1st Silicon Announces Bank Financing, Technology Transfer and Wafer Supply Agreements with Sharp Corporation, Appointment of General Contractor

Business Wire, March 30, 1999

KUCHING, Sarawak, Malaysia--(BUSINESS WIRE)--March 30, 1999--At formal signing ceremonies today at the company's headquarters here, 1st Silicon(TM) (spoken: "First Silicon") made three major announcements.

The first was the receipt of a syndicated loan in excess of $200 million (USD) from a consortium of European banks arranged by the Commerzbank AG.

The company simultaneously announced that comprehensive, long-term technology transfer and wafer supply agreements have been signed with SHARP Corporation of Japan.

Lastly, 1st Silicon disclosed the appointment of Meissner Wurst Zander as the firm's general contractor for the construction of its semiconductor wafer fabrication facility.

Mr. Claudio G. Loddo, Chief Executive Officer of 1st Silicon said, "With these agreements now in force, 1st Silicon can promise future customers a world class independent semiconductor manufacturing facility having true leading-edge technologies in place that will provide superior products and service consistent with the best foundry practices."

The Chief Minister for the State of Sarawak, Datuk Patinggi Tan Sri (Dr.) Haji Abdul Taib Bin Mahmud, said, "This event gives me and all of the citizens of Sarawak great pleasure for it marks the achievement of an important milestone in establishing the first wafer fabrication plant in the State. Not only is 1st Silicon the State's first Government-sponsored high tech project, it will provide a huge impetus for the transformation of Sarawak's economy and the realization of our 'National Vision 2020' goal."

1st Silicon will focus on serving the needs of fabless semiconductor companies, which is the fastest growing sector of the semiconductor market. This industry segment numbers over 480 companies across the globe, ranging from start-ups to mature organizations having revenues of more than $1 billion (USD) per year. In addition, 1st Silicon plans to supply to integrated device manufacturers, as well as its own partners.

The facility is located on a 97 acre site in the Sama Jaya Free Industrial Zone of Kuching. In land resource terms alone, this is an ample area for three contemporary wafer fabs. The company estimates that it will reach a production capacity of 30,000 wafers per month at full capacity.

Solid Financial Foundation Secured

1st Silicon's loan package was arranged by Commerzbank AG under the auspices of the Ausfuhrkredit-Gesellschaft mbH (AKA), an organization composed of German Banks that has been providing export credits since 1952.

The participating banks are AKA, Commerzbank AG, Dresdner Bank AG, Landesbank Hessen-Thueringen Girozentral, Landesbank Baden-Wuerttemberg, and Banco Central Hispanoamericano S.A.

The loan package has been secured bilaterally between the Agency of the Federal Republic of Germany and the Federal Government of Malaysia and sustained by the State Government of Sarawak. The Central Bank of Malaysia, Bank Negara, has given its approval to all of 1st Silicon's financing activities.

World Class Technology Acquired

The technology agreement will provide 1st Silicon with several SHARP state-of-the-art 0.25-micron processes on 200-mm wafers, which will be followed by continued development of several 0.18-micron processes. The partnership with SHARP includes a wafer supply agreement through which a significant portion of 1st Silicon's production will be absorbed by the Japanese manufacturer.

This reciprocal agreement marks the first instance of a deep submicron technology transfer out of Japan by SHARP Corporation, and is historically significant because it is the first technology of this type to be introduced into Malaysia. Process transfer has commenced, and qualification is planned for Q3 2000 with production starting in Q4 2000.

World Renowned Contractor Engaged

Selected as General Contractor for Malaysia's first deep submicron wafer fabrication facility is M W Zander, a subsidiary of Jenoptik AG. Actual work on the project started earlier this year, and completion is scheduled for mid 2000. M W Zander was formed in 1998 through the merger of the German firms Meissner Wurst (Stuttgart) and Zander (Nuremberg).

M W Zander has designed and constructed numerous wafer-manufacturing facilities for some of the world's most prestigious semiconductor manufacturers. The company has undertaken extensive operations in Southeast Asia from its offices in Singapore, Taiwan, Korea and Malaysia.

1st Silicon

The headquarters of 1st Silicon (Malaysia) Sdn. Bhd. is at Level 2, Riverbank Tower, Jalan Tunku Abdul Rahman, 93100 Kuching, Sarawak, Malaysia. The company's telephone number is 60-82-410212 and the fax number is 60-82-410213. The company's web site may be found at www.1stsilicon.com.

Editor's Notes: -0-

1.   "1st Silicon" and the 1st Silicon logo are trademarks applied for
     worldwide by 1st Silicon (Malaysia) Sdn. Bhd.
2.   U.S. press inquiries should be directed to Kim Alfaro, Telephone:
     415/563-4769; Fax: 415/563-8913; email: kimpr@holonet.net.
3.   1st Silicon's web site: www.1stsilicon.com
4.   1st Silicon's corporate profile and photographs of Mr. Loddo are
     available from Kim Alfaro.
5.   Photographs in JPEG and TIFF formats of the signing ceremonies
     may be downloaded from the company's website.
6.   Individual releases detailing the AKA Loan syndication, the
     agreement with SHARP and the M W Zander contract as well as
     statements from Malaysian officials may be downloaded from 1st
     Silicon's website.
7.   Jenoptik/M W Zander press inquiries should be directed to Mr.
     Achim Schneider, JENOPTIK Jena, Germany. Telephone:  49-3641-65
     2451, Fax:  49-3641-65 2484, email: Achim.Schneider@Jenoptik.com