EDA Software Firm Silicon Design Systems Secures $6.7M in Second Round of Financing.

SANTA CLARA, Calif. -- Carmel Ventures Leads Funding with Participation by Infinity Venture Capital; Industry Veteran Jacob Greidinger Named VP of R&D

Silicon Design Systems, Inc., the next-generation physical design company that just introduced a new convergent routing technology for complex chip design, today announced it has secured $6.7 million in the new funding by Carmel Ventures and Infinity Venture Capital. First round investor Gilo Ventures also participated in this round. The funds will be used as working capital to further the company's research and development, and marketing initiatives. In addition, the company announced the appointment of Jacob Greidinger as vice president of R&D.

Rina Shainski, a general partner at Carmel ventures said, "The SDS new-generation routing technology addresses the very difficult challenge of physical design closure, whose time and cost increase as feature size shrinks. SDS received strong validation from power and mainstream EDA users at the 2004 Design Automation Conference (DAC) and was highlighted by Gartner's Chief EDA analyst Gary Smith. These endorsements reinforce our belief that SDS' approach to physical design has tremendous potential for reducing cost and time to tapeout in complex designs."

Avishai Silvershatz, a managing partner at Infinity Venture added, "We have known the company's key technologists for a long time, and we believe SDS embodies key enabling technology for next-generation chips. Its new solution, based on field-proven technologies, was developed by and for real users. We therefore strongly believe that the company will become a significant player in the multi-billion-dollar EDA industry."

According to Davidi Gilo, chairman of Silicon Design Systems, "We are excited to welcome Carmel Ventures and Infinity Venture Capital as new investors that perceive the strength of our technology and direction. We believe their contribution in guiding Silicon Design Systems from a technology phase to a product phase will be instrumental in our future success." Gilo Ventures was the sole investor in SDS until this round of financing and also was the sole investor in Series A funding completed in 2003.

Commenting on the Greidinger appointment, Naeem Zafar, president and CEO of Silicon Design Systems, added, "We are thrilled to have an industry veteran like Jacob join our team. With his proven track record of managing the product development lifecycle - from full development to customer rollout - we feel confident he will prove invaluable during the coming years."

Greidinger, who has global responsibility for the company's R&D efforts, brings to this position more than 20 years of experience in management, design and development of highly complex EDA products. Prior to joining Silicon Design Systems, he was vice president of technology and R&D at Monterey Design Systems. Previously, he co-founded and was vice president at Aristo Technology. He also has held various R&D and management positions at Compass Design Automation, Mentor Graphics, Silicon Compiler Systems and Daisy Systems. Greidinger holds three U.S. patents and has filed four additional patents.

About Carmel Ventures

Carmel Ventures is Israel's largest software-focused fund. Led by former entrepreneurs and executives of the software and investment industries, Carmel provides active, hands-on support to its Israeli, European and US portfolio companies. Carmel has offices in Herzeliya, Israel and London, and a worldwide network of industry, strategic and investment resources. With $171 million in commitments from a strong investor base that includes Citigroup, GroveStreet, AOL Time Warner, Siemens, The Partners Group, Swiss Life, VCM and other leading worldwide investors, Carmel provides significant capital and support throughout the growth cycle of its portfolio companies. For more information, please visit www.carmelventures.com.

About Infinity Venture Capital

Infinity (www.israel-infinity.com) manages approximately $200 million in funds for investment. Infinity was founded in 1997, as a successor of the Nitzanim Fund (1993). The principal investors in Infinity are Clal Industries, GE Asset Management, the American investment bank Friedman Billings Ramsey (FBR), and the founders of Nitzanim - the Rind/Butler Group and Banque Nationale de Paris of France. To date, Infinity has invested in close to 40 technology companies including Shopping.com, Shellcase, Galil Medical, Proneuron Biotechnologies, Orsus, Aprion Digital (merged with Scitex Vision), Native Networks, VisionCare Opthalmic Technologies (merged with Amersham), RedBend, Identify Software and BrainsGate. At the beginning of 2003, Infinity took over the private venture holdings of the Clal Industries Group. The new portfolio includes approximately 25 companies, of which the most prominent are Saifun Semiconductors, Cyber-Ark and Cydoor.

About Gilo Ventures

Gilo Ventures is a U.S.-based venture capital firm focusing on early stage investments in semiconductors, enterprise software and telecommunications. Managing partner Davidi Gilo is a serial entrepreneur with a proven track record including DSP Group (Nasdaq:DSPG), DSP Communications (sold to Intel for $1.6B), Audiocodes (Nasdaq:AUDC), Nogatech Nasdaq:NGTC (sold to Zoran for $170M), Zen Research (LSE:ZENR, currently private) and Vyyo (Nasdaq:VYYO). Mr. Gilo also was the founder, chairman and CEO of semiconductor companies DSP Group, DSP Communications and Zen Research. He is currently the Chairman and CEO of Vyyo, a telecommunication equipment company; and he serves as the chairman of two of Gilo Ventures' portfolio companies: Stentor, a Medical Imaging software company; and Silicon Design Systems, an EDA software company.

About Silicon Design Systems

Silicon Design Systems, Inc., the next-generation physical design company, makes complex chip design faster and more predictable, for better results. Its automated routing software tools using the adaptive fine-grained routing architecture (AFRA) eliminate rather than minimize signal integrity and timing violations, helping companies achieve smaller die size, better performance and predictable design closure. Silicon Design Systems is headquartered in Santa Clara, Calif., with a research and development center in Israel. For further information, please visit: www.SiliconDS.com.

Silicon Design Systems and the Silicon Design Systems logo are registered trademarks of Silicon Design Systems. All other names mentioned are trademarks, registered trademarks, or service marks of their respective companies.