Mentor Graphics and Philips Partner on USB Technology

WILSONVILLE, Ore., May 21, 2003 - Mentor Graphics Corp. (Nasdaq: MENT) and Royal Philips Electronics (NYSE: PHG, AEX: PHI) today announced a technology collaboration to help their mutual customers implement Hi-Speed Universal Serial Bus (USB) in embedded applications. With close cooperation and testing upfront, Philips semiconductor division and Mentor are working jointly to create USB 2.0-compliant combinations of transceivers and intellectual property (IP). Proven interoperability will help customers by reducing risk, shortening development times, and lowering overall system development costs. Representing the first results of this collaboration, Philips used the Mentor Graphics® proven USB IP Reference Platform to achieve compliance certification of the Philips UTMI Transceiver, the ISP1503.

"Mentor Graphics has been a strong supporter of standard interfaces for USB and the corresponding testing and compliance checks. By providing a fully functional USB platform, it provides us with a fast track to USB compliance," said Rajeev Mehtani, product line manager, Wired Connectivity of Philips Semiconductors. "In addition, its certification experience and technical expertise accelerated the whole process dramatically."

"We are pleased to partner with Philips, and see its cooperation with Mentor as a clear endorsement of our development approach," said Michael Kaskowitz, general manager of the Intellectual Property Division of Mentor Graphics. "In the USB IP and transceiver effort, it is imperative to have the commitment and support from software and silicon players to insure interoperability. Philips is taking a leadership role in this effort by driving specifications as well as providing necessary hardware support. In the end, the customer will win because, together, we provide a fully compliant and tested solution that can be taken to market quickly, with minimum risk, and at an optimal cost."

Mentor Graphics offers a wide range of USB products covering USB low, full and Hi-Speed function controllers, USB On-The-Go controllers, host controllers and transceivers. The USB products provide an efficient implementation in both gate count and system performance, coded to very high standards and thoroughly verified by simulation and hardware prototypes. Mentor's USB products are closely supported by a team of knowledgeable designers with many years of combined experience in IP development for USB. The company offers extensive knowledge of USB implementation, system integration, application development and compliance testing, providing a considerable talent pool to help partners with their own designs.

Philips offers a broad USB semiconductor portfolio comprising over 70 products, including transceivers, devices, and hosts for USB 1.1, USB 2.0 Hi-Speed and USB On-The-Go.

About Royal Philips Electronics
Royal Philips Electronics of the Netherlands is one of the world's biggest electronics companies and Europe's largest, with sales of $30.1 billion (EUR 31.8 billion) in 2002. It is a global leader in color television sets, lighting, electric shavers, medical diagnostic imaging and patient monitoring, and one-chip TV products. Its 170,000 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, and medical systems. Philips is quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam and other stock exchanges. News from Philips is located at www.semiconductors.philips.com.

About Mentor Graphics
Mentor Graphics Corporation (Nasdaq: MENT) is a world leader in electronic hardware and software design solutions, providing products, consulting services and award-winning support for the world's most successful electronics and semiconductor companies. Established in 1981, the company reported revenues over the last 12 months of about $600 million and employs approximately 3,500 people worldwide. Corporate headquarters are located at 8005 S.W. Boeckman Road, Wilsonville, Oregon 97070-7777; Silicon Valley headquarters are located at 1001 Ridder Park Drive, San Jose, California 95131-2314. World Wide Web site: www.mentor.com.

Mentor Graphics is a registered trademark of Mentor Graphics. All other company or product names are the registered trademarks or trademarks of their respective owners.

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