Reorganisation

The company plans to produce its leading-edge 180nm and below photomasks at a new commercial production facility in Dresden, Germany, announced earlier this year. Operations in Dresden are scheduled to begin by Q2 2004.

The Rousset and Hamburg facilities would continue to serve as front-end regional centers for technical and sales support. The company anticipates completing consolidation of European operations within 10 months. These initiatives are expected to reduce the global workforce by 8% - 140 positions - once fully implemented.

In the USA, the company will reduce its global workforce by 2% -30 positions - in Round Rock, Texas.

Insolvency proceedings began against SZ Testsysteme on
December 1, 2002. Business operations will be continued until a creditors meeting on December 13, 2002. The meeting will decide on the continuation of the insolvency proceedings. The company reports that there seems to be no positive solution for the public
company.