L. Coleman, William M. Kelly and      
Teruyasu Sekimoto, each of whom is an officer or employee of Silicon Graphics;  
and Anthony B. Holbrook and Fred M. Gibbons, each of whom is an independent     
director not affiliated with MIPS Technologies or Silicon Graphics. The MIPS    
Board of Directors is divided into three classes of directors serving staggered 
three-year terms, with Classes I and II having two directors each and Class III 
having three directors. The terms of office of the directors presently expire as
follows: Messrs. Bourgoin and Coleman (the current class I directors) at the    
annual meeting of stockholders in 1999, Messrs. Sekimoto and Gibbons (the       
current Class II directors) at the annual meeting of stockholders in 2000, and  
Dr. Baskett and Messrs. Kelly and Holbrook (the current Class III directors) at 
the annual meeting of stockholders in 2001.                                     

If the Recapitalization is approved, the MIPS Board of Directors will   
continue to have seven members and will consist of one Class A Director and six 
Class B Directors. In order to provide the holders of the Class A Common Stock  
the opportunity to elect the Class A Director at the 1999 Annual Meeting of     
Stockholders of MIPS Technologies, it is anticipated that the number of         
directors in Class I will be increased by one and the Class A Director will be  
included in Class I. In addition, the number of directors in Class III will be  
decreased by one. It is expected that, prior to the 1999 Annual Meeting of      
Stockholders, Mr. Holbrook will be appointed by the MIPS Board of Directors as  
the initial Class A Director. The holders of the Class A Common Stock will be   
entitled to elect one Class A Director at MIPS Technologies' 1999 Annual Meeting
of Stockholders of MIPS Technologies and the Class A Director so elected will   
hold office until the expiration of his or her term at the Annual Meeting of    
Stockholders of MIPS Technologies in 2002. In order to ensure that the holders  
of the Class A Common Stock will at all times be entitled to elect at least one 
director of MIPS Technologies, the Amended Certificate of Incorporation will    
provide that the total number of directors must consist of at least five        
persons. The Existing Certificate of Incorporation provides for a minimum of    
only three directors.                                                           

INTERESTS OF CERTAIN PERSONS IN THE RECAPITALIZATION                            

In considering the recommendation of the Special Committee and the MIPS 
Board of Directors, the stockholders of MIPS Technologies should be aware that  
certain officers and directors of MIPS Technologies are also stockholders and/or
employees of Silicon Graphics and may have certain interests in the             
Recapitalization that are different from, or in addition to, the interests of   
the MIPS Public Stockholders.                                                   

   OWNERSHIP OF EXISTING COMMON STOCK.  As of December 31, 1998, the directors
and executive officers of MIPS Technologies beneficially owned an aggregate of  
26,054 shares of Existing Common Stock, including shares that may be acquired   
upon the exercise of outstanding stock options (or less than one percent of the 
then outstanding shares of Existing Common Stock).                              

 OWNERSHIP OF SILICON GRAPHICS COMMON STOCK.  As of December 31, 1998, the
directors and executive officers of MIPS Technologies beneficially owned an     
aggregate of   shares of common stock par value $0.001 per shares (the "Silicon 
Graphics Common Stock"), of Silicon Graphics, including shares that may be      
acquired upon the exercise of outstanding stock options (or less than one       
percent of the then outstanding shares of Silicon Graphics Common Stock).       

CERTAIN FEDERAL INCOME TAX CONSEQUENCES                                         

  Implementation of the Recapitalization will be tax-free for federal income
tax purposes to MIPS Technologies and its stockholders based upon the facts and 
law as of the date of this Proxy Statement.                                     

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NASDAQ APPROVALS                                                                

    MIPS Technologies is in the process of obtaining the necessary approvals and
waivers from The Nasdaq Stock Market, Inc. ("Nasdaq") in order to effect the    
Recapitalization.                                                               

   In connection with the Recapitalization, application will be made to Nasdaq
to redesignate the Existing Common Stock as Class A Common Stock. In the event  
of a Tax-Free Distribution, MIPS Technologies expects that the Class B Common   
Stock also will be quoted on the Nasdaq National Market or on such other        
exchange as the Class A Common Stock is then listed or quoted.                  

FEDERAL SECURITIES LAWS CONSEQUENCES                                            

All shares of Class A Common Stock received in the Recapitalization by  
holders of the Existing Common Stock will be freely transferable, except that   
shares of Class A Common Stock received by persons who are deemed to be         
affiliates of MIPS Technologies may be resold by them only in transactions      
permitted by the resale provision of Rule 144 promulgated under the Securities  
Act of 1933, as amended (the "Securities Act"), or otherwise in compliance with 
(or pursuant to an exemption from) the registration requirements of the         
Securities Act. Persons deemed to be affiliates of MIPS Technologies are those  
individuals or entities that control, are controlled by, or are under common    
control with, MIPS Technologies and generally include the executive officers and
directors of MIPS Technologies, as well as certain principal stockholders of    
MIPS Technologies.                                                              

NO APPRAISAL RIGHTS                                                             

   Holders of Existing Common Stock are not entitled to appraisal rights under
Section 262 of the General Corporation Law of the State of Delaware (the "DGCL")
in connection with the Recapitalization because the Recapitalization is not a   
transaction for which appraisal rights are available under the DGCL.            

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THE EXCHANGE AGREEMENT

 IF THE RECAPITALIZATION IS APPROVED BY THE MIPS PUBLIC STOCKHOLDERS, MIPS
TECHNOLOGIES AND SILICON GRAPHICS WILL ENTER INTO THE EXCHANGE AGREEMENT, WHICH 
WILL GOVERN CERTAIN OF THE TERMS OF THE RECAPITALIZATION. THE FOLLOWING IS A    
SUMMARY OF THE MATERIAL TERMS OF THE EXCHANGE AGREEMENT, A FORM OF WHICH IS     
ATTACHED TO THIS PROXY STATEMENT AS ANNEX C. THE FOLLOWING DOES NOT PROPOSE TO  
BE COMPLETE AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FORM OF THE    
EXCHANGE AGREEMENT ATTACHED AS ANNEX C.                                         

EXCHANGE OF CLASS A SHARES FOR CLASS B SHARES BY SILICON GRAPHICS               

Subject to the terms and conditions of the Exchange Agreement and in    
accordance with the DGCL, immediately after the Effective Time (as defined      
below), each share of Class A Common Stock beneficially owned by Silicon        
Graphics and its affiliates will be exchanged for one share of Class B Common   
Stock. The "Effective Time", for purposes of the Exchange Agreement, means the  
time at which the Amended Certificate of Incorporation becomes effective under  
the DGCL.                                                                       

SILICON GRAPHICS' OBLIGATION TO PURCHASE NEW MIPS COMMON STOCK                  

Subject to terms and conditions of the Exchange Agreement, if Silicon   
Graphics has not disposed of its entire interest in MIPS Technologies (whether  
through a Tax-Free Distribution or otherwise) prior to December 31, 2000,       
Silicon Graphics shall, on the last day of each fiscal quarter beginning on     
December 31, 2000 and ending on the last day of the fiscal quarter immediately  
preceding any such disposition, accrue an obligation to purchase the number of  
shares of New MIPS Common Stock set forth below (the "Required Purchase         
Amount"):                                                                       

                                                        [Enlarge/Download Table]

QUARTER ENDING:                                                      REQUIRED PURCHASE AMOUNT 
-------------------------------------------------------------------  -------------------------
                                                                                              
December 31, 2000..................................................           1,800,000       
March 31, 2001.....................................................           1,700,000       
June 30, 2001......................................................           1,800,000       
September 30, 2001.................................................           1,700,000       
December 31, 2001..................................................           1,800,000       
March 31, 2002.....................................................           1,700,000       
June 30, 2002......................................................           1,700,000       
September 30, 2002.................................................           2,000,000       
December 31, 2002 and each quarter thereafter until a                                         
  distribution.....................................................           2,000,000       

  Silicon Graphics shall make such purchase or purchases of shares of Common
Stock equal to the Required Purchase Amount prior to the date (the "Purchase    
Date") which is thirty (30) days following the public announcement of financial 
results for the applicable fiscal quarter. If, prior to the Purchase Date for   
any Required Purchase Amount, MIPS Technologies notifies Silicon Graphics in    
writing that the independent directors and the Chief Executive Officer of MIPS  
Technologies have unanimously determined that the purchase of shares of New MIPS
Common Stock equal to the Required Purchase Amount is not in the interests of   
MIPS Technologies and the MIPS Public Stockholders, then the Required Purchase  
Amount for such quarterly period will be reduced by the number set forth in such
notice.                                                                         

   At its sole option, Silicon Graphics may satisfy its obligation to purchase
shares of New MIPS Common Stock equal to a Required Purchase Amount by          
purchasing (i) newly issued shares of Class B Common Stock from MIPS            
Technologies, (ii) issued and outstanding shares of Class A Common Stock in the 
public market or otherwise from a third party or (iii) any combination of (i)   
and (ii) above, in each case on or prior to the applicable Purchase Date. In    
determining whether Silicon Graphics has satisfied its obligation to purchase   
shares of New MIPS Common Stock equal to the Required Purchase Amount with      
respect to a quarterly period, each share of Class A Common Stock purchased by  
Silicon Graphics in the                                                         

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public market or otherwise from a third party shall be counted as four shares of
New MIPS Common Stock purchased in satisfaction of the Required Purchase Amount 
and each share of Class B Common Stock purchased by Silicon Graphics from the   
Company shall be counted as one share of New MIPS Common Stock purchase in      
satisfaction of the Required Purchase Amount, provided, however, that any shares
of Class A Common Stock purchased by Silicon Graphics in the public market or   
otherwise from a third party shall only be applied in satisfaction of a Required
Purchase Amount one time. Silicon Graphics will have registration rights with   
respect to the shares of New MIPS Common Stock it acquires in satisfaction of   
the Required Purchase Amount. Silicon Graphics will not be obligated to purchase
the Required Purchase Amount for the quarter in which Silicon Graphics disposes 
of its entire interest in MIPS Technologies (including through a Tax-Free       
Distribution) or in which Silicon Graphics exchanges its shares of Class B      
Common Stock for Class A Common Stock as a result of a Change in Tax Law (as    
defined herein) and for each quarter thereafter.                                

   Shares of Class B Common Stock may be purchased from MIPS Technologies at a
price per share equal to the average closing price of the Class A Common Stock  
on the Nasdaq National Market for the last ten trading days of the quarter with 
respect to which such obligation accrues.                                       

TAX INDEMNIFICATION AGREEMENT                                                   

The Exchange Agreement will also contain a covenant obligating MIPS     
Technologies and Silicon Graphics to enter into a Tax Indemnification Agreement 
(the "Tax Agreement") prior to a Tax-Free Distribution. The Tax Agreement       
generally will limit the ability of MIPS Technologies to undertake certain      
actions after the Tax-Free Distribution that would cause the Tax-Free           
Distribution to become taxable to Silicon Graphics and its stockholders. The Tax
Agreement generally will require MIPS Technologies to indemnify Silicon Graphics
from any taxes resulting from the failure of the Tax-Free Distribution to be    
tax-free due to (i) the issuance of stock by MIPS Technologies in an acquisition
or private or public offering within the 30-month period following the Tax-Free 
Distribution (the "Period") other than pursuant to (a) the exercise of          
compensatory stock options or awards and (b) the issuance of up to a cumulative 
amount of 10% of the outstanding stock of MIPS Technologies at the time of the  
Tax-Free Distribution; (ii) MIPS Technologies' knowingly and voluntarily taking 
any other action during the Period which it believes will more likely than not  
result in the distribution becoming taxable; (iii) MIPS Technologies' breaching 
any representations and covenants in the Tax Agreement; (iv) MIPS Technologies' 
exchanging any shares of Class B Stock for Class A Stock, including pursuant to 
the MIPS Exchange Right, during the five-year period following the Tax-Free     
Distribution; or (v) MIPS Technologies' amending the voting rights with respect 
to the Class B Stock or Class A Stock during the five-year period following the 
Tax-Free Distribution. MIPS Technologies also will be required to indemnify     
Silicon Graphics from any taxes resulting from the failure of the Tax-Free      
Distribution to be tax-free due to an acquisition of MIPS Technologies.         
Notwithstanding any of the above, MIPS Technologies generally will have no      
obligation to indemnify Silicon Graphics if (x) a supplemental ruling to the    
effect that such proposed action will not adversely affect the tax-free status  
of the Tax-Free Distribution is obtained from the IRS, (y) Silicon Graphics     
consents to such action or (z) MIPS Technologies delivers to Silicon Graphics an
opinion of nationally recognized tax counsel, reasonably satisfactory to Silicon
Graphics, that such action will not cause the Tax-Free Distribution to become   
taxable. The limitations on the issuance of shares of MIPS Technologies' capital
stock discussed above could have a negative impact on MIPS Technologies'        
financial flexibility following a Tax-Free Distribution.                        

The Tax Agreement will contain other customary provisions.              

REQUIRED EXCHANGE OF CLASS B SHARES FOR CLASS A SHARES BY SILICON GRAPHICS      

The Exchange Agreement will also provide that Silicon Graphics will be  
required to exchange all of its shares of Class B Common Stock for shares of    
Class A Common Stock if, prior to a Tax-Free Distribution, the Code is amended  
(a "Change in Tax Law") to provide that in a tax-free spin-off of a subsidiary, 
the                                                                             

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distributing company must hold not less than 80% of the value of the            
subsidiary's stock, and such Change in Tax Law would apply to a Tax-Free        
Distribution by Silicon Graphics of its interest in MIPS Technologies.          

INDEMNIFICATION AND EXPENSES                                                    

   Silicon Graphics will indemnify and hold harmless MIPS Technologies and its
affiliates, officers, directors, employees, agents, successors and assigns from 
and against any and all liabilities, losses, damages, claims, costs and         
expenses, interest, awards, judgments and penalties (including, without         
limitation, attorneys' and consultants' fees and expenses) actually suffered or 
incurred by them, arising out of or resulting from any claim or cause of action 
by any third party to the extent arising out of the Recapitalization or any     
distribution of all of its interest in MIPS Technologies.                       

    Pursuant to the Exchange Agreement, Silicon Graphics has agreed to reimburse
MIPS Technologies for the fees and expenses of legal counsel to the Special     
Committee in connection with the Recapitalization and the Tax-Free Distribution,
whether or not the Recapitalization or the Tax-Free Distribution is consummated,
in an amount set forth in a budget to be agreed to between the parties. Silicon 
Graphics has also agreed to reimburse MIPS Technologies for the reasonable fees 
and expenses of the financial advisor to the Special Committee and all other    
reasonable out-of-pocket expenses incurred by MIPS Technologies in connection   
with the Recapitalization and the Tax-Free Distribution. Silicon Graphics will  
be responsible for all of the fees, costs and expenses incurred by Silicon      
Graphics in connection with the Recapitalization and Tax-Free Distribution.     

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

  In this document and in the documents incorporated herein by reference, we
make forward-looking statements that include assumptions as to events that may  
occur following a Recapitalization, including sales and other dispositions by   
Silicon Graphics of its interest in MIPS Technologies, as well as to how MIPS   
Technologies may perform in the future. You will find many of these statements  
in the following sections:                                                      

    - "The Recapitalization--Reasons for the Recapitalization; Recommendation of
the Special Committee and the MIPS Board" beginning on page 16; and 

- Under the caption "Management's Discussion and Analysis of Financial  
 Condition and Results of Operations" in Part II of MIPS Technologies'
      Annual Report on Form 10-K for the fiscal year ended June 30, 1998, and in
      Part I of MIPS Technologies' Quarterly Report on Form 10-Q for the quarter
   ended September 30, 1998, each of which is incorporated by reference in
this Proxy Statement.                                               

Also, when we use words like "may," "may not," "believes," "does not    
believe," "intends," "expects," "does not expect," "anticipates," "does not     
anticipate" and similar expressions, we are making forward-looking statements.  
Such statements should be viewed with caution.                                  

 Actual events or results could differ materially from the forward-looking
statements as a result of many factors, including, but not limited to,          
fluctuations in the operating results of MIPS Technologies or Silicon Graphics  
or significant changes in their respective businesses, prevailing market        
conditions for the capital stock of MIPS Technologies and Silicon Graphics, any 
shift in MIPS Technologies' or Silicon Graphics' strategic directions and       
changes in tax or other laws relevant to the Recapitalization.                  

  In addition, MIPS Technologies' stockholders should consider carefully the
information set forth under the captions "Business," "Legal Proceedings" and    
"Management's Discussion and Analysis of Financial Condition and Results of     
Operations" in MIPS Technologies' Annual Report on Form 10-K for the fiscal year
ended June 30, 1998 and under the caption "Management's Discussion and Analysis 
of Financial Condition and Results of Operations" in MIPS Technologies'         
Quarterly Report on Form 10-Q                                                   
for the quarter ended September 30, 1998. In making these forward-looking       
statements in this document and in the documents that are incorporated by       
reference, MIPS Technologies claims the protection of the safe harbor for       
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995. MIPS Technologies does not assume any obligation to update these   
forward-looking statements to reflect actual results, changes in assumptions or 
changes in other factors affecting such forward-looking statements.             

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MIPS TECHNOLOGIES 

THE COMPANY                                                                     

MIPS Technologies is a leader in the design and licensing of            
high-performance 32- and 64-bit RISC processor intellectual property and core   
technology for the digital consumer and embedded systems markets. MIPS          
Technologies and its licensees offer a variety of standard, custom, semi-custom 
and application specific processors. MIPS Technologies licenses its intellectual
property to semiconductor manufacturing and fabless design companies, as well as
system OEMs. To date, the MIPS RISC architecture has been used to create over 60
separate microprocessor products. These microprocessor products have a          
cumulative installed base of over 100 million units and have been embedded into 
a variety of products such as video games, color printers and handheld personal 
computers. MIPS Technologies' semiconductor partners reported that approximately
47 million units based on the MIPS RISC architecture were shipped in fiscal year
1998.                                                                           

MIPS Technologies' technology focuses on providing cost-effective and   
high-performance microprocessor and related designs for high-volume embedded    
applications. The MIPS RISC architecture is flexible and allows semiconductor   
manufacturers to integrate their intellectual property with MIPS Technologies   
designs to develop differentiated and innovative products for a variety of      
embedded applications within demanding time-to-market requirements. The         
advantages of the MIPS Technologies architecture relate primarily to scalability
of die size and performance. Products incorporating the MIPS Technologies       
architecture range from disk drives using microprocessor cores with a die size  
of less than two square millimeters to high-performance workstations using      
microprocessors with a die size of 300 square millimeters. In addition, while   
designed for high performance, the MIPS RISC-based architectures have been      
incorporated in low-power applications such as the Philips Velo and the NEC     
MobilePro handheld personal computers. The MIPS Technologies architecture is    
designed around upward compatible instruction sets that enable manufacturers    
developing products across a broad range of price/performance points to use     
common support tools and software.                                              

On July 6, 1998 MIPS Technologies completed the Offering. Prior to the  
Offering, MIPS Technologies was a wholly owned subsidiary of Silicon Graphics.  
In order to increase the focus of the MIPS Group on the design and development  
of microprocessor applications dedicated to the embedded market, in December    
1997, Silicon Graphics initiated a plan to separate the business of the MIPS    
Group from its other operations. In April 1998, the Board of Directors of       
Silicon Graphics approved a transaction, pursuant to which, Silicon Graphics    
transferred to MIPS Technologies the assets and liabilities related to the      
design and development of microprocessor intellectual property for embedded     
market applications (the "Separation"). Prior to the Separation, MIPS           
Technologies' business was conducted by Silicon Graphics primarily through its  
MIPS Group, a division of Silicon Graphics. MIPS Technologies' predecessor, MIPS
Computer Systems, Inc., was founded in 1984 and was engaged in the design and   
development of RISC microprocessors for the computer systems and embedded       
markets.                                                                        

MIPS Technologies was incorporated in Delaware in June 1992. MIPS       
Technologies has its principal executive offices at 1225 Charleston Road,       
Mountain View, California 94043-1353, and its telephone number at that address  
is (650) 567-5000.                                                              

Additional information concerning MIPS Technologies is included in MIPS 
Technologies' reports filed under the Securities Exchange Act of 1934, as       
amended (the "Exchange Act"), portions of which are incorporated by reference in
this Proxy Statement. See "Where You Can Find More Information."                

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT                     

  The following table sets forth certain information as of December 31, 1998
as to the beneficial ownership of Existing Common Stock by (i) each person known
to MIPS Technologies to own beneficially, as defined in Rule 13d-3 under the    
Exchange Act, five percent or more of the outstanding shares of                 

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Existing Common Stock, based on MIPS Technologies' records, (ii) each director, 
(iii) the Chief Executive Officer, (iv) the four other most highly compensated  
executive officers as of June 30, 1998, and (v) all directors and persons       
serving as executive officers as a group.                                       

                                                        [Enlarge/Download Table]

                                                                                   NUMBER OF SHARES                    
                                                                                     BENEFICIALLY       PERCENTAGE OF  
NAME OF BENEFICIAL OWNER                                                              OWNED(1)(2)          SHARES      
---------------------------------------------------------------------------------  -----------------  -----------------
                                                                                                                       
Silicon Graphics, Inc............................................................       31,750,000               85%   
2011 North Shoreline Boulevard                                                                                         
Mountain View, California 94043                                                                                        
John E. Bourgoin.................................................................           17,168                *    
Lavi Lev.........................................................................            1,970                *    
Kevin C. Eichler.................................................................            1,776                *    
Derek Meyer......................................................................            2,079                *    
Sandy Creighton..................................................................            1,776                *    
Dr. Forest Baskett...............................................................               --           --        
Kenneth L. Coleman...............................................................            1,285                *    
Fred M. Gibbons..................................................................               --           --        
Anthony B. Holbrook..............................................................               --           --        
William M. Kelly.................................................................               --           --        
Teruyasu Sekimoto................................................................               --           --        
All executive officers and directors as a group (11 persons).....................           26,054                *    

------------------------                                                        

*   Less than 1%                                                                

(1) The inclusion herein of any shares as beneficially owned does not constitute
an admission of beneficial ownership of those shares.                   

(2) Does not include shares of common stock that may be acquired with respect to
  the current offering period ending April 30, 1999 under MIPS Technologies'
Employee Stock Purchase Plan.                                           

RELATIONSHIP WITH SILICON GRAPHICS                                              

 GENERAL.  As a result of its beneficial ownership of approximately 85% of
the currently outstanding Existing Common Stock, Silicon Graphics presently has 
the ability to direct the election of all of the members of the MIPS Board of   
Directors and to exercise a controlling influence over the business and affairs 
of MIPS Technologies. If the Recapitalization is adopted, the MIPS Public       
Stockholders, by virtue of their ownership of all of the issued and outstanding 
shares of Class A Common Stock, will be entitled to elect the Class A Directors,
and prior to a Tax-Free Distribution (unless the shares of Class B Common Stock 
have been converted into or exchanged for shares of Class A Common Stock) or    
other disposition by Silicon Graphics of its Class B Common Stock, Silicon      
Graphics will be entitled to elect all of the Class B Directors. In addition, if
the Recapitalization is adopted, so long as Silicon Graphics owns more than 50% 
of the New MIPS Common Stock, it will have the ability to remove the Class A    
Directors for cause and the Class B Directors with or without cause. Silicon    
Graphics presently has the ability to remove any and all directors with or      
without cause. Finally, whether or not the Recapitalization is adopted, Silicon 
Graphics will continue to have the ability to call special meetings of          
stockholders and to effect stockholder action by written consent in lieu of a   
meeting of stockholders. These rights currently are not available to MIPS Public
Stockholders, nor will they be after Silicon Graphics ceases to own in excess of
50% of the common equity of MIPS Technologies. See "Description of MIPS Capital 
Stock Prior to and Following the Recapitalization--Certificate of Incorporation 
and By-law Provisions That May Have an Anti-Takeover Effect."                   

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CERTAIN AGREEMENTS.  In connection with the Separation and the Offering,
MIPS Technologies and Silicon Graphics entered into various agreements intended 
to define the relationship between them on a going forward basis. Because these 
agreements were entered into at a time when MIPS Technologies was still a wholly
owned subsidiary of Silicon Graphics, they are not the result of arms-length    
negotiations between the parties. These agreements include the following:       

  - MANAGEMENT SERVICES AGREEMENT, pursuant to which Silicon Graphics agreed
to provide certain services, including accounting, treasury, tax,   
   facilities and information services, to MIPS Technologies following the
Separation on a interim or transitional basis.                      

- TECHNOLOGY AGREEMENT, pursuant to which Silicon Graphics assigned or  
   licensed certain intellectual property rights to MIPS Technologies, and
    MIPS Technologies licensed back to Silicon Graphics certain intellectual
property rights.                                                    

- TRADEMARK AGREEMENT, pursuant to which Silicon Graphics assigned or   
licensed certain trademark and trademark-related rights to MIPS     
Technologies, and MIPS Technologies licensed certain rights back to 
Silicon Graphics.                                                   

   - TAX SHARING AGREEMENT, under which MIPS Technologies and Silicon Graphics
     have agreed, among other things, to make payments between them such that,
with respect to any period, the amount of taxes to be paid by MIPS  
  Technologies, subject to certain adjustments, will be determined as if
MIPS Technologies filed separate federal, state and local income tax
returns.                                                            

- FACILITIES LEASE ARRANGEMENTS, pursuant to which MIPS Technologies    
   subleases approximately 27,500 square feet of office space from Silicon
Graphics, with an option to increase to 55,000 square feet.         

 - CORPORATE AGREEMENT, pursuant to which (i) MIPS Technologies granted to
Silicon Graphics a continuing option to purchase, under certain     
     circumstances, additional shares of common stock and shares of non-voting
 capital stock of MIPS Technologies, (ii) MIPS Technologies granted to
    Silicon Graphics registration rights related to the common stock of MIPS
     Technologies owned by Silicon Graphics and (iii) MIPS Technologies agreed
to refrain from engaging in certain actions for so long as Silicon  
   Graphics owns a majority of MIPS Technologies outstanding common stock.

Additional information concerning MIPS Technologies' relationship with  
Silicon Graphics is included in certain documents filed by MIPS Technologies    
under the Securities Act that are incorporated by reference in this Proxy       
Statement. See "Where You Can Find More Information."                           

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MARKET PRICE AND DIVIDEND INFORMATION 

MARKET PRICES                                                                   

 The table below sets forth, for the calendar quarters indicated, the high
and low reported last sale prices per share of the Existing Common Stock on the 
Nasdaq National Market.                                                         

                                                        [Enlarge/Download Table]

                                                                                                 COMMON STOCK    
                                                                                             --------------------
                                                                                                                 
                                                                                               HIGH        LOW   
                                                                                             ---------  ---------
1998                                                                                                             
Quarter ended June 30, 1998 (on June 30, 1998)(1)........................................... $  15.125  $  12.00 
Quarter ended September 30, 1998............................................................ $  23.75   $   9.625
Quarter ended December 31, 1998............................................................. $  32.00   $  13.875
1999                                                                                                             
Quarter ending March 31, 1999 (through January 28, 1999).................................... $  28.25   $  39.875

------------------------                                                        

(1) On June 30, 1998, MIPS Technologies effected its initial public offering of 
Existing Common Stock at $12.00 per share.                              

On January 13, 1998, the last full trading day prior to the public      
announcement of the Recapitalization, the reported last sale price of Existing  
Common Stock on the Nasdaq National Market was $32.25 per share.                

   On January 28, 1999, the most recent practicable date prior to the printing
of this Proxy Statement, the reported last sale price of Existing Common Stock  
on the Nasdaq National Market was $36.00 per share.                             

MIPS STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE 
EXISTING COMMON STOCK.                                                          

DIVIDENDS                                                                       

MIPS Technologies has not paid any dividends since its incorporation and
currently intends to retain any earnings to fund the development and growth of  
its business, and therefore does not currently anticipate paying cash or stock  
dividends on the Existing Common Stock, or the New MIPS Common Stock, if the    
Recapitalization is adopted, in the foreseeable future. MIPS Technologies'      
future dividend policy will be determined by the MIPS Board of Directors on the 
basis of various factors, including MIPS Technologies' results of operations and
financial condition and any legal and contractual restrictions.                 

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DESCRIPTION OF MIPS CAPITAL STOCK PRIOR TO
AND FOLLOWING THE RECAPITALIZATION

If the Recapitalization is adopted, the Existing Certificate of         
Incorporation will be amended. The following is a general description of the    
relative rights of the holders of MIPS Technologies capital stock at the present
time and such rights if the Recapitalization is adopted.                        

AUTHORIZED CAPITAL STOCK                                                        

   Upon the consummation of the Recapitalization, the authorized capital stock
of MIPS Technologies will consist of 300,000,000 shares, of which (i)           
150,000,000 shares will be Class A Common Stock, par value $0.001 per share,    
(ii) 100,000,000 shares will be Class B Common Stock, par value $0.001 per share
and (iii) 50,000,000 shares will be preferred stock, par value $0.001 per share 
(the "Preferred Stock"), issuable in series. After giving effect to the         
Recapitalization and the exchange by Silicon Graphics of its shares of Class A  
Common Stock for shares of Class B Common Stock, there will be 5,542,286 shares 
of Class A Common Stock outstanding and 31,750,000 shares of Class B Common     
Stock outstanding.                                                              

At present, MIPS Technologies authorized capital stock consists of      
150,000,000 shares of common stock, par value $0.001 per share, and 50,000,000  
shares of Preferred Stock, par value $0.001 per share, issuable in series. As of
the Record Date, there were       outstanding shares of Existing Common Stock   
held by approximately       holders of record.                                  

COMMON STOCK                                                                    

   VOTING RIGHTS.  Upon the consummation of the Recapitalization, with respect
to the election of directors to the MIPS Board of Directors, holders of Class A 
Common Stock, voting separately as a class, will be entitled to elect 20% of the
directors on the MIPS Board of Directors (or, if such 20% is not a whole number,
then the next lower whole number of directors that is closest to 20% of such    
membership, provided that in no event will there be less than one director      
elected by the holders of the Class A Common Stock). Each share of Class A      
Common Stock shall have one vote in the election of such directors.             

   The holders of the Class B Common Stock, voting separately as a class, will
be entitled to elect the remaining directors (other than directors elected by   
the holders of Preferred Stock). Each share of Class B Common Stock will have   
one vote in the election of such directors. References to the number of         
directors on the MIPS Board of Directors will not include any directors whom the
holders of any Preferred Stock may have the exclusive right to elect.           

If, at any time, all the outstanding shares of Class B Common Stock have
been converted into or exchanged for shares of Class A Common Stock, subject to 
the rights of holders of Preferred Stock, the holders of the Class A Common     
Stock, voting as a class, will be entitled to elect all the directors on the    
MIPS Board of Directors.                                                        

The holders of Class A Common and Class B Common Stock will in all other
matters vote together as a single class, with each share of Class A Common Stock
and Class B Common Stock having one vote, except as required by law and except  
with respect to any proposed amendment to the Amended Certificate of            
Incorporation which would alter the special rights of the Class A Common Stock  
or the Class B Common Stock, in which case the affected class shall also be     
entitled to vote on such amendment separately as a class. Notwithstanding the   
foregoing, the affirmative vote of the holders of a majority of the New MIPS    
Common Stock, voting together as a single class, will be required to approve the
conversion, if not automatically converted pursuant to the terms of the Amended 
Certificate of Incorporation, of the Class B Common Stock to Class A Common     
Stock following a Tax-Free Distribution and the lapse of five years of the date 
of such distribution.                                                           

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Following a Tax-Free Distribution, for so long as any person or group of
persons acting in concert beneficially owns 10% or more of the outstanding      
shares of Class B Common Stock, such person or group will not have any voting   
powers in respect of such shares of Class B Common Stock or be entitled to      
exercise any voting rights in any election of directors unless such person or   
group is also the beneficial owner of at least an equivalent percentage of the  
outstanding shares of Class A Common Stock.                                     

  At present, the holders of shares of Existing Common Stock are entitled to
one vote for each share on all matters voted on by MIPS Technologies'           
stockholders, including elections of directors, and except as otherwise required
by law and subject to any voting rights granted to holders of any series of     
Preferred Stock, the holders of such shares possess all the voting power.       

The Existing Certificate of Incorporation does not, and the Amended     
Certificate of Incorporation will not, provide for cumulative voting in the     
election of directors.                                                          

    DIVIDENDS.  Upon the consummation of the Recapitalization and subject to the
rights of the holders of any series of Preferred Stock, the holders of Class A  
Common Stock and the holders of Class B Common Stock will be entitled to receive
such dividends and other distributions in cash, stock of any corporation (other 
than New MIPS Common Stock) or property of MIPS Technologies as may be declared 
thereon from time to time by the MIPS Board of Directors from funds legally     
available therefor. The holders of the New MIPS Common Stock will share equally 
on a per share basis in all such dividends and other distributions; provided,   
however, in the case of dividends or other distributions payable in, or         
reclassifications involving, New MIPS Common Stock, including distributions     
pursuant to stock splits or divisions of New MIPS Common Stock, only shares of  
Class A Common Stock will be paid or distributed with respect to shares of Class
A Common Stock and only shares of Class B Common Stock will be paid or          
distributed with respect to shares of Class B Common Stock. The number of shares
of Class A Common Stock and Class B Common Stock so paid or distributed will be 
equal in number on a per share basis. In addition, MIPS Technologies may not    
subdivide or combine shares of either class of New MIPS Common Stock without at 
the same time proportionally subdividing or combining shares of the other class.

   At present, subject to any preferential rights of any outstanding series of
Preferred Stock created by the MIPS Board of Directors from time to time, the   
holders of shares of Existing Common Stock are entitled to such dividends as may
be declared from time to time by the Board of Directors from funds legally      
available therefor.                                                             

 COMMON STOCK OWNED BY SILICON GRAPHICS.  Prior to a Tax-Free Distribution
and for so long as Silicon Graphics or any of its subsidiaries owns shares of   
Class B Common Stock, any shares of Class A Common Stock acquired by Silicon    
Graphics or any of its subsidiaries will automatically convert into Class B     
Common Stock, on a one-for-one basis. Following a Tax-Free Distribution, if     
Silicon Graphics acquires New MIPS Common Stock Silicon Graphics may acquire and
hold such shares of New MIPS Common Stock as Class A Common Stock or Class B    
Common Stock, as such shares were designated immediately prior to Silicon       
Graphics' acquisition thereof.                                                  

  CONVERSION.  Prior to a Tax-Free Distribution, any share of Class B Common
Stock transferred to a person, other than Silicon Graphics or any of its        
subsidiaries, will automatically convert into one share of Class A Common Stock 
upon such disposition. Shares of Class B Common Stock will not be automatically 
converted into shares of Class A Common Stock (i) in any transfer effected in   
connection with a distribution of shares of Class B Common Stock to stockholders
of Silicon Graphics in a transaction (including any distribution in exchange for
shares of capital stock or other securities of Silicon Graphics) intended to    
qualify as a Tax-Free Distribution or (ii) in any transfer following a Tax-Free 
Distribution. Following a Tax-Free Distribution, shares of Class B Common Stock 
shall be transferable as Class B Common Stock, subject to applicable laws.      

Shares of Class B Common Stock will automatically convert into shares of
Class A Common Stock on the fifth anniversary of the Tax-Free Distribution,     
unless prior to such Tax-Free Distribution, Silicon                             

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Graphics delivers to MIPS Technologies an opinion of counsel, reasonably        
satisfactory to MIPS Technologies, to the effect that, based in part on         
conversations with the IRS disclosed to MIPS Technologies, such automatic       
conversion would have a material adverse effect on the ability of Silicon       
Graphics to timely obtain a favorable ruling from the IRS regarding the tax-free
status of such Tax-Free Distribution. If such an opinion is received, approval  
of such conversion will be submitted to a vote of the holders of the Class A    
Common Stock and the holders of Class B Common Stock as soon as practicable     
after the fifth anniversary of the Tax-Free Distribution, unless prior to such  
Tax-Free Distribution, Silicon Graphics delivers to MIPS Technologies an opinion
of counsel, reasonably satisfactory to MIPS Technologies, to the effect that,   
based in part on conversations with the IRS disclosed to MIPS Technologies, such
vote would have a material adverse effect on the ability of Silicon Graphics to 
timely obtain a favorable ruling from the IRS regarding the tax-free status of  
such Tax-Free Distribution. Approval of such conversion will require the        
affirmative vote of a majority of the shares of Class A Common Stock and Class B
Common Stock present and voting, voting together as a single class, with each   
share entitled to one vote for such purpose. No assurance can be given that such
conversion would occur.                                                         

  All shares of Class B Common Stock will automatically convert into Class A
Common Stock if, at any time prior to a Tax-Free Distribution, the aggregate    
number of outstanding shares of Class B Common Stock beneficially owned by      
Silicon Graphics and/or any of its subsidiaries is less than 50% of the         
aggregate number of outstanding shares of New MIPS Common Stock; provided,      
however, that such automatic conversion will not occur if, prior to the closing 
of any transaction or the occurrence of any event which would reduce the        
aggregate number of outstanding shares of Class B Common Stock owned by Silicon 
Graphics and/or any of its subsidiaries to less than 50% of the aggregate number
of shares of New MIPS Common Stock then outstanding, the independent directors  
of the Board of Directors and the Chief Executive Officer of MIPS Technologies  
unanimously determine that such automatic conversion is not in the interests of 
MIPS Technologies and the MIPS Public Stockholders. Upon the closing of any     
subsequent transaction or the occurrence of any event which would further reduce
the percentage of the shares of New MIPS Common Stock then outstanding held by  
Silicon Graphics, each share of Class B Common Stock will automatically convert 
into one share of Class A Common Stock unless, prior to the closing of any such 
transaction or the occurrence of any such event, the independent directors of   
the MIPS Board of Directors and the Chief Executive Officer of MIPS Technologies
unanimously determine that such automatic conversion is not in the interests of 
MIPS Technologies and the MIPS Public Stockholders. In any event, all shares of 
Class B Common Stock will automatically convert into shares of Class A Common   
Stock if the aggregate number of outstanding Class B Common Stock held by       
Silicon Graphics and/or any of its affiliates is less than 30% of the aggregate 
number of outstanding shares of New MIPS Common Stock.                          

   In the case of any merger or consolidation of MIPS Technologies pursuant to
which all or substantially all of the capital stock of MIPS Technologies is     
exchanged for the stock of another entity and the stockholders of MIPS          
Technologies immediately prior to such merger or consolidation own less than 50%
of the outstanding shares of such other entity immediately after such merger or 
consolidation, each share of Class B Common Stock will automatically convert    
into one share of Class A Common Stock immediately prior to the effectiveness of
such merger or consolidation, unless, prior to a Tax-Free Distribution, Silicon 
Graphics delivers to MIPS Technologies an opinion of counsel, reasonably        
satisfactory to MIPS Technologies, to the effect that, based in part on         
conversations with the IRS disclosed to MIPS Technologies, such automatic       
conversion would have a material adverse effect on the ability of Silicon       
Graphics to timely obtain a favorable ruling from the IRS regarding the tax-free
status of the Tax-Free Distribution.                                            

Prior to a Tax-Free Distribution and upon the closing of a merger or    
consolidation involving Silicon Graphics or a tender offer for shares of Silicon
Graphics capital stock, if the stockholders of Silicon Graphics immediately     
prior to such merger, consolidation or tender offer own less than 50% of the    
outstanding shares of Silicon Graphics (or, if the capital stock of Silicon     
Graphics is exchanged or converted in any such transaction for capital stock of 
another corporation, such corporation) immediately                              

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after such merger, consolidation or tender offer, each share of Class B Common  
Stock held by Silicon Graphics or its successor will automatically convert into 
one share of Class A Common Stock.                                              

    All conversions will be effected on a share-for-share basis. Shares of Class
A Common Stock are not convertible into shares of Class B Common Stock at any   
time or under any circumstances.                                                

Shares of Existing Common Stock have no conversion rights.              

    MERGER OR REORGANIZATION.  Upon the consummation of the Recapitalization, in
the event of any merger, consolidation or reorganization of MIPS Technologies   
with or into another entity in connection with which shares of New MIPS Common  
Stock are converted into or exchangeable for shares of stock, other securities  
or property (including cash), all holders of New MIPS Common Stock, regardless  
of class, will be entitled to receive the same kind and amount of shares of     
stock and other securities and property (including cash); provided, however,    
that, in the event that the shares of Class B Common Stock have not been        
converted into or exchanged for shares of Class A Common Stock, (i) in any such 
transaction, the holders of shares of Class A Common Stock and the holders of   
shares of Class B Common Stock may receive different kinds of shares of stock if
the only difference in such shares is the inclusion of voting rights which      
maintain the different voting rights of the holders of Class A Common Stock and 
holders of Class B Common Stock with respect to the election of the applicable  
percentage of the authorized number of directors on the MIPS Board of Directors 
as described above or (ii) if all or substantially all of the New MIPS Common   
Stock is exchanged for capital stock of another entity and such transaction is  
required to be accounted for as a "pooling-of-interests", the holders of shares 
of Class A Common Stock and the holders of shares of Class B Common Stock shall 
receive shares of stock in the acquiring entity based on the relative fair value
of a share of Class A Common Stock and a share of Class B Common Stock measured 
as of the announcement date for such transaction.                               

   At present, all shares of Existing Common Stock are entitled to receive the
same kind and amount of shares of stock and other securities and property       
(including cash) in the event of any merger, consolidation or reorganization of 
MIPS Technologies with and into another company.                                

   EXCHANGE OF CLASS B COMMON STOCK.  The Amended Certificate of Incorporation
will provide that, following a Tax-Free Distribution, MIPS Technologies may     
exchange all, but not less than all, of the outstanding shares of Class B Common
Stock for shares of Class A Common Stock on a one-for-one basis, provided,      
however, this provision will have no force or effect if, prior to such Tax-Free 
Distribution, Silicon Graphics delivers to MIPS Technologies an opinion of      
counsel, reasonably satisfactory to MIPS Technologies, to the effect that, based
in part on conversation with the IRS disclosed to MIPS Technologies, the        
inclusion of this provision in the Amended Certificate of Incorporation would   
have a material adverse effect on the ability of Silicon Graphics to timely     
obtain a favorable ruling from the IRS regarding the tax-free status of the     
Tax-Free Distribution. In addition, Silicon Graphics may limit MIPS             
Technologies' ability to exercise this exchange right pursuant to the Tax       
Agreement which will be entered into by MIPS Technologies and Silicon Graphics  
prior to a Tax-Free Distribution. See "The Exchange Agreement--Tax              
Indemnification Agreement."                                                     

    Shares of Existing Common Stock are not subject to exchange at the option of
MIPS Technologies or otherwise.                                                 

    LIQUIDATION.  Upon the consummation of the Recapitalization, in the event of
any liquidation, dissolution or winding-up of MIPS Technologies, whether        
voluntary or involuntary, after payment in full of the amounts required to be   
paid to holders of Preferred Stock, if any, the remaining assets and funds of   
MIPS Technologies will be distributed pro rata to the holders of the Class A    
Common Stock and Class B Common Stock.                                          

   At present, subject to any preferential rights of any outstanding series of
Preferred Stock created by the MIPS Board of Directors from time to time, upon  
the liquidation, dissolution or winding-up of MIPS                              

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Technologies, the holders of shares of Existing Common Stock will be entitled to
receive, pro rata, all assets of MIPS Technologies available for distribution to
such holders.                                                                   

    OTHER RIGHTS.  At present and upon the consummation of the Recapitalization,
no shares of Existing Common Stock are, and no shares of New MIPS Common Stock  
will be, subject to redemption or have preemptive or preferential rights to     
purchase additional shares of common stock of MIPS Technologies.                

Upon consummation of the Recapitalization, all the outstanding shares of
Class A Common Stock and Class B Common Stock will be legally issued, fully paid
and nonassessable.                                                              

PREFERRED STOCK                                                                 

The following provisions of the Existing Certificate of Incorporation   
regarding the Preferred Stock will not be amended by the Amended Certificate of 
Incorporation if the Recapitalization is consummated.                           

   The Preferred Stock is issuable from time to time either as a class without
series or in one or more series and with such designation, rights, privileges,  
restrictions and conditions for each class or series as shall be stated in the  
resolutions providing for designation and issue of each such series adopted by  
the MIPS Board of Directors. The MIPS Board of Directors is authorized by the   
Existing Certificate of Incorporation to determine, among other things, the     
voting, dividend, redemption, conversion and liquidation powers, rights and     
preferences and the limitations thereon of such series. MIPS Technologies       
believes that the ability of the MIPS Board of Directors to issue one or more   
series of Preferred Stock will provide MIPS Technologies with flexibility in    
structuring possible future financings and acquisitions, and in meeting other   
corporate needs that may arise. The authorized shares of Preferred Stock, as    
well as shares of Existing Common Stock, or New MIPS Common Stock, as the case  
may be, will be available for issuance without further action by MIPS           
stockholders, unless such action is required by applicable law or the rules of  
any stock exchange or automated quotation system on which the MIPS Technologies 
securities may be listed or traded.                                             

Although the MIPS Board of Directors has no present plans to issue any  
Preferred Stock, it could issue a series of Preferred Stock that could,         
depending on the terms of such series, impede the completion of a merger, tender
offer or other takeover attempt. The MIPS Board of Directors will make any      
determination to issue such shares based on its judgment as to the best         
interests of MIPS Technologies and its stockholders. The MIPS Board of Directors
could issue Preferred Stock with voting and other rights that could adversely   
effect the voting power of the holders of the Existing Common Stock, or New MIPS
Common Stock, as the case may be, and that could discourage an acquisition      
attempt through which an acquiror may be able to change the composition of MIPS 
Board of Directors, including a tender offer or other transaction that some, or 
a majority, of MIPS Technologies stockholders might believe to be in their best 
interests or in which stockholders might receive a premium for their stock over 
the then current market price of such stock.                                    

CORPORATE OPPORTUNITIES                                                         

The following provisions regarding corporate opportunities, presently   
contained in the Existing Certificate of Incorporation, will also be included in
the Amended Certificate of Incorporation if the Recapitalization is consummated.

  Silicon Graphics will have no duty to refrain from engaging in the same or
similar activities or lines of business as MIPS Technologies, and neither       
Silicon Graphics nor any officer or director thereof (except as provided below),
will be liable to MIPS Technologies or its stockholders for breach of any       
fiduciary duty by reason of any such activities of Silicon Graphics. In the     
event that Silicon Graphics acquires knowledge of a potential transaction or    
matter which may be a corporate opportunity for both Silicon Graphics and MIPS  
Technologies, Silicon Graphics will have no duty to communicate or offer such   
corporate opportunity to MIPS Technologies and will not be liable to MIPS       
Technologies or its stockholders for breach of any                              

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fiduciary duty as a stockholder of MIPS Technologies by reason of the fact that 
Silicon Graphics pursues or acquires such corporate opportunity for itself,     
directs such corporate opportunity to another person, or does not communicate   
information regarding such corporate opportunity to MIPS Technologies.          

  In the event that a director or officer of MIPS Technologies who is also a
director or officer of Silicon Graphics acquires knowledge of a potential       
transaction or matter which may be a corporate opportunity for both MIPS        
Technologies and Silicon Graphics, such director or officer of MIPS Technologies
will have fully satisfied and fulfilled the fiduciary duty of such director or  
officer to MIPS Technologies and its stockholders with respect to such corporate
opportunity if such director or officer acts in a manner consistent with the    
following policy:                                                               

   (i) a corporate opportunity offered to any person who is an officer of MIPS
      Technologies, and who is also a director but not an officer of Silicon
Graphics, shall belong to MIPS Technologies;                    

    (ii) a corporate opportunity offered to any person who is a director but not
        an officer of MIPS Technologies, and who is also a director or officer
of Silicon Graphics, shall belong to MIPS Technologies if such
      opportunity is expressly offered to such person in writing solely in
       his or her capacity as a director of MIPS Technologies, and otherwise
shall belong to Silicon Graphics; and                         

   (iii) a corporate opportunity offered to any person who is an officer of both
MIPS Technologies and Silicon Graphics shall belong to MIPS   
         Technologies if such opportunity is expressly offered to such person in
writing solely in his or her capacity as an officer of MIPS   
Technologies, and otherwise shall belong to Silicon Graphics. 

For purposes of the foregoing:                                          

(i) a director of MIPS Technologies who is chairman of the MIPS Board of
       Directors or of a committee thereof will not be deemed to be an officer
       of MIPS Technologies by reason of holding such position (without regard
       to whether such position is deemed an office of MIPS Technologies under
its by-laws), unless such person is a full-time employee of MIPS
Technologies; and                                               

 (ii) (a) the term "MIPS Technologies" will mean MIPS Technologies and all
    corporations, partnerships, joint ventures, associations and other
    entities in which MIPS Technologies beneficially owns (directly or
    indirectly) fifty percent or more of the outstanding voting stock,
         voting power, partnership interest or similar voting interests, and (b)
      the term "Silicon Graphics" will mean Silicon Graphics, Inc. and all
    corporations, partnerships, joint ventures, associations and other
    entities (other than MIPS Technologies, defined in accordance with
         clause (a) of this section (ii)) in which Silicon Graphics beneficially
        owns (directly or indirectly) fifty percent or more of the outstanding
     voting stock, voting power, partnership interests or similar voting
interests.                                                    

The foregoing provisions will expire on the date that Silicon Graphics  
ceases to own beneficially Existing Common Stock representing at least 20% of   
the total voting power of all classes of outstanding Existing Common Stock, or  
New MIPS Common Stock, as the case may be, and no person who is a director or   
officer of MIPS Technologies is also a director or officer of Silicon Graphics  
or any of its subsidiaries (other than MIPS Technologies).                      

  In addition to any vote of the stockholders required by the certificate of
incorporation of MIPS Technologies, until the time that Silicon Graphics ceases 
to own beneficially Existing Common Stock, or New MIPS Common Stock, as the case
may be, representing at least 20% of the total voting power of all classes of   
outstanding Existing Common Stock, or New MIPS Common Stock, as the case may be,
the affirmative vote of the holders of more than 80% of the total voting power  
of all classes of outstanding Existing Common Stock, or New MIPS Common Stock,  
as the case may be, shall be required to alter, amend or repeal in a manner     
adverse to the interests of Silicon Graphics and its subsidiaries (other than   
MIPS Technologies), or adopt any provision adverse to the interests of Silicon  
Graphics and its subsidiaries (other than MIPS Technologies), or inconsistent   
with, the corporate opportunity provisions described                            

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above. Accordingly, so long as Silicon Graphics beneficially owns Existing      
Common Stock, or New MIPS Common Stock, as the case may be, representing at     
least 20% of the total voting power of all classes of outstanding Existing      
Common Stock, or New MIPS Common Stock, as the case may be, it can prevent any  
such alteration, amendment, repeal or adoption.                                 

Any person purchasing or otherwise acquiring common stock of MIPS       
Technologies will be deemed to have notice of, and to have consented to, the    
foregoing provisions regarding corporate opportunities.                         

CERTIFICATE OF INCORPORATION AND BY-LAW PROVISIONS THAT MAY HAVE AN             
ANTI-TAKEOVER EFFECT                                                        

  Certain provisions of the certificate of incorporation and by-laws of MIPS
Technologies summarized below may be deemed to have an anti-takeover effect and 
may delay, discourage or prevent a tender offer or takeover attempt that a      
stockholder might consider to be in its best interest, including attempts that  
might result in a premium being paid over the market price of the Common Stock. 

BOARD OF DIRECTORS.  Upon the consummation of the Recapitalization, the 
Amended Certificate of Incorporation will provide that, subject to any rights of
holders of Preferred Stock to elect additional directors under specified        
circumstances, the number of directors of MIPS Technologies will be not less    
than five and not more than 10, with the exact number to be fixed from time to  
time by resolution of the MIPS Board of Directors. The directors, other than    
those who may be elected by the holders of Preferred Stock, will be classified, 
with respect to the time for which they severally hold office, into three       
classes, as nearly equal in number as possible; provided, however, that in the  
event that there is only one Class A Director, such Class A Director shall be in
the class of directors whose initial term ends on the date of the 1999 annual   
meeting of stockholders of MIPS Technologies. Each director will hold office    
until such person's successor is duly elected and qualified. In addition, the   
Amended Certificate of Incorporation and Amended By-Laws will provide that,     
subject to any rights of holders of Preferred Stock, and unless the MIPS Board  
of Directors otherwise determines, newly created directorships resulting from   
any increase in the number of directors shall be filled by the vote of the      
majority of the directors then in office, provided that following such          
appointment, 20% (or, if 20% is not a whole number, then the next lower whole   
number of directors that is closest to 20% of such membership) of the number of 
the directors on the MIPS Board of Directors as so increased, excluding the     
number of directors whom the holders of any series of Preferred Stock shall have
the exclusive right to elect, consists of directors elected by (or appointed on 
behalf of) the holders of Class A Common Stock. Any director elected or         
appointed in accordance with the preceding sentence shall hold office for the   
remainder of the full term of the class of director in which the new            
directorship was created and until such director's successor shall have been    
elected and qualified.                                                          

Any vacancies on the MIPS Board of Directors created by the death,      
resignation, disqualification or removal of a director may be filled by the vote
of the majority of the directors then in office elected by, or appointed on     
behalf of, the same class of stock that elected that director whose death,      
resignation or removal created the vacancy, unless there are no such directors, 
in which case such vacancy may be filled by the vote of the majority of all     
directors then in office, even if less than a quorum, or by the sole remaining  
director. Notwithstanding the immediately preceding sentence, any vacancy on the
MIPS Board of Directors created by the death, resignation, disqualification or  
removal of a director elected by (or appointed on behalf of) the holders of a   
class of stock may also be filled by a vote of the holders of such class of     
stock, unless there are no outstanding shares of such class of stock, in which  
case any such vacancy may be filled by a vote of the holders of the remaining   
class of stock. Any director elected to fill a vacancy created by the death,    
resignation, disqualification or removal of a director shall hold office for the
remainder of the full term of the director whose vacancy is being filled and    
until such director's successor shall have been elected and qualified. No       
decrease in the number of directors constituting the MIPS Board of Directors    
shall shorten the term of any incumbent director. Subject to any preferential   
rights of any outstanding series of Preferred Stock, any director may be removed
from office, with cause, by the affirmative vote of the holders of at least a   
majority of the outstanding New MIPS Common Stock, voting                       

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as a single class; provided, however, that prior to a Tax-Free Distribution, any
director elected by the holders of the Class B Common Stock may be removed, with
or without cause, by the affirmative vote of the holders of at least a majority 
of the outstanding Class B Common Stock.                                        

At present, the Existing Certificate of Incorporation and the Existing  
By-laws provide that, subject to any rights of holders of Preferred Stock to    
elect additional directors under specified circumstances, the number of         
directors of MIPS Technologies will be not more than 10 and not less than three.
In addition, the Existing Certificate of Incorporation and Existing By-laws     
provide that directors, other than those who may be elected by the holders of   
Preferred Stock, will be classified, with respect to the time for which they    
severally hold office, into three classes, as nearly equal in number as possible
and further provided that, subject to any rights of holders of Preferred Stock, 
and unless the MIPS Board of Directors otherwise determines, newly created      
directorships resulting from any increase in the number of directors and any    
vacancies on the MIPS Board of Directors resulting from death, resignation,     
disqualification, removal or other cause will be filled by the affirmative vote 
of a majority of the remaining directors then in office, even though less than a
quorum, or by the sole remaining director, and not by the stockholders. Subject 
to the rights of holders of Preferred Stock, any director may be removed from   
office only for cause by the affirmative vote of the holders of at least a      
majority of the Existing Common Stock; provided, however, that prior to the     
Trigger Date (as defined below), any director may be removed from office, with  
or without cause, by the affirmative vote of the holders of at least a majority 
of the Existing Common Stock.                                                   

  The provisions of the corporate documents described above would preclude a
third-party from removing incumbent directors and simultaneously gaining control
of MIPS Board of Directors by filling the vacancies created by removal with its 
own nominees. Under the classified board provision described above, it would    
take at least two elections of directors for any individual or group to gain    
control of the MIPS Board of Directors. Accordingly, these provisions could     
discourage a third party from initiating a proxy contest, making a tender offer 
or otherwise attempting to gain control of MIPS Technologies.                   

    NO STOCKHOLDER ACTION BY WRITTEN CONSENT; SPECIAL MEETINGS.  At present, and
upon the consummation of the Recapitalization, as of the time at which Silicon  
Graphics and its affiliates cease to beneficially own an aggregate of at least a
majority of the then outstanding shares of Existing Common Stock, or New MIPS   
Common Stock, as the case may be (the "Trigger Date"), any action required or   
permitted to be taken by the stockholders may be effected only at a duly called 
annual or special meeting of stockholders and may not be effected by a written  
consent in lieu of such a meeting. Effective as of the Trigger Date, except as  
otherwise required by law and subject to the rights of the holders of any       
Preferred Stock, special meetings of stockholders of MIPS Technologies for any  
purpose may be called only by certain specified officers of MIPS Technologies or
by any officer at the request in writing of a majority of the MIPS Board of     
Directors and, effective as of the Trigger Date, the power of the stockholders  
to call a special meeting is specifically denied. In addition, prior to the     
Trigger Date, MIPS Technologies will call a special meeting of stockholders     
promptly upon the request of Silicon Graphics. These provisions may have the    
effect of delaying consideration of a stockholder proposal until the next annual
meeting unless a special meeting is called by the MIPS Board of Directors or    
certain specified officers.                                                     

ADVANCE NOTICE PROCEDURES.  At present, and upon the consummation of the
Recapitalization, an advance notice procedure for the nomination, other than by 
or at the direction of MIPS Board of Directors, of candidates for election as   
directors, as well as for other stockholder proposals, to be considered at      
annual meetings of stockholders, must be followed to take such actions. In      
general, notice of intent to nominate a director or raise matters at such       
meetings will have to be received in writing by MIPS Technologies not less than 
60 nor more than 90 days prior to the anniversary of the previous year's annual 
meeting of stockholders, and must contain certain information concerning the    
person to be nominated or the matters to be brought before the meeting and      
concerning the stockholder submitting the proposal. If the chairman of a meeting
determines that an individual was not nominated, or other business was not      
brought before the meeting, in accordance with the advance notice procedures,   
such individual will not be                                                     

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eligible for election as a director, or such business will not be conducted at  
such meeting, as the case may be.                                               

The advance notice procedures do not apply to Silicon Graphics and its  
affiliates prior to the Trigger Date.                                           

  CHARTER AMENDMENTS.  At present, the Existing Certificate of Incorporation
provides that the affirmative vote of the holders of at least 80% of the        
outstanding Common Stock is required to amend, repeal or adopt any provision    
inconsistent with the foregoing provisions of such Certificate of Incorporation.
The Existing Certificate of Incorporation further provides that certain         
provisions of the Existing By-laws may be altered, amended or repealed by the   
affirmative vote of directors constituting not less than a majority of the      
entire MIPS Board of Directors (if effected by action of the MIPS Board of      
Directors) or by the affirmative vote of the holders of at least 80% of the     
voting power of all classes of outstanding capital stock, voting together as a  
single class (if effected by action of the stockholders).                       

The foregoing provisions of the Existing Certificate of Incorporation   
regarding charter amendments will not be amended by the Amended Certificate of  
Incorporation if the Recapitalization is approved.                              

SECTION 203 OF DELAWARE GENERAL CORPORATION LAW                                 

Section 203 of the DGCL provides that, subject to certain exceptions    
specified therein, an "interested stockholder" of a Delaware corporation shall  
not engage in any business combination, including mergers or consolidations or  
acquisitions of additional shares of the corporation, with the corporation for a
three-year period following the date that such stockholder becomes an interested
stockholder unless (i) prior to such date, the board of directors of the        
corporation approved either the business combination or the transaction which   
resulted in the stockholder becoming an interested stockholder, (ii) upon       
consummation of the transaction which resulted in the stockholder becoming an   
interested stockholder, the interested stockholder owned at least 85% of the    
voting stock of the corporation outstanding at the time the transaction         
commenced (excluding certain shares), or (iii) on or subsequent to such date,   
the business combination is approved by the board of directors of the           
corporation and authorized at an annual or special meeting of stockholders by   
the affirmative vote of at least 66 2/3% of the outstanding voting stock of the 
corporation which is not owned by the interested stockholder. Except as         
otherwise specified in Section 203, an interested stockholder is defined to     
include (x) any person that is the owner of 15% or more of the outstanding      
voting securities of the corporation, or is an affiliate or associate of the    
corporation and was the owner of 15% or more of the outstanding voting stock of 
the corporation at any time within three years immediately prior to the date of 
determination and (y) the affiliates and associates of any such person.         

Under certain circumstances, Section 203 makes it more difficult for a  
person who would be an interested stockholder to effect various business        
combinations with a corporation for a three-year period. MIPS Technologies has  
not, and will not, if the Recapitalization is consummated, elect to be exempt   
from the restrictions imposed under Section 203. However, Silicon Graphics and  
its affiliates are excluded from the definition of "interested stockholder"     
pursuant to the terms of Section 203. The provisions of Section 203 may         
encourage persons interested in acquiring MIPS Technologies to negotiate in     
advance with the MIPS Board of Directors, since the stockholder approval        
requirement would be avoided if a majority of the directors then in office      
approves either the business combination or the transaction which results in any
such person becoming an interested stockholder. Such provisions also may have   
the effect of preventing changes in the management of MIPS Technologies. It is  
possible that such provisions could make it more difficult to accomplish        
transactions which MIPS Technologies' stockholders may otherwise deem to be in  
their best interests.                                                           

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LIMITATION OF LIABILITY                                                         

  The Existing Certificate of Incorporation provides that a director of MIPS
Technologies will not be personally liable to MIPS Technologies or its          
stockholders for monetary damages for breach of fiduciary duty as a director,   
except, if required by the DGCL as amended from time to time, for liability (i) 
for breach of the director's duty of loyalty to MIPS Technologies or its        
stockholders, (ii) for acts or omissions not in good faith or which involve     
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the DGCL, which concerns unlawful payments of dividends, stock purchases or     
redemptions, or (iv) for any transaction from which the director derived an     
improper personal benefit. Neither the amendment or repeal of such provision    
will eliminate or reduce the effect of such provision in respect of any matter  
occurring, or any cause of action, suit or claim that, but for such provision,  
would accrue or arise prior to such amendment or repeal. While the Existing     
Certificate of Incorporation provides directors with protection from monetary   
damages for breaches from their duty of care, it does not eliminate such duty.  
Accordingly, the Existing Certificate of Incorporation will have no effect on   
the availability of equitable remedies such as an injunction or rescission based
on a director's breach of his or her duty of care.                              

The foregoing provisions of the Existing Certificate of Incorporation   
regarding limitation of liability will not be amended by the Amended Certificate
of Incorporation if the Recapitalization is approved.                           

LISTING                                                                         

    Application will be made to The Nasdaq Stock Market, Inc. to redesignate the
Existing Common Stock as Class A Common Stock. The Class A Common Stock will be 
quoted on the Nasdaq National Market under the symbol "MIPS".                   

TRANSFER AGENT AND REGISTRAR                                                    

The Transfer Agent and Registrar for the New MIPS Common Stock will be  
Boston EquiServe Limited Partnership located at 150 Royall Street, Canton,      
Massachusetts. Its phone number is (781) 575-2000.                              

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STOCKHOLDER PROPOSALS 

MIPS Technologies will hold a 1999 Annual Meeting of Stockholders (the  
"Annual Meeting"). The deadline for stockholders to submit proposals pursuant to
Rule 14a-8 of the Exchange Act for inclusion in MIPS Technologies' proxy        
statement and form of proxy for the Annual Meeting is             , 1999. The   
date after which notice of a stockholder proposal submitted outside of the      
processes of Rule 14a-8 of the Exchange Act is considered untimely is           
            , 1999. If notice of a stockholder proposal submitted outside of the
processes of Rule 14a-8 of the Exchange Act is received by MIPS Technologies    
after             , 1999, then MIPS Technologies' proxy for the Annual Meeting  
may confer discretionary authority to vote on such matter without any discussion
of such matter in the proxy statement for the Annual Meeting.                   

EXPERTS 

Ernst & Young LLP, independent auditors, have audited our financial     
statements included in our Annual Report on Form 10-K for the year ended June   
30, 1998, as set forth in their report, which is incorporated in this proxy     
statement by reference. Our financial statements are incorporated by reference  
in reliance upon their report given on their authority as experts in accounting 
and auditing.                                                                   

WHERE YOU CAN FIND MORE INFORMATION 

MIPS Technologies is subject to the informational requirements of the   
Exchange Act and, in accordance therewith, files reports, proxy statements and  
other information with the Commission. The reports, proxy statements and other  
information filed by MIPS Technologies with the Commission can be inspected and 
copied at the public reference facilities maintained by the Commission at Room  
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's   
Regional Offices located at 7 World Trade Center, 13th floor, New York, New York
10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies  
of such material also can be obtained at prescribed rates from the Public       
Reference Section of the Commission at 450 Fifth Street, Washington, D.C. 20549.
Information regarding the Public Reference Room may be obtained by calling the  
Commission at (800) 732-0330. In addition, MIPS Technologies is required to file
electronic versions of such material with the Commission through the            
Commission's Electronic Data Gathering, Analysis and Retrieval (EDGAR) system.  
The Commission maintains a World Wide Web site at http://www.sec.gov that       
contains reports, proxy and information statements and other information        
regarding registrants that file electronically with the Commission. Existing    
Common Stock is listed on the Nasdaq National Market and reports and other      
information concerning MIPS Technologies can also be inspected at the offices of
the National Association of Securities Dealers, Inc. at 1735 K Street, N.W.,    
Washington, D.C. 20001-1500.                                                    

    The Commission allows us to "incorporate by reference" information into this
Proxy Statement, which means that we can disclose important information to you  
by referring you to another document filed separately with the Commission.      
Statements contained in this Proxy Statement or in any document incorporated by 
reference in this Proxy Statement as to the contents of any contract or other   
document referred to herein or therein are not necessarily complete, and in each
instance reference is made to the copy of such contract or other document (if   
any) filed as an exhibit to such other document, each such statement being      
qualified in all respects by such reference. The information incorporated by    
reference is deemed to be part of this Proxy Statement. This Proxy Statement    
incorporates by reference the documents set forth below that MIPS Technologies  
has previously filed with the Commission. These documents contain important     
information about MIPS Technologies and its finances.                           

   MIPS Technologies (File No. 000-24487) incorporates by reference herein the
following portions of the following documents previously filed with the         
Commission:                                                                     

   1.  Items 7, 8 and 9 in Part II of MIPS Technologies' Annual Report on Form
     10-K for the fiscal year ended June 30, 1998 (as amended on Form 10-K/A
filed November 17, 1998); and                                     

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  2.  Items 2 and 3 in Part I of MIPS Technologies' Quarterly Report on Form
10-Q for the quarter ended September 30, 1998.                    

  All documents and reports subsequently filed by MIPS Technologies pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this 
Proxy Statement and prior to the date of the Special Meeting shall be deemed to 
be incorporated by reference in this Proxy Statement and to be part hereof from 
the date of filing of such documents or reports. Any statement contained in a   
document incorporated or deemed to be incorporated by reference herein shall be 
deemed to be modified or superseded for purposes of this Proxy Statement to the 
extent that a statement contained herein or in any other subsequently filed     
document which also is or is deemed to be incorporated by reference herein      
modifies or supersedes such statement. Any such statement so modified or        
superseded shall not be deemed, except as so modified or superseded, to         
constitute a part of this Proxy Statement.                                      

The Proxy Statement incorporates important business and financial       
information about MIPS Technologies that is not included in or delivered with   
this Proxy Statement. Documents incorporated by reference which are not         
presented herein or delivered herewith (other than exhibits to such documents   
unless such exhibits are specifically incorporated by reference) are available  
to any person, including any beneficial owner, to whom this Proxy Statement is  
delivered, on written or oral request, without charge, to MIPS Technologies,    
Inc., 1225 Charleston Road, Mountain View, California, 94043 (telephone number: 
(650) 567-5000), Attention: Secretary. In order to ensure timely delivery of any
of such documents, any request should be made by             , 1999.            

No persons have been authorized to give any information or to make any  
representation other than those contained in this Proxy Statement in connection 
with the solicitations of proxies or the offering of securities made hereby and,
if given or made, such information or representation must not be relied upon as 
having been authorized by MIPS Technologies or any other person. This Proxy     
Statement does not constitute an offer to sell, or a solicitation of an offer to
buy, any securities, or the solicitation of a proxy, in any jurisdiction to or  
from any person to whom it is not lawful to make any such offer or solicitation 
in such jurisdiction. Neither the delivery of this Proxy Statement nor any      
distribution of securities made hereunder shall under any circumstances create  
an implication that there has been no change in the affairs of MIPS Technologies
since the date hereof or that the information herein is correct as of any time  
subsequent to its date.                                                         

                                         By Order of the Board of Directors of
                           MIPS Technologies, Inc.

                   Sandy Creighton
             SECRETARY

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LIST OF DEFINED TERMS 

                                                        [Enlarge/Download Table]
                                                                                         
Amended By-laws....................................................................... 12
Amended Certificate of Incorporation.................................................. 12
Annual Meeting........................................................................ 42
Change in Tax Law..................................................................... 25
Class A Common Stock.................................................................. 12
Class A Directors..................................................................... 19
Class B Common Stock.................................................................. 12
Class B Directors..................................................................... 19
Code.................................................................................. 15
Existing By-Laws...................................................................... 15
Existing Certificate of Incorporation................................................. 13
Existing Common Stock................................................................. 12
MIPS Exchange Right................................................................... 21
MIPS Public Stockholders.............................................................. 13
New MIPS Common Stock................................................................. 12
Recapitalization...................................................................... 12
Recapitalization Proposal............................................................. 12
Record Date........................................................................... 12
Required Purchase Amount.............................................................. 24
Special Committee..................................................................... 12
Special Meeting....................................................................... 12
Tax-Free Distribution................................................................. 15
Trigger Date.......................................................................... 39

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                                                                         ANNEX A

AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
MIPS TECHNOLOGIES, INC. 

MIPS TECHNOLOGIES, INC., a Delaware corporation, hereby certifies as    
follows:                                                                        

1. The name of the corporation is MIPS Technologies, Inc. (the          
"Corporation"). The date of filing of its original Certificate of Incorporation 
with the Secretary of State of the State of Delaware (the "Delaware Secretary of
State") was June 8, 1992, and the Restated Certificate of Incorporation was     
filed with the Secretary of State of the State of Delaware on June 30, 1998. The
original name of the Corporation was MIPS Technologies, Inc.                    

 2. Pursuant to Sections 242 and 245 of the General Corporation Law of the
State of Delaware (the "DGCL"), this Amended and Restated Certificate of        
Incorporation restates and integrates and further amends the provisions of the  
Restated Certificate of Incorporation of this Corporation. Pursuant to and in   
accordance with Sections 242 and 245 of the DGCL, this Amended and Restated     
Certificate of Incorporation was proposed by the directors of the Corporation   
and adopted by the holders of a majority of the outstanding shares of capital   
stock of the Corporation entitled to vote at a special meeting of the           
stockholders.                                                                   

3. The text of the Certificate of Incorporation is hereby amended and   
restated in its entirety to read as follows:                                    

ARTICLE I 
NAME

   The name of the corporation is MIPS Technologies, Inc. (the "Corporation").

ARTICLE II
REGISTERED AGENT

   The address of the Corporation's registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington,     
County of New Castle. The name of the Corporation's registered agent at such    
address is The Corporation Trust Company.                                       

ARTICLE III 
PURPOSE 

 The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of the
State of Delaware (the "DGCL") as the same exists or may hereafter be amended.  

ARTICLE IV
CAPITAL STOCK 

  SECTION 1.  (a) The total number of shares of all classes of capital stock
that the Corporation shall have the authority to issue is 300,000,000 shares, of
which (i) 150,000,000 shares shall be Class A Common Stock, par value $0.001 per
share (the "Class A Common Stock"), (ii) 100,000,000 shares shall be Class B    
Common Stock, par value $0.001 per share (the "Class B Common Stock", and       
together with the Class A Common Stock, the "Common Stock"), and (iii)          
50,000,000 shares shall be preferred stock, par value $0.001 per share (the     
"Preferred Stock").                                                             

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   (b) Any amendment to this Amended and Restated Certificate of Incorporation
(the "Certificate of Incorporation") which shall increase or decrease the number
of authorized shares of any class or classes of stock may be adopted by the     
affirmative vote of the holders of a majority of the outstanding shares of      
Common Stock of the Corporation, irrespective of the provisions of Section      
242(b)(2) of the DGCL or any corresponding provision hereinafter enacted.       

(c) Immediately upon effectiveness of this Certificate of Incorporation,
each share of common stock of the Corporation, par value $0.001 per share,      
issued and outstanding immediately prior to such effectiveness, shall be changed
into and reclassified as one share of Class A Common Stock.                     

SECTION 2.  The following is a statement of the relative powers,        
preferences, rights, qualifications, limitations and restrictions of the shares 
of Class A Common Stock and Class B Common Stock:                               

  (a)  GENERAL.  Except as otherwise expressly provided herein or as
   provided by law, the relative powers, preferences, rights, and the relative
 participating, optional and other special rights, and the qualifications,
    limitations and restrictions of the shares of Class A Common Stock and Class
B Common Stock shall be identical in all respects.                      

    (b)  DIVIDENDS OR DISTRIBUTIONS OF CASH OR PROPERTY.  Subject to the
rights of the holders of any series of Preferred Stock, and except as   
  otherwise provided for herein, the holders of Class A Common Stock and the
   holders of Class B Common Stock shall be entitled to receive such dividends
    and other distributions in cash, stock of any corporation (other than Common
   Stock of the Corporation) or property of the Corporation as may be declared
thereon by the Board of Directors of the Corporation (the "Board of     
Directors") from time to time out of assets of the Corporation legally  
   available therefor and shall share equally on a per share basis in all such
dividends and other distributions.                                      

(c)  DIVIDENDS OR DISTRIBUTIONS OF COMMON STOCK.  In the case of
    dividends or other distributions payable in, or reclassifications involving,
   Common Stock, including distributions pursuant to stock splits or divisions
of Common Stock, only shares of Class A Common Stock shall be paid or   
  distributed with respect to shares of Class A Common Stock and only shares
   of Class B Common Stock shall be paid or distributed with respect to shares
 of Class B Common Stock. The number of shares of Class A Common Stock and
 Class B Common Stock so paid or distributed shall be equal in number on a
per share basis.                                                        

    (d)  STOCK SUBDIVISIONS AND COMBINATIONS.  The Corporation shall not
subdivide, reclassify or combine stock of either class of Common Stock  
without at the same time making a proportionate subdivision,            
reclassification or combination of the other class.                     

   (e)  VOTING.  Voting power shall be divided between the classes and
series of stock as follows:                                             

          (i) Subject to Section (2)(e)(ii) of this Article IV, with respect
 to the election of directors of the Corporation, holders of Class A
    Common Stock, voting separately as a class, shall be entitled to elect
      that number of directors (the "Class A Directors") which constitutes 20%
       of the number of members of the Board of Directors determined as provided
    in Section 2 of Article V (or, if such 20% is not a whole number, then
     the next lower whole number of directors that is closest to 20% of such
    membership). Each share of Class A Common Stock shall have one vote in
   the election of such directors. Subject to Section (2)(e)(ii) of this
 Article IV, holders of Class B Common Stock, voting separately as a
   class, shall be entitled to elect the remaining directors (other than
       directors elected by the holders of Preferred Stock). Each share of Class
       B Common Stock shall have one vote in the election of such directors. For
      purposes of Section 2(e) and Section 2(f) of this Article IV, references
      to the number of members of the Board of Directors shall not include any
      directors whom the holders of any shares of Preferred Stock may have the
    exclusive right to elect as granted in accordance with Section 6(a) of
this Article IV.                                                  

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           (ii) At such time as all outstanding shares of Class B Common Stock
      shall have been converted into or exchanged for shares of Class A Common
      Stock in accordance with the provisions of this Article IV, then Section
   2(e)(i) of this Article IV shall have no further force or effect, and
      thereafter, subject to the rights of the holders of Preferred Stock, the
       holders of the Class A Common Stock, voting as a class, shall be entitled
to elect all members of the Board of Directors.                   

        (iii) Except as otherwise specified herein, the holders of Class A
       Common Stock and holders of Class B Common Stock (A) shall in all matters
      not otherwise specified in this Section (2)(e) or Section (2)(f) of this
Article IV vote together as a single class (including, without    
  limitation, with respect to increases or decreases in the authorized
      number of shares of any class of Common Stock), with each share of Class
       A Common Stock and Class B Common Stock having one vote, and (B) shall be
     entitled to vote as separate classes only when required by law to do so
under mandatory statutory provisions that may not be excluded or  
overridden by a provision of this Certificate of Incorporation.   

            (iv) Except as set forth in this Section (2)(e) or Section (2)(f) of
       this Article IV, the holders of Class A Common Stock shall have exclusive
   voting power (except for any voting powers of any series of Preferred
      Stock) on all matters at any time when no Class B Common Stock is issued
 and outstanding, and the holders of Class B Common Stock shall have
   exclusive voting power (except for any voting powers of any series of
      Preferred Stock) on all matters at any time when no Class A Common Stock
is issued and outstanding.                                        

      (v) Notwithstanding anything to the contrary contained in this
Section 2(e) of this Article IV, following a Tax-Free Spin-Off (as
       defined in Section 2(i)(i) of this Article IV), for so long as any person
      or entity or group of persons or entities acting in concert beneficially
     own 10% or more of the outstanding shares of Class B Common Stock, such
   person, entity or group shall not, with respect to any such shares of
       Class B Common Stock, have any voting powers in respect of such shares of
      Class B Common Stock or be entitled to exercise any voting rights in any
       election of directors unless such person or entity is also the beneficial
     owner of at least an equivalent percentage of the outstanding shares of
       Class A Common Stock. For purposes of this Section (2)(e)(v), "beneficial
       ownership" means ownership, directly or indirectly, including through any
      contract, arrangement, understanding, relationship or otherwise, written
    or oral, formal or informal, controls the voting power (which includes
the power to vote or to direct the voting) of such Common Stock.  

       (f)  VACANCIES.  Any vacancy in the office of a director created by the
   death, resignation, disqualification or removal of a director may be filled
by the vote of the majority of the directors then in office (or the sole
    remaining director) elected by (or appointed on behalf of) the same class of
stock that elected the director (or on behalf of which the director was 
    appointed) whose death, resignation, disqualification or removal created the
    vacancy, unless there are no such directors or no outstanding shares of such
   class of stock, in which case such vacancy may be filled by the vote of the
   majority of all directors then in office, even if less than a quorum, or by
    the sole remaining director. Notwithstanding anything in this Section (2)(f)
or Section (2)(e) of this Article IV to the contrary, any vacancy in the
   office of a director created by the death, resignation, disqualification or
   removal of a director elected by (or appointed on behalf of) the holders of
 a class of stock may also be filled by a vote of holders of such class of
stock, unless there are no outstanding shares of such class of stock, in
 which case any such vacancy may be filled by a vote of the holders of the
   remaining class of stock. Any director elected to fill a vacancy created by
    the death, resignation, disqualification or removal of a director shall hold
  office for the remainder of the full term of the director whose vacancy is
    being filled and until such director's successor shall have been elected and
   qualified unless removed and replaced pursuant to Section 4(c) of Article V
and this Section (2)(f).                                                

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        Subject to the rights, if any, of the holders of any series of Preferred
  Stock then outstanding, any vacancy on the Board of Directors that results
  from an increase in the number of directors shall be filled by the vote of
  the majority of the directors then in office; PROVIDED that (unless all of
the outstanding shares of Class B Common Stock shall have been converted
into or exchanged for shares of Class A Common Stock) following such    
 appointment, 20% of the number of members of the Board of Directors as so
   increased (or, if such 20% is not a whole number, then the next lower whole
 number of directors that is closest to 20% of such membership) consist of
directors elected by (or appointed on behalf of) the holders of Class A 
   Common Stock and the remaining members of the Board of Directors consist of
   directors elected by (or appointed on behalf of) the holders of the Class B
Common Stock. Any director elected (or appointed) in accordance with the
  preceding sentence shall hold office for the remainder of the full term of
  the class of directors in which the new directorship was created and until
    such director's successor shall have been elected and qualified, unless such
  director is removed and replaced pursuant to Section 4(c) of Article V and
this Section (2)(f).                                                    

        (g)  MERGER OR REORGANIZATION.  In the case of any reorganization or any
    consolidation of the Corporation with one or more other entities or a merger
 of the Corporation with another entity, each holder of a share of Class A
Common Stock shall be entitled to receive with respect to such share the
 same kind and amount of shares of stock and other securities and property
(including cash) receivable upon such reorganization, consolidation or  
   merger by a holder of a share of Class B Common Stock, and each holder of a
  share of Class B Common Stock shall be entitled to receive with respect to
   such share the same kind and amount of shares of stock and other securities
and property (including cash) receivable upon such reorganization,      
consolidation or merger by a holder of a share of Class A Common Stock; 
    PROVIDED, HOWEVER, that, in the event that the outstanding shares of Class B
    Common Stock have not been converted into or exchanged for shares of Class A
   Common Stock, (i) in any such reorganization, consolidation, or merger, the
    holders of shares of Class A Common Stock and the holders of shares of Class
 B Common Stock may receive different kinds of shares of stock if the only
  difference in such shares is the inclusion of voting rights which maintain
the different voting rights of the holders of Class A Common Stock and  
holders of Class B Common Stock with respect to the election of the     
 applicable percentage of the authorized number of members of the Board of
   Directors as described in Section (2)(e)(i) of this Article IV and (ii) if,
pursuant to any such transaction all or substantially all of the Common 
Stock is exchanged for stock of another entity and such transaction is  
   required to be accounted for as a pooling-of-interests under U.S. generally
accepted accounting principles, the holders of shares of Class A Common 
Stock and the holders of shares of Class B                              
   Common Stock shall receive shares of stock in the acquiring entity based on
 the relative fair value of a share of Class A Common Stock and a share of
   Class B Common Stock. For purposes of this Section (2)(g), fair value shall
be measured as of the announcement date for such transaction.           

  (h)  LIQUIDATION.  In the event of any liquidation, dissolution or
winding-up of the affairs of the Corporation, whether voluntary or      
    involuntary, after payment in full of the amounts required to be paid to the
holders of Preferred Stock, the remaining assets and funds of the       
Corporation shall be distributed pro rata to the holders of the Class A 
  Common Stock and the holders of Class B Common Stock. For purposes of this
 Section 2(h), the voluntary sale, conveyance, lease, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all or
substantially all of the assets of the Corporation or a consolidation or
 merger of the Corporation with one or more other entities (whether or not
  the Corporation is the corporation surviving such consolidation or merger)
   shall not be deemed to be a liquidation, dissolution or winding-up, whether
voluntary or involuntary.                                               

(i)  CONVERSION.                                                

         (i) Prior to the date on which shares of Class B Common Stock are
   distributed to the stockholders of Silicon Graphics, Inc., a Delaware
corporation (Silicon Graphics, Inc., together with its successors,
  "Silicon Graphics"), in a Tax-Free Spin-Off (as defined below), each
      share of Class B Common Stock shall automatically convert into one share
of Class A Common Stock                                           

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    upon the transfer of such share if, after such transfer, such share is
     not beneficially owned by Silicon Graphics or any subsidiary of Silicon
       Graphics. Shares of Class B Common Stock shall not convert into shares of
    Class A Common Stock (A) in any transfer effected in connection with a
      distribution of Class B Common Stock to stockholders of Silicon Graphics
    in a transaction (including any distribution in exchange for shares of
       capital stock or other securities of Silicon Graphics) intended generally
   to qualify under Section 355 of the Internal Revenue Code of 1986, as
      amended from time to time (the "Code") (a "Tax-Free Spin-Off") or (B) in
    any transfer after a Tax-Free Spin-Off. Following a Tax-Free Spin-Off,
       shares of Class B Common Stock shall no longer be convertible into shares
      of Class A Common Stock except as set forth in Section (2)(i)(ii)-(v) of
this Article IV.                                                  

       For purposes of this Section (2)(i), a Tax-Free Spin-Off shall be
 deemed to have occurred at the time shares are first transferred to
stockholders of Silicon Graphics following receipt of an affidavit
    described in Section 2(i)(viii)(C) of this Article IV. For purposes of
       this Section (2)(i), the term "beneficially owned" with respect to shares
 of Class B Common Stock means ownership by a person or entity that,
       directly or indirectly, through any contract, arrangement, understanding,
      relationship or otherwise, controls the voting power (which includes the
     power to vote or to direct the voting) of such Class B Common Stock and
       the term "subsidiary" means, as to any person or entity, all corporations
      (other than the Corporation), partnerships, joint ventures, associations
or other entities in which such person or entity beneficially owns
   (directly or indirectly) 50% or more of the outstanding voting stock,
voting power, partnership interests or similar voting interests.  

       (ii) In the event of a Tax-Free Spin-Off, each share of Class B
       Common Stock shall automatically convert into one share of Class A Common
   Stock on the fifth anniversary of the date on which shares of Class B
       Common Stock are first transferred to stockholders of Silicon Graphics in
  a Tax-Free Spin-Off unless, prior to such Tax-Free Spin-Off, Silicon
    Graphics delivers to the Corporation an opinion of counsel, reasonably
   satisfactory to the Corporation, to the effect that, based in part on
      conversations with the Internal Revenue Service (the "IRS") disclosed to
      the Corporation, such automatic conversion would have a material adverse
    effect on the ability of Silicon Graphics to timely obtain a favorable
ruling from the IRS regarding the tax-free status of the Tax-Free 
   Spin-Off. If such an opinion is received, approval of such conversion
  shall be submitted to a vote of the holders of the Common Stock at a
     meeting of stockholders called for such purpose, as soon as practicable
    after the fifth anniversary of the Tax-Free Spin-Off, unless, prior to
     such Tax-Free Spin-Off, Silicon Graphics delivers to the Corporation an
    opinion of counsel, reasonably satisfactory to the Corporation, to the
       effect that, based in part on conversations with the IRS disclosed to the
Corporation, such vote would have a material adverse effect on the
      ability of Silicon Graphics to timely obtain a favorable ruling from the
IRS regarding the tax-free status of the Tax-Free Spin-Off. At the
     meeting of stockholders called for such purpose, every holder of Common
      Stock shall be entitled to one vote in person or by proxy for each share
      of Common Stock standing in his or her name on the transfer books of the
      Corporation. Approval of such conversion shall require the approval of a
     majority of the votes entitled to be cast by the holders of the Class A
  Common Stock and the holders of the Class B Common Stock present and
       voting, voting together as a single class, and the holders of the Class B
Common Stock shall not be entitled to a separate class vote. Such 
       conversion shall be effective on the date on which such approval is given
at a meeting of stockholders called for such purpose.             

         (iii) In the case of any merger or consolidation of the Corporation
    pursuant to which all or substantially all of the capital stock of the
Corporation is exchanged for the stock of another entity and the  
 stockholders of the Corporation immediately prior to such merger or
     consolidation own less than 50% of the outstanding shares of such other
  entity immediately after such merger or consolidation, each share of
Class B Common Stock shall automatically convert into one share   

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    of Class A Common Stock immediately prior to the effectiveness of such
    merger or consolidation, unless, prior to a Tax-Free Spin-Off, Silicon
    Graphics delivers to the Corporation an opinion of counsel, reasonably
   satisfactory to the Corporation, to the effect that, based in part on
     conversations with the IRS disclosed to the Corporation, such automatic
       conversion would have a material adverse effect on the ability of Silicon
     Graphics to timely obtain a favorable ruling from the IRS regarding the
tax-free status of the Tax-Free Spin-Off.                         

          (iv) Prior to a Tax-Free Spin-Off, upon the closing of a merger or
consolidation involving Silicon Graphics or a tender offer for the
capital stock of Silicon Graphics, if the stockholders of Silicon 
      Graphics immediately prior to such merger, consolidation or tender offer
     own less than 50% of the outstanding shares of capital stock of Silicon
    Graphics (or, if the capital stock of Silicon Graphics is exchanged or
converted in any such transaction for capital stock of another    
corporation, such corporation) immediately after such merger,     
       consolidation or tender offer, each share of Class B Common Stock held by
    Silicon Graphics or its successor shall automatically convert into one
share of Class A Common Stock.                                    

            (v) Prior to a Tax-Free Spin-Off, each share of Class B Common Stock
      shall automatically convert into one share of Class A Common Stock if at
any time prior to such Tax-Free Spin-Off the aggregate number of  
  outstanding shares of Class B Common Stock owned by Silicon Graphics
     and/or any of its subsidiaries is less than 50% of the aggregate number
      of shares of Common Stock then outstanding; PROVIDED, HOWEVER, that such
  automatic conversion shall not occur if, prior to the closing of any
transaction or the occurrence of any event which would reduce the 
     aggregate number of outstanding shares of Class B Common Stock owned by
     Silicon Graphics and/or any of its subsidiaries to less than 50% of the
aggregate number of shares of Common Stock then outstanding, the  
     independent directors of the Board of Directors and the Chief Executive
  Officer of the Corporation unanimously determine that such automatic
conversion is not in the interests of the Corporation and its     
     stockholders, other than Silicon Graphics, which determination shall be
      irrevocable and final. Upon the closing of any subsequent transaction or
      the occurrence of any event which would further reduce the percentage of
   the shares of Common Stock then outstanding held by Silicon Graphics,
     each share of Class B Common Stock shall automatically convert into one
     share of Class A Common Stock, unless, prior to the closing of any such
transaction or the occurrence of any such event, the independent  
    directors of the Board of Directors and the Chief Executive Officer of
     the Corporation unanimously determine that such automatic conversion is
      not in the interests of the Corporation and its stockholders, other than
   Silicon Graphics, which determination shall be irrevocable and final.

       Notwithstanding the foregoing, prior to a Tax-Free Spin-Off, each
      share of Class B Common Stock shall automatically convert into one share
    of Class A Common Stock if at any time prior to such Tax-Free Spin-Off
      the aggregate number of outstanding shares of Class B Common Stock owned
    by Silicon Graphics and/or any of its subsidiaries is less than 30% of
the aggregate number of shares of Common Stock then outstanding.  

            (vi) The Corporation will provide notice of any automatic conversion
       of all outstanding shares of Class B Common Stock to holders of record of
the Common Stock as soon as practicable following such conversion;
PROVIDED, HOWEVER, that the Corporation may satisfy such notice   
 requirement by providing such notice prior to such conversion. Such
  notice shall be provided by mailing notice of such conversion, first
     class postage prepaid, to each holder of record of the Common Stock, at
such holder's address as it appears on the transfer books of the  
   Corporation; PROVIDED, HOWEVER, that neither the failure to give such
      notice nor any defect therein shall affect the validity of the automatic
      conversion of any shares of Class B Common Stock. Each such notice shall
state, as appropriate, the following:                             

(A) the automatic conversion date;                

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           (B) that all outstanding shares of Class B Common Stock are
automatically converted;                                  

             (C) the place or places at which certificates for such shares
are to be surrendered for conversion; and                 

             (D) that no dividends will be declared on the shares of Class B
Common Stock converted after such conversion date.        

           Immediately upon such conversion, the rights of the holders of shares
   of Class B Common Stock as such shall cease and such holders shall be
       treated for all purposes as having become the record owners of the shares
     of Class A Common Stock issued upon such conversion; PROVIDED, HOWEVER,
    that such persons shall be entitled to receive when paid any dividends
    declared on the Class B Common Stock as of a record date preceding the
   time of such conversion and unpaid as of the time of such conversion,
subject to Section (2)(i)(vii) of this Article IV.                

         (vii) Prior to a Tax-Free Spin-Off, no one other than those persons
in whose names shares of Class B Common Stock become originally   
  registered on the stock ledger of the Corporation by reason of their
     record ownership of shares of Class A Common Stock which were exchanged
    for shares of Class B Common Stock in accordance with the terms of the
Exchange Agreement, dated as of            , 1999, between the    
     Corporation and Silicon Graphics or Section 2(k) of this Article IV, or
 transferees or successive transferees who receive shares of Class B
       Common Stock in connection with a transfer which meets the qualifications
 set forth in Section 2(i)(viii) of this Article IV below, shall, by
       virtue of the acquisition of a certificate representing shares of Class B
      Common Stock, have the status of an owner or holder of shares of Class B
      Common Stock or be recognized as such by the Corporation or be otherwise
       entitled to enjoy the benefit of the special voting rights of a holder of
shares of Class B Common Stock.                                   

       (viii) Prior to a Tax-Free Spin-Off, shares of Class B Common Stock
shall be transferred on the books of the Corporation and a new    
 certificate therefor issued, upon presentation at the office of the
    Secretary of the Corporation (or at such additional place or places as
   may from time to time be designated by the Secretary or any Assistant
Secretary of the Corporation) of the certificate representing such
  shares, in proper form for transfer and accompanied by all requisite
   stock transfer tax stamps, only if such certificate when so presented
shall also be accompanied by any one of the following:            

      (A) an affidavit from Silicon Graphics stating that such
    certificate is being presented to effect a transfer by Silicon
     Graphics of such shares to a subsidiary of Silicon Graphics; or

        (B) an affidavit from Silicon Graphics stating that such
           certificate is being presented to effect a transfer by any subsidiary
       of Silicon Graphics of such shares to Silicon Graphics or another
subsidiary of Silicon Graphics; or                        

        (C) an affidavit from Silicon Graphics stating that such
    certificate is being presented to effect a transfer by Silicon
        Graphics of such shares to the stockholders of Silicon Graphics in
connection with a Tax-Free Spin-Off.                      

          Each affidavit of a record holder furnished pursuant to this Section
  2(i)(viii) shall be verified as of a date not earlier than five days
    prior to the date of delivery thereof, and, if such record holder is a
 corporation or partnership, shall be verified by an officer of such
      corporation or by a general partner of such partnership, as the case may
be.                                                               

          If a record holder of shares of Class B Common Stock shall deliver a
       certificate representing such shares, endorsed by him or her for transfer
    or accompanied by an instrument of transfer signed by him or her, to a
      person who receives such shares in connection with a transfer which does
    not meet the qualifications set forth in this Section 2(i)(viii), then
    such person or any successive transferee of such certificate may treat
such endorsement or instrument as authorizing                     

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    him or her on behalf of such record holder to convert such shares into
  shares of Class A Common Stock in the manner above provided, for the
    purpose of the transfer to himself or herself of the shares of Class A
       Common Stock issuable upon such conversion, and to give on behalf of such
    record holder the written notice of conversion above required, and may
convert such shares of Class B Common Stock accordingly.          

       If such shares of Class B Common Stock shall have been improperly
       registered in the name of such a person (or in the name of any successive
    transferee of such certificate) and a new certificate therefor issued,
such person or transferee shall surrender such new certificate for
 cancellation, accompanied by the written notice of conversion above
      required, in which case (A) such person or transferee shall be deemed to
 have elected to treat the endorsement on (or instrument of transfer
     accompanying) the certificate so delivered by such former record holder
      as authorizing such person or transferee on behalf of such former record
  holder so to convert such shares and so to give such notice, (B) the
  shares of Class B Common Stock registered in the name of such former
       record holder shall be deemed to have been surrendered for conversion for
       the purpose of the transfer to such person or transferee of the shares of
    Class A Common Stock issuable upon conversion, and (C) the appropriate
   entries shall be made on the books of the Corporation to reflect such
action.                                                           

       In the event that the Board of Directors (or any committee of the
       Board of Directors, or any officer of the Corporation, designated for the
   purpose by the Board of Directors) shall determine, upon the basis of
     facts not disclosed in any affidavit or other document accompanying the
    certificate representing shares of Class B Common Stock when presented
for transfer, that such shares of Class B Common Stock have been  
       registered in violation of the provisions of Section 2(i)(viii), or shall
determine that a person is enjoying for his or her own benefit the
      special rights and powers of shares of Class B Common Stock in violation
       of such provisions, then the Corporation shall take such action at law or
  in equity as is appropriate under the circumstances. An unforeclosed
 pledge made to secure a bona fide obligation shall not be deemed to
violate such provisions.                                          

  (ix) Prior to the occurrence of a Tax-Free Spin-Off, every
  certificate representing shares of Class B Common Stock shall bear a
legend on the face thereof reading as follows:                    

     "The shares of Class B Common Stock represented by this
           certificate may not be transferred to any person in connection with a
         transfer that does not meet the qualifications set forth in Section
         2(i)(viii) of Article IV of the Amended and Restated Certificate of
      Incorporation of this Corporation, as amended, and no person who
       receives such shares in connection with a transfer which does not
      meet the qualifications prescribed by Section 2(i)(viii) of said
     Article IV is entitled to own or to be registered as the record
        holder of such shares of Class B Common Stock. Each holder of this
          certificate, by accepting the same, accepts and agrees to all of the
foregoing."                                               

          Upon and after the transfer of shares in a Tax-Free Spin-Off, shares
     of Class B Common Stock shall no longer bear the legend set forth above
in this Section 2(i)(ix).                                         

      (x) Upon any conversion of shares of Class B Common Stock into
       shares of Class A Common Stock pursuant to the provisions of this Section
     (2)(i), any dividend for which the record date or payment date shall be
      subsequent to such conversion which may have been declared on the shares
of Class B Common Stock so converted shall be deemed to have been 
   declared, and shall be payable, with respect to the shares of Class A
      Common Stock into or for which such shares of Class B Common Stock shall
 have been so converted, and any such dividend which shall have been
 declared on such shares payable in shares of Class B Stock shall be
      deemed to have been declared, and shall be payable, in shares of Class A
Common Stock.                                                     

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           (xi) The Corporation shall at all times reserve and keep available,
       out of its authorized but unissued Common Stock, such number of shares of
      Class A Common Stock as would become issuable upon the conversion of all
shares of Class B Common Stock then outstanding.                  

        (xii) The Corporation will not be required to pay any documentary,
      stamp or similar issue or transfer taxes payable in respect of the issue
       or delivery of shares of Class A Common Stock on the conversion of shares
    of Class B Common Stock pursuant to Section (2)(i) of this Article IV,
     and no such issue or delivery shall be made unless and until the person
      requesting such issue has paid to the Corporation the amount of such tax
       or has established, to the satisfaction of the Corporation, that such tax
has been paid.                                                    

  (j)  EXCHANGE.  In the event a Tax-Free Spin-Off has occurred, the
Corporation may exchange all (but not less than all) of the outstanding 
shares of Class B Common Stock for shares of Class A Common Stock on a  
    one-for-one basis, PROVIDED, HOWEVER, this Section (2)(j) of this Article IV
shall have no further force or effect if, prior to a Tax-Free Spin-Off, 
Silicon Graphics delivers to the Corporation an opinion of counsel,     
reasonably satisfactory to the Corporation, to the effect that, based in
part on conversations with the IRS disclosed to the Corporation, the    
 inclusion of this Section (2)(j) of this Article IV would have a material
adverse effect on the ability of Silicon Graphics to timely obtain a    
   favorable ruling from the IRS regarding the tax-free status of the Tax-Free
Spin-Off.                                                               

        (k)  COMMON STOCK OWNED BY SILICON GRAPHICS.  Prior to the occurrence of
    a Tax-Free Spin-Off and if all of the shares of Class B Common Stock held by
Silicon Graphics and any Subsidiary (as defined in Section 2(i)(i)) of  
 Silicon Graphics have not been previously converted into or exchanged for
  shares of Class A Common Stock, each share of Class A Common Stock held by
Silicon Graphics and any Subsidiary (as defined in Section 2(i)(i)) of  
Silicon Graphics, however acquired, shall, immediately upon such        
  acquisition, automatically convert into one share of Class B Common Stock.
   Notwithstanding the foregoing, after the occurrence of a Tax-Free Spin-Off,
any shares of Class A Common Stock held by Silicon Graphics and any     
Subsidiary (as defined in Section 2(i)(i)) of Silicon Graphics, however 
acquired, shall remain shares of Class A Common Stock.                  

   SECTION 3.  The Corporation shall not reissue or resell any shares of Class
B Common Stock which shall have been converted into or exchanged for shares of  
Class A Common Stock pursuant to or as permitted by the provisions of Section   
(2)(i) or Section 2(j) of this Article IV, or any shares of Class B Common Stock
which shall have been acquired by the Corporation in any other manner. The      
Corporation shall, from time to time, take such appropriate action as may be    
necessary to retire such shares and to reduce the authorized number of shares of
Class B Common Stock accordingly.                                               

  SECTION 4.  The holders of shares of Common Stock shall have no preemptive
or preferential rights of subscription to any shares of any class of capital    
stock of the Corporation or any securities convertible into or exchangeable for 
shares of any class of capital stock of the Corporation.                        

SECTION 5.  No stockholder shall be entitled to exercise any right of   
cumulative voting.                                                              

    SECTION 6.  The Preferred Stock may be issued, if so determined by the Board
of Directors, either as a class without series or from time to time in one or   
more series and with such designation for such class or each issue of such class
or each such series as may be adopted by the Board of Directors. The Board of   
Directors in any such resolution or resolutions is expressly authorized to state
and express for such class or each such series:                                 

       (a) Voting rights, if any, including, without limitation, the authority
    to confer multiple votes per share, voting rights as to specified matters or
  issues or, subject to the provisions of this Certificate of Incorporation,
voting rights to be exercised either together with the holders of Common
Stock as a single class, or independently as a separate class;          

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     (b) The rate per annum and the times at and conditions upon which the
holders of shares of such class or series shall be entitled to receive  
dividends, the conditions and dates upon which such dividends shall be  
payable and whether such dividends shall be cumulative or noncumulative,
    and, if cumulative, the terms upon which such dividends shall be cumulative;

(c) Redemption, repurchase, retirement and sinking fund rights, 
 preferences and limitations, if any, the amount payable on shares of such
  class or series in the event of such redemption, repurchase or retirement,
 the terms and conditions of any sinking fund, the manner of creating such
fund or funds and whether any of the foregoing shall be cumulative or   
noncumulative;                                                          

  (d) The rights to which the holders of the shares of such class or
series shall be entitled upon any voluntary or involuntary liquidation, 
dissolution or winding-up of the Corporation;                           

    (e) The terms, if any, upon which the shares of such class or series
  shall be convertible into or exchangeable for shares of stock of any other
 class or classes or of any other series of the same or any other class or
    classes, including the price or prices or the rate or rates of conversion or
exchange and the terms of adjustment, if any; and                       

    (f) Any other designations, preferences and relative, participating,
optional or other special rights and qualifications, limitations or     
    restrictions thereof so far as they are not inconsistent with the provisions
of this Certificate of Incorporation (as it may be amended from time to 
  time) and to the full extent now or hereafter permitted by the laws of the
State of Delaware.                                                      

SECTION 7.  All shares of Preferred Stock, if issued as a class without 
series, or all shares of the Preferred Stock of any one series, if issued in    
series, shall be identical to each other in all respects and shall entitle the  
holders thereof to the same rights and privileges, except that shares of any one
series issued at different times may differ as to the dates from which dividends
thereon, if cumulative, shall be cumulative.                                    

  SECTION 8.  Except as otherwise provided by law, and subject to any rights
of the holders of Preferred Stock, the provisions of this Article IV (other than
Section 1 hereof) shall not be modified, revised, altered or amended, repealed  
or rescinded in whole or in part, without the affirmative vote of the holders of
at least a majority of the then outstanding shares of Class A Common Stock and  
the Class B Common Stock, voting together as a single class; PROVIDED, HOWEVER, 
that with respect to any proposed amendment to this Certificate of Incorporation
which would alter or change the powers, preferences or special rights of the    
shares of Class A Common Stock or Class B Common Stock so as to affect them     
adversely, the affirmative vote of the holders of at least a majority of the    
then outstanding shares of the class affected by the proposed amendment, voting 
separately as a class, shall be obtained in addition to the affirmative vote of 
the holders of at least a majority of the Class A Common Stock and the Class B  
Common Stock, voting together as a single class as provided above.              

ARTICLE V 
BOARD OF DIRECTORS

   SECTION 1.  The business and affairs of the Corporation shall be managed by
or under the direction of the Board of Directors, which may exercise all the    
powers of the Corporation and do all such lawful acts and things that are not   
conferred upon or reserved to the stockholders by law, by this Certificate of   
Incorporation or by the By-laws of the Corporation.                             

  SECTION 2.  The Board of Directors shall consist of not less than five (5)
and not more than ten (10) directors, the exact number of directors to be       
determined by resolution of the Board of Directors. The directors shall be      
divided into three classes, designated Class I, Class II and Class III. Each    
class shall consist, as nearly as possible, of one third of the total number of 
directors constituting the entire Board of Directors, as determined by the Board
of Directors, and directors elected by a class of stock shall be divided as     
evenly as possible, as determined by the Board of Directors, among Class I,     
Class II and                                                                    

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Class III; PROVIDED, HOWEVER, that, in the event that there shall be only one   
Class A Director, such Class A Director shall be in Class I. The term of the    
initial Class I directors shall terminate on the date of the 1999 annual meeting
of stockholders of the Corporation; the term of the initial Class II directors  
shall terminate on the date of the 2000 annual meeting of stockholders of the   
Corporation; and the term of the initial Class III directors shall terminate on 
the date of the 2001 annual meeting of stockholders of the Corporation.         
Directors elected by a class of stock shall be divided as evenly as possible, as
determined by the Board of Directors, among Class I, Class II and Class III. At 
each annual meeting of stockholders, beginning with the 1999 annual meeting of  
stockholders, successors to the class of directors whose terms expire at that   
annual meeting shall be elected for a three-year term. If the number of         
directors is changed, any increase or decrease shall be apportioned among the   
classes of directors established pursuant to this Article V to maintain the     
number of directors in each class as nearly equal as possible. No decrease in   
the number of directors constituting the Board of Directors shall shorten the   
term of any incumbent director. Notwithstanding the foregoing, each director    
initially appointed on behalf of the Class A Common Stock shall hold office     
initially for a term expiring at the 1999 annual meeting of stockholders.       
Subject to the immediately preceding sentence, a director shall hold office     
until the annual meeting for the year in which his or her term expires and until
his or her successor shall be elected and shall qualify, SUBJECT, HOWEVER, to   
prior death, resignation, retirement, disqualification or removal from office.  

Notwithstanding the foregoing, whenever the holders of any one or more  
classes or series of Preferred Stock issued by the Corporation shall have the   
right, voting separately by class or series, to elect directors at an annual or 
special meeting of stockholders, the election, term of office, filling of       
vacancies and other features of such directorships shall be governed by the     
terms of this Certificate of Incorporation (as it may be amended from time to   
time) or the resolution or resolutions adopted by the Board of Directors        
pursuant to Section 4 of Article IV, and such directors so elected shall not be 
divided into classes pursuant to this Section 2 of Article V unless expressly   
provided by such terms.                                                         

  SECTION 3.  Election of directors need not be by written ballot unless the
By-laws of the Corporation so provide.                                          

   SECTION 4.  The following provisions are inserted for the management of the
business and for the conduct of the affairs of the Corporation, and for further 
definition, limitation and regulation of the powers of its directors and        
stockholders:                                                                   

      (a) The By-laws of the Corporation may be altered, amended or repealed
and new By-laws may be adopted by the affirmative vote of directors     
constituting not less than a majority of the total authorized number of 
directors fixed from time to time by the Board of Directors pursuant to 
Section 2 of this Article V.                                            

 (b) Advance notice of stockholder nominations for the election of
   directors and of the proposal of business by stockholders shall be given in
the manner provided in the By-laws of the Corporation, as amended and in
effect from time to time.                                               

   (c) Subject to any preferential rights of any outstanding series of
   Preferred Stock, any Class A Director may be removed from office, only with
   cause, by the affirmative vote of the holders of at least a majority of the
   outstanding Class A Common Stock and any director elected by the holders of
    the Class B Common Stock may be removed, only with cause, by the affirmative
    vote of the holders of at least a majority of the outstanding Class B Common
 Stock; PROVIDED, HOWEVER, that prior to a Tax-Free Spin-Off, any director
  elected by the holders of the Class B Common Stock may be removed, with or
    without cause, by the affirmative vote of the holders of at least a majority
of the outstanding Class B Common Stock.                                

(d) Notwithstanding anything contained in this Certificate of   
Incorporation to the contrary, the affirmative vote of the holders of at
  least 80% of the Common Stock, voting as a single class, shall be required
 to amend, repeal or adopt any provision inconsistent with this Article V.

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ARTICLE VI
STOCKHOLDER ACTION

 SECTION 1.  Any corporate action required or permitted to be taken at any
annual or special meeting of stockholders may be taken without a meeting,       
without prior notice and without a vote, if a consent or consents in writing,   
setting forth the action so taken, shall be signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary  
to authorize or take such action at a meeting at which all shares entitled to   
vote thereon were present and voted and shall be delivered to the Corporation   
(either by hand or by certified or registered mail, return receipt requested) at
its registered office in the State of Delaware or its principal place of        
business, or to an officer or agent of the Corporation having custody of the    
book in which proceedings of meetings of stockholders are recorded; PROVIDED,   
HOWEVER, that effective as of the date on which Silicon Graphics and its        
affiliates cease to be the beneficial owner of an aggregate of at least a       
majority of the then outstanding shares of Common Stock (the "Trigger Date"),   
any corporate action required or permitted to be taken at any annual or special 
meeting of stockholders may be taken only at a duly called annual or special    
meeting of stockholders and may not be taken by written consent in lieu of such 
a meeting.                                                                      

    SECTION 2.  Effective as of the Trigger Date, unless otherwise prescribed by
law and subject to any preferential rights of any outstanding series of         
Preferred Stock, special meetings of the stockholders of the Corporation for any
purpose or purposes may be called at any time by the Chairman of the Board of   
Directors, the President or, at the request in writing of a majority of the     
members of the Board of Directors, any officer of the Corporation, and effective
as of the Trigger Date, any power of the stockholders of the Corporation to call
a special meeting is specifically denied.                                       

SECTION 3.  Notwithstanding anything contained in this Certificate of   
Incorporation to the contrary, the affirmative vote of the holders of at least  
80% of the Common Stock, voting as a single class, shall be required to amend,  
repeal or adopt any provision inconsistent with this Article VI.                

ARTICLE VII 
INDEMNIFICATION 

    SECTION 1.  Each person who was or is made a party to or is threatened to be
made a party to or is involved in any action, suit or proceeding, whether civil,
criminal, administrative, investigative or otherwise (hereinafter a             
"proceeding"), by reason of the fact that he or she, or a person of whom he or  
she is the legal representative, is or was a director or officer of the         
Corporation or is or was serving at the request of the Corporation as a director
or officer of another corporation or of a partnership, joint venture, trust or  
other enterprise, including service with respect to employee benefit plans,     
whether the basis of such proceeding is alleged action in an official capacity  
as a director or officer or in any other capacity while serving as a director or
officer, shall be indemnified to the fullest extent authorized by the DGCL, as  
the same exists or may hereafter be amended (but, in the case of any such       
amendment, only to the extent that such amendment permits the Corporation to    
provide broader indemnification rights than said law permitted the Corporation  
to provide prior to such amendment), against all expense, liability and loss    
(including attorneys' fees, amounts paid or to be paid in settlement and excise 
taxes or penalties imposed on fiduciaries with respect to (i) employee benefit  
plans, (ii) charitable organizations or (iii) similar matters) reasonably       
incurred or suffered by such person in connection therewith and such            
indemnification shall continue as to a person who has ceased to be a director or
officer and shall inure to the benefit of such person's heirs, executors and    
administrators; PROVIDED, HOWEVER, that the Corporation shall indemnify any such
person seeking indemnity in connection with a proceeding (or part thereof)      
initiated by such person (other than pursuant to Section 2 of this Article VII) 
only if such proceeding (or part thereof) was authorized by the Board of        
Directors. The right to indemnification conferred in this Section 1 of Article  
VII shall be a contract right and shall include the right to be paid by the     
Corporation the expenses incurred in defending any such proceeding in advance of
its final disposition; PROVIDED, HOWEVER, that, if the DGCL requires, the       
payment of such expenses incurred by a director or officer in his or her        
capacity as a                                                                   

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director or officer (and not in any other capacity in which service was or is   
rendered by such person while a director or officer, including, without         
limitation, service to an employee benefit plan) in advance of the final        
disposition of a proceeding shall be made only upon delivery to the Corporation 
of an undertaking, by or on behalf of such director or officer, to repay all    
amounts so advanced if it shall ultimately be determined that such director or  
officer is not entitled to be indemnified under this Section 1 of Article VII or
otherwise.                                                                      

  SECTION 2.  If a claim the Corporation is obligated to pay under Section 1
of this Article VI is not paid in full by the Corporation within 60 days after a
written claim has been received by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the unpaid amount of   
the claim and, if successful in whole or in part, the claimant shall be entitled
to be paid also the expense of prosecuting such claim against the Corporation.  
It shall be a defense to any such action (other than an action brought to       
enforce a claim for expenses incurred in defending any proceeding in advance of 
its final disposition where the required undertaking, if any is required, has   
been tendered to the Corporation) that the claimant has not yet established that
it meets the standards of conduct which make it permissible under the DGCL for  
the Corporation to indemnify the claimant for the amount claimed, but the burden
of proving such defense shall be on the Corporation. Neither the failure of the 
Corporation (including its Board of Directors, independent legal counsel or its 
stockholders) to have made a determination prior to the commencement of such    
action that indemnification of the claimant is proper in the circumstances      
because he or she has met the applicable standard of conduct set forth in the   
DGCL, nor an actual determination by the Corporation (including its Board of    
Directors, independent legal counsel or its stockholders) that the claimant has 
not met such applicable standard of conduct, shall be a defense to the action or
create a presumption that the claimant has not met the applicable standard of   
conduct.                                                                        

SECTION 3.  The right to indemnification and the payment of expenses    
incurred in defending a proceeding in advance of its final disposition conferred
in this Article VII shall not be exclusive of any other right which any person  
may have or hereafter acquire under any statute, provision of this Certificate  
of Incorporation, By-law of the Corporation, agreement, vote of stockholders or 
disinterested directors or otherwise, both as to action in his or her official  
capacity and as to action in another capacity while holding such office.        

    SECTION 4.  The Corporation may purchase and maintain insurance on behalf of
any person who is or was a director, officer, employee or agent of the          
Corporation, or is or was serving at the request of the Corporation as a        
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, against any expense, liability or     
loss, whether or not the Corporation would have the power to indemnify such     
person against such expense, liability or loss under the DGCL.                  

   SECTION 5.  The Corporation may, to the extent authorized from time to time
by the Board of Directors, grant rights to indemnification, and rights to be    
paid by the Corporation the expenses incurred in defending any proceeding in    
advance of its final disposition, to any employee or agent of the Corporation to
the fullest extent of the provisions in this Article VII with respect to the    
indemnification and advancement of expenses of directors and officers of the    
Corporation.                                                                    

    SECTION 6.  If any part of this Article VII should be found to be invalid or
ineffective in any proceeding, the validity and effect of the remaining         
provisions shall not be affected. Any repeal or modification of this Article VII
by the stockholders of the Corporation shall not adversely affect any rights to 
indemnification and to advancement of expenses that any person may have at the  
time of such repeal or modification with respect to any acts or omissions       
occurring prior to such repeal or modification.                                 

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ARTICLE VIII
BY-LAWS 

  SECTION 1.  The By-laws of the Company may be altered, amended or repealed
and new By-laws may be adopted (i) at any annual or special meeting of          
stockholders, by the affirmative vote of the holders of a majority of the       
outstanding shares of Common Stock, voting together as a single class, entitled 
to vote thereat, PROVIDED, HOWEVER, that any proposed alteration, amendment or  
repeal of, or the adoption of any By-law inconsistent with, Sections 3, 5 or 10 
of Article II of the By-laws or Sections 1 or 5 of Article III of the By-laws by
the stockholders shall require the affirmative vote of the holders of at least  
80% of the Common Stock, voting as a single class, or (ii) by the affirmative   
vote of directors constituting not less than a majority of the total number of  
directors which the Corporation would have if there were no vacancies.          

SECTION 2.  Notwithstanding anything contained in this Certificate of   
Incorporation to the contrary, the affirmative vote of the holders of at least  
80% of the Common Stock, voting as a single class, shall be required to amend,  
repeal or adopt any provision inconsistent with this Article VIII.              

ARTICLE IX
LIMITATION ON LIABILITY OF DIRECTORS

   SECTION 1.  A director of the Corporation shall not be personally liable to
the Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's   
duty of loyalty to the Corporation or its stockholders, (ii) for acts or        
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation   
Law, or (iv) for any transaction from which the director derived an improper    
personal benefit.                                                               

ARTICLE X 
CORPORATE OPPORTUNITIES 

SECTION 1.  As the Corporation recently ceased to be an indirect, wholly
owned subsidiary of Silicon Graphics, but Silicon Graphics remains a substantial
stockholder of the Corporation, and in anticipation that the Corporation and    
Silicon Graphics may engage in the same or similar activities or lines of       
business and have an interest in the same areas of corporate opportunities, and 
in recognition of the benefits to be derived by the Corporation through its     
continued contractual, corporate and business relations with Silicon Graphics   
(including possible service of officers and directors of Silicon Graphics as    
officers and directors of the Corporation), the provisions of this Article are  
set forth to regulate and define the conduct of certain affairs of the          
Corporation as they may involve Silicon Graphics and its officers and directors,
and the powers, rights, duties and liabilities of the Corporation and its       
officers, directors and stockholders in connection therewith.                   

   SECTION 2.  Silicon Graphics shall have no duty to refrain from engaging in
the same or similar activities or lines of business as the Corporation, and     
neither Silicon Graphics nor any officer or director thereof (except as provided
in Section 3 below) shall be liable to the Corporation or its stockholders for  
the breach of any fiduciary duty by reason of any such activities of Silicon    
Graphics. In the event that Silicon Graphics acquires knowledge of a potential  
transaction or matter which may be a corporate opportunity for both Silicon     
Graphics and the Corporation, Silicon Graphics shall have no duty to communicate
or offer such corporate opportunity to the Corporation and shall not be liable  
to the Corporation or its stockholders for breach of any fiduciary duty as a    
stockholder of the Corporation by reason of the fact that Silicon Graphics      
pursues or acquires such corporate opportunity for itself, directs such         
corporate opportunity to another person, or does not communicate information    
regarding such corporate opportunity to the Corporation.                        

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  SECTION 3.  In the event that a director or officer of the Corporation who
is also a director or officer of Silicon Graphics acquires knowledge of a       
potential transaction or matter which may be a corporate opportunity for both   
the Corporation and Silicon Graphics, such director or officer of the           
Corporation shall have fully satisfied and fulfilled the fiduciary duty of such 
director or officer to the Corporation and its stockholders with respect to such
corporate opportunity, if such director or officer acts in a manner consistent  
with the following policy: (i) a corporate opportunity offered to any person who
is an officer of the Corporation, and who is also a director but not an officer 
of Silicon Graphics, shall belong to the Corporation; (ii) a corporate          
opportunity offered to any person who is a director but not an officer of the   
Corporation, and who is also a director or officer of Silicon Graphics shall    
belong to the Corporation if such opportunity is expressly offered to such      
person in writing solely in his or her capacity as a director of the            
Corporation, and otherwise shall belong to Silicon Graphics; and (iii) a        
corporate opportunity offered to any person who is an officer of both the       
Corporation and Silicon Graphics shall belong to the Corporation if such        
opportunity is expressly offered to such person in writing solely in his or her 
capacity as an officer of the Corporation, and otherwise shall belong to Silicon
Graphics.                                                                       

SECTION 4.  Any person purchasing or otherwise acquiring any interest in
shares of the capital stock of the Corporation shall be deemed to have notice of
and to have consented to the provisions of this Article.                        

SECTION 5.  For purposes of this Article only:                          

  (a)  A director of the Corporation who is Chairman of the Board of
   Directors or of a committee thereof shall not be deemed to be an officer of
the Corporation by reason of holding such position (without regard to   
whether such position is deemed an office of the Corporation under the  
  By-laws of the Corporation), unless such person is a full-time employee of
the Corporation; and                                                    

  (b)  (i) The term "Corporation" shall mean the Corporation and all
   corporations, partnerships, joint ventures, associations and other entities
  in which the Corporation beneficially owns (directly or indirectly) 50% or
    more of the outstanding voting stock, voting power, partnership interests or
similar voting interests, and (ii) the term "Silicon Graphics," for the 
purpose of this Article only, shall mean Silicon Graphics and all       
   corporations, partnerships, joint ventures, associations and other entities
  (other than the Corporation, defined in accordance with clause (i) of this
Section 5(b)) in which Silicon Graphics beneficially owns (directly or  
indirectly) 50% or more of the outstanding voting stock, voting power,  
partnership interests or similar voting interests.                      

    SECTION 6.  Notwithstanding anything in this Certificate of Incorporation to
the contrary, (i) the foregoing provisions of this Article shall expire on the  
date that Silicon Graphics ceases to beneficially own Common Stock representing 
at least 20% of the outstanding shares of Common Stock and no person who is a   
director or officer of the Corporation is also a director or officer of Silicon 
Graphics; and (ii) in addition to any vote of the stockholders required by this 
Certificate of Incorporation, until the time that Silicon Graphics ceases to    
beneficially own Common Stock representing at least 20% of the outstanding      
shares of Common Stock, the affirmative vote of the holders of more than 80% of 
the outstanding shares of Common Stock, voting as a single class, shall be      
required to alter, amend or repeal in a manner adverse to the interests of      
Silicon Graphics, or adopt any provision adverse to the interests of Silicon    
Graphics and inconsistent with, any provision of this Article. Neither the      
alteration, amendment or repeal of this Article nor the adoption of any         
provision of this Certificate of Incorporation inconsistent with this Article   
shall eliminate or reduce the effect of this Article in respect of any matter   
occurring, or any cause of action, suit or claim that, but for this Article,    
would accrue or arise, prior to such alteration, amendment, repeal or adoption. 

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ARTICLE XI
AMENDMENT OF CERTIFICATE OF INCORPORATION 

The Corporation reserves the right to amend, alter, restate, change or  
repeal any provision contained in this Certificate of Incorporation, in the     
manner now or hereafter prescribed by the laws of the State of Delaware, and all
rights of the stockholders herein are granted subject to this reservation.      

This Amended and Restated Certificate of Incorporation shall become     
effective at                (Wilmington, Delaware time),            , 1999.     

  IN WITNESS WHEREOF, MIPS TECHNOLOGIES, INC. has caused this certificate to
be signed by John E. Bourgoin, its President and Chief Executive Officer, and   
attested by Kevin C. Eichler, its Vice President and Chief Financial Officer, on
this   day of            , 1999.                                                

                                                                [Download Table]
                                                                              
                                MIPS TECHNOLOGIES, INC.                       

                                By:                                           
                                     -----------------------------------------
                                     Name: John E. Bourgoin                   
                                     Title: President and Chief Executive     
                                     Officer                                  

ATTEST:                                                                       

------------------------------                                                
Name: Kevin C. Eichler                                                        
Title: Vice President and                                                     
Chief Financial Officer                                                       

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                                                                         ANNEX B

AMENDED AND RESTATED BY-LAWS
OF
MIPS TECHNOLOGIES, INC. 
ARTICLE I 
OFFICES 

    The registered office of the Corporation shall be in the City of Wilmington,
County of New Castle, State of Delaware. The Corporation may also have one or   
more offices at such other places, either inside or outside of the State of     
Delaware, as the Board of Directors may from time to time determine or as the   
business of the Corporation may require. The books and records of the           
Corporation may be kept (subject to the provisions of the laws of the State of  
Delaware) at any place, either inside or outside of the State of Delaware, as   
from time to time may be determined by the Board of Directors.                  

ARTICLE II
STOCKHOLDERS

   Section 1.  PLACE OF MEETINGS.  Meetings of stockholders (whether annual or
special) shall be held at such place, either inside or outside of the State of  
Delaware, as the Board of Directors shall from time to time determine.          

  Section 2.  ANNUAL MEETING.  The annual meeting of the stockholders of the
Corporation shall be held on such date and at such time as may be fixed by      
resolution of the Board of Directors.                                           

   Section 3.  SPECIAL MEETINGS.  Unless otherwise prescribed by law or by the
Corporation's Amended and Restated Certificate of Incorporation, as amended from
time to time (the "Charter"), and subject to any preferential rights of any     
outstanding series of Preferred Stock (as defined in the Charter), special      
meetings of stockholders of the Corporation for any purpose or purposes may be  
called only by the Chairman of the Board of Directors, the President, or, at the
request in writing of a majority of the Board of Directors, any officer. Such   
request shall state the purpose or purposes of the proposed meeting. In         
addition, prior to the Trigger Date (as defined in the Charter), the Corporation
shall call a special meeting of stockholders of the Corporation promptly upon   
request by Silicon Graphics, Inc., a Delaware corporation, or any of its        
affiliates, in each case if such entity is a stockholder of the Corporation.    

Section 4.  NOTICE OF MEETINGS.  Except as otherwise provided by law,   
written or printed notice, stating the place, day and hour of the meeting and   
the purpose or purposes for which the meeting is called shall be delivered by   
the Corporation not less than ten (10) calendar days nor more than sixty (60)   
calendar days before the date of the meeting, either personally or by mail, to  
each stockholder of record entitled to vote at such meeting. Meetings may be    
held without notice if all stockholders entitled to vote are present, or if     
notice is waived by those not present in accordance with Section 2 of Article X 
of these By-laws. Any previously scheduled meeting of the stockholders may be   
postponed, and any special meeting of the stockholders may be canceled, by      
resolution of the Board of Directors upon public notice given prior to the date 
previously scheduled for such meeting of stockholders.                          

Section 5.  NOTICE OF STOCKHOLDER BUSINESS AND NOMINATIONS.             

(a) Annual Meetings of Stockholders.                                    

     (i) Nominations of persons for election to the Board of Directors and
    the proposal of business to be considered by the stockholders may be made at
  an annual meeting of stockholders (A) pursuant to the Corporation's notice
   of meeting delivered pursuant to Section 4 of this Article II, (B) by or at

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the direction of the Board of Directors, (C) by any stockholder of the  
    Corporation who was a stockholder of record at the time of the giving of the
notice provided for in this Section 5, who is entitled to vote at the   
meeting and who complies with the notice procedures set forth in this   
 Section 5, or (D) prior to the Trigger Date, by Silicon Graphics, Inc., a
   Delaware corporation ("Silicon Graphics"), or any of its affiliates that is
a stockholder of the Corporation.                                       

       (ii) For nominations or other business to be properly brought before an
  annual meeting by a stockholder pursuant to clause (C) of paragraph (a)(i)
   of this Section 5, the stockholder must have given timely notice thereof in
writing to the Secretary of the Corporation, and, if the stockholder is 
  proposing other business, such other business must be a proper subject for
stockholder action, and, if the stockholder is nominating a person or   
   persons for election to the Board of Directors, such nominating stockholder
  must be entitled to vote for the election of the director to be nominated.
   To be timely, a stockholder's notice shall be delivered to the Secretary at
   the principal executive offices of the Corporation not less than sixty (60)
 days nor more than ninety (90) days prior to the first anniversary of the
   preceding year's annual meeting; PROVIDED, HOWEVER, that, in the event that
   the date of the annual meeting is advanced by more than thirty (30) days or
  delayed by more than sixty (60) days from such anniversary date, notice by
the stockholder to be timely must be so delivered not earlier than the  
  ninetieth day prior to such annual meeting and not later than the close of
 business on the later of the sixtieth day prior to such annual meeting or
   the tenth day following the day on which public announcement of the date of
  such meeting is first made by the Corporation. For purposes of determining
   whether a stockholder's notice shall have been delivered in a timely manner
    for the annual meeting of stockholders in 1999, the first anniversary of the
    previous year's meeting shall be deemed to be June       , 1999. In no event
shall the public announcement of an adjournment of an annual meeting    
commence a new time period for the giving of a stockholder's notice as  
 described above. Such stockholder's notice shall set forth (A) as to each
   person whom the stockholder proposes to nominate for election or reelection
    as a director all information relating to such person that is required to be
disclosed in solicitations of proxies for election of directors in an   
election contest, or is otherwise required, in each case pursuant to    
 Regulation 14A under the Securities Exchange Act of 1934, as amended (the
    "Exchange Act"), and Rule 14a-11 thereunder (including such person's written
    consent to being named in the proxy statement as a nominee and to serving as
a director if elected) and the class of stock which such director will  
represent; (B) as to any other business that the stockholder proposes to
   bring before the meeting, a brief description of the business desired to be
   brought before the meeting, the reasons for conducting such business at the
  meeting and any material interest in such business of such stockholder and
   the beneficial owner, if any, on whose behalf the proposal is made; and (C)
    as to the stockholder giving the notice and the beneficial owner, if any, on
    whose behalf the nomination or proposal is made, (1) the name and address of
such stockholder, as they appear on the Corporation's books, and of such
  beneficial owner and (2) the class and number of shares of the Corporation
which are owned beneficially and of record by such stockholder and such 
beneficial owner.                                                       

(iii) Notwithstanding anything in the second sentence of paragraph
  (a)(ii) of this Section 5 to the contrary, in the event that the number of
   directors to be elected to the Board of Directors is increased and there is
no public announcement by the Corporation naming all of the nominees for
   director or specifying the size of the increased Board of Directors made by
    the Corporation at least seventy (70) days prior to the first anniversary of
    the preceding year's annual meeting, a stockholders' notice required by this
    Section 5 shall also be considered timely, but only with respect to nominees
   for any new positions created by such increase, if it shall be delivered to
the Secretary at the principal executive offices of the Corporation not 
    later than the close of business on the tenth day following the day on which
such public announcement is first made by the Corporation.              

   (b) Special Meetings of Stockholders. Only such business shall be conducted
at a special meeting of stockholders as shall have been brought before the      
meeting pursuant to the Corporation's notice of                                 

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meeting pursuant to Section 4 of this Article II. Nominations of persons for    
election to the Board of Directors may be made at a special meeting of          
stockholders at which directors are to be elected pursuant to the Corporation's 
notice of meeting (i) by or at the direction of the Board of Directors, (ii) by 
any stockholder of the Corporation who was a stockholder of record at the time  
of the giving of the notice provided for in this Section 5, who is entitled to  
vote for the election of the director to be nominated at the special meeting,   
and who complies with the notice procedures set forth in this Section 5, or     
(iii) prior to the Trigger Date and with respect to the directors that the      
holders of the Class B Common Stock (as defined in the Charter) are entitled to 
elect, by Silicon Graphics, or any of its affiliates that is a stockholder of   
the Corporation. In the event that the Corporation calls a special meeting of   
stockholders for the purpose of electing one or more directors to the Board of  
Directors, any stockholder entitled to vote for the election of the director to 
be nominated may nominate such person or persons (as the case may be), for      
election to the Board of Directors, if the requirements of paragraph (a)(ii) of 
this Section 5 shall be met and the stockholder's notice required thereby is    
delivered to the Secretary of the Corporation at the principal executive offices
of the Corporation not earlier than the ninetieth day prior to such special     
meeting and not later than the close of business on the later of the sixtieth   
day prior to such special meeting or the tenth day following the day on which   
public announcement by the Corporation is first made of the date of the special 
meeting and of the nominees proposed by the Board of Directors to be elected at 
such meeting.                                                                   

(c) General.                                                            

        (i) Only persons who are nominated in accordance with the procedures set
forth in this Section 5 shall be eligible to serve as directors and only
   such business shall be conducted at a meeting of stockholders as shall have
   been brought before the meeting in accordance with the procedures set forth
    in this Section 5. Except as otherwise provided by law, the Charter or these
By-laws, the chairman of the meeting shall have the power and duty to   
    determine whether a nomination or any business proposed to be brought before
   the meeting was made in accordance with this Section 5 and, if any proposed
   nomination or business is not in compliance with this Section 5, to declare
that such defective proposal or nomination shall be disregarded.        

     (ii) For purposes of this Section 5, "public announcement" shall mean
disclosure in a press release reported by the Dow Jones News Service,   
Associated Press or a comparable national news service or in a document 
publicly filed by the Corporation with the Securities and Exchange      
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.     

 (iii) Notwithstanding the foregoing provisions of this Section 5, a
stockholder shall also comply with all applicable requirements of the   
 Exchange Act and the rules and regulations thereunder with respect to the
matters set forth in this Section 5. Nothing in this Section 5 shall be 
deemed to affect any rights (A) of stockholders to request inclusion of 
   proposals in the Corporation's proxy statement pursuant to Rule 14a-8 under
  the Exchange Act or (B) of the holders of any series or Preferred Stock to
elect directors.                                                        

   Section 6.  QUORUM.  Except as otherwise provided by law or in the Charter,
at any meeting of stockholders, the holders of a majority of the aggregate      
voting power of all outstanding shares of all classes of capital stock of the   
Corporation entitled to vote at such meeting (the "Voting Stock"), represented  
in person or by proxy, shall constitute a quorum at such meeting, except when   
specified business is required to be voted on by a class or series of stock     
voting as a class, the holders of a majority of the shares of such class or     
series shall constitute a quorum of such class or series for the transaction of 
such business. At any meeting of stockholders at which a quorum is not present, 
the person serving as chairman of the meeting or the holders of a majority in   
interest of the stockholders present in person or by proxy and who are entitled 
to vote on every matter that is to be voted on without regard to class at such  
meeting may adjourn the meeting from time to time. No notice of the time and    
place of adjourned meetings need by given except as required by law.            

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    Section 7.  ORGANIZATION AND CONDUCT OF BUSINESS.  The Chairman of the Board
of Directors shall act as chairman of meetings of the stockholders. The Board of
Directors may designate any other officer or director of the Corporation to act 
as chairman of any meeting in the absence of the Chairman of the Board of       
Directors, and the Board of Directors may further provide for determining who   
shall act as chairman of any stockholder's meeting in the absence of the        
Chairman of the Board of Directors and such designee. The person serving as     
chairman of any meeting of stockholders shall determine the order of business   
and the procedure at the meeting, including such regulation of the manner of    
voting and the conduct of discussion as seem to him or her in order.            

  The Secretary of the Corporation shall act as secretary of all meetings of
the stockholders, but in the absence of the Secretary the presiding officer may 
appoint any other person to act as secretary of any meeting.                    

Section 8.  PROXIES AND VOTING.  At any meeting of stockholders, every  
stockholder entitled to vote may vote in person or by proxy authorized by an    
instrument executed in writing (or in such manner prescribed by the General     
Corporation Law of the State of Delaware) by the stockholder, or by such        
person's duly authorized attorney in fact.                                      

    Election of directors at all meetings of the stockholders at which directors
are to be elected shall be by ballot, and, subject to the rights of the holders 
of any series of Preferred Stock to elect directors, a plurality of the shares  
present in person or represented by proxy at the meeting, entitled to vote in   
the election and actually cast shall elect the directors. Except as otherwise   
provided by law, the Charter and these By-laws and subject to the rights of the 
holders of any series of Preferred Stock, in all matters other than the election
of directors, the affirmative vote of a majority of the voting power of the     
shares present in person or represented by proxy at the meeting and entitled to 
vote on the matter shall be the act of the stockholders.                        

   Section 9.  INSPECTORS OF ELECTION.  The Board of Directors may, and to the
extent required by law shall, in advance of any meeting of stockholders, appoint
one or more inspectors to act at the meeting, decide upon the qualification of  
voters, count the votes, decide the results and make a written report thereof in
accordance with the General Corporation Law of the State of Delaware. The Board 
of Directors may designate one or more persons as alternate inspectors to       
replace any inspector who fails to act. If no inspector or alternate is able to 
act at a meeting of stockholders, the person presiding at the meeting shall     
appoint one or more inspectors to act at the meeting. Each inspector, before    
entering upon the discharge of his or her duties, shall take and sign an oath   
faithfully to execute the duties of inspector with strict impartiality and      
according to the best of his or her ability. The inspector(s) shall have the    
duties prescribed by law.                                                       

   Section 10.  NO STOCKHOLDER ACTION BY WRITTEN CONSENT.  Effective as of the
Trigger Date, any action required or permitted to be taken by the stockholders  
of the Corporation must be effected at a duly called annual or special meeting  
of such holders and may not be effected by any consent in writing by such       
holders.                                                                        

ARTICLE III 
BOARD OF DIRECTORS

 Section 1.  NUMBER AND TERM OF OFFICE.  Subject to the rights, if any, of
holders of preferred stock of the Corporation, the number of directors of the   
Corporation shall be fixed from time to time exclusively by resolution of the   
Board of Directors adopted by the affirmative vote of directors constituting not
less than a majority of the Whole Board (as hereinafter defined), but shall     
consist of not more than ten (10) nor less than five (5) directors. The         
directors, other than those who may be elected by the holders of any class or   
series of preferred stock of the Corporation, shall be classified, with respect 
to the time they severally hold office, into three classes, as nearly equal in  
number as possible, one class to be initially elected for a term expiring at the
annual meeting of stockholders to be held in 1999, another class to be initially
elected for a                                                                   

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term expiring at the annual meeting of stockholders to be held in 2000, and     
another class to be initially elected for a term expiring at the annual meeting 
of stockholders to be held in 2001, with each director to serve until his or her
successor shall have been elected and shall have qualified, PROVIDED, HOWEVER,  
that, in the event that there shall be only one Class A Director (as defined in 
the Charter), such Class A Director shall be in the class of directors whose    
initial term expires at the annual meeting of stockholders to be held in 1999.  
Directors elected by a class of stock shall be divided as evenly as possible, as
determined by the Board of Directors, among the three classes of directors. At  
each succeeding annual meeting of stockholders, directors elected to succeed    
those directors whose terms then expire shall be elected for a term of office to
expire at the third succeeding annual meeting of stockholders after their       
election, with each director to serve until his or her successor shall have been
elected and shall have qualified. If the number of directors is changed, any    
increase or decrease shall be apportioned among the classes of directors        
established pursuant to Article V of the Charter to maintain the number of      
directors in each class as nearly equal as possible. No decrease in the number  
of directors constituting the Board of Directors shall shorten the term of any  
incumbent director. Notwithstanding the foregoing, each director initially      
appointed on behalf of the Class A Common Stock shall hold office initially for 
a term expiring at the 1999 annual meeting of stockholders. Subject to the      
immediately preceding sentence, a director shall hold office until the annual   
meeting for the year in which his or her term expires and until his or her      
successor shall be elected and shall qualify, SUBJECT, HOWEVER, to prior death, 
resignation, retirement, disqualification or removal from office.               

  For purposes of these By-laws, the term "Whole Board" shall mean the total
number of directors that the Corporation would have if there were no vacancies  
on the Corporation's Board of Directors.                                        

Section 2.  MEETINGS.  Regular meetings of the Board of Directors may be
held at such place, either inside or outside of the State of Delaware, and at   
such time, as may from time to time be designated by the Chairman of the Board  
of Directors or resolution of the Board of Directors or as may be specified in  
the call of any meeting. An annual meeting of the Board of Directors shall be   
held on the same day as, and as soon as practicable following, the annual       
meeting of stockholders or at such other time or place as shall be determined by
the Board of Directors at its regular meeting next preceding said annual meeting
of stockholders.                                                                

 Special meetings of the Board of Directors may be held at any time on the
call of the Chairman of the Board of Directors, the President or a majority of  
the Board of Directors then in office. The person or persons authorized to call 
special meetings of the Board of Directors may fix the time and place of the    
meetings. Meetings may be held at any time or place without notice if all the   
directors are present or if those not present waive notice of the meeting in    
writing.                                                                        

    Section 3.  NOTICE OF MEETINGS.  Notice of the time and place of meetings of
the Board of Directors (excepting the annual meeting of directors) shall be     
given to each director by the Secretary or an Assistant Secretary of the        
Corporation by (i) mailing or sending via courier such notice not later than    
during the second day preceding the day on which such meeting is to be held, or 
(ii) by (a) sending a facsimile transmission or other form of electronic        
communication containing such notice or (b) delivering such notice personally or
by telephone, in each case, not later than during the first day preceding the   
day on which such meeting is to be held. Unless otherwise stated in the notice  
thereof, any and all business may be transacted at any meeting.                 

 Section 4.  QUORUM AND ORGANIZATION OF MEETINGS.  Subject to Section 5 of
this Article III, a whole number of directors equal to at least a majority of   
the Whole Board shall constitute a quorum for the transaction of business, but  
if at any meeting of the Board of Directors there shall be less than a quorum   
present, a majority of the directors present may adjourn the meeting from time  
to time without further notice. The act of a majority of the directors present  
at a meeting at which a quorum is present shall be the act of the Board of      
Directors. The directors present at a duly organized meeting may continue to    
transact                                                                        

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business until adjournment, notwithstanding the withdrawal of enough directors  
to leave less than a quorum.                                                    

 Meetings shall be presided over by the Chairman of the Board of Directors
or, in his or her absence, by such other person as the Board of Directors may   
designate or the members present may select.                                    

  Section 5.  VACANCIES.  Any vacancy in the office of a director created by
the death, resignation, disqualification or removal of a director may be filled 
by the vote of the majority of the directors then in office (or the sole        
remaining director) elected by (or appointed on behalf of) the same class of    
stock that elected that director (or on behalf of which that director was       
appointed) whose death, resignation, disqualification or removal created the    
vacancy, unless there are no such directors or no outstanding shares of such    
class of stock, in which case such vacancy may be filled by the vote of the     
majority of all directors then in office, even if less than a quorum, or by the 
sole remaining director. Notwithstanding anything in Section (2)(f) or Section  
(2)(e) of Article IV of the Charter to the contrary, any vacancy in the office  
of a director created by the death, resignation, disqualification or removal of 
a director elected by (or appointed on behalf of) the holders of a class of     
stock may also be filled by a vote of holders of such class of stock, unless    
there are no outstanding shares of such class of stock, in which case any such  
vacancy may be filled by a vote of holders of the holders of the remaining class
of stock. Any director elected to fill a vacancy created by the death,          
resignation or removal of a director shall hold office for the remainder of the 
full term of the director whose vacancy is being filled and until such          
director's successor shall have been elected and qualified unless removed and   
replaced pursuant to Section 4(c) of Article V of the Charter and Section (2)(f)
of Article IV of the Charter.                                                   

Subject to the rights, if any, of the holders of any series of Preferred
Stock then outstanding, any vacancy on the Board of Directors that results from 
an increase in the number of directors shall be filled by the vote of the       
majority of the directors then in office. In filling such vacancies, the Board  
of Directors shall take all necessary actions to ensure that, following the     
appointment to such vacancies (unless all of the outstanding shares of Class B  
Common Stock shall have been converted into or exchanged for shares of Class A  
Common Stock), 20% of the number of members of the Board of Directors as so     
increased (or, if such 20% is not a whole number, then the next lower whole     
number of directors that is closest to 20% of such membership) consists of      
directors elected by (or appointed on behalf of) the holders of Class A Common  
Stock, and the remaining members of the Board of Directors as so increased      
consists of directors elected by (or appointed on behalf of) the holders of     
Class B Common Stock. Any director elected (or appointed) in accordance with the
preceding sentence shall hold office for the remainder of the full term of the  
class of directors in which the new directorship was created and until such     
director's successor shall have been elected and qualified, unless such director
is removed and replaced pursuant to Section 4(c) of Article V and Section (2)(f)
of Article IV of the Charter.                                                   

Section 6.  POWERS.  In addition to the powers and authorities by these 
By-laws expressly conferred upon them, the Board of Directors shall have and may
exercise all such powers of the Corporation and do all such lawful acts and     
things that are not by statute, the Charter or these By-laws directed or        
required to be exercised or done by the stockholders.                           

  Section 7.  RELIANCE UPON BOOKS, REPORTS AND RECORDS.  Each director, each
member of any committee designated by the Board of Directors and each officer,  
in the performance of his or her duties, shall be fully protected in relying in 
good faith upon such information, opinions, reports or statements presented to  
the Corporation by any of its officers or employees, or by committees of the    
Board of Directors, or by any other person, as to matters such director, member 
or officer, as the case may be, reasonably believes are within such person's    
professional or expert competence and who has been selected with reasonable care
by the Board of Directors or by any such committee, or in relying in good faith 
upon other records of the Corporation.                                          

Section 8.  COMPENSATION OF DIRECTORS.  Directors, as such, may receive,
pursuant to resolution of the Board of Directors, fixed fees and other          
compensation for their services as directors, including, without                

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limitation, services as members of committees of the Board of Directors;        
PROVIDED, HOWEVER, that nothing herein contained shall be construed to preclude 
any director from serving the Corporation in any other capacity and receiving   
compensation therefor.                                                          

Section 9.  MEETINGS BY MEANS OF CONFERENCE TELEPHONE.  Unless otherwise
provided by the Charter or these By-laws, members of the Board of Directors, or 
any committee designated by the Board of Directors, may participate in a meeting
of the Board of Directors or such committee by means of a conference telephone  
or similar communications equipment by means of which all persons participating 
in the meeting can hear each other, and participation in a meeting pursuant to  
this Section 9 shall constitute presence in person at such meeting.             

  Section 10.  ACTIONS BY WRITTEN CONSENT.  Any action required or permitted
to be taken at any meeting of the Board of Directors or of any committee thereof
may be taken without a meeting if all members of the Board of Directors or      
committee, as the case may be, consent thereto in writing, and the writing or   
writings are filed with the minutes of proceedings of the Board of Directors or 
committee.                                                                      

ARTICLE IV
COMMITTEES OF THE BOARD OF DIRECTORS

Section 1.  COMMITTEES OF THE BOARD OF DIRECTORS.  There are hereby     
established as committees of the Board of Directors: an Audit Committee and a   
Compensation Committee, each of which shall have the powers and functions set   
forth in Sections 2 and 3 hereof, respectively, and such additional powers as   
may be delegated to it by the Board of Directors. The Board of Directors may    
from time to time establish additional standing committees or special committees
of the Board of Directors, each of which shall have such powers and functions as
may be delegated to it by the Board of Directors. The Board of Directors may    
abolish any committee established by or pursuant to this Section 1 as it may    
deem advisable. Each such committee shall consist of two or more directors, the 
exact number being determined from time to time by the Board of Directors.      
Designations of the chairman and members of each such committee, and, if        
desired, a vice chairman and alternates for members, shall be made by the Board 
of Directors. In the absence or disqualification of any member of any committee 
and any alternate member in his or her place, the member or members of the      
committee present at the meeting, and not disqualified from voting whether or   
not he or she or they constitute a quorum, may by unanimous vote appoint another
member of the Board of Directors to act at the meeting in the place of the      
absent or disqualified member. Each committee shall have a secretary who shall  
be designated by its chairman. A vice chairman of a committee shall act as the  
chairman of the committee in the absence or disability of the chairman. Nothing 
herein shall be deemed to prevent the Board of Directors from appointing one or 
more committees consisting in whole or in part of persons who are not directors 
of the Corporation; PROVIDED, HOWEVER, that no such committee shall have or may 
exercise any authority of the Board of Directors.                               

  Section 2.  AUDIT COMMITTEE.  The Audit Committee shall select and engage,
on behalf of the Corporation, independent public accountants to (a) audit the   
books of account and other corporate records of the Corporation and (b) perform 
such other duties as the Audit Committee may from time to time prescribe. The   
Audit Committee shall transmit financial statements certified by such           
independent public accountants to the Board of Directors after the close of each
fiscal year. The selection of independent public accountants for each fiscal    
year shall be made in advance of the annual meeting of stockholders in such     
fiscal year and shall be submitted for ratification or rejection at such        
meeting. The Audit Committee shall confer with such accountants and review and  
approve the scope of the audit of the books of account and other corporate      
records of the Corporation. The Audit Committee shall have the power to confer  
with and direct the officers of the Corporation to the extent necessary to      
review the internal controls, accounting practices, financial structure and     
financial reporting of the Corporation. From time to time the Audit Committee   
shall report to and advise the Board of Directors concerning the results of its 
consultation and review and such other matters relating to the internal         
controls, accounting practices, financial structure and financial reporting of  
the Corporation as the Audit Committee believes merit                           

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review by the Board of Directors. The Audit Committee also shall perform such   
other functions and exercise such other powers as may be delegated to it from   
time to time by the Board of Directors.                                         

 Section 3.  COMPENSATION COMMITTEE.  The Compensation Committee shall fix
from time to time the salaries of members of the Board of Directors who are     
officers or employees of the Corporation and of all Senior Vice Presidents,     
Executive Vice Presidents and Vice Presidents of the Corporation. It also shall 
perform such functions as may be delegated to it under the provisions of any    
bonus, supplemental compensation, special compensation or stock option plan of  
the Corporation.                                                                

   Section 4.  RULES AND PROCEDURES.  Each committee may fix its own rules and
procedures and shall meet at such times and places as may be provided by such   
rules, by resolution of the committee or by call of the chairman or vice        
chairman of such committee. Notice of each meeting of each committee, other than
of regular meetings provided for by its rules or resolutions, shall be given to 
committee members. The presence of a majority of its members, but not less than 
two, shall constitute a quorum of any committee, and all questions shall be     
decided by a majority vote of the members present at the meeting. All actions   
taken at each committee meeting shall be recorded in minutes of the meeting.    

Section 5.  APPLICATION OF ARTICLE.  Whenever any provision of any other
document relating to any committee of the Corporation named therein shall be in 
conflict with any provision of this Article IV, the provisions of this Article  
IV shall govern, except that if such other document shall have been approved by 
the stockholders or by the Board of Directors, the provisions of such other     
document shall govern.                                                          

ARTICLE V 
OFFICERS

Section 1.  OFFICERS.  The officers of the Corporation shall include a  
Chairman of the Board of Directors, who shall be chosen from among the          
directors, a President, a Chief Financial Officer, one or more Executive Vice   
Presidents, one or more Senior Vice Presidents, one or more Vice Presidents, a  
Treasurer, a General Counsel and a Secretary, each of whom shall be elected by  
the Board of Directors to hold office until his or her successor shall have been
chosen and shall have qualified for office. The Board of Directors, the Chairman
of the Board of Directors and the Chief Executive Officer may elect or appoint  
one or more Controllers, one or more Assistant Vice Presidents, one or more     
Assistant Treasurers, one or more Assistant General Counsels and one or more    
Assistant Secretaries, and the Board of Directors may elect or appoint such     
other officers as it may deem necessary, or desirable, each of whom shall have  
such authority, shall perform such duties and shall hold office for such term as
may be prescribed by the Board of Directors from time to time. Any person may   
hold at one time more than one office, excepting that the duties of the         
President and Secretary shall not be performed by one person.                   

  Section 2.  CHAIRMAN OF THE BOARD OF DIRECTORS.  The Chairman of the Board
of Directors shall be the Chief Executive Officer of the Corporation. Subject to
the provisions of these By-laws and to the direction of the Board of Directors, 
he or she shall have ultimate authority for decisions relating to the general   
management and control of the affairs and business of the Corporation and shall 
perform all other duties and exercise all other powers commonly incident to the 
position of Chief Executive Officer or which are or from time to time may be    
delegated to him or her by the Board of Directors, or which are or may at any   
time be authorized or required by law. He or she shall preside at all meetings  
of the Board of Directors. He or she shall make reports to the Board of         
Directors and stockholders, and shall see that all orders and resolutions of the
Board of Directors and any committee thereof are carried into effect. The       
Chairman of the Board may also serve as President, if so elected by the Board of
Directors. The Board of Directors may also elect a Vice Chairman to act in the  
place of the Chairman upon his or her absence or inability to act.              

 Section 3.  PRESIDENT.  Subject to the provisions of these By-laws and to
the direction of the Board of Directors and of the Chief Executive Officer, the 
President shall have such powers and shall perform such duties as from time to  
time may be delegated to him or her by the Board of Directors or by the Chief   
Executive Officer, or which are or may at any time be authorized or required by 
law.                                                                            

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Section 4.  EXECUTIVE VICE PRESIDENTS, SENIOR VICE PRESIDENTS AND VICE  
PRESIDENTS.  Each of the Executive Vice Presidents, each of the Senior Vice     
Presidents and each of the other Vice Presidents shall have such powers and     
shall perform such duties as may be delegated to him or her by the Board of     
Directors, the Chairman of the Board of Directors, the President or such other  
officer or officers to whom he or she is directly responsible.                  

 Section 5.  TREASURER AND ASSISTANT TREASURER.  The Treasurer, subject to
the direction of the Board of Directors, shall have the care and custody of all 
funds and securities of the Corporation. When necessary or proper he or she     
shall endorse on behalf of the Corporation for collection, checks, notes and    
other obligations, and shall deposit all funds of the Corporation in such banks 
or other depositaries as may be designated by the Board of Directors or by such 
officers or employees as may be authorized by the Board of Directors so to      
designate. He or she shall perform all acts incident to the office of Treasurer,
subject to the control of the Board of Directors and such other officer or      
officers to whom he or she is directly responsible. He or she may be required to
give a bond for the faithful discharge of his or her duties, in such sum and    
upon such conditions as the Board of Directors may require.                     

   At the request and direction of the Treasurer or, in the case of his or her
absence or inability to act, any Assistant Treasurer may act in his or her      
place. In the case of the death of the Treasurer, or in the case of his or her  
absence or inability to act without having designated an Assistant Treasurer to 
act temporarily in his or her place, the Assistant Treasurer or other person so 
to perform the duties of the Treasurer shall be designated by the Chairman of   
the Board of Directors, the President or an Executive Vice President.           

Section 6.  SECRETARY AND ASSISTANT SECRETARY.  The Secretary shall keep
full and accurate minutes of the meetings of the stockholders and of the Board  
of Directors in the proper record book of the Corporation provided therefor,    
and, when required, the minutes of meetings of the committees, and shall be     
responsible for the custody of all such minutes. Subject to the direction of the
Board of Directors, the Secretary shall have custody of the stock ledgers and   
documents of the Corporation. He or she shall have custody of the corporate seal
of the Corporation and shall affix and attest such seal to any instrument whose 
execution under seal shall have been duly authorized. He or she shall give due  
notice of meetings and, subject to the direction of the Board of Directors,     
shall perform all other duties commonly incident to his or her office or as     
properly required of him or her by the Chairman of the Board of Directors and   
such other officer or officers to whom he or she is directly responsible and    
shall enjoy all other powers commonly incident to his or her office.            

   At the request and direction of the Secretary or, in the case of his or her
absence or inability to act, any Assistant Secretary may act in his or her      
place. In the case of the death of the Secretary, or in the case of his or her  
absence or inability to act without having designated an Assistant Secretary to 
act temporarily in his or her place, the Assistant Secretary or other person so 
to perform the duties of the Secretary shall be designated by the Chairman of   
the Board of Directors, the President or an Executive Vice President.           

 Section 7.  ASSISTANT VICE PRESIDENTS AND OTHER OFFICERS.  Each Assistant
Vice President and other officers shall perform such duties commonly incident to
his or her office or as properly required of him or her by the Chairman of the  
Board of Directors and such other officer or officers to whom he or she is      
directly responsible.                                                           

Section 8.  GENERAL COUNSEL.  The General Counsel shall have general    
supervision of all matters of a legal nature concerning the Corporation. He or  
she shall perform all such duties commonly incident to his or her office or as  
properly required of him or her by the Chairman of the Board of Directors and   
such other officer or officers to whom he or she is directly responsible.       

 Section 9.  SALARIES.  Salaries of officers, agents or employees shall be
fixed from time to time by the Board of Directors or by such committee or       
committees, or person or persons, if any, to whom such power shall have been    
delegated by the Board of Directors. An employment contract, whether with an    
officer, agent or employee, if expressly approved or specifically authorized by 
the Board of Directors, may fix a                                               

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term of employment thereunder; and such contract, if so approved or authorized, 
shall be valid and binding upon the Corporation in accordance with the terms    
thereof, PROVIDED that this provision shall not limit or restrict in any way the
right of the Corporation at any time to remove from office, discharge or        
terminate the employment of any such officer, agent or employee prior to the    
expiration of the term of employment under any such contract.                   

  Section 10.  VACANCIES.  A vacancy in any office filled by election of the
Board of Directors may be filled by the Board of Directors by the election of a 
new officer who shall hold office, subject to the provisions of this Article V, 
until the regular meeting of the directors following the next annual meeting of 
the stockholders and until his or her successor is elected.                     

    Section 11.  REMOVAL OR DISCHARGE.  Any officer may be removed or discharged
by the Chairman of the Board of Directors at any time excepting an officer who  
is also a director. Any officer who also is a director may be discharged at any 
time by the Board of Directors.                                                 

ARTICLE VI
RESIGNATIONS

 Any director or officer of the Corporation, whether elected or appointed,
may resign at any time by giving written notice of such resignation to the      
Chairman of the Board of Directors, the President, or the Secretary, and such   
resignation shall be deemed effective as of the close of business on the date   
said notice is received by the Chairman of the Board of Directors, the          
President, or the Secretary, or at such later time as is specified therein. No  
formal action shall be required of the Board of Directors or the stockholders to
make any such resignation effective.                                            

ARTICLE VII 
CAPITAL STOCK; DIVIDENDS; SEAL

Section 1.  STOCK CERTIFICATES AND TRANSFERS.  The interest of each     
stockholder of the Corporation shall be evidenced by certificates for shares of 
stock in such form as the appropriate officers of the Corporation may from time 
to time prescribe. The shares of the stock of the Corporation shall be          
transferred on the books of the Corporation by the holder thereof in person or  
by such person's attorney upon surrender for cancellation of certificates for at
least the same number of shares, with an assignment and power of transfer       
endorsed thereon or attached thereto, duly executed, and with such proof of the 
authenticity of the signature as the Corporation or its agents may reasonably   
require. The certificates of stock shall be numbered and signed by the Chairman 
of the Board of Directors, the President, an Executive Vice President, a Senior 
Vice President or a Vice President, and also by the Treasurer or an Assistant   
Treasurer, or the Secretary or an Assistant Secretary. Any and all signatures   
may be facsimiles. In case any officer, transfer agent or registrar who has     
signed or whose facsimile signature has been placed upon a certificate has      
ceased to be such officer, transfer agent or registrar before such certificate  
is issued, it may be issued by the Corporation with the same effect as if he or 
she were such officer, transfer agent or registrar at the date of issue.        

  Section 2.  LOST, DESTROYED OR STOLEN CERTIFICATES.  Any person claiming a
stock certificate in lieu of one lost, destroyed or stolen, shall give the      
Corporation an affidavit as to his, her or its ownership of the certificate and 
of the facts which go to prove that it has been lost, destroyed or stolen. If   
required by the Board of Directors or any financial officer of the Corporation, 
he, she or it also shall give the Corporation a bond, in such form as may be    
approved by the Board of Directors or such financial officer, sufficient to     
indemnify the Corporation against any claim that may be made against it on      
account of the alleged loss of the certificate or the issuance of a new         
certificate. A new certificate shall be issued upon receipt of such an affidavit
and, if required, upon the giving of such a bond.                               

  Section 3.  RECORD OF HOLDER OF SHARES.  The Corporation shall be entitled
to treat the holder of record of any share or shares as the holder in fact      
thereof, and accordingly shall not be bound to recognize                        

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any equitable or other claims to or interest in such shares on the part of any  
other person, whether or not it shall have express or other notice thereof, save
as expressly provided by the General Corporation Law of the State of Delaware.  
The Corporation shall be entitled to recognize the exclusive right of a person  
registered on its books as the owner of shares to receive dividends and to vote 
as such owner.                                                                  

Section 4.  DIVIDENDS.  The Board of Directors may from time to time    
declare, and the Corporation may pay, dividends on its outstanding shares of    
capital stock in the manner and upon the terms and conditions provided by law   
and the Charter.                                                                

Section 5.  CORPORATE SEAL.  The corporate seal shall be in such form as
shall from time to time be approved by the Board of Directors. If and when so   
authorized by the Board of Directors, a duplicate of the seal may be kept and   
used by the Secretary or Treasurer or by any Assistant Secretary or Assistant   
Treasurer.                                                                      

ARTICLE VIII
EXECUTION OF CONTRACTS AND OTHER DOCUMENTS

Section 1.  CONTRACTS, ETC.  Except as otherwise required by law, the   
Charter or these By-laws, such officers, employees or agents of the Corporation 
as shall be specified by the Board of Directors shall sign, in the name and on  
behalf of the Corporation, all deeds, bonds, contracts, mortgages and other     
instruments or documents, the execution of which shall be authorized by the     
Board of Directors; and such authority may be general or confined to specific   
instances. Except as so authorized by the Board of Directors, no officer, agent 
or employee of the Corporation shall have the power or authority to bind the    
Corporation by any contract or engagement or to pledge, mortgage, sell or       
otherwise dispose of its credit or any of its property or to render it          
pecuniarily liable for any purpose or in any amount.                            

Section 2.  CHECKS, DRAFTS, ETC.  Except as otherwise provided in these 
By-laws, all checks, drafts, notes, bonds, bills of exchange or other orders,   
instruments or obligations for the payment of money shall be signed by such     
officer or officers, employee or employees, or agent or agents, as the Board of 
Directors shall by resolution direct. The Board of Directors may, in its        
discretion, also provide by resolution for the countersignature or registration 
of any or all such orders, instruments or obligations for the payment of money. 

  Section 3.  PROXIES.  Unless otherwise prescribed by resolution adopted by
the Board of Directors, the Chairman of the Board of Directors, the President or
any Executive Vice President, Senior Vice President or Vice President may from  
time to time appoint an attorney or attorneys or agent or agents of the         
Corporation, in the name and on behalf of the Corporation, to cast the votes    
which the Corporation may be entitled to cast as the holder of stock or other   
securities in any other corporation, any of whose stock or other securities may 
be held by the Corporation, at meetings of the holders of the stock or other    
securities of such other corporation, or to consent in writing, in the name of  
the Corporation as such holder, to any action by such other corporation, and may
instruct the person or persons so appointed as to the manner of casting such    
votes or giving such consent, and may execute or cause to be executed in the    
name and on behalf of the Corporation and under its corporate seal or otherwise,
all such written proxies or other instruments as he or she may deem necessary or
proper in the premises.                                                         

ARTICLE IX
FISCAL YEAR 

    The fiscal year of the Corporation shall begin the first day of July in each
year.                                                                           

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ARTICLE X 
MISCELLANEOUS 

 Section 1.  NOTICES AND WAIVERS THEREOF.  Whenever any notice whatever is
required by these By-laws, the Charter or any of the laws of the State of       
Delaware to be given to any stockholder, director or officer, such notice,      
except as otherwise provided by the laws of the State of Delaware, may be given 
personally or by telephone or be given by facsimile transmission or other form  
of electronic communication, addressed to such stockholder at such person's     
address as it appears on the stock transfer books of the Corporation, or to such
director or officer at his or her Corporation location, if any, or at such      
address as appears on the books of the Corporation, or the notice may be given  
in writing by depositing the same in a post office, or in a regularly maintained
letter box, or by sending it via courier, postage prepaid, in a sealed wrapper  
addressed to such stockholder at such person's address as it appears on the     
stock transfer books of the Corporation, or to such director or officer at his  
or her Corporation location, if any, or such address as appears on the books of 
the Corporation.                                                                

Any notice given by facsimile transmission or other form of electronic  
communication shall be deemed to have been given when it shall have been        
transmitted. Any notice given by mail or courier shall be deemed to have been   
given when it shall have been mailed or delivered to the courier.               

    A waiver of any such notice in writing, including by facsimile transmission,
signed or dispatched by the person entitled to such notice or by his or her duly
authorized attorney, whether before or after the time stated therein, shall be  
deemed equivalent to the notice required to be given, and the presence at any   
meeting of any person entitled to notice thereof shall be deemed a waiver of    
such notice as to such person.                                                  

Section 2.  AUDITS.  The accounts, books and records of the Corporation 
shall be audited upon the conclusion of each fiscal year by an independent      
certified public accountant selected by the Board of Directors, and it shall be 
the duty of the Board of Directors to cause such audit to be done annually.     

ARTICLE XI
AMENDMENTS

 These By-laws may be altered, amended or repealed, and new By-laws may be
adopted (a) at any annual or special meeting of stockholders by the affirmative 
vote of the holders of a majority of the voting power of the stock issued and   
outstanding and entitled to vote thereat, PROVIDED, HOWEVER, that any proposed  
alteration, amendment or repeal of, or the adoption of any By-law inconsistent  
with, Section 3, 5 or 10 of Article II or Section 1 or 5 of Article III of the  
By-laws by the stockholders shall require the affirmative vote of the holders of
at least 80% of the voting power of all Voting Stock then outstanding, voting   
together as a single class, and PROVIDED FURTHER, HOWEVER, that, in the case of 
any such stockholder action at a special meeting of stockholders, notice of the 
proposed alteration, amendment, repeal or adoption of the new By-law or By-laws 
must be contained in the notice of such special meeting, or (b) by the          
affirmative vote of a majority of the Whole Board.                              

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                                                                         ANNEX C

    EXCHANGE AGREEMENT
BETWEEN 
SILICON GRAPHICS, INC.
AND 
MIPS TECHNOLOGIES, INC. 
DATED AS OF         , 1999

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TABLE OF CONTENTS 

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                                                                                                          -----------
                                                                                                                     
                                                    ARTICLE I                                                        
                                                  THE EXCHANGE                                                       

1.01. The Exchange.......................................................................................          1 
1.02. Closing Date.......................................................................................          1 
1.03. Exchange of Certificates...........................................................................          2 

                                                   ARTICLE II                                                        
                                               PURCHASE OBLIGATION                                                   

2.01. Required Purchase Amount...........................................................................          2 
2.02. Common Stock to be Purchased.......................................................................          2 
2.03. Purchase Price for Shares of Class B Common Stock..................................................          3 

                                                   ARTICLE III                                                       
                                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY                                      

3.01. Organization and Qualification.....................................................................          3 
3.02. Amended and Restated Certificate of Incorporation and By-Laws......................................          4 
3.03. Capitalization.....................................................................................          4 
3.04. Authority Relative to This Agreement...............................................................          4 
3.05. No Conflict; Required Filings and Consents.........................................................          4 
3.06. Brokers............................................................................................          5 

                                                   ARTICLE IV                                                        
                               REPRESENTATIONS AND WARRANTIES OF SILICON GRAPHICS                                    

4.01. Organization and Qualification; Subsidiaries.......................................................          5 
4.02. Certificate of Incorporation and By-Laws...........................................................          5 
4.03. Authority Relative to This Agreement...............................................................          5 
4.04. No Conflict; Required Filings and Consents.........................................................          6 
4.05. Ability to Consummate the Distribution.............................................................          6 
4.06. Brokers............................................................................................          6 

                                                    ARTICLE V                                                        
                                              ADDITIONAL AGREEMENTS                                                  

5.01. Ability to Consummate the Distribution.............................................................          6 
5.02. Indemnification by Silicon Graphics................................................................          6 
5.03. Transfer Restrictions..............................................................................          7 
5.04. Tax Indemnification Agreement......................................................................          7 

                                                   ARTICLE VI                                                        
                                CONDITIONS TO THE EFFECTIVENESS OF THE AGREEMENT                                     

6.01. Conditions to the Obligations of Each Party........................................................          8 
6.02. Conditions to the Obligations of Silicon Graphics..................................................          8 
6.03. Conditions to the Obligations of the Company.......................................................          9 

                                                   ARTICLE VII                                                       
                                        TERMINATION, AMENDMENT AND WAIVER                                            

7.01. Termination........................................................................................          9 
7.02. Effect of Termination..............................................................................          9 

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7.03. Amendment..........................................................................................          9 
7.04. Waiver.............................................................................................         10 
7.05. Expenses...........................................................................................         10 

                                                  ARTICLE VIII                                                       
                                               GENERAL PROVISIONS                                                    

8.01. Notices............................................................................................         10 
8.02. Certain Definitions................................................................................         10 
8.03. Severability.......................................................................................         11 
8.04. Assignment; Binding Effect; Benefit................................................................         11 
8.05. Specific Performance...............................................................................         11 
8.06. Governing Law......................................................................................         11 
8.07. Headings...........................................................................................         11 
8.08. Counterparts.......................................................................................         11 
8.09. Entire Agreement...................................................................................         11 

                                                                [Download Table]
                                                                        
ANNEX A  Certain Terms and Provisions of Tax Indemnification Agreement  

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EXCHANGE AGREEMENT dated as of      , 1999 (this "AGREEMENT") between   
SILICON GRAPHICS, INC., a Delaware corporation ("SILICON GRAPHICS"), and MIPS   
TECHNOLOGIES, INC., a Delaware corporation (the "COMPANY").                     

W I T N E S S E T H 

WHEREAS, on the date hereof, the authorized capital stock of the Company
consists of 200,000,000 shares, of which 150,000,000 shares are common stock,   
par value $0.001 per share (the "EXISTING COMMON STOCK"), and 50,000,000 shares 
are preferred stock, par value $0.001 per share (the "PREFERRED STOCK");        

    WHEREAS, pursuant to an amended and restated certificate of incorporation of
the Company (the "AMENDED AND RESTATED CERTIFICATE OF INCORPORATION"), the      
Company intends to effect a recapitalization (the "RECAPITALIZATION") pursuant  
to which (i) the authorized capital stock of the Company will increase to       
300,000,000 shares, of which 150,000,000 shares will be shares of Class A Common
Stock, par value $0.001 per share (the "CLASS A COMMON STOCK"), 100,000,000     
shares will be shares of Class B Common Stock, par value $0.001 per share (the  
"CLASS B COMMON STOCK" and, together with the Class A Common Stock, the "COMMON 
STOCK"), and 50,000,000 shares will be shares of Preferred Stock, and (ii) each 
issued and outstanding share of Existing Common Stock will be changed into and  
reclassified as one share of Class A Common Stock.                              

  WHEREAS, immediately following the Recapitalization, Silicon Graphics will
be the beneficial owner of 31,750,000 shares of Class A Common Stock;           

WHEREAS, upon the terms and subject to the conditions contained in this 
Agreement, Silicon Graphics has agreed to exchange all of the issued and        
outstanding shares of Class A Common Stock it will beneficially own immediately 
following the Recapitalization for an equal number of shares of Class B Common  
Stock (the "EXCHANGE");                                                         

  WHEREAS, Silicon Graphics has indicated its present intention to divest of
its interest in the Company in one or more public and/or private offerings      
followed by a distribution (the "DISTRIBUTION") generally intended to qualify   
under Section 355 of the United States Internal Revenue Code of 1986, as amended
(the "CODE"); and                                                               

WHEREAS, in the event that the Distribution has not occurred prior to   
December 31, 2000, Silicon Graphics shall become obligated to purchase a        
specified number of shares of Common Stock on a quarterly basis, upon the terms 
and subject to the conditions of this Agreement;                                

  NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby,      
Silicon Graphics and the Company hereby agree as follows:                       

ARTICLE I 
THE EXCHANGE

  SECTION 1.01.  THE EXCHANGE.  Upon the terms and subject to the conditions
set forth in Article VI, on the Closing Date (as defined below), each share of  
Class A Common Stock beneficially owned by Silicon Graphics immediately         
following the Recapitalization shall, in accordance with Section 1.03 herein, be
exchanged by Silicon Graphics for one share of Class B Common Stock, with each  
such share of Class B Common Stock having the relative powers, preferences,     
rights, qualifications, limitations and restrictions attaching to the Class B   
Common Stock as specified in the Amended and Restated Certificate of            
Incorporation.                                                                  

 SECTION 1.02.  CLOSING DATE.  The term "CLOSING DATE" means the date when
the Amended and Restated Certificate of Incorporation becomes effective under   
the General Corporation Law of the State                                        

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of Delaware. On the Closing Date, a closing will be held at the offices of      
Shearman & Sterling, 555 California Street, 20(th) Floor, San Francisco, CA     
94104 (or such other place as the parties may agree).                           

  SECTION 1.03.  EXCHANGE OF CERTIFICATES.  On or prior to the Closing Date,
Silicon Graphics shall deposit, or shall cause to be deposited, with the Company
the certificate or certificates representing the shares of Class A Common Stock 
beneficially owned by Silicon Graphics as of the Closing Date. On the Closing   
Date, the Company shall issue to Silicon Graphics a new certificate or          
certificates representing an aggregate number of shares of Class B Common Stock 
equal to the aggregate number of shares of Class A Common Stock beneficially    
owned by Silicon Graphics as of the Closing Date.                               

ARTICLE II
PURCHASE OBLIGATION 

SECTION 2.01.  REQUIRED PURCHASE AMOUNT.  (a) Subject to terms and      
conditions of this Agreement, if Silicon Graphics shall not have disposed of its
entire interest in the Company (whether through a Distribution or otherwise)    
prior to December 31, 2000, Silicon Graphics shall, on the last day of each     
fiscal quarter of the Company beginning on December 31, 2000 and ending on the  
last day of the fiscal quarter immediately preceding any such disposition (the  
last day of each such quarter being a "QUARTER END DATE"), accrue an obligation 
to purchase, with respect to such Quarter End Date, the number of shares of     
Common Stock set forth below (the total number of shares of Common Stock with   
respect to any Quarter End Date, as reduced in accordance with Section 2.01(b)  
below, being a "REQUIRED PURCHASE AMOUNT"):                                     

                                                        [Enlarge/Download Table]

QUARTER END DATE                                                                         REQUIRED PURCHASE AMOUNT 
---------------------------------------------------------------------------------------  -------------------------
                                                                                                                  
December 31, 2000......................................................................           1,800,000       
March 31, 2001.........................................................................           1,700,000       
June 30, 2001..........................................................................           1,800,000       
September 30, 2001.....................................................................           1,700,000       
December 31, 2001......................................................................           1,800,000       
March 31, 2002.........................................................................           1,700,000       
June 30, 2002..........................................................................           1,700,000       
September 30, 2002.....................................................................           2,000,000       
December 31, 2002 and each Quarter End Date............................................           2,000,000       

(b) If, prior to the Purchase Date (as defined in Section 2.02) for any 
Required Purchase Amount, the Company notifies Silicon Graphics in writing (such
writing hereinafter referred to as a "PURCHASE WAIVER") that the independent    
directors and the Chief Executive Officer of the Company have unanimously       
determined that the purchase of shares of Common Stock equal to such Required   
Purchase Amount is not in the interests of the Company and its stockholders     
other than Silicon Graphics and its affiliates (other than the Company), then   
the Required Purchase Amount with respect to the related Quarter End Date shall 
be reduced by the number of shares of Common Stock set forth in such Purchase   
Waiver.                                                                         

SECTION 2.02.  COMMON STOCK TO BE PURCHASED.  (a) At its sole option,   
Silicon Graphics may satisfy its obligation to purchase shares of Common Stock  
equal to any Required Purchase Amount by purchasing (i) newly issued shares of  
Class B Common Stock from the Company, (ii) issued and outstanding shares of    
Class A Common Stock in the public market or otherwise from a third party or    
(iii) any combination of Class B Common Stock and Class A Common Stock pursuant 
to (i) and (ii) above, in each case on or prior to the applicable Purchase Date.
If Silicon Graphics elects to purchase shares of Class B Common Stock from the  
Company in full or partial satisfaction of its obligation to purchase shares of 
Common Stock equal to the Required Purchase Amount, Silicon Graphics shall,     
prior to the relevant Purchase Date for such Required Purchase Amount, deliver  
to the Company a written notice (a "PURCHASE NOTICE") to such effect specifying 
(A) the number of shares of Class B Common Stock to be purchased by Silicon     
Graphics from the Company and (B) a calculation of the purchase price for such  
shares as determined pursuant to                                                

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the terms of Section 2.03 of this Agreement. As soon as practicable following   
receipt by the Company of a Purchase Notice, the Company will deliver to Silicon
Graphics, against payment therefor, certificates (issued in the name of Silicon 
Graphics) representing the shares of Class B Common Stock being purchased       
pursuant to such Purchase Notice. Payment for such shares shall be made by wire 
transfer of immediately-available funds to such account as shall be specified by
the Company for the full purchase price of such shares. Each share of Common    
Stock purchased by Silicon Graphics pursuant to this Section 2.02 shall also be 
deemed to be a "Registered Security" under Article II of the Corporate          
Agreement, dated as of July 6, 1998, between the Company and Silicon Graphics   
(the "CORPORATE AGREEMENT") and therefore entitled to the benefits of said      
Article III and the parties shall amend the Corporate Agreement to implement the
foregoing.                                                                      

 (b) The following shall apply in determining whether Silicon Graphics has
satisfied its obligation to purchase shares of Common Stock equal to the        
Required Purchase Amount with respect to any Quarter End Date: (i) each share of
Class A Common Stock purchased by Silicon Graphics in the public market or      
otherwise from a third party on or prior to the applicable Purchase Date shall  
be counted as four (4) shares of Common Stock purchased in satisfaction of the  
Required Purchase Amount and (ii) each share of Class B Common Stock purchased  
by Silicon Graphics from the Company on or prior to the applicable Purchase Date
shall be counted as one (1) share of Common Stock purchased in satisfaction of  
the Required Purchase Amount; PROVIDED, HOWEVER, that any shares of Class A     
Common Stock purchased by Silicon Graphics in the public market or otherwise    
from a third party shall only be applied in satisfaction of a Required Purchase 
Amount one time.                                                                

   (c) With respect to each Quarter End Date, Silicon Graphics shall make such
purchase or purchases of shares of Common Stock equal to the Required Purchase  
Amount prior to the date (the "PURCHASE DATE") which is thirty (30) days        
following the public announcement of financial results for the fiscal quarter of
the Company ending on such Quarter End Date.                                    

SECTION 2.03.  PURCHASE PRICE FOR SHARES OF CLASS B COMMON STOCK.  The  
purchase price per share for any newly issued shares of Class B Common Stock    
purchased by Silicon Graphics from the Company in satisfaction of Silicon       
Graphics' obligation to purchase a Required Purchase Amount shall be the average
of the closing prices per share of the Class A Common Stock on the Nasdaq       
National Market for the last ten (10) trading days of the quarter immediately   
preceding the applicable Purchase Date.                                         

ARTICLE III 
REPRESENTATIONS AND WARRANTIES OF THE COMPANY 

The Company hereby represents and warrants to Silicon Graphics that:    

    SECTION 3.01.  ORGANIZATION AND QUALIFICATION.  The Company is a corporation
duly incorporated, validly existing and in good standing under the laws of      
Delaware and has all requisite corporate power and authority and all necessary  
governmental approvals to own, lease and operate its properties and to carry on 
its business as it is now being conducted, except where the failure to be so    
organized, existing or in good standing or to have such corporate power,        
authority and governmental approvals have not had, and could not reasonably be  
expected to have, individually or in the aggregate, a Company Material Adverse  
Effect (as defined below). The Company is duly qualified or licensed as a       
foreign corporation to do business, and is in good standing, in each            
jurisdiction where the character of the properties owned, leased or operated by 
it or the nature of its business makes such qualification or licensing          
necessary, except for such failures to be so qualified or licensed and in good  
standing that have not had, and could not reasonably be expected to have,       
individually or in the aggregate, a Company Material Adverse Effect. The term   
"COMPANY MATERIAL ADVERSE EFFECT" means any change in or effect on the business 
of the Company that is materially adverse to the financial condition or results 
of operations of the Company.                                                   

SECTION 3.02.  AMENDED AND RESTATED CERTIFICATE OF INCORPORATION AND    
BY-LAWS.  The Company has heretofore made available to Silicon Graphics a       
complete and correct copy of the Restated Certificate of                        

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Incorporation and the By-Laws of the Company. Such Restated Certificate of      
Incorporation and By-Laws are in full force and effect. The Company is not in   
violation of any of the provisions of its Restated Certificate of Incorporation 
or By-Laws.                                                                     

   SECTION 3.03.  CAPITALIZATION.  The authorized capital stock of the Company
consists of (a) 250,000,000 shares of Common Stock, of which 150,000,000 shares 
are designated as Class A Common Stock and 100,000,000 shares are designated as 
Class B Common Stock and (b) 50,000,000 shares of Preferred Stock. As of the    
date of this Agreement (after giving effect to the Recapitalization but prior to
giving effect to the Exchange contemplated hereby), (i) [37,265,000] shares of  
Class A Common Stock are issued and outstanding, all of which are validly       
issued, fully paid and nonassessable, (ii) no shares of Class B Common Stock are
issued and outstanding, (iii) no shares of Common Stock are held in the treasury
of the Company, (iv) no shares of the Preferred Stock are issued and outstanding
and (v) [      ] shares are reserved for future issuance pursuant to options    
(the "COMPANY STOCK OPTIONS"). Other than pursuant to the 1998 Long-Term        
Incentive Plan and the Employee Stock Purchase Plan (the "COMPANY STOCK OPTION  
PLANS") and the Corporate Agreement, there are no options, warrants or other    
rights, agreements, arrangements or commitments of any character relating to the
issued or unissued capital stock of the Company or obligating the Company to    
issue or sell any shares of capital stock of, or other equity interests in, the 
Company. All shares of Common Stock subject to issuance as aforesaid, upon      
issuance on the terms and conditions specified in the instruments pursuant to   
which they are issuable, will be duly authorized, validly issued, fully paid and
nonassessable. There are no outstanding contractual obligations of the Company  
to repurchase, redeem or otherwise acquire any shares of Common Stock.          

 SECTION 3.04.  AUTHORITY RELATIVE TO THIS AGREEMENT.  The Company has all
necessary corporate power and authority to execute and deliver this Agreement   
and, subject to the filing of the Amended and Restated Certificate of           
Incorporation of the Company with the Secretary of State of the State of        
Delaware, to perform its obligations hereunder and to consummate the            
transactions contemplated by this Agreement. The Recapitalization has been      
approved and adopted by (i) the affirmative vote of the holders of a majority of
the issued and outstanding shares of Existing Common Stock and (ii) the         
affirmative vote of the holders of a majority of the issued and outstanding     
shares of Existing Common Stock (excluding Silicon Graphics and its affiliates  
as a stockholder for the purposes of this clause (ii)) and in accordance with   
the Company's Restated Certificate of Incorporation. The execution and delivery 
of this Agreement by the Company and the consummation by the Company of the     
Recapitalization and the transactions contemplated by this Agreement have been  
duly and validly authorized by all necessary corporate action and, except for   
the filing of the Amended and Restated Certificate of Incorporation of the      
Company with the Secretary of State of the State of Delaware, no other corporate
proceedings on the part of the Company are necessary to authorize the           
Recapitalization, this Agreement or to consummate the transactions contemplated 
by this Agreement. This Agreement has been duly and validly executed and        
delivered by the Company and, assuming the due authorization, execution and     
delivery by Silicon Graphics, constitutes a legal, valid and binding obligation 
of the Company.                                                                 

SECTION 3.05.  NO CONFLICT; REQUIRED FILINGS AND CONSENTS.  (a) The     
execution and delivery of this Agreement by the Company do not, and the         
performance of this Agreement by the Company will not, (i) conflict with or     
violate the Amended and Restated Certificate of Incorporation or the Amended and
Restated By-laws of the Company, (ii) conflict with or violate any foreign or   
domestic law, statute, ordinance, rule, regulation, order, judgment or decree   
("LAW") applicable to the Company or by which any property or asset of the      
Company is bound or affected, or (iii) result in any breach of or constitute a  
default (or an event which with notice or lapse of time or both would become a  
default) under, or give to others any right of termination, amendment,          
acceleration or cancellation of, or result in the creation of a lien or other   
encumbrance on any property or asset of the Company pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or  
other instrument or obligation, except, with respect to clause (iii), for any   
such conflicts, violations, breaches, defaults or other occurrences that have   
not had, and could not reasonably be expected to have, individually or in the   

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aggregate, a Company Material Adverse Effect, and that could not reasonably be  
expected to prevent or materially delay the consummation of the transactions    
contemplated by this Agreement.                                                 

   (b) The execution and delivery of this Agreement by the Company do not, and
the performance of this Agreement by the Company will not, require any consent, 
approval, authorization or permit of, or filing with or notification to, any    
domestic or foreign governmental or regulatory authority ("GOVERNMENTAL         
ENTITY"), except (i) for applicable requirements, if any, of the Securities     
Exchange Act of 1934, as amended (together with the rules and regulations       
promulgated thereunder, the "EXCHANGE ACT"), state securities or "blue sky" laws
("BLUE SKY LAWS") and The Nasdaq Stock Market, Inc. and (ii) where failure to   
obtain such consents, approvals, authorizations or permits, or to make such     
filings or notifications, has not had, and could not reasonably be expected to  
have, individually or in the aggregate, a Company Material Adverse Effect, and  
could not reasonably be expected to prevent or materially delay the consummation
of the transactions contemplated by this Agreement.                             

   SECTION 3.06.  BROKERS.  No broker, finder or investment banker is entitled
to any brokerage, finder's or other fee or commission in connection with the    
Recapitalization or the transactions contemplated by this Agreement based upon  
arrangements made by or on behalf of the Company.                               

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SILICON GRAPHICS

Silicon Graphics hereby represents and warrants to the Company that:    

SECTION 4.01.  ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.  Each of   
Silicon Graphics and each subsidiary of Silicon Graphics other than the Company 
(the "SILICON GRAPHICS SUBSIDIARIES") is a corporation duly incorporated,       
validly existing and in good standing under the laws of the jurisdiction of its 
incorporation and has all corporate requisite power and authority and all       
necessary governmental approvals to own, lease and operate its properties and to
carry on its business as it is now being conducted, except where the failure to 
be so organized, existing or in good standing or to have such corporate power,  
authority and governmental approvals have not had, and could not reasonably be  
expected to have, individually or in the aggregate, a Silicon Graphics Material 
Adverse Effect (as defined below). Each of Silicon Graphics and the Silicon     
Graphics Subsidiaries is duly qualified or licensed as a foreign corporation to 
do business, and is in good standing, in each jurisdiction where the character  
of the properties owned, leased or operated by it or the nature of its business 
makes such qualification or licensing necessary, except for such failures to be 
so qualified or licensed and in good standing that have not had, and could not  
reasonably be expected to have, individually or in the aggregate, a Silicon     
Graphics Material Adverse Effect. The term "SILICON GRAPHICS MATERIAL ADVERSE   
EFFECT" means any change in or effect on the business of Silicon Graphics or the
Silicon Graphics Subsidiaries that is materially adverse to the financial       
condition or results of operations of Silicon Graphics and the Silicon Graphics 
Subsidiaries taken as a whole.                                                  

  SECTION 4.02.  CERTIFICATE OF INCORPORATION AND BY-LAWS.  Silicon Graphics
has heretofore made available to the Company a complete and correct copy of the 
Certificate of Incorporation and the By-Laws of Silicon Graphics. Such          
Certificate of Incorporation and By-Laws are in full force and effect. Silicon  
Graphics is not in violation of any of the provisions of its Certificate of     
Incorporation or By-Laws.                                                       

  SECTION 4.03.  AUTHORITY RELATIVE TO THIS AGREEMENT.  Silicon Graphics has
all necessary corporate power and authority to execute and deliver this         
Agreement, to perform its obligations hereunder and to consummate the           
transactions contemplated by this Agreement. The execution and delivery of this 
Agreement by Silicon Graphics and the consummation by Silicon Graphics of the   
transactions contemplated by this Agreement have been duly and validly          
authorized by all necessary corporate action and no other corporate proceedings 
on the part of Silicon Graphics are necessary to authorize this Agreement or to 
consummate the transactions contemplated by this Agreement. This Agreement has  
been duly and validly executed and delivered by Silicon Graphics and, assuming  
the due authorization, execution and delivery by the Company, constitutes a     
legal, valid and binding obligation of Silicon Graphics.                        

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SECTION 4.04.  NO CONFLICT; REQUIRED FILINGS AND CONSENTS.  (a) The     
execution and delivery of this Agreement by Silicon Graphics do not, and the    
performance of this Agreement by Silicon Graphics will not, (i) conflict with or
violate the certificate of incorporation or by-laws of Silicon Graphics or any  
other Silicon Graphics Subsidiary, (ii) conflict with or violate any Law        
applicable to Silicon Graphics or any Silicon Graphics Subsidiary or by which   
any property or asset of Silicon Graphics or any Silicon Graphics Subsidiary is 
bound or affected, or (iii) result in any breach of or constitute a default (or 
an event which with notice or lapse of time or both would become a default)     
under, or give to others any right of termination, amendment, acceleration or   
cancellation of, or result in the creation of a lien or other encumbrance on any
property or asset of Silicon Graphics or any Silicon Graphics Subsidiary        
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,   
license, permit, franchise or other instrument or obligation, except, with      
respect to clause (iii), for any such conflicts, violations, breaches, defaults,
or other occurrences that have not had, and could not reasonably be expected to 
have, individually or in the aggregate, a Silicon Graphics Material Adverse     
Effect, and that could not reasonably be expected to prevent or materially delay
the consummation of the transactions contemplated by this Agreement.            

    (b) The execution and delivery of this Agreement by Silicon Graphics do not,
and the performance of this Agreement by Silicon Graphics will not, require any 
consent, approval, authorization or permit of, or filing with or notification   
to, any Governmental Entity, except (i) for applicable requirements, if any, of 
the Exchange Act and Blue Sky Laws, and (ii) where failure to obtain such       
consents, approvals, authorizations or permits, or to make such filings or      
notifications, has not had, and could not reasonably be expected to have,       
individually or in the aggregate, a Silicon Graphics Material Adverse Effect,   
and could not reasonably be expected to prevent or materially delay the         
consummation of the transactions contemplated by this Agreement                 

 SECTION 4.05.  ABILITY TO CONSUMMATE THE DISTRIBUTION.  As of the date of
this Agreement, Silicon Graphics is not aware of any legal or contractual       
restriction affecting it or any of its assets or properties that could          
reasonably be expected to prevent or materially delay the consummation of the   
Distribution.                                                                   

   SECTION 4.06.  BROKERS.  No broker, finder or investment banker is entitled
to any brokerage, finder's or other fee or commission in connection with the    
Recapitalization or the transactions contemplated by this Agreement based upon  
arrangements made by or on behalf of Silicon Graphics.                          

ARTICLE V 
ADDITIONAL AGREEMENTS 

SECTION 5.01.  ABILITY TO CONSUMMATE THE DISTRIBUTION.  Silicon Graphics
shall use its reasonable efforts to avoid becoming voluntarily or involuntarily 
subject to any legal or contractual restriction that could reasonably be        
expected to prevent the consummation of the Distribution; PROVIDED, HOWEVER,    
that Silicon Graphics shall be permitted to enter into commercially reasonable  
agreements in the ordinary course of business and consistent with past practice 
which may contain provisions restricting Silicon Graphics' ability to consummate
the Distribution, including, but not limited to, provisions that restrict the   
ability of Silicon Graphics to declare, set aside or pay any dividend or other  
distribution in respect of its capital stock.                                   

 SECTION 5.02.  INDEMNIFICATION BY SILICON GRAPHICS.  (a) Silicon Graphics
shall indemnify and hold harmless the Company, its affiliates and their         
successors and assigns, and the officers, directors, employees and agents of the
Company, its affiliates and their successors and assigns (each an "INDEMNIFIED  
PARTY") from and against any and all liabilities, losses, damages, claims, costs
and expenses, interest, awards, judgments and penalties (including, without     
limitation, attorneys' and consultants' fees and expenses) actually suffered or 
incurred by them (including, without limitation, any action brought or otherwise
initiated by any of them) (hereinafter a "LOSS") by reason of or in connection  
with any claim or cause of action of any third party (a "THIRD PARTY CLAIM"), to
the extent, but only to the extent, such Third Party                            

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Claim arises out of the Recapitalization or the Distribution; PROVIDED, HOWEVER,
that any such Third Party Claim shall have been brought prior to the expiration 
of the applicable statute of limitations period governing such claim.           

(b) Notwithstanding anything to the contrary in Section 5.02(a), Silicon
Graphics shall not be obligated under Section 5.02(a) to indemnify and hold     
harmless any Indemnified Party for any Losses suffered or incurred by an        
Indemnified Party by reason of or in connection with any secondary sales by     
Silicon Graphics of Common Stock following the Recapitalization.                

  (c) If an Indemnified Party shall receive notice of any Third Party Claim,
the Indemnified Party shall give Silicon Graphics notice of such Third Party    
Claim within 30 days of the receipt by the Indemnified Party of such notice;    
PROVIDED, HOWEVER, that the failure to provide such notice shall not release    
Silicon Graphics from any of its obligations under this Section 5.02 except to  
the extent Silicon Graphics is materially prejudiced by such failure and shall  
not relieve Silicon Graphics from any other obligation or liability that it may 
have to any Indemnified Party otherwise than under this Section 5.02. If Silicon
Graphics acknowledges in writing its obligation to indemnify the Indemnified    
Party hereunder against any Losses that may result from such Third Party Claim, 
then Silicon Graphics shall be entitled to assume and control the defense of    
such Third Party Claim at its expense and through counsel of its choice if it   
gives notice of its intention to do so to the Indemnified Party within five days
of the receipt of such notice from the Indemnified Party; PROVIDED, HOWEVER,    
that if there exists or is reasonably likely to exist a conflict of interest    
that would make it inappropriate in the judgment of the Indemnified Party, in   
its sole and absolute discretion, for the same counsel to represent both the    
Indemnified Party and Silicon Graphics, then the Indemnified Party shall be     
entitled to retain its own counsel, in each jurisdiction for which the          
Indemnified Party determines counsel is required, at the expense of Silicon     
Graphics. In the event Silicon Graphics exercises the right to undertake any    
such defense against any such Third Party Claim as provided above, the          
Indemnified Party shall cooperate with Silicon Graphics in such defense and make
available to Silicon Graphics, at Silicon Graphics' expense, all witnesses,     
pertinent records, materials and information in the Indemnified Party's         
possession or under the Indemnified Party's control relating thereto as is      
reasonably required by Silicon Graphics. Similarly, in the event the Indemnified
Party is, directly or indirectly, conducting the defense against any such Third 
Party Claim, Silicon Graphics shall cooperate with the Indemnified Party in such
defense and make available to the Indemnified Party, at Silicon Graphics'       
expense, all such witnesses, records, materials and information in Silicon      
Graphics' possession or under Silicon Graphics' control relating thereto as is  
reasonably required by the Indemnified Party. No such Third Party Claim may be  
settled by Silicon Graphics without the prior written consent of the Indemnified
Party.                                                                          

    SECTION 5.03.  TRANSFER RESTRICTIONS.  Silicon Graphics has been advised and
understands that all shares of Class B Common Stock acquired by Silicon Graphics
in satisfaction of its obligations under Article II or as a result of the       
automatic conversion of shares of Class A Common Stock into shares of Class B   
Common Stock in accordance with Article IV of the Amended and Restated          
Certificate of Incorporation have not been registered under the Securities Act  
of 1933, as amended (the "SECURITIES ACT"). The parties hereto agree that such  
shares may be resold, pledged or otherwise transferred by Silicon Graphics only 
(a) to the Company (upon exchange or redemption thereof or otherwise), (b)      
pursuant to an exemption from registration under the Securities Act, or (c) in  
accordance with Article III of the Corporate Agreement.                         

 SECTION 5.04.  TAX INDEMNIFICATION AGREEMENT.  Prior to the Distribution,
the Company and Silicon Graphics shall enter into a Tax Indemnification         
Agreement regarding such Distribution which shall contain (i) each of the terms 
and provisions included in Appendix A hereto and (ii) such other terms and      
provisions as are customary for such agreements and as shall be mutually agreed 
to by the parties.                                                              

   SECTION 5.05.  EXCHANGE OF SHARES UPON CHANGE IN TAX LAW.  (a) If, prior to
a Distribution, (i) the Code has been amended by the enactment of new           
legislation which generally imposes a requirement to the                        

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effect that in a tax-free spin-off of a subsidiary, the distributing company    
must hold not less than 80% of the value of all or a portion of the subsidiary's
stock (such change in the Code being a "CHANGE IN TAX LAW") AND (ii) Silicon    
Graphics receives from the Company an opinion of counsel reasonably satisfactory
to Silicon Graphics that such Change in Tax Law would apply to a Distribution,  
then Silicon Graphics shall, and shall cause each of its subsidiaries (other    
than the Company) to, exchange each share of Class B Common Stock owned by it   
for one share of Class A Common Stock.                                          

(b) Within twenty (20) days of its receipt of the opinion referred to in
clause (ii) of Section 5.05(a), Silicon Graphics shall, and shall cause each of 
its subsidiaries (other than the Company) to, deliver to the Company the        
certificate or certificates representing the shares of Class B Common Stock it  
owns and, upon receipt of such certificate or certificates, the Company shall   
issue a certificate or certificates to Silicon Graphics or such subsidiary, as  
the case may be, for the aggregate number of shares of Class A Common Stock     
issuable in exchange therefor pursuant to Section 5.05(a).                      

ARTICLE VI
CONDITIONS TO THE EFFECTIVENESS OF THE AGREEMENT

    SECTION 6.01.  CONDITIONS TO THE OBLIGATIONS OF EACH PARTY.  The obligations
of the Company and Silicon Graphics to consummate this Agreement are subject to 
the satisfaction or waiver (where permissible) of the following conditions:     

    (a) the Amended and Restated Certificate of Incorporation shall have
    become effective in accordance with the General Corporation Law of the State
of Delaware;                                                            

        (b) no Governmental Entity or court of competent jurisdiction located or
having jurisdiction in the United States shall have enacted, issued,    
promulgated, enforced or entered any law, rule, regulation, judgment,   
 decree, executive order or award (an "Order") which is then in effect and
has the effect of making the Recapitalization or the transactions       
    contemplated by this Agreement illegal or otherwise prohibiting consummation
   of the Recapitalization or the transactions contemplated by this Agreement;

(c) the shares of Class A Common Stock to be issued in the      
Recapitalization shall have been approved for quotation on the Nasdaq   
National Market;                                                        

       (d) a registration statement on Form 8-A (the "REGISTRATION STATEMENT")
registering the Class A Common Stock under the Exchange Act shall have  
become effective upon filing with the Securities and Exchange Commission
  ("SEC") and no stop order suspending the effectiveness of the Registration
 Statement shall have been issued and no proceeding for that purpose shall
have been initiated by the SEC; and                                     

     (e) all consents, approvals and authorizations legally required to be
    obtained to consummate this Agreement shall have been obtained from and made
with all Governmental Entities, except for such consents, approvals and 
authorizations the failure of which to obtain would not have a material 
adverse effect on the ability of the Company or Silicon Graphics to     
consummate the transactions contemplated hereby.                        

SECTION 6.02.  CONDITIONS TO THE OBLIGATIONS OF SILICON GRAPHICS.  The  
obligations of Silicon Graphics to consummate this Agreement are subject to the 
satisfaction or waiver (where permissible) of the following additional          
conditions:                                                                     

       (a) each of the representations and warranties of the Company contained
    in this Agreement shall be true and correct as of the Closing Date as though
  made on and as of the Closing Date, except where failure to be so true and
 correct would not have a Company Material Adverse Effect, and except that
those representations and warranties which address matters only as of a 
   particular date shall remain true and correct as of such date, except where
failure to be so true and correct would not                             

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have a Company Material Adverse Effect, and Silicon Graphics shall have 
received a certificate of the Chief Executive Officer or Chief Financial
Officer of the Company to such effect; and                              

     (b) the Company shall have performed or complied with in all material
respects all agreements and covenants required by this Agreement to be  
performed or complied with by it on or prior to the Closing Date, and   
 Silicon Graphics shall have received a certificate of the Chief Executive
Officer or Chief Financial Officer of the Company to that effect.       

SECTION 6.03.  CONDITIONS TO THE OBLIGATIONS OF THE COMPANY.  The       
obligations of the Company to consummate this Agreement are subject to the      
satisfaction or waiver (where permissible) of the following additional          
conditions:                                                                     

  (a) each of the representations and warranties of Silicon Graphics
contained in this Agreement shall be true and correct as of the Closing 
    Date, as though made on and as of the Closing Date, except where the failure
    to be so true and correct would not have a Silicon Graphics Material Adverse
  Effect, and except that those representations and warranties which address
matters only as of a particular date shall remain true and correct as of
    such date, except where the failure to be so true and correct would not have
a Silicon Graphics Material Adverse Effect, and the Company shall have  
  received a certificate of an executive officer of Silicon Graphics to such
effect; and                                                             

 (b) Silicon Graphics shall have performed or complied with in all
    material respects all agreements and covenants required by this Agreement to
    be performed or complied with by it on or prior to the Closing Date, and the
    Company shall have received a certificate of an executive officer of Silicon
Graphics to such effect.                                                

ARTICLE VII 
TERMINATION, AMENDMENT AND WAIVER 

 SECTION 7.01.  TERMINATION.  This Agreement, including without limitation
the obligations of Silicon Graphics under Article II hereof, may be terminated, 
and the other transactions contemplated by this Agreement may be abandoned at   
any time, notwithstanding any requisite approval and adoption of this Agreement 
and the transactions contemplated by this Agreement, as follows:                

      (a) by mutual written consent of the parties, duly authorized by their
respective boards of directors based on, in the case of the Company, the
 unanimous recommendation of the independent directors of the Company; and

(b) by either party, upon the occurrence of a Change in Tax Law.

  SECTION 7.02.  EFFECT OF TERMINATION.  In the event of termination of this
Agreement pursuant to Section 7.01, this Agreement shall forthwith become void, 
there shall be no liability under this Agreement on the part of Silicon Graphics
or the Company or any of their respective officers or directors, and all rights 
and obligations of each party hereto shall cease; PROVIDED, HOWEVER, that       
nothing herein shall relieve any party from liability for the wilful breach of  
any of its representations, warranties, covenants or agreements set forth in    
this Agreement; and PROVIDED, FURTHER, that the obligations of Silicon Graphics 
(i) under Section 5.02(a) to indemnify an Indemnified Party for Losses suffered 
or incurred by reason of or in connection with a Third Party Claim arising out  
of the Recapitalization or Distribution and (ii) under Section 7.05 to reimburse
certain fees and expenses incurred by the Company in connection with the        
Recapitalization and the Distribution, shall survive.                           

 SECTION 7.03.  AMENDMENT.  This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.                             

    SECTION 7.04.  WAIVER.  At any time any party hereto may (a) extend the time
for the performance of any obligation or other act of any other party hereto,   
(b) waive any inaccuracy in the representations                                 

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and warranties contained herein or in any document delivered pursuant hereto,   
and (c) waive compliance with any agreement or condition contained herein. Any  
such extension or waiver shall be valid if set forth in an instrument in writing
signed by the party to be bound thereby.                                        

  SECTION 7.05.  EXPENSES.  Silicon Graphics shall reimburse the Company for
the fees and expenses of legal counsel to the Special Committee incurred by the 
Company in connection with the Recapitalization and the Distribution, whether or
not the Recapitalization or Distribution is consummated, in an amount set forth 
in a budget to be agreed to between the parties (the "BUDGET"). In the event    
that the scope or expected amount of legal work on which the Budget was based   
changes, the parties shall agree to a revised budget for legal fees and expenses
(the "REVISED BUDGET") and Silicon Graphics shall pay for such revised legal    
fees and expenses in accordance with the Revised Budget. Silicon Graphics shall 
also reimburse the Company for (i) the reasonable fees and expenses of its      
financial advisor and (ii) all other reasonable out-of-pocket expenses incurred 
by the Company in connection with the Recapitalization and the Distribution.    
Silicon Graphics will be responsible for all of the fees, costs and expenses    
incurred by Silicon Graphics in connection with the Recapitalization and the    
Distribution, whether or not consummated.                                       

ARTICLE VIII
GENERAL PROVISIONS

 SECTION 8.01.  NOTICES.  All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be   
deemed to have been duly given upon receipt) by delivery in person, by cable,   
telecopy, facsimile, telegram or telex or by registered or certified mail       
(postage prepaid, return receipt requested) to the respective parties at the    
following addresses (or at such other address for a party as shall be specified 
in a notice given in accordance with this Section 8.01):if to Silicon Graphics: 
Silicon Graphics, Inc.                                            
2011 N. Shoreline Boulevard                                       
Mountain View, CA 94043                                           
Facsimile No.: (650) 933-7096                                     
Attention: Director, Corporate Legal Services                     
if to the Company:                                                
MIPS Technologies, Inc.                                           
1225 Charleston Avenue                                            
Mountain View, CA 94043                                           
Facsimile No.: (650) 567-5150                                     
Attention: Chief Executive Officer                                

SECTION 8.02.  CERTAIN DEFINITIONS.  For purposes of this Agreement, the
term:                                                                           

    (a) "AFFILIATE" of a specified person means a person who directly or
    indirectly through one or more intermediaries controls, is controlled by, or
is under common control with such specified person;                     

    (b) "CONTROL" (including the terms "CONTROLLED BY" and "UNDER COMMON
    CONTROL WITH") means the possession, directly or indirectly or as trustee or
 executor, of the power to direct or cause the direction of the management
and policies of a person, whether through the ownership of voting       
securities, as trustee or executor, by contract or credit arrangement or
otherwise; and                                                          

   (c) "PERSON" means an individual, corporation, partnership, limited
    partnership, syndicate, person (including, without limitation, a "PERSON" as
defined in section 13(d)(3) of the Exchange Act), trust, association or 
   entity or government, political subdivision, agency or instrumentality of a
government.                                                             

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SECTION 8.03.  SEVERABILITY.  If any term or other provision of this    
Agreement is invalid, illegal or incapable of being enforced by any rule of Law 
or public policy, all other conditions and provisions of this Agreement shall   
nevertheless remain in full force and effect so long as the economic or legal   
substance of the transactions contemplated by this Agreement is not affected in 
any manner materially adverse to any party. Upon such determination that any    
term or other provision is invalid, illegal or incapable of being enforced, the 
parties hereto shall negotiate in good faith to modify this Agreement so as to  
effect the original intent of the parties as closely as possible in a mutually  
acceptable manner in order that the transactions contemplated by this Agreement 
be consummated as originally contemplated to the fullest extent possible.       

   SECTION 8.04.  ASSIGNMENT; BINDING EFFECT; BENEFIT.  Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by  
any of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other party. Subject to the preceding sentence,    
this Agreement shall be binding upon and shall inure to the benefit of the      
parties hereto and their respective successors and assigns. Except as provided  
in Section 5.02, nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto or their respective          
successors and assigns any rights, remedies, obligations or liabilities under or
by reason of this Agreement.                                                    

SECTION 8.05.  SPECIFIC PERFORMANCE.  The parties hereto agree that     
irreparable damage would occur in the event any provision of this Agreement was 
not performed in accordance with the terms hereof and that the parties shall be 
entitled to specific performance of the terms hereof, in addition to any other  
remedy at law or in equity.                                                     

SECTION 8.06.  GOVERNING LAW.  This Agreement shall be governed by, and 
construed in accordance with, the laws of the State of California applicable to 
contracts executed in and to be performed in that state and without regard to   
any applicable conflicts of law.                                                

SECTION 8.07.  HEADINGS.  The descriptive headings contained in this    
Agreement are included for convenience of reference only and shall not affect in
any way the meaning or interpretation of this Agreement.                        

  SECTION 8.08.  COUNTERPARTS.  This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, and by the   
different parties hereto in separate counterparts, each of which when executed  
and delivered shall be deemed to be an original but all of which taken together 
shall constitute one and the same agreement.                                    

SECTION 8.09.  ENTIRE AGREEMENT.  This Agreement constitutes the entire 
agreement among the parties with respect to the subject matter hereof and       
supersedes all prior agreements and understandings among the parties with       
respect thereto. No addition to or modification of any provision of this        
Agreement shall be binding upon any party hereto unless made in writing and     
signed by all parties hereto.                                                   

IN WITNESS WHEREOF, Silicon Graphics and the Company have caused this   
Agreement to be executed as of the date first written above by their respective 
officers thereunto duly authorized.                                             

                                                        [Enlarge/Download Table]
                                                                                             
                                              SILICON GRAPHICS, INC.                         

Attest                                                                                       
by:                                           By                                             
        ------------------------------------             ------------------------------------
        Name:                                            Name:                               
        Title:                                           Title:                              

                                              MIPS TECHNOLOGIES, INC.                        

Attest                                                                                       
by:                                           By                                             
        ------------------------------------             ------------------------------------
        Name:                                            Name:                               
        Title:                                           Title:                              

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                                                                      APPENDIX A

CERTAIN TERMS AND PROVISIONS OF TAX INDEMNIFICATION AGREEMENT 

1.  LIMITATIONS ON CERTAIN ACTIONS.  MIPS covenants and agrees that     
following the Distribution it will not take, or cause or allow any MIPS         
Affiliate to take, any of the following actions:                                

(A) for the thirty (30)-month period beginning on the date of the       
Distribution, issue stock of MIPS in an acquisition or public or private        
offering, except that MIPS or any MIPS Affiliate may issue stock:               

      (1) pursuant to the exercise of employee, director or consultant stock
options, stock awards, stock purchase rights or other employment related
arrangements under any stock incentive plan then in existence; and      

     (2) up to a cumulative amount of ten percent (10%) of the outstanding
stock of MIPS at the time of the Distribution;                          

   (B) for the five (5)-year period beginning on the date of the Distribution,
amend its certificate of incorporation (or other organizational documents),     
whether through a stockholder vote or otherwise, in a manner that affects the   
relative voting rights of the separate classes of MIPS stock (including, without
limitation, through the conversion Class B Stock into Class A Stock);           

   (C) for the five (5)-year period beginning on the date of the Distribution,
exchange any shares of Class B Stock for Class A Stock, including pursuant to   
the MIPS Exchange Right;                                                        

 (D) take, or fail to take, any action where such action or failure to act
would be inconsistent with any material, information, covenant or representation
in the Ruling Documents, Supplemental Ruling Documents, Ruling or Supplemental  
Ruling.                                                                         

(E) for the thirty (30)-month period beginning on the date of the       
Distribution, knowingly and voluntarily take any action which it believes will  
more likely than not result in the Distribution failing to qualify under Section
355 or cause the Distribution otherwise to be taxable under Section 355(e).     

   2.  INDEMNITY BY MIPS.  Except as provided in Section 3, MIPS and each MIPS
Affiliate shall jointly and severally indemnify SGI, each SGI Affiliate and     
their directors, officers and employees and hold them harmless from and against 
any federal, state or local income or franchise taxes imposed as a result of the
Distribution failing to qualify under Section 355 or otherwise being taxable    
under Section 355(e) as a result of:                                            

(A) MIPS or a MIPS Affiliate breaching any of the covenants contained in
Section 1;                                                                      

   (B) any acquisition of stock of MIPS or any MIPS Affiliate by any person or
persons (including, without limitation, as a merger of another entity with and  
into MIPS or any MIPS Affiliate) or any acquisition of assets of MIPS or any    
MIPS Affiliate (including, without limitation, as a result of a merger) by any  
person or persons.                                                              

   3.  PERMITTED ACTIONS.  Notwithstanding the provisions of Sections 1 and 2,
MIPS and each MIPS Affiliate shall have no obligation to indemnify under Section
2 (and may take any action otherwise prohibited by Section 1) if:               

  (A) SGI obtains a Supplemental Ruling that rules that such action will not
cause the Distribution to fail to qualify under Section 355 or otherwise to be  
taxable under Section 355(e);                                                   

(B) SGI consents to such action; or                                     

    (C) MIPS delivers to SGI an opinion, in form reasonably satisfactory to SGI,
of nationally recognized tax counsel, to the effect that such action will not   
cause the Distribution to fail to qualify under Section 355 or otherwise to be  
taxable under Section 355(e).                                                   

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4.  SUPPLEMENTAL RULINGS.                                               

    (A) REQUEST BY SGI. SGI shall have the right to obtain a Supplemental Ruling
in its sole and exclusive discretion. If SGI determines to obtain a Supplemental
Ruling, MIPS shall cooperate with SGI and take any and all actions reasonably   
requested by SGI in connection with obtaining the Supplemental Ruling           
(including, without limitation, by making any representation or covenant or     
providing any materials or information requested by the Internal Revenue        
Service; provided that, MIPS shall not be required to make any representation or
covenant that is inconsistent with historical facts or as to future matters or  
events over which it has no control). In connection with obtaining a            
Supplemental Ruling, (i) SGI shall cooperate with and keep MIPS informed in a   
timely manner of all material actions taken or proposed to be taken by SGI in   
connection therewith; (ii) SGI shall (A) reasonably in advance of the submission
of any Supplemental Ruling Documents, provide MIPS with a draft copy thereof,   
(B) reasonably consider MIPS's comments on such draft copy, and (C) provide MIPS
with a final copy; and (iii) SGI shall provide MIPS with notice reasonably in   
advance of, and MIPS shall have the right to attend, any formally scheduled     
meetings with the Internal Revenue Service (subject to the approval of the      
Internal Revenue Service) that relate to such Supplemental Ruling.              

   (B) REQUEST BY MIPS. SGI agrees that at the reasonable request of MIPS, SGI
shall cooperate with MIPS and use its reasonable best efforts to seek to obtain,
as expeditiously as possible, a Supplemental Ruling or other guidance from the  
Internal Revenue Service for the purpose of confirming the continuing validity  
of (A) the Ruling or (B) any Supplemental Ruling issued previously. Further, in 
no event shall SGI file any Supplemental Ruling under this Section 4 unless MIPS
represents that (1) it has read the request for the Supplemental Ruling and any 
Supplemental Ruling Documents and (2) all information and representations, if   
any, relating to MIPS and any MIPS Affiliate contained in the Supplemental      
Ruling Documents are true, correct and complete in all material respects. MIPS  
shall reimburse SGI for all reasonable costs and expenses incurred by SGI in    
obtaining a Supplemental Ruling requested by MIPS. MIPS hereby agrees that SGI  
shall have sole and exclusive control over the process of obtaining a           
Supplemental Ruling, and that only SGI shall apply for a Supplemental Ruling.   
MIPS further agrees that it shall not seek any guidance from the Internal       
Revenue Service or any other tax authority concerning the Distribution except as
set in this Section 4(B). In connection with obtaining any such Supplemental    
Ruling, (i) SGI shall cooperate with and keep MIPS informed in a timely manner  
of all material actions taken or proposed to be taken by SGI in connection      
therewith; (ii) SGI shall (A) reasonably in advance of the submission of any    
Supplemental Ruling Documents, provide MIPS with a draft copy thereof, (B)      
reasonably consider MIPS's comments on such draft copy, and (C) provide MIPS    
with a final copy; and (iii) SGI shall provide MIPS with notice reasonably in   
advance of, and MIPS shall have the right to attend, any formally scheduled     
meetings with the Internal Revenue Service (subject to the approval of the      
Internal Revenue Service) that relate to such Supplemental Ruling.              

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FORM OF PROXY                                                     FORM OF PROXY 

 MIPS TECHNOLOGIES, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS 
 FOR SPECIAL MEETING -- [MEETING DATE], 1999

JOHN E. BOURGOIN, KEVIN C. EICHLER and SANDY CREIGHTON, or any of them, each    
with the power of substitution, are hereby authorized to represent as proxies   
and vote all shares of stock of MIPS Technologies, Inc. (the "Company") the     
undersigned is entitled to vote with respect to the proposals set forth below   
and in the discretion of such proxies on all other matters that may properly    
be presented for action at the Special Meeting of Stockholders of the Company   
to be held at the [Place], [Address], [City], [State] on [DAY], [MEETING        
DATE], 1999 at [____a.m.] or at any postponement or adjournment                 
thereof, and instructs said proxies to vote as follows:                         

SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE               
STOCKHOLDER. IF NO SUCH DIRECTIONS ARE INDICATED, THE PROXIES WILL HAVE         
AUTHORITY TO VOTE FOR PROPOSAL.                                                 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -   
^ FOLD AND DETACH HERE ^    
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)  

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  THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 1.

                                     Please mark your votes as
                                             indicated in this example     /X/

1. To approve the Recapitalization          FOR         AGAINST      ABSTAIN    
Proposal, including the approval         / /           / /          / /   
and adoption of the proposed                                              
amended and restated Certificate                                          
of Incorporation and By-laws of                                           
the Company and the exchange by                                           
Silicon Graphics, Inc. of each                                            
share of Class A common stock it                                          
will own for one share of Class B                                         
common stock.                                                             

                                       PLEASE MARK, SIGN, DATE AND
                                             PROMPTLY RETURN THIS PROXY IN THE
                              ENCLOSED ENVELOPE.

Signature(s)__________________________ Dated:_____________________________, 1999
Please sign exactly as your name or name(s) appear in this proxy. When          
signing as attorney, executor, administrator, trustee or guardian, please       
give your full title as such. If shares are held jointly, each holder should    
sign.                                                                           

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -   
^ FOLD AND DETACH HERE ^    

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘PRES14A’ Filing		Date		First		Last			Other Filings
		12/31/02		28		81			10-Q
		9/30/02		28		81			10-Q
		6/30/02		28		81			10-K
		3/31/02		28		81			10-Q
		12/31/01		28		81			10-Q
		9/30/01		28		81			10-Q
		6/30/01		28		81			10-K405
		3/31/01		28		81			10-Q
		12/31/00		9		81			10-Q
		9/30/00		19					10-Q
For Period End:		11/11/99
		6/30/99		6					10-K
		4/30/99		33
		3/31/99		35					10-Q,  DEFS14A
Filed on:		1/29/99
		1/28/99		11		35
		1/13/99		11		21
		1/11/99		21
		1/4/99		21
		1/3/99		20
		12/31/98		26		35			10-Q
		12/18/98		20
		12/17/98		20
		12/14/98		20
		12/11/98		20
		12/7/98		20
		11/23/98		19
		11/17/98		46					10-K/A
		9/30/98		31		47			10-Q
		7/6/98		5		82
		6/30/98		11		49			10-K,  10-K/A
		1/13/98		35
		6/8/92		49
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