August Technology Reaches Milestone in All-Surface Wafer Inspection Strategy.

MINNEAPOLIS -- First Backside Inspection System Installed at Top 20 Chipmaker; Installations Scheduled at Five Additional Top 20 Chipmakers

August Technology Corporation (Nasdaq:AUGT), a leading supplier of inspection, metrology and defect analysis solutions for the microelectronic industries, today announced the shipment and installation of the first B20 module for backside wafer inspection to a leading U.S.-based integrated device manufacturer (IDM).

"As industry leaders, our customers are continually striving for ways to reduce time to market and bring new products to market faster. Device manufacturers are expressing to us their increasingly critical need to completely understand the wafer condition - frontside, backside and edge," explained Tom Shurson, all-surfaces product manager. "This includes not only where defects are found on the surface of the wafer, but also where in the process defects are created and the root causes of these defects."

Shurson continued, "This B20 beta customer has already been able to identify and correct wafer edge related process issues using our AXi / E20 edge and frontside wafer inspection system. With the B20 module, they will be able to use the inspection data to correlate frontside defects, such as hot spots, to backside contamination defects and determine root causes such as robotic handling, particles and metal contamination."

August Technology's all-surface wafer inspection strategy includes the B20 for backside inspection and the E20 for edge inspection which work in conjunction with the AXi Series, NSX Series or 3Di Series for advanced macro frontside inspection. The Company currently has twelve E20 edge inspection modules in the field and more than a dozen B20s scheduled for shipment in the next two quarters.

About August Technology: August Technology's automated inspection, metrology and analysis solutions provide critical product and process enhancing information, which enables microelectronic device manufacturers to drive down costs and time to market. Based in Bloomington, Minnesota, August Technology is a founding member of the Advanced Packaging and Interconnect Alliance (APiA) and an active member of the Die Products Consortium (DPC). Additional information can be found on the company's web site at www.augusttech.com.

Forward Looking Statement: This release contains forward-looking statements that involve risks and uncertainties including statements regarding the capabilities, customer needs and shipments of the new B20 and E20 product offerings. These forward-looking statements involve risks and uncertainties that may cause actual results to differ from those set forth in the forward-looking statements, including, but not limited to deterioration in general economic conditions, further softening of the financial markets, downturns in the semiconductor or microelectronics industry, inaccurate market expectations, or any unforeseen difficulties in the development, manufacture, shipment, installation, performance or market acceptance of our new B20 and E20 products. Please refer to additional risk factors stated in August Technology's Annual Report on Form 10-K filed with the Securities and Exchange Commission.