Palmchip Secures $13 Million in First-Round Funding

Investment to Fuel Growth of SOC (System on Chip) Development Platforms That Change the Way Mega-Gate IC Designs are Realized
SAN JOSE, Calif. -- September 25, 2000 Palmchip Corporation today announced that it has secured first-round funding of $13 million from a venture capital syndicate led by Index IT, a division of Beeson Gregory in London, England. Beeson Gregory is a leading investment firm with expertise in emerging semiconductor and IP (intellectual property) companies in the United Kingdom and the United States. ARM Holdings plc (LSE:ARM) (NASDAQ:ARMHY), an early corporate investor in Palmchip, has restructured its investment and retains a minority position below ten percent.

Board level and senior executive changes are also being announced. Michael L. Hackworth, formerly president and currently chairman of Cirrus Logic, Inc., has been elected as Palmchip's chairman of the board. Joseph T. Rodgers, formerly CFO of Quantum Corporation and now a consulting financial advisor to emerging companies, has been elected to a seat on the board of directors. Derek J. Bell, formerly vice president of engineering in charge of Synopsys worldwide design services group, joins the company as executive vice president and chief operating officer. Bell will report to Jauher Zaidi, Palmchip president and CEO, and in a new role for Palmchip, he will be responsible for the definition, development, shipment, and support of the company?s hardware and software platforms, products, and support environments.

Palmchip will use the funds to drive development of its next generation SOC platforms. These platforms "pre-build" many of the basic, necessary functions in an SOC device and include interfaces to and libraries of popular embedded processors, as well as other important system blocks. Chip designers all over the world are beginning to realize the potential value in utilizing robust platform technology as a practical means to build customized mega-gate devices within cycle times that are suitable for today?s short market windows.

Palmchip is the leading company in providing a system-on-chip (SOC) integration architecture that enables rapid design and verification of platforms containing IP (intellectual property) from independent sources. The company will use part of the funds to establish a global sales presence and add application-specific expertise targeted to support advanced application-ready platforms.

"Our mission is to enable the true plug-and-play creation of mega-gate SOCs," said Jauher Zaidi, president and CEO of Palmchip. "This funding, combined with the experience we've gained working with early adopters of our platform technology, will allow us to further develop our integration architecture and create rich, application-ready platforms for customers that must have faster ways to design customized ASICs. We will provide application specific platforms for a variety of emerging growth sectors of the semiconductor markets that depend on optimization to the highest performance, lowest power consumption, or smallest die size." Mike Hackworth, Palmchip's new chairman of the board, added, "Palmchip represents a new breed of IC company making IP re-use at the system level a practical reality. Platforms with integrated hardware and software solutions are the wave of the future, and our investors share our confidence in our ability to deliver the ?time to money? benefits of our powerful platform technology to system OEMs and IC companies.?

Palmchip's enabling technology is its patented CoreFrame architecture. This architecture allows any third-party IP to plug-and-play with any other third-party IP, including Palmchip's own portfolio of proprietary designs. Using the CoreFrame architecture, Palmchip created a generation of general-purpose platforms featuring interfaces to popular embedded processors. These platforms are useful to customers, such as fabless chip companies and vertically integrated system manufacturers, that require maximum flexibility to add their own proprietary IP. A newer generation of platforms is now on its way to market: to meet the demand for higher levels of application-specific integration, Palmchip is developing application-ready platforms that add specialized IP to further meet the requirements of customers in specific markets. These platforms help in particular the system OEMs who are pushing the frontiers of mega-gate solutions, whether PLDs or full ASICs.

About Beeson Gregory
Beeson Gregory is a London-based investment bank dedicated to serving the needs of entrepreneurial and growing companies. In addition, the company provides research, market-making and agency dealing for institutional clients. Index IT is the core technology private equity division within Beeson Gregory and specializes in identifying, funding, and advising technology companies from early stage through to IPO. Currently Beeson Gregory acts as official advisor and stockbroker to over 80 publicly listed companies. The firm is a founder member of EASDAQ in the United Kingdom and has led or co-managed some 30 percent of the equity issues on that market. More information can be obtained at www.ip2ipo.com or www.beeson-gregory.co.uk

About Palmchip
Palmchip Corporation develops and licenses configurable semiconductor IP (intellectual property) platforms for embedded SOC (system on chip) integrated circuits. Key target applications include networking, portable communications and computing, storage, and multimedia. The company offers general-purpose platforms that contain interfaces to today's popular embedded processors. It also offers application-ready platforms. Palmchip's IP is based on its CoreFrame integration architecture. This technology is independent of processor, I/O or foundry, allowing designers flexibility in porting IP from any number of sources. Palmchip DirectConnect partners offer a range of third-party IP, software, and design tools that are compatible with the CoreFrame architecture. Palmchip was established in 1996 and is today a privately held company based in San Jose, California (USA). It is a member of the Virtual Socket Interface Alliance and VCX. More information can be obtained at www.palmchip.com.

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Palmchip, CoreFrame, and the palm leaf logo are registered trademarks, and PalmPak, DirectConnect, FlexiSOC and QuickConfig are trademarks of Palmchip Corporation. All other trademarks are the property of their respective owners.

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