FOR IMMEDIATE RELEASE:
January 28, 2003

GOVERNOR: INTERNATIONAL SEMATECH NORTH SIGNED AND LAUNCHED
$400 million, 300 Millimeter Wafer Initiative Moving Forward on Schedule

Governor George E. Pataki, Senate Majority Leader Joseph L. Bruno and Assembly Speaker Sheldon Silver today announced that New York State and International SEMATECH -- a consortium of the twelve major computer chip manufacturers in the world -- have finalized the agreement for SEMATECH to site its next generation 300 millimeter computer chip research and development program at the Center of Excellence in Nanoelectronics. They were joined at today's event by International SEMATECH Chief Technology Officer Betsy Weitzman and other public officials.

The signing of the contract follows the Governor's July announcement of this international initiative, and several months of successful contract discussions between International SEMATECH, its member companies, the Governor's office and the University at Albany's Center of Excellence in Nanoelectronics.

"I am proud to say that the contract for International SEMATECH North is signed, sealed and delivered," Governor Pataki said. "Years from now we will look back on today as an important milestone in New York's transformation into a worldwide powerhouse in high-tech and biotech research, job creation and economic growth. To help overcome the tremendous fiscal challenges we face, we will continue moving forward with aggressive tax cuts and smart investments -- like International SEMATECH ? that will strengthen our economy and create thousands of good high-tech jobs for New Yorkers."

Senate Majority Leader Bruno said, "The fact that International SEMATECH could have located anywhere in the world, but chose to come to the Capital Region, is testament to everything we have done to make New York more economically competitive and create new high tech jobs. When you consider all the projects in addition to SEMATECH, such as the Centers of Excellence and the Gen*NY*sis biotechnology economic development projects throughout the State, there is reason for tremendous optimism for the future. Thanks to Governor Pataki's efforts we are building the foundation of a strong economy based on high-tech and biotech businesses and jobs."

Assembly Speaker Sheldon Silver said, "This private-public partnership between SEMATECH and the University of Albany is crucial to our State's transformation into 'the place' where high-paying, high-tech industries want to be. Finalizing the agreement brings us another step closer to the economic opportunities we envisioned in 1998, when the Assembly Majority, working with the renowned Dr. Alain Kaloyeros, invested in bringing to the University of Albany the National Focus Center In Interconnects, a key incentive in SEMATCH's decision to locate in the Capital District."

Bob Helms, President and CEO of International SEMATECH said, "This is a great day for our members and for the semiconductor industry. By combining talent and resources and maximizing the leverage of industry, university, and state funds, International SEMATECH and UAlbany are tackling a major technical challenge facing the industry -- the development of a new infrastructure to support EUV lithography. And we're funded for success, thanks to the commitments provided by Governor Pataki and the State of New York."

Edward H. Braun, Chairman and CEO of Veeco Instruments, Inc. said, "We are pleased to partner with Albany NanoTech and SEMATECH in this important research, and we are grateful to Governor Pataki and the State of New York for the significant investments in university research and high technology commercialization."

Albany Mayor Gerald Jennings said, "International SEMATECH North is great news for Albany and the Capital District, and it really puts us on the international high-tech map. The Governor's efforts on our behalf -- with the Center of Excellence, International SEMATECH North, Tokyo Electron Limited, the Harriman Campus, and the investments in downtown Albany -- will be transformational for our City. I thank the Governor, our legislative leaders and our industry and academic partners for their vote of confidence in Albany -- we won't let you down."

The new facility at the University at Albany will be called International SEMATECH North. The first high-tech SEMATECH facility, established in 1988 in Austin, Texas, had a tremendous impact on Austin and its regional economy. The Austin region's population has more than doubled since 1990, from about 600,000 to more than 1.2 million and technology-related employment has grown to a total of 125,000. More than 200 semiconductor-related companies and more than 450 software development companies are now located in the region.

The International SEMATECH (Semiconductor Manufacturing Technology) research and development consortium includes: US firms: IBM, Intel, Motorola, Hewlett-Packard, Texas Instruments, Advanced Micro Devices, Agere Systems (Lucent); European firms: Philips (Netherlands), Infineon Technologies (Germany), and STMicroelectronics (France); and Asian firms: Hynix (Korea), TSMC (Taiwan).

The agreement between New York State and International SEMATECH includes approximately $400 million in State and Industry support over the next five years, consisting of $210 million from the State (including $50 million previously announced for the Center of Excellence at Albany and included in the 2002-03 State Budget) and $193 million from International SEMATECH and its member companies, including IBM. The State's investment is primarily for capital construction, equipment and specialized tools for International SEMATECH North research. International SEMATECH North will employ more than 500 high tech researchers when fully operational, including those from SEMATECH, its member companies and others.

International SEMATECH was initially established in 1987 to increase the United State's worldwide market share of the chip industry and has since expanded its mission to be the lead R&D organization for worldwide semiconductor manufacturers. International SEMATECH's goal is to improve semiconductor manufacturing technologies for computer efficiency, consumer products and military weapon systems. International SEMATECH currently has a facility in Austin, Texas employing 600 researchers, focused on 200 millimeter computer chip technology.

In January, 1988, International SEMATECH made a determination to establish its first high- tech consortium facility in Austin, Texas, after keen competition among a dozen states including New York, California, Texas, North Carolina, Massachusetts, Florida, Wisconsin, Colorado, Oregon, Arizona, New Mexico and Missouri. In 1988, New York State, despite advancing an approximately $150 million package to attract SEMATECH consisting of an array of no interest loans, sales tax exemptions on materials and personal property, real property tax reductions, energy efficiency incentives and workforce training funds, lost the competition to Austin, Texas.

Empire State Development Chairman Charles Gargano said, "Since first taking office, Governor Pataki has implemented policies that have helped create hundreds of thousands of private sector jobs across our State. Today's announcement is yet another indication that the Governor's policies continue to work, and that they will lead to a better high-tech future for New York."

SUNY Board of Trustees Chairman Thomas F. Egan said, "Governor Pataki and Professor Kaloyeros are to be congratulated for their success persuading International SEMATECH North to locate their new R & D facility at SUNY's Albany campus. Professor Kaloyeros' pioneering research and development of the 300 millimeter computer chip and the quality of the research at the University at Albany position SUNY as a worldwide leader in this area. On behalf of the SUNY Board of Trustees, I thank Governor Pataki, SEMATECH President and CEO Bob Helms, Professor Kaloyeros and University at Albany President Hitchcock for this extraordinary accomplishment."

SUNY Chancellor Robert L. King said, "I am enormously grateful to Governor Pataki and the SUNY Albany team for bringing International SEMATECH to the University at Albany campus and to all parties in reaching this historic agreement. International SEMATECH chose the State University of New York and the Center of Excellence in Nanotechnology over sites across the country and around the world. This decision well reflects the high quality of the research conducted at the University at Albany and throughout the State University of New York. The relationship begun here today between the State University of New York Research Foundation and International SEMATECH, will benefit New York State and its University for decades to come."

University at Albany President Karen R. Hitchcock said, "We are delighted with the Governor's announcement of the agreement to establish International SEMATECH North at the University at Albany. It is a great testimony to the unique and enabling array of research, development, and prototyping capabilities of the University's Center of Excellence in Nanoelectronics. We are extremely grateful to the State and International SEMATECH for their unprecedented investment in our high technology programs. These investments would not have been possible without the proactive leadership that Governor Pataki, Majority Leader Bruno and Speaker Silver continue to provide in support of universities and high-tech industry in New York."

Alain E. Kaloyeros, Ph.D., Executive Director of Albany NanoTech of the University at Albany said, "Clearly, the state-of-the-art resources of the Governor's Center of Excellence in Nanoelectronics have launched a new era for New York and UAlbany, as we partner with International SEMATECH in hosting international programs in advanced semiconductor research and development. This announcement is a glowing testimony to the vision and leadership of Governor Pataki and his successful strategy in turning New York and its public university system into an international high technology magnet."

Russell W. Bessette, M.D., Executive Director of the New York State Office of Science, Technology and Academic Research (NYSTAR), said, "The creation of SEMATECH International North is a prime example of how Governor Pataki's initiatives will boost the State's economy through high-tech development. I applaud the Governor's leadership in making strategic job-creating investments in the high technology industry in New York."

International SEMATECH North brings a world-class private consortium of semiconductor research and development activities to the University at Albany and New York State. This lays the cornerstone to draw critical semiconductor and related high technology industries to the State.

The State has already committed nearly $120 million toward micro and nanoelectronics for the University at Albany's CESTM building (Center for Environmental Science and Technology Management). This includes the $50 million previously announced for the Albany Center of Excellence in Nanoelectronics for 300 millimeter research in the 2002-03 State budget.

As part of this effort, the State also provides $5 million annually to the National Interconnect Focus Center in Interconnect Technologies, jointly operated by U Albany and RPI along with Stanford, MIT and Georgia Tech, and sponsored by the Semiconductor Industry Association (SIA), the Defense Advanced Research Projects Agency (DARPA) and the top semiconductor industry equipment suppliers. Total State support for the Focus Center will reach $45 million by 2004.

The arrival of International SEMATECH is a direct result of the Governor's efforts to establish Centers of Excellence throughout the State, including the Albany Center of Excellence in Nanoelectronics. Centers of Excellence are unique collaborations between industry, universities and the State to take ideas generated in academic labs and rapidly prototype new products and commercialize them. Centers of Excellence include critical workforce development programs, so companies have access to the skilled workers that can produce the new products in New York.

The Albany Center in Nanoelectronics was a critical factor in SEMATECH's decision to come to New York. This success, in combination with other efforts statewide and the State's aggressive, business-friendly policies, were main elements in Tokyo Electron's decision to start a $300 million R & D initiative at the Albany Center.

Other Centers of Excellence are underway in Buffalo in Bioinformatics, in greater Rochester in Photonics, in Syracuse in Environmental Systems and on Long Island in Information Technology. Already, more than $1 billion in private sector and federal investments have been pledged for Centers statewide.

Last year, the Governor announced the creation of a new technology park at the 300 acre W. Averell Harriman State Office Campus adjacent to the University at Albany. It is anticipated that spin-off companies and existing companies that will locate near the International SEMATECH North and Tokyo Electron Limited research centers will be able to use this valuable resource for economic development purposes.

Last week, Governor Pataki announced that his 2003-04 Executive Budget will include new State tax incentives that will leverage $250 million in new venture capital investments for small and emerging businesses connected to the highly successful Centers of Excellence program and other State supported research facilities.