Tundra Semiconductor Terminates Product Acquisition and License Agreements with IBM

    OTTAWA, June 3 /CNW Telbec/ - Tundra Semiconductor Corporation (Tundra),
(TSX:TUN), a leader in System Interconnect, has terminated its product
acquisition agreement, announced in August, 2007, with IBM Global Engineering
Solutions (IBM), effective June 1, 2008. The acquired product was to be based
on an IBM Power Architecture(TM) 90 nm processor core. IBM recently notified
Tundra that the performance of the core is lower than previously stated. Since
the IBM core cannot meet the stated performance, the product is now unsuitable
for Tundra's intended target applications and market. In November, 2007,
Tundra also signed a license agreement with IBM to bring new 65nm Power
Architecture solutions to market as part of Tundra's smart System Interconnect
(sSI) strategy and roadmap. As a result of the decision to terminate the
product acquisition agreement, and based on Tundra's review of the current IBM
performance data for the 65nm core, Tundra has also made the decision to
terminate that license agreement.
    Tundra intends to actively pursue alternative means of executing against
its sSI strategy to bring intelligent System Interconnect solutions to broader
global markets.

    About Tundra

    Tundra Semiconductor Corporation (TSX:TUN) supplies the world's leading
communications, computing and storage companies with System Interconnect
products, intellectual property (IP) and design services backed by world-class
customer service and technical support. Tundra's track record of product
leadership includes over a decade of bridges and switches enabling key
industry standards: RapidIO(R), PCI, PCI-X, PCI Express(R), Power
Architecture(TM), VME, HyperTransport(TM), Interlaken, and SPI4.2. Tundra's
products deliver high functional quality and simplified board design and
layout, with specific focus on system level signal integrity. Tundra's design
services division, Silicon Logic Engineering, Inc., offers industry-leading
ASIC and FPGA design services, semiconductor intellectual property and product
development consulting. Tundra's technology connects critical components in
high performance embedded systems around the world. For more information,
please visit www.tundra.com.

    Forward Looking Information

    Tundra cautions that forward-looking information in this release is based
on certain assumptions and expectations made by Tundra that may prove to be
inaccurate. Assumptions made include Tundra's ability to identify and
implement alternative means to develop future products in a timely manner to
address sSI market opportunities, customer demand for Tundra's products and
services, and Tundra's ability to maintain and enhance existing customer
relationships. Furthermore, Tundra cautions that forward-looking statements in
this release are based on current assumptions and expectations that are
subject to risks and uncertainties. Actual results may differ due to factors
such as customer demand for any new products, market risks and trading prices,
customer relationships, new services offerings, product shipping schedules,
competitive products and services, pricing pressure, and changes in the target
markets. The Company assumes no obligation to update or revise any
forward-looking statements. Additional information identifying risks and
uncertainties is contained in the Company's filings with the various
provincial securities commissions which are available online at www.sedar.com.

    TUNDRA and the Tundra logo are registered marks of Tundra Semiconductor
Corporation in Canada, the United States, the European Union and the People's
Republic of China. Design.Connect.Go. is a trademark of Tundra Semiconductor
Corporation. The Power Architecture and Power.org word marks and the Power and
Power.org logos and related marks are trademarks and service marks licensed by
Power.org. Other registered and unregistered trademarks are the property of
their respective owners.

    (C) Copyright 2008 Tundra Semiconductor Corporation.  All rights
    reserved.  Information subject to change without notice.

For further information:

For further information: David Long, Chief Financial Officer, (613)
592-0859 ext. 1704, David.long@tundra.com; Keri Zeran, Director, Marketing
Communications, (613) 697-6788, Keri.zeran@tundra.com

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