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News Release
March 15, 1999


MIDDLEFIELD, CONNECTICUT (March 15, 1999)......Zygo Corporation (NASDAQ:ZIGO) ZYGO's chairman and CEO, Gary K. Willis, and its president and COO, J. Bruce Robinson, announced certain major initiatives today. These initiatives are intended to revitalize the Company and provide the infrastructure needed for substantial profitable growth in the future. Mr. Robinson commented, "During my introduction to ZYGO's various domestic operations, it was apparent that the Company had positioned itself exceedingly well in terms of products and technology for the semiconductor and data storage markets, as well as having made significant advancements in noncontacting measurement technology for the industrial market. This positioning, when combined with the obvious technical talent available within the ZYGO organization and the growing need for high precision measurement-based yield improvement systems on the production floor, provides a very solid platform for the future. Now it is time to build upon this base, transition ourselves into a sharply market-driven enterprise, and initiate significant top line growth. To this end, several positive initiatives are being announced."

  • The Company will create three regional sales, service and applications business centers in the United States focused on providing world class customer support for all products. These will be located in Sunnyvale, California; Chicago, Illinois; and Middlefield, Connecticut.
  • The Company will establish a worldwide customer technical support center at its Middlefield, Connecticut, headquarters location through which it will provide "hot line" personal support, internet web site support, spare parts, upgrades, and service to all customers.
  • Supporting the regional sales and service business centers will be industry sales groups whose mandate will be to provide technical product support as well as a longer-term market view of the needs of each of ZYGO's primary industries: semiconductor, data storage, industrial, and optics to the ZYGO technology division. ZYGO's Sunnyvale, California, facility - in addition to housing its Western Regional Sales and Service Business Center - will be the Company's "Center of Excellence" for the semiconductor industry. The other industry support groups will be centered in Middlefield.
  • Internationally, ZYGO's Syncotec subsidiary in Asslar, Germany, will become a regional sales, service and business center for the Company's European activities.

In the Far East, ZYGO Singapore Pte will be responsible for managing all representatives and agents in the Pacific Rim, excluding Japan. The Company intends to open a sales support office in Taiwan in the near future. Also, ZYGO intends to open a sales support office in Japan in the future to support both its OEM customers and its representatives there.

Mr. Robinson added, "These initiatives should allow us to grow significantly in the next several years. Each region, industry, and product have growth targets developed by our team to help facilitate the realization of this goal."

The Company also noted several positive events which have occurred recently, including:

  • The expansion of the Company's partnership in Atomic Force Microscopy with IBM's Manufacturing Technology Center and the first shipments of AFM units to customers.
  • Significant orders from several data storage media companies for the MESA and AutoMESA disk flatness measurement product. MESA incorporates revolutionary, patented technology, which allows the system to rapidly measure the surface topology with departures far exceeding those measurable with previous noncontact optical interferometric technology.
  • The MESA product has also been effectively applied in a number of industrial applications including components for power steering controls, diesel fuel injectors, compressors, and air conditioning units for motor vehicles. ZYGO shipped the first industrially packaged MESA for installation directly on the production floor of a European customer earlier this month.
  • The signing of a corporate purchasing agreement with a major semiconductor chip supplier for multiple purchases of the Automated Reticle Material Handling System. This agreement opens the door for ZYGO's system to be ordered by all of this customer's semiconductor fabs in the near future.
  • The receipt of a purchase order from a leading manufacturer of photomask production tools for seven Automated Material Handling Systems, a major subcomponent of the customer's solution. This OEM system is expected to begin shipping to end customers later this year.
  • The introduction of the new DPS-310 system for printability analysis on photomasks and the sale of the first unit to Sematech. The DPS-310 allows the user to determine if defects found on photomasks will reproduce themselves on the semiconductor without printing the semiconductor, saving thousands of dollars of lost yield.

The Company has committed to a plan, which will enable it to serve its customers more efficiently. A new customer service center providing value-added customer-specific applications engineering, system integration, upgrades, and repairs will be established in Sunnyvale. The present manufacturing operations located in Sunnyvale will be relocated to other ZYGO operations or subcontracted. The Company estimates that these actions will cost approximately $2.4 million which will be recorded in the quarter ended March 31, 1999. These actions, which should be completed by June 30, 1999, are expected to save the Company approximately $2.0 million annually beginning in the Company's fiscal year 2000.

Zygo Corporation designs, develops, manufactures, and markets high performance measurement and yield improvement instruments, custom automation systems, and accessories used in high technology industries. The Company is headquartered in Middlefield, Connecticut, and also has operations in Asslar, Germany; Longmont, Colorado; and sales offices throughout the world. ZYGO is traded on the Nasdaq National Market under the symbol ZIGO. Additional information on the Company is available on the Internet at

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company's current judgment on certain issues. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors which could cause actual results to differ materially are described in the Company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission.

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