January 15, 2009

Cree Licenses GaN Substrate Technology to Mitsubishi Chemical Corporation

DURHAM, N.C. -- Cree, Inc. (Nasdaq: CREE), a market leader in LED lighting, announces that it has entered into an exclusive patent license agreement, subject to some exceptions, with Mitsubishi Chemical Corporation (MCC). Under the agreement, MCC has been given the right to manufacture and sell freestanding GaN substrates and the right to enter into similarly-scoped sublicenses, subject to certain conditions. Over the life of the agreement, Cree will receive a combination of guaranteed payments and royalties on the sale of GaN substrates.

“Cree is pleased to enter into this license agreement with MCC, a well-known and respected materials supplier that has both the resources and expertise to take full advantage of Cree’s GaN substrate technology,” said Steve Kelley, Cree chief operating officer. “The license agreement is a further indication of Cree’s willingness to promote innovation and technological advances in optoelectronic materials, while realizing additional value from our intellectual property.”

"GaN substrates are important products in the optoelectronics business at MCC. By entering into this exclusive license agreement with Cree, MCC will expand the GaN substrate business for optical and electrical devices,” Yasuji Kobashi, general manager of MCC’s optoelectronics business stated. “MCC will be able to accelerate R&D and production for high-quality GaN substrates with different crystalline orientations.”

Other terms of the license agreement, including amount of upfront payment, were not disclosed.

About Mitsubishi Chemical Corporation
MCC is one of the three core business companies of Mitsubishi Chemical Holdings Corporation and a top chemical company in Japan. Through its core competencies in chemistry, MCC provides cutting-edge products and technologies over a broad range of business domains: performance products, health care and chemicals.

As for major lighting and display-related products, MCC has long engaged in the development and commercialization of phosphors, GaN substrates, and GaAs and GaP compound semiconductor materials. To address global environmental problems, MCC is responding with numerous CO2 and energy-reduction technologies and products.

For further information please refer to www.m-kagaku.co.jp.

About Cree
Cree is leading the LED lighting revolution and setting the stage to obsolete the incandescent light bulb through the use of energy-efficient, environmentally friendly LED lighting. Cree is a market-leading innovator of lighting-class LEDs, LED lighting solutions, and semiconductor solutions for wireless and power applications.

Cree’s product families include recessed LED down lights, blue and green LED chips, high-brightness LEDs, lighting-class power LEDs, power-switching devices and radio-frequency/wireless devices. Cree solutions are driving improvements in applications such as general illumination, backlighting, electronic signs and signals, variable-speed motors, and wireless communications.

For additional product and company information, please refer to www.cree.com

This press release contains forward-looking statements involving risks and uncertainties, both known and unknown, that may cause actual results to differ materially from those indicated. Actual results may differ materially due to a number of factors, including uncertain demand for products using the licensed technology, and other factors discussed in Cree’s filings with the Securities and Exchange Commission, including its report on Form 10-K for the year ended June 29, 2008, and subsequent filings.