SHAREHOLDER’S CLASS ACTION

COMPLAINT

Plaintiff, Vladimir Gusinsky Rev. Trust, by its attorneys, alleges as follows:

1. This is a stockholder class action brought by plaintiff on behalf of the holders of

2. In pursuing the unlawful plan to cash out Silicon Storage’s public stockholders for

3. In entering into the merger agreement, without full and fair disclosure of all material

4. Instead of seeking to obtain the highest price reasonably available for the Company,

5. Defendants’ motivation was clear. By catering the process to the Acquirers to

6. As alleged herein, the Proposed Transaction is the product of a hopelessly flawed

7. Absent judicial intervention, the merger will be consummated, resulting in

8. This Court has jurisdiction over the subject matter of this action pursuant to the

9. This Court has jurisdiction over the Defendants in this action because Silicon

10. Venue lies in this Court because the Company’s principal place of business is located

11. This action challenges the internal affairs or governance of IRF and hence is not

12. Plaintiff Vladimir Gusinsky Rev. Trust is and at all times relevant hereto was a

13. Defendant Silicon Storage, is a California corporation. Silicon Storage supplies

14. Defendant Bing Yeh (“Yeh”) is the President, Chief Executive Officer and a member

15. Defendant Yaw Wen Hu (“Hu”) has been a member of the Board of Directors since

16. Defendant Ronald Chwang (“Chwang”) has been a member of the Board of

17. Defendant Terry M. Nickerson (“Nickerson”) has been a member of the Board of

18. Defendant Bryant R. Riley (“Riley”) has been a member of the Board of Directors

19. Defendant Edward Yao-Wu Yang (“Yang”) has been a member of the Board of

20. The defendants named above in ¶¶14-19 are sometimes collectively referred to

21. In any situation where the directors of a publicly traded corporation undertake a

(a) adversely affects the value provided to the corporation’s shareholders;

(b) will discourage or inhibit alternative offers to purchase control of the

corporation or its assets;

(c) contractually prohibits them from complying with their fiduciary duties;

(d) will otherwise adversely affect their duty to search and secure the best value

reasonably available under the circumstances for the corporation’s shareholders; and/or

(e) will provide the directors with preferential treatment at the expense of, or

separate from, the public shareholders.

22. In accordance with their duties of loyalty and good faith, the defendants, as directors

(a) participating in any transaction where the directors’ or officers’ loyalties are

divided;

(b) participating in any transaction where the directors or officers receive or are

entitled to receive a personal financial benefit not equally shared by the public shareholders of the

corporation; and/or

(c) unjustly enriching themselves at the expense or to the detriment of the public

shareholders.

23. Plaintiff alleges herein that the Individual Defendants, separately and together, in

24. Because the Individual Defendants have breached their duties of loyalty, good faith

25. Plaintiff brings this action on its own behalf and as a class action, on behalf of all

26. This action is properly maintainable as a class action.

27. The Class is so numerous that joinder of all members is impracticable. There are

28. There are questions of law and fact which are common to the Class and which

(a) whether Defendants have breached and are continuing to breach their

fiduciary duties of undivided loyalty, independence or due care with respect to Plaintiff and the

other members of the Class in connection with the Proposed Merger; and

(b) whether Plaintiff and the other members of the Class would suffer irreparable

injury were the transaction complained of herein consummated.

29. Plaintiff’s claims are typical of the claims of the other members of the Class and

30. Plaintiff is an adequate representative of the Class, has retained competent counsel

31. The prosecution of separate actions by individual members of the Class would create

32. Plaintiff anticipates that there will be no difficulty in the management of this

33. Defendants have acted on grounds generally applicable to the Class with respect to

34. On November 13, 2009, the Company issued a press release entitled “Silicon Storage

SST (Silicon Storage Technology, Inc.) (Nasdaq: SSTI - News), a

memory and non-memory products provider for high-volume

applications in the digital consumer, networking, wireless

communications and Internet computing markets, today announced

that it has entered into a definitive merger agreement to be

acquired by Technology Resource Holdings, Inc., a Prophet Equity

LP-controlled entity, as well as by members of SST’s management

team. Prophet Equity LP will acquire all of the outstanding

common stock of the company for $2.10 per share, except for

shares held by Bing Yeh, SST’s Chairman and Chief Executive

Officer, and Yaw Wen Hu, SST’s Executive Vice President and

Chief Operating Officer and member of the Board of Directors,

who have agreed to exchange all of their shares of SST common

stock for shares of capital stock of the resulting privately held

company. This price per share represents approximately a 13

percent premium to the closing price per share of SST’s stock on

November 12, 2009…

The agreement contains a go-shop provision under which

the Strategic Committee, with the assistance of its independent

advisors, has the right to solicit proposals or offers with respect to,

or that would reasonably be expected to lead to, an acquisition

proposal from a third party for a 45 day period beginning on

November 13, 2009. SST does not intend to disclose any

developments with respect to this solicitation process unless or

until the Strategic Committee has made a decision with respect to

any proposals or offers it may receive.

“After an extensive review of strategic alternatives with

company management and our financial advisors, we determined

this all-cash sale of the company with a go-shop provision is in the

best interests of the company’s shareholders,” said Ronald

Chwang, chairman of the Strategic Committee.

“We believe that this transaction provides the greatest

likelihood of achieving the highest value for the company’s

shareholders, and that this is also in the best interest of our

customers, partners and employees. We believe the added

flexibility of being a private company will help us to focus on

delivering innovative memory and non-memory solutions to our

customers and supporting their needs with the highest levels of

service that they have come to expect,” said Bing Yeh, co-Founder

and Chief Executive Officer of SST.

The transaction, which is expected to close in the second

quarter of 2010, is subject to regulatory approvals and approval of

the agreement by (i) the holders of a majority of the company’s

outstanding common stock represented and voting at a special

meeting to be held to approve the transaction, excluding Bing Yeh

and Yaw Wen Hu, and (ii) the holders of a majority of the

company’s outstanding common stock, and other customary

closing conditions.

35. On the day the Proposed Acquisition was announced, the Company’s stock closed at

36. Based on shareholders’ views that the Proposed Acquisition greatly undervalues the

37. If the Proposed Acquisition is allowed to proceed, without adequate information

38. The Individual Defendants are obligated to maximize the value of Silicon Storage to

39. By reason of their positions with Silicon Storage, the Individual Defendants are in

40. The Board members and advisors identified herein have irremediable positions of

41. The Proposed Acquisition is wrongful, unfair and harmful to Silicon Storage’s public

42. As a result of defendants’ unlawful actions, Plaintiff and the other members of the

43. In light of the foregoing, the Individual Defendants must, as their fiduciary

•        Undertake an appropriate evaluation of Silicon Storage’s worth as an acquisition

candidate.

•        Act independently so that the interests of Silicon Storage’s public stockholders will

be protected, including, but not limited to, the retention of truly independent advisors

and/or the appointment of a truly independent Special Committee.

•        Adequately ensure that no conflicts of interest exist between defendants’ own

interests and their fiduciary obligation to maximize stockholder value or, if such

conflicts exist, to ensure that all conflicts be resolved in the best interests of Silicon

Storage’s public stockholders.

•        Disclose all material information to shareholders.

44. Plaintiff repeats and realleges each allegation set forth herein.

45. The defendants have violated fiduciary duties of care, loyalty, candor and

46. By the acts, transactions and courses of conduct alleged herein, defendants,

47. The Individual Defendants have violated their fiduciary duties by entering into a

48. As demonstrated by the allegations above, the Individual Defendants failed to

(a) they failed to take steps to maximize, the value of Silicon Storage to its public

shareholders and they took steps to avoid competitive bidding, to cap the price of Silicon Storage’s

stock and to give the Individual Defendants an unfair advantage, by, among other things, failing to

solicit other potential acquirers or alternative transactions;

(b) they failed to properly value Silicon Storage; and

(c) they ignored or did not protect against the numerous conflicts of interest

resulting from the directors’ own interrelationships or connection with the Proposed Acquisition.

49. Because the Individual Defendants dominate and control the business and corporate

50. By reason of the foregoing acts, practices and course of conduct, the defendants have

51. As a result of the actions of defendants, Plaintiff and the Class have been and will be

52. Unless enjoined by this Court, the defendants will continue to breach their fiduciary

53. Defendants are engaging in self dealing, are not acting in good faith toward Plaintiff

54. Plaintiff and the members of the Class have no adequate remedy at law. Only

WHEREFORE, Plaintiff demands injunctive relief, in its favor and in favor of the Class and

A. Declaring that this action is properly maintainable as a class action;

B. Declaring and decreeing that the Proposed Acquisition agreement was entered into in

C. Enjoining defendants, their agents, counsel, employees and all persons acting in

D. Directing the Individual Defendants to exercise their fiduciary duties to obtain a

E. Directing defendants to immediately disclose all material information to shareholders

F. Rescinding, to the extent already implemented, the Proposed Acquisition or any of

G. Imposing a constructive trust, in favor of plaintiff, upon any benefits improperly

H. Awarding plaintiff the costs and disbursements of this action, including reasonable

I. Granting such other and further relief as this Court may deem just and proper.

Plaintiff hereby demands a jury on all issues which can be heard by a jury.