May 9, 2005 – Simtek Corp. and Cypress Semiconductor Corp. have announced a comprehensive agreement to jointly develop a 0.13-micron silicon-oxide-nitride-oxide-silicon (SONOS) nonvolatile memory process. Under the agreement, Cypress will invest $4 million in 6,740,816 shares of Simtek common stock.

Simtek will use the technology to produce a family of 4Mbit nvSRAM and value-added-memory (VAM) products, while Cypress plans to use it in a wide variety of devices including its next-generation PSoC programmable mixed signal arrays. Initial products are scheduled for 2006.

Simtek, a global provider of advanced nonvolatile semiconductor memory products, will use the proceeds primarily to support the 0.13-micron process and product developments. Simtek and Cypress will work together to add the SONOS nonvolatile capability to Cypress’s baseline CMOS process, which is in production at its MN wafer fabrication plant. Both Simtek and Cypress will develop independent, noncompeting products to be manufactured on the process, with each company benefiting from manufacturing efficiencies driven by their combined volumes.

“We are highly motivated to add SONOS to our 0.13-micron line,” said T.J. Rodgers, Cypress’s president and CEO. “This new relationship with Simtek enables both companies to share experience, intellectual property, and development costs to bring a wide range of products to market more quickly while improving production efficiencies.”