Ultratech Awarded Multi-Million-Dollar Order From a Leading Japanese Thin Film Head Manufacturer

Business Wire, April 29, 1999

SAN JOSE, Calif.--(BUSINESS WIRE)--April 29, 1999--

Model 1700ABS Steppers to be Used

for Air Bearing Surface Patterning Applications

Ultratech Stepper, Inc. (Nasdaq:UTEK), a leading supplier of photolithography systems used to manufacture semiconductors, micromachining devices and thin film heads (TFH) for disk drives, today announced a multi-million-dollar order for several Ultratech 1700ABS systems from a leading Japanese thin film head manufacturer. The new systems -- a lithography tool specifically designed for use in air bearing surface (ABS) patterning for TFH rowbar applications -- will be installed in three Far East fabs and will replace the customer's older generation tools.

Commenting on the order, Arthur W. Zafiropoulo, Ultratech's chairman and chief executive officer, noted the significance of this order. "Not only is this new Ultratech customer one of the most technically sophisticated disk drive suppliers in the global market with broad capabilities in TFH, media and disk drive operations; they are also expected to be one of the few TFH manufacturers to be fully transitioned to giant magneto resistive (GMR) head production by the end of 1999." Zafiropoulo added that Ultratech continues to occupy a dominant position in the TFH-rowbar market. "We established a presence in this segment during the pole trim era of inductive heads with our high-performing Model 1700 Machine Vision Systems (MVS), and our continued dedication to this specific application area is reflected in our installed base of over 80 percent."

The Model 1700ABS was introduced by Ultratech in late 1997. Its low cost of ownership and large depth of focus combine with process flexibility and high reliability to provide the optimum cost-effective 1X solution.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Certain of the statements contained herein may be considered forward-looking statements that involve risks and uncertainties, such as the cyclicality in the thin film head and semiconductor industries, delays, deferrals and cancellations of orders by customers, pricing pressures, competition, lengthy sales cycles for the company's systems, ability to volume-produce systems and meet customer requirements, the mix of products sold, dependence on new product introductions and commercial success of any new products, integration and development of the UltraBeam and Verdant operations, manufacturing inefficiencies and absorption levels, risks associated with introducing new technologies, adjustments relating to the potential change in accounting for the ISI acquisition, the failure to develop and commercialize the ISI products, inventory obsolescence, economic and political conditions in Asia, delays in collecting accounts receivables, extended payment terms and changes in technologies. Such risks and uncertainties are set forth in the company's SEC reports, including the company's Annual Report on Form 10-K for the period ended December 31, 1998.

About Ultratech: Founded in 1979, Ultratech Stepper, Inc. designs, manufactures and markets photolithography equipment used worldwide in the fabrication of integrated circuits, micromachining devices, thin film heads for disk drives and photomasks for the semiconductor industry. The company produces products that substantially reduce the cost of ownership for manufacturers in the electronics industry. The company's home page on the World Wide Web is located at http://www.ultratech.com