SIMTEK to acquire the assets of the nvsram product line from ZMD for cash and stock

Colorado Springs, CO, December 7, 2005 - Simtek Corporation, (OTCBB:SRAM) the inventor, pioneer, and world's leading supplier of advanced nonvolatile static random access memory (nvSRAM) products, announced the signing of a definitive agreement with Zentrum Mikroelektronik Dresden AG (“ZMD”) for Simtek to purchase certain assets related to ZMD’s nvSRAM product line. The transaction will have the following benefits to Simtek:

In the transaction, Simtek will regain sole ownership of its patents and technical information used by ZMD on SONOS-based standard product memory architectures previously licensed by Simtek to ZMD and will gain a license to other ZMD patents and technical information pertaining to SONOS-based nvSRAMs as derivative technology invented by ZMD as they used Simtek’s previously licensed IP. ZMD will be permitted use of certain Simtek intellectual property in its embedded-function system-on-chip products like ASSPs and ASICs. At closing, Simtek and ZMD will enter into a 5-year non-compete agreement.

Simtek will purchase inventory of certain products to be sold to both former ZMD and current Simtek customers. The Company expects to benefit from the related revenue stream generated from this inventory without significant additional working capital required. Simtek has previously indicated that it sees revenue growth in 2006 in the range of 40% to 50%. The acquisition of the revenue stream from this transaction combined with growth in the company’s baseline business could more than double the Company’s revenue from 2005 to 2006.

Simtek will establish a European design, customer service and support center in Dresden, Germany. Top caliber designers are being hired from ZMD to support Simtek’s product development roadmap. Simtek plans to use the new design team to accelerate product development and introduction of innovative new products designed for its 0.25 micron fab at DongbuAnam Semiconductor and also targeted to the 0.13 micron fab at Cypress.

“ZMD has been a formidable competitor for several years. They have expanded adoption of nvSRAMs especially in Tier 1 customers in Europe. Simtek is excited about this opportunity to enlarge its business and offer more goods and services to an expanded customer base in the US, Asia, and especially in Europe,” stated Harold A. Blomquist, President and Chief Executive Officer of Simtek. “This will immediately expand Simtek’s baseline business and market reach and, since we are adding very little additional cost to support this business, is expected to speed up the company’s return to sustainable profitability,” Blomquist also said.

Based on the Company’s planned stock structure the transaction is expected to be accretive to earnings. ZMD had sales of approximately $7.5 million of nvSRAM products in the past 12 months. Simtek anticipates that the additional unit volume will result in a larger scale over which Simtek can optimize its business operations, thus providing improved operating margins.

Simtek was advised on the transaction by SVB Alliant. As previously announced, C.E. Unterberg, Towbin has been retained to assist the Company in raising capital. Closing of the transaction is contingent upon Simtek having secured the financing and capital resources necessary to consummate the transaction as well as other customary closing conditions.