Configurable ARC Processor to Enable Encryption Capability for U.S. Government Satellite Scheduled for Launch In 2006

ELSTREE, England, Dec. 13, 2005 - ARC International (LSE: ARK) today announced that a major U.S. defense contractor has taken a license for a configurable 32-bit ARC processor core. The aerospace contractor will use ARC’s configurable CPU to develop a radiation hardened semiconductor chip that will handle data encryption functions for a U.S. government satellite. The contractor is a leading developer and manufacturer of cryptographic microcircuits used in applications such as space communications for ground and flight units and the President’s White House “red phone.”

One reason the aerospace giant cited for selecting ARC was the ability to tailor the CPU architecture to meet the rigorous requirements of government satellite applications. Furthermore, configurability helped the contractor make its chip proprietary and almost impossible to duplicate by competitors.

“Our patented configurable CPU technology is ideal for companies looking to develop semiconductors that are protected from piracy and cloning,” said Derek Meyer, senior vice president of sales and marketing at ARC International. “By enabling licensees to develop proprietary instructions that are optimized to the ARCompact instruction set architecture, their application-specific technology is secure from being copied by competitors or hackers. This major defense corporation is the latest to use our core for data encryption devices and we are pleased to welcome them to the growing community of ARC customers.”

About ARC’s Patented Configurable CPU Technology

ARC’s configurable technology enables SoC designers to create highly differentiated silicon that is optimized to the end application. Because customers can eliminate non-essential hardware, ARC-Based™ SoCs are generally smaller and therefore less expensive to manufacture than SoCs developed using fixed architecture CPUs.

Using ARC’s configurable technology, SoC designers can define custom extensions to accelerate critical code, resulting in greater application efficiency and a proprietary solution that is wholly owned by its inventor. ARC cores also offer powerful DSP instruction extensions through the ARC XY Advanced DSP subsystem, which can eliminate the need for external logic and DSP blocks on an SoC.

About ARC International plc

ARC International is the world leader in low-power, high-performance 32-bit configurable CPU/DSP processor cores, subsystems, real-time operating systems and development tools for embedded system design. ARC’s patented configurable CPU technology assists customers in the development of next generation digital media, consumer and communications devices, resulting in lower cost, higher performance SoC products. ARC International maintains a worldwide presence with corporate offices in San Jose, California, USA and Elstree, UK. The company has research and development offices located in England and the United States. For more information please visit the ARC website at: www.arc.com. ARC International is listed on the London Stock Exchange as ARC International plc (LSE: ARK).