Atmel and Aware, Inc. Announce ADSL2/2plus Licensing Agreement: Aware Supplies StratiPHY2+ Technology for Atmel's System-On-Chip Communication Products for WAN and LAN Connectivity

SAN JOSE, Calif. – June 16, 2004  – Atmel® Corporation (NASDAQ:ATML), a global leader in the design, manufacturing and marketing of advanced semiconductors, and Aware, Inc. (NASDAQ:AWRE), a worldwide leader and innovator of broadband intellectual property, today announced that Atmel has licensed the StratiPHY2+™ intellectual property (IP) package from Aware and will be introducing a new line of customer premise equipment (CPE) ADSL2/2plus system-on-a-chip (SoC) products based on Aware's StratiPHY2+. 

"Through a licensing agreement with Aware, Atmel is extending its CPE product portfolio with an advanced ADSL2/2plus offering. This allows us to leverage our market-proven capabilities in large-scale silicon level integration and system-on-a-chip technology with Aware's ADSL2/2plus core technology to offer a competitive high-quality chipset to our customers," commented Richard Bisset, Atmel's Product Marketing Director. "Atmel's adoption of the new ADSL2 and ADSL2plus standard-based WAN solutions enables us to effectively address both the legacy and the evolving ADSL market requirements for gateway equipment, while Aware's proven experience in ADSL system design and firmware ensures optimal physical layer performance to equipment suppliers." 

Atmel is now leveraging the strength and diversity of its existing silicon product offerings, including comprehensive range of SoC solutions for the communications market for wired and wireless LAN applications, with the existing, field-proven solution of Aware's StratiPHY2+. StratiPHY2+ is a complete physical instantiation of Aware's intellectual property, which includes a digital chip and software technology. It is fully compliant with the ITU standard ADSL2 (G.992.3) and ADSL2plus (G.992.5), which doubles the downstream bandwidth of ADSL, resulting in significant downstream data rate increases on shorter phone lines. It also supports Reach-Extended ADSL2 (RE-ADSL2), which uses new power spectral density (PSD) masks that significant increase ADSL's reach by up to 40%. The inclusion of StratiPHY2+ ensures that the new CPE chip complies with all the ADSL/ADSL2/2plus standards and annexes, and it exceeds the standards' requirements for rate and reach performance. 

"As a wireless chip company, Atmel understands the importance of bridging DSL Internet access with a wireless home network to deliver compelling revenue-generating applications, such as video and Voice-Over-IP," commented Luke Smithwick, vice president of business development of Aware. "A wireless in-home network is an important next step in the adoption of broadband, and by licensing Aware's ADSL2/2plus core technology, Atmel's system-on-chip communication devices for WAN and LAN connectivity will offer consumers a reliable, standards-compliant residential gateway and modem linking the strengths of DSL with the flexibility and versatility of wireless home networks." 

Aware recently announced that its StratiPHY2+ CPE digital chip has achieved interoperability with Alcatel's 7300 Advanced Services Access Manager (ASAM), reaching data rates in excess of 24 Mbps, which is a major industry milestone signaling that multi-vendor ADSL2/2plus interoperability and the arrival of advanced services over DSL is a reality today. StratiPHY2+'s interoperability, combined with the DSL Forum's recent global forecast of 200 million DSL subscribers by the end of 2005, competitively positions Atmel's future line of ADSL2/2plus SoC products and gives Atmel a head-start on the emerging market of ADSL2/2plus chips for CPEs. 

Aware will feature StratiPHY2+ in its booth (#21729) at SuperComm 2004 from June 22 - 24 in Chicago. 

About Atmel 
Founded in 1984, Atmel Corporation is headquartered in San Jose, California with manufacturing facilities in North America and Europe. Atmel designs, manufactures and markets worldwide, advanced logic, mixed-signal, nonvolatile memory and RF semiconductors. Atmel is also a leading provider of system-level integration semiconductor solutions using CMOS, BiCMOS, SiGe, and high-voltage BCDMOS process technologies. 

About Aware
Aware, Inc. designs, develops, licenses and markets DSL technology that enables broadband communications over existing telephone networks. Its solutions, including splitterless G.lite, full-rate ADSL, ADSL2, ADSL2+, Dr. DSL®, StratiPHY™, StratiPHY2+™, BondedADSL™, and G.SHDSL address central office as well as customer premise requirements. More information about Aware can be found at http://www.aware.com. 

Safe Harbor Warning
Portions of this release contain forward-looking statements regarding future events and are subject to risks and uncertainties, such as estimates or projections of future revenue and earnings and the growth of the DSL market. Aware wishes to caution you that there are factors that could cause actual results to differ materially from the results indicated by such statements. These factors include, but are not limited to: we have a unique business model, our quarterly results are difficult to predict, we depend on a limited number of licensees, we derive a significant amount of revenue from one customer, we depend on equipment companies to incorporate our technology into their products, we face intense competition from other DSL vendors, DSL technology competes with other technologies for broadband access, and our business is subject to rapid technological change. We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our quarterly report on Form 10-Q for the quarter ended March 31, 2004 and other reports and filings made with the Securities and Exchange Commission.

Atmel and combinations thereof are the registered trademarks of Atmel Corporation or its subsidiaries. StratiPHY2+ is a registered trademark of Aware, Inc. Other terms and product names may be the trademarks of others.