RAYTHEON AND SYSTEMONIC INK "POWERHOUSE" PACT TO SPEED
PACE-SETTING WIRELESS COMMUNICATIONS SOLUTIONS TO MARKET

Systemonic Acquires Key RF Networking Business Assets; Raytheon Will Supply SiGe RF Wafers, RF IC Design Services, Power Amplifiers and Take Equity Position

San Jose, CA, and Dresden, Germany - November 7, 2001 - Systemonic announced the signing of a multi-faceted agreement with Raytheon Company's Commercial Electronics business (RCE). This agreement will give RCE a focused partner that will capitalize on Raytheon's advanced Wireless LAN (W-LAN) assets. Systemonic will leverage the acquired technologies to offer whole silicon system solutions that focus on powering wireless data, video and voice networks, across standards and across the world.

Under the terms of the agreement, Systemonic has acquired products and intellectual property of the RF Networking group of RCE. Paramount on the list of assets is the group's 5 gigahertz RF chipset. This 2-chip set, marketed as Tondelayo, will be matched with Systemonic's flagship family of flexible CMOS Baseband integrated circuits, code-named HiperSonic. Systemonic will also support the design-in and resale of the Raytheon power amplifier as part of its total solution.

"We are very proud to conclude the acquisition of these industry leading 5 GHz RF technologies. We will move these technologies to production through a broad and deep relationship with a recognized communications technology leader like Raytheon." said Ruediger Stroh, President and CEO of Systemonic. "We are also delighted to welcome a world class team comprised of RF and protocol firmware designers as well as marketing and RF operations personnel. Our combined organization is now poised to realize our vision of enabling transparent connectivity for end users".

As part of the transaction and in light of its commitment to the venture, Raytheon has acquired an equity interest in Systemonic. Additionally, Raytheon will receive a broad license to the current generation RF technology for use exclusively in defense business. The two companies intend on collaborating on future product definition and as channel partners. "This agreement furthers Raytheon's investment in wireless technology," said Jack Wohler, president of RCE. "We found a creative approach to harnessing a core technology of Raytheon with the engineering and marketing capabilities of Systemonic."

As a result of this transaction, Systemonic will initially offer whole solutions to OEMs focusing on the WLAN markets in the enterprise, the home and internet access hotspots. Baseband and RF products will also be offered in other markets such as the point to point and point to multi-point fixed wireless arenas. In certain markets the Baseband and the RF subsystem can be sold standalone.
"This is very good for both companies," said Arnab K. Chanda, Senior Communications Components Analyst at Lehman Brothers. "Raytheon gets access to a crack team focused on commercializing technologies for the wireless communications market and Systemonic gets access to the best RF technology available anywhere. The result is a real technology and product powerhouse."

The Multi-standard Reality
In order to minimize total cost of ownership, wireless-networking solutions must transparently support multiple existing, evolving and emerging standards that are prevalent in the marketplace. While IEEE 802.11b has emerged as the global standard, several regional standards are vying for supremacy for next generation protocols and performance levels. North America has adopted the IEEE 802.11a specifications with 802.11g under discussion. In Europe, HiperLAN/2 or 802.11h may be the future protocol for high-speed communications. Completing the regional morass, Japan is expected to use its local flavor of high-speed wireless networks in addition to global standards. Only Systemonic is creating the flexible solutions capable of processing these combinations of protocols.

Many of these regional standards are still in flux. Even amendments and improvements to the long established 802.11b specification are being finalized. Combine this standards-evolution with the natural technology migration to higher performance and the world of wireless communications will be one of multiple standards and protocols for many, many years to come. The programmable nature of Systemonic's approach will allow leading OEMs to upgrade important aspects of their products via Baseband and MAC layer software upgrades.

Systemonic's DSP-based solutions are domain specific and are not based on general-purpose DSP structures. As such, these solutions are area and power efficient when compared to hardwired chipsets with the added advantage of programmability that allows the "Systemonic Detect and Connect ™" approach to the variety of protocol standards that may exist in any environment.

"Our goal is to reduce the end user's Total Cost of Ownership. For example, We enable IT managers to buy one PC Card that supports multiple standards. Furthermore, we are focused on delivering range at maximum speed thereby reducing number of Access Points." said Jim Bland, VP of Sales and Marketing.

With the addition of the RF Networking business, Systemonic will be able to offer truly complete wireless system solutions. Future versions of HiperSonic will continue to provide the digital processing of multiple protocols. Access to Raytheon's world-class RF technology will provide Systemonic with complementary front-end solutions that can cost effectively handle the multiple standard reality. This allows global OEMs to quickly create products solutions tailored to regional requirements and migrate their product lines to adapt to changing standards.

About Systemonic
Systemonic is a wireless communications platform provider that delivers complete Silicon System Solutions that power wireless data, video and voice networks across standards, across the world. Its flexible, re-configurable platform allows customers to bring wireless communications products that support multiple standards to market faster, with more features, lower power consumption and at a lower total cost of ownership.

In November 2000, Systemonic completed second round funding of USD 30 million from an investment consortium led by Atlas Venture and APAX Europe IV, including, Krone mt, and Lehman Brothers.

Systemonic was founded in 1999 after four years of research at the University of Dresden.

About RF Networking
RF Networking offered solutions in the form of chipsets and radio reference designs to OEMs and systems integrators (SI) exclusively. Systemonic will leverage these OEM and SI relationships going forward. These designs were developed to meet industry standards and satisfy market requirements for ultimate integration into full service wireless networks. Throughout the development and manufacturing phase, RF Networking offered technical assistance to help its customers improve the time to market for their products. The RF Networking group was part of Raytheon Commercial Electronics, a division of Raytheon Company (NYSE: RTN).

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