ARC International expands distribution of configurable SoC platform technologies in UK and Ireland

Distribution deal with Direct Insight Ltd provides developers reduced risk and decreased time-to-market for embedded systems based on ARCtangent™ and third-party microprocessors

Elstree, UK, 09 October 2002 – ARC International (LSE: ARK), a world leader in configurable System-on-Chip (SoC) platform technologies, today announced its appointment of Direct Insight Ltd as distributor for ARC's software product line in the UK and Ireland. ARC's powerful software suite of development tools greatly reduces design risks and decreases time-to-market for embedded systems based on the 32-bit RISC/DSP ARCtangent™ microprocessor core architecture, as well as third-party microprocessors including ARM®, ColdFire®, MIPS®, PowerPC® and XScale™.

The new agreement follows the integration of ARC's subsidiaries and products under the ARC International brand. Direct Insight already held a successful relationship with ARC's former subsidiary, Precise Software Technologies Inc, a provider of application-software platforms.

The renewed relationship has expanded Direct Insight's product offering beyond ARC's Precise/MQX™ RTOS and communications software stacks, to include all of ARC's software products, such as the MetaWare® High C/C++™ compiler and SeeCode™ debugger.

Mike Gulett, president and chief executive of ARC International said "We are very pleased to have renewed our relationship with Direct Insight as we have mutually enjoyed a very successful relationship in the past. Going forward Direct Insight will continue to be an important element in ARC International's network of distributors for our software products as we position ourselves for continual growth in Europe."

David Pashley, managing director at Direct Insight said: "ARC International is a forward-thinking, innovative and professional company, and we are very happy to be extending our partnership with them. Exciting new products are being introduced which enable us to offer a highly competitive integrated development platform for key target processors."

ARC's software suite includes tools to integrate pre-verified peripheral IP. By choosing predefined options with a point-and-click user interface, it takes only a few easy steps to create embedded systems that include features such as 32-bit timers, UARTs, a 10/100-Mbps Ethernet media-access controller (MAC) or a USB controller. Instead of wasting costly development time licensing and integrating mismatched IP from multiple sources, developers are free to focus on their core competencies and create highly differentiated products that stand apart from the competition.

About Direct Insight Ltd
Direct Insight markets and supports a comprehensive range of embedded tools, products and services – a one-stop-shop for the UK and Ireland's embedded developers. For 10 years, Direct Insight has worked in partnership with customers to provide high quality products, services and support in key technologies including SoC design and verification, embedded systems development, boundary scan test, and support of device programming activities. Direct Insight acts as UK distributor for a number of market-leading products, including Data I/O Corp, Corelis Inc., Forte Design Systems, iSYSTEM and ARC International. Further information is available on our website at www.directinsight.co.uk

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 time to market, reducing their cost, reducing the number of IP suppliers 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 web site, www.ARC.com. ARC International is listed on the London Stock Exchange as ARC International plc (LSE:ARK).

Statements made in this press release that are not historical facts include forward-looking statements that involve 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, ARCtangent, High C/C++, Precise/MQX and SeeCode are trademarks of ARC International. MetaWare is a registered trademark of ARC International. All other brands or product names are the property of their respective holders.