Simtek announced the signing of a definitive agreement with the german Zentrum Mikroelektronik Dresden (ZMD) to purchase certain assets related to ZMD’s nvSRAM product line. The deal will cost $8 million in cash and $2 million in stock and includes more than $1 million in shippable inventory. ZMD had sales of approximately $7.5 million of nvSRAM products in the past 12 months.

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 establish a European design, customer service and support center in Dresden, Germany. 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.