Grace Semiconductor Expands Access to 0.18- and 0.13-Micron Processes With Adoption of ARM Physical IP

Agreement Gives ARM Users Worldwide Access to Grace Technology-Based Physical IP Via the ARM Website at No Charge

SHANGHAI, China and CAMBRIDGE, England -- December 20, 2005 -- Grace Semiconductor Manufacturing Corporation (Grace), a leading foundry in integrated circuit (IC) fabrication, and ARM (LSE: ARM ; Nasdaq: ARMHY) today announced their first licensing agreement, which enables ARM to develop a suite of its Artisan(R) physical IP to support Grace's 0.18- and 0.13-micron process technologies. This agreement expands Grace's domestic and global foundry strategy by having access to the thousands of ARM physical IP users worldwide.

"ARM products are the leading physical IP solutions for SoC design," said Dr. Arthur Kuo, executive vice president of sales and marketing, Grace Semiconductor Manufacturing Company. "Our partnership with ARM will help us expand our global presence and provide customers with silicon-proven, high-quality products, which can help shorten design time, minimize risk and accelerate time-to-market."

The licensed ARM physical IP products include its Artisan SRAM, ROM and register-file memory generators as well as its SAGE-X(TM) standard cell library and the general-purpose I/O library that support Grace's 0.18- and 0.13-micron processes. This IP conforms to the Artisan design standards and includes ARM's extensive set of views and models in support of industry leading EDA tools. Additionally, the agreement enables ARM to distribute its Grace technology-based physical IP on a worldwide basis under its Access Library Program, to licensed design teams at no charge.

"ARM's partnership with Grace is an important addition to our continued commitment and support for our Partners in China," said Jun Tan, president of ARM China Operations. "This agreement expands the proliferation of the ARM and Grace technologies and helps enable our mutual customers' design to silicon success."

Availability

Front-end views of the ARM memory generators, SAGE-X standard cell library and general-purpose I/Os for Grace's 0.18-micron process are immediately available for licensed designers to download via the ARM web site at no charge. Complete views of these products are expected to be available in the first quarter of 2006.

About Grace Semiconductor Manufacturing Corporation

Grace Semiconductor Manufacturing Corporation (Grace) is a pure IC foundry company that specializes in integrated circuit (IC) fabrication. Grace's mission is to become a leading foundry in China by supplying high quality and advanced process technology to domestic and global customers. Grace is located in Zhangjiang Hi-Tech Park in Pudong, Shanghai, with a total land area of 240,000 square meters. Two fabs based on 12-inch wafer specifications have been constructed. Currently, Fab 1A (8") is in full production. It reaches a monthly capacity of 27,000 8-inch wafers in the second half of 2004. More information about Grace is available at http://www.gsmcthw.com.

About ARM

ARM designs the technology that lies at the heart of advanced digital products, from wireless, networking and consumer entertainment solutions to imaging, automotive, security and storage devices. ARM's comprehensive product offering includes 16/32-bit RISC microprocessors, data engines, 3D processors, digital libraries, embedded memories, peripherals, software and development tools, as well as analog functions and high-speed connectivity products. Combined with the company's broad Partner community, they provide a total system solution that offers a fast, reliable path to market for leading electronics companies. More information on ARM is available at http://www.arm.com.