Silver knockout is the silver part that shows through the artwork of the disc, as the example here. When designing artwork for the silver knockout, simply use white and indicate on your artwork the white areas will actually be silver.
When the discs are printed we will then skip the normal white base and print the art directly on the silver disc. Take note that any CMYK printing on silver will have a slight metallic look. It can be avoided if a special white mask is created just for the areas that do require a white base. To do so create a separate white layer and indicate it as a special white mask. Extra film charges might apply.