Cree, Inc. to Acquire UltraRF Semiconductor Division of Spectrian Corporation

Source: Cree, Inc.

Cree Establishes Broad RF Power Technology Platform

Durham, NC. Cree, Inc. (Nasdaq: CREE) today announced it has entered into a definitive agreement to acquire UltraRF, a division of Spectrian Corporation (Nasdaq: SPCT) of Sunnyvale, California through an asset purchase transaction. UltraRF designs, manufactures and markets a complete line LDMOS and bipolar radio frequency (RF) power semiconductors, the critical component utilized in building power amplifiers for wireless infrastructure. The combination of UltraRF s LDMOS technology with Cree s silicon carbide (SiC) and gallium nitride (GaN) capability establishes Cree as the broadest supplier of RF power technology.

Under the terms of the agreement, Cree will purchase UltraRF assets and assume certain of its liabilities in exchange for approximately 908,000 shares of Cree common stock and $30 million cash, or at Cree s option, additional Cree shares worth $30 million. Cree believes the acquisition will be accretive to earnings per share before goodwill. It will be accounted for as a purchase transaction under accounting guidelines. The parties anticipate that the acquisition, which is subject to regulatory approval, environmental and other due diligence, and other customary conditions, will close in late December 2000 or January 2001.

In addition, as part of the acquisition, Cree will sign, at closing, a two-year supply agreement with Spectrian whereby Spectrian will purchase semiconductor products from Cree. Cree and Spectrian will also enter into a one-year joint agreement for development of laterally diffused metal oxide semiconductors (LDMOS), high linearity and gain driver modules, high efficiency LDMOS power modules, and SiC MESFET components.

Cree and UltraRF plan to combine the strength of the two companies by leveraging UltraRF s packaging and distribution channels and LDMOS and bipolar transistor technologies expertise with Cree s demonstrated performance with SiC and GaN products and materials. This provides Cree with a unique combination of technology bases in the RF and microwave transistor market. This acquisition will enable immediate revenue-producing applications for RF products and provide Cree with additional design, packaging and distribution channels necessary for SiC and GaN-based devices.

Neal Hunter, Chairman and CEO of Cree stated, "We are extremely excited about the acquisition of UltraRF. The LDMOS technology offered today by UltraRF provides the solution in the 0.8 to 2.4 GHz range for wireless infrastructure. As we focus on the emerging opportunities operating at frequencies above 2 GHz and the build-out of third and future generations of wireless infrastructure, we believe that LDMOS technology, combined with Cree s demonstrated SiC and GaN RF products, could provide a total solution for applications above 2 GHz. The single most critical and expensive component to broadband wireless infrastructure is the RF device that amplifies a high frequency signal to higher power levels. By incorporating LDMOS, SiC and GaN device technologies, Cree will be the first company to offer a complete suite of products that aims to significantly reduce the cost and increase the performance characteristics of available devices."

Cree intends to leverage UltraRF s relationships with key wireless infrastructure companies and providers and enable the company to increase its distribution channels with a broader base of products. Cree expects the acquisition, once completed, to accelerate customer acceptance of its SiC and GaN technology, which offer higher power densities and broader band capability.

Chris Tubis, President of UltraRF commented, "UltraRF s LDMOS product offerings complement Cree s existing SiC and GaN RF products by providing a full range of solutions that can handle a broad range of frequencies. We will now be uniquely positioned to address the demanding needs of UMTS (universal mobile telephone service) and WCDMA (wideband code division multiple access). As the build-out of the 3G network gets underway, we anticipate that LDMOS, SiC and GaN will play a much larger and crucial role in that environment."

The November 2000 issue of The Huber Mills, Digital Power Report, published by Gilder Publishing, stated, "The high-power LDMOS market hardly existed four years ago. Today, it accounts for roughly 50 percent of total sales of high-end RF powerchips. At the critical emerging 2 GHz frequency, UltraRF stands essentially alone today as a third player... The market is still very young -- still wide open for superior designs to emerge and dominate."

Based in Sunnyvale, California, UltraRF offers the industry s only independent source of high-power, high-performance LDMOS power semiconductors for the infrastructure marketplace, which are critical enabling components in the design and manufacture of the second and third generation wireless infrastructure equipment. UltraRF offers a full line of bipolar and LDMOS devices at power levels from 10 watts to over 1000 watts (pulse radar) with the highest power density available today.

Cree, Inc. will host a conference call at 11:00 a.m. EST today to review the details of the acquisition announcement. The conference call will be available to all interested parties through a live audio web broadcast via the Internet. Log onto our website at www.cree.com and go to "Investor Info" for webcast details. The call will be archived and available on the website for one week ending at 5:00 p.m., EST, November 28th. A telephone replay of the call will also be available one hour after the call, Tuesday, November 21st, and ending 5:00 p.m., EST, November 28th. Please call 800-625-5288 (domestic) or 303-804-1855 (international) and use Reservation No. 868034 to listen to the replay.

About Cree, Inc.:

North Carolina-based Cree, Inc. develops and manufactures semiconductor materials and devices based on silicon carbide (SiC), gallium nitride (GaN) and related compounds. The company s products include blue and green LEDs, RF power transistors for use in wireless infrastructure applications, SiC crystals used in the production of unique gemstones and SiC wafers sold for use in research and development. Cree has new product initiatives based on its experience in SiC and GaN-based semiconductors, including blue laser diodes for optical storage applications, high frequency microwave devices for radar and other communications systems, and power devices for power conditioning and switching. For more information on Cree, visit http://www.cree.com.

This press release contains forward-looking statements involving risks and uncertainties that may cause actual results to differ materially from those indicated. Actual results may differ materially due to a number of factors, including the risk that the acquisition may not be completed as scheduled, the combined companies may not achieve the results expected, the costs of integrating the companies may be greater than expected as well as those factors discussed in Cree s report on Form 10-K for the year ended June 25, 2000 and subsequent quarterly report filed with the Securities and Exchange Commission.

Contact: Fran Barsky, Investor Relations Manager of Cree Tel: 919-313-5397 Fax: 919-313-5452