August Technology Signs Agreement to Acquire Semiconductor Technologies & Instruments ``STI''.

Business Editors

MINNEAPOLIS--(BUSINESS WIRE)--May 23, 2002

August Technology Corporation (Nasdaq:AUGT) today announced that it has entered into a definitive agreement to acquire Semiconductor Technologies and Instruments, Inc. (STI) of Plano, Texas. STI, owned by ASTI Holdings, Ltd., of Singapore, is a leading competitor in the automated micro defect inspection equipment market. The acquisition purchase price is approximately $26.1 million consisting of $12 million cash, a $3 million six month note to ASTI Holdings, Ltd. and $11.1 million in stock.

"One of our key strategies is to be the technology leader in automated visual inspection and product characterization for emerging microelectronic markets," stated Jeff O'Dell, August Technology's CEO. "This acquisition significantly enhances our ability to serve these diverse and growing markets, including advanced packaging and wafer bumping. We are particularly interested in STI's strengths related to 2D and 3D inspection on the probe floor, an area of increasing importance as the industry drives towards known good die (KGD) strategies for wafer level packaging and system-in-package applications."

The transaction also provides August Technology with an integrated tool combining die sorting with advanced automated inspection - a key final step in the trend toward fully automated final wafer manufacturing. In addition, STI's installed base adds key foundries in Taiwan and several prominent integrated device manufacturers (IDMs) in Europe and the United States to August Technology's already broad customer list.

"The STI operation will become a development and applications center and will continue focusing on advanced technology for wafer level inspection," said David Klenk, August Technology's president and chief operating officer. "This strategic acquisition will bring new talent and technology to August Technology while establishing a strong regional presence in the Dallas high-tech corridor. In addition to engineering and applications development, the office will house sales and service employees serving the region."

Rajiv Roy, STI's current president, will remain with the organization and lead the Texas operation. "We are very excited to join with August Technology to provide device manufacturers with a complete offering of industry leading automated visual inspection products," stated Roy. "Our combined resources will allow us to more completely meet the needs of our customers worldwide."

O'Dell concluded, "We welcome STI into the August Technology family and will continue to look for additional opportunities to maximize our shareholder value."

The closing of the transaction is subject to approval by the shareholders of STI's parent company and other customary conditions and is anticipated to close in the third quarter of 2002.

August Technology will provide a live webcast of a conference call to discuss the acquisition with senior management on Friday, May 24 at 10:00 am CDT. The webcast will be available on the company's website at www.augusttech.com and archived for replay shortly following the call and continuing for two weeks. To listen to the call, visit the web site at least fifteen minutes early to register and download any necessary audio software.

August Technology Corporation, based in Bloomington, Minnesota, is a leading supplier of automated visual defect inspection equipment for the microelectronic industries and has established worldwide service and sales representation. The inspection solutions designed, manufactured and marketed by August Technology provide critical product and process enhancing information enabling microelectronic device manufacturers to drive down costs and time to market. 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 by visiting August Technology'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 anticipated closing of this transaction and statements regarding the benefits of increased tool performance, broadened diversity and a strengthened customer list. 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 the risk that conditions to closing will not be satisfied, unforeseen problems integrating STI's business and retaining its customers, or any unforeseen difficulties in the development or manufacture, shipment, delivery and acceptance of our products or in the economy in general. Please refer to additional risk factors stated in August Technology's Annual Report on Form 10-K filed with the Securities and Exchange Commission.