Uniroyal Technology Corporation Announces the Acquisition of Sterling Semiconductor

Sarasota, Fla. Uniroyal Technology Corporation (Nasdaq: UTCI) today announced that it has entered into an agreement to acquire all of the capital stock of Sterling Semiconductor (Sterling), a leading developer of silicon carbide technology and materials, through a merger for approximately 1,469,000 shares of Uniroyal common stock. Outstanding Sterling stock options held by key employees will be converted to options to purchase approximately 492,000 Uniroyal shares. In addition, Uniroyal will assume approximately $4.0 million in long-term debt. The closing is scheduled to take place in mid-May and is subject to approval by the shareholders of Sterling.

Sterling produces and sells single-crystal silicon carbide (SiC) substrates as well as epitaxial thin films on silicon carbide substrates. These next-generation semiconductor materials are key to advancing technologies in wireless communications, industrial process controls and optoelectronics. Uniroyal Technology manufactures high brightness light emitting diodes (LEDs) at its Uniroyal Optoelectronics facility in Tampa, Florida.

Howard R. Curd, Chairman and Chief Executive Officer of Uniroyal Technology Corporation, noted, "We are very excited about the acquisition of Sterling Semiconductor and their excellent management team. We are strategically positioned to increase Uniroyal s participation in the explosive compound semiconductor industry via internal growth as well as through acquisition. The addition of the silicon carbide technology developed by Sterling creates a variety of opportunities for expansion into devices that solve common problems in the high frequency communications, high temperature, high power and optoelectronics applications."

"As a subsidiary of Uniroyal, Sterling will be positioned to substantially increase its wafer, epitaxy and device production capacity and customer deliveries. We also see potential new market opportunities. For instance, our combined technologies provide a platform to accelerate our product development of devices targeted at the rapidly growing wireless communications market," said James M. LeMunyon, President of Sterling.

Silicon carbide, a wide bandgap semiconductor material, possesses unique physical and electrical properties that enhance the performance of electronic devices. SiC operates efficiently at high temperatures and is inert to most known chemical and caustic conditions making it desirable for use in industrial process control devices. Its stable thermal properties enable SiC-based wireless communication devices to operate at higher frequencies and with greater power output levels. Silicon carbide substrates are also used for the development of blue LEDs and laser devices.

Sterling Semiconductor is a leading producer of SiC products and was established in 1996 to manufacture silicon carbide wafers and advanced electronic device components made from silicon carbide. Sterling has been the recipient of many United States Government research and development grants and contracts to develop leading edge materials and device technologies for military and commercial applications. Sterling currently has a strong backlog of U.S. Government contracts, including a prestigious three year Title III contract to establish a 3-inch silicon carbide wafer production line.

Sterling s research and development efforts are conducted at its facility in Sterling, Virginia, and manufacturing is conducted at its facility in Danbury, Connecticut. Sterling has a worldwide sales network within North America, Asia and Europe.

Uniroyal Technology has three business segments: Optoelectronics, Coated Fabrics and Specialty Adhesives. Some of the Company s well-known brand names and products include epitaxial wafers, package-ready dies and lamps for LEDs in its Optoelectronics segment, NAUGAHYDE(R) and NAUGASOFT(TM) in coated fabrics, and SILAPRENE(R), HYDRA FAST-EN(R) and GUNTHER ULTRA/BOND(R) in adhesives. The Company s common stock and warrants trade on the Nasdaq/NMS under the symbols UTCI and UTCIW, respectively.

The securities to be offered in connection with the merger will not be and have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. Statements made herein that are forward-looking in nature within the meaning of the Private Securities Litigation Reform Act of 1995 are subject to risks and uncertainties that could cause actual results to differ materially. Such risks and uncertainties include, but are not limited to, those related to business conditions and the financial strength of the various markets served by the Company, the level of spending for such products and the ability of the Company to successfully manufacture and market its products.

Contact:
George Zulanas, Jr., CFO of Uniroyal Technology Corporation, 941-361-2220; or
Mark Tyler of TT Communications, 212-962-3690, for Uniroyal Technology Corporation George Zulanas, Jr., CFO of Uniroyal Technology Corporation, 941-361-2220; or
Mark Tyler of TT Communications, 212-962-3690, for Uniroyal Technology Corporation