ARC International & Denali Software Partnership Integrates Memory Controller with ARCtangent

SAN JOSE, CA., July 24, 2002 – ARC International (LSE:ARK), a world leader in configurable SoC platform technologies, announced it has entered into a partnership with Denali Software, Inc. to integrate Denali's Databahn™ high-performance memory controller core with the ARCtangent™ series of microprocessor cores. As a result of this integration, customers will be able to configure a custom ARCtangent processor core to include support for synchronous memory technologies such as SDRAM and DDR-SDRAM.

Databahn is the industry's first configurable memory controller core solution. Targeted at high-bandwidth applications, Databahn supports all high-speed memory technologies including DDR-SDRAM, FCRAM, and RLDRAM. A web-based interface enables designers to configure the Databahn cores for application-specific performance, then automatically generate the synthesizable memory controller and related integration materials. To ensure compatibility with all the latest memory components, Databahn's online configuration process is tightly integrated with a database of more than 4,000 memory components at www.eMemory.com .

The ARCtangent microprocessor core is a 32-bit user-customizable RISC/DSP architecture. Unlike almost all other processor architectures, it allows the chip designer to build a custom microprocessor with easy-to-use tools. Predefined instructions and features cut much of the development work, producing a much faster route to market.

"We selected Denali as a strategic partner because of their philosophy toward user configurability," said Mike Gulett, president and CEO of ARC International. "The integration of Databahn with the ARCtangent series allows our customers to reduce the number of IP suppliers, reduce time-to-market, reduce costs and reduce risk."

"Processing power and memory bandwidth are arguably the two most important elements of SoC design today," said Sanjay Srivastava, CEO of Denali Software. "ARC has the leading solution for configurable processing. Now, by pairing the ARCtangent-A5 with Databahn, they can solve the memory bottleneck with all the configurability necessary for high bandwidth applications."

This partnership is consistent with ARC's pledge to make it easier for customers to get to volume quicker, by dealing with fewer IP suppliers that can provide them with more of a solution. Relationships like this demonstrates the commitment of ARC International to provide its partners with the tools necessary to meet their market objectives, and to effectively extend the market reach of both companies.

About ARC International

ARC International is a leading developer of embedded user-customizable high-performance 32-bit RISC/DSP processor cores, with integrated development tools, peripherals, RTOS and software. These integrated products and solutions are a result of the acquisitions of MetaWare, VAutomation and Precise Software Technologies. ARC's integrated intellectual property solutions assist customers in rapidly developing next

generation wireless, networking and consumer electronics products, reducing the number of IP suppliers, reducing time-to-market, reducing their costs, and reducing their risk for System-on-Chip products. Products based on ARC's technology include digital still cameras, set-top boxes and network processors.

ARC International employs more than 200 people in research and development, sales and marketing offices across North America, Europe and Israel. Full details of the company's locations and other information are on the company's website, www.ARC.com . ARC International is listed on the London Stock Exchange as ARC International plc (LSE:ARK).

About Denali Software

Denali Software Inc. is the world's largest provider of comprehensive solutions for memory system selection, design, integration, and verification. Memory selection, memory controller configuration, and Denali's Memory Research Services supported through its online infrastructure at eMemory.com. Denali's MMAV (Memory Modeling-Advanced Verification) product is the de facto industry standard for modeling and simulating memory for functional verification. Denali's Databahn product for memory controller IP (Intellectual Property) provides designers with the highest quality solution for producing memory controller cores for all of new and emerging DRAM memory technologies. More than 400 companies worldwide use Denali's tools, technology, and services to efficiently integrate new memory technologies into complex system designs for communication, consumer, and computer products. For more information, contact Denali at www.denali.com , or call (650) 461-7200.

Statements made in this press release that are not historical facts include forward-looking statements that involved risks and uncertainties. Important factors that could cause actual results to differ from those indicated by such forward-looking statements include, among others, market acceptance of the ARC technology; fluctuations in and unpredictability of the Company's quarterly results; general economic and business conditions; regulatory policies adopted by governmental authorities; assumptions regarding the Company's future business strategy; changes in technology; competition; ability to attract and retain qualified personnel; risks associated with the Company's international operations; and other uncertainties that are discussed in the "Investment Considerations" section of the Company's listing particulars dated 28 September 2000 filed with the United Kingdom Listing Authority and the Registrar of Companies in England and Wales. The Company disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date such statement was first made.

ARC, the ARC logo, ARCompact, ARCtangent and USB Now are trademarks of ARC International. All other brands or product names are the property of their respective holders.