Governor Gilmore Announces First Phase of 300 mm Wafer Chip Plant - First on East Coast

Completed fab will offer more than 1,100 new jobs for Henrico County

Richmond - Governor Jim Gilmore today announced that Infineon Technologies (DAX/NYSE: IFX) will expand its presence in Henrico County by becoming the first semiconductor plant to commercially produce 300 mm wafers on the East Coast. Infineon Technologies Richmond, formerly known as White Oak Semiconductor, expects to create 1,100 new jobs at full build-out as a result of the expansion. Production is due to start in early 2002.

"It is gratifying to see that Virginia's pro-business climate has sparked another major semiconductor expansion," said Governor Gilmore. "My administration has positioned Virginia at the forefront of the latest advances in technology. As one of the first companies to produce 300 mm wafers in the U.S., Infineon Technologies is a perfect match for The Digital Dominion."

Governor Gilmore approved a $3 million grant from the Governor's Opportunity Fund to assist Henrico County with site preparation. The Commonwealth will provide a $2 million education grant to increase Virginia's semiconductor technology capacity at higher education institutions. Infineon Technologies Richmond also qualifies for a Major Business Facility Job Tax Credit, a statutory incentive available to all qualifying companies. The Virginia Economic Development Partnership, the Greater Richmond Partnership and the Henrico County Economic Development Authority assisted Infineon Technologies Richmond with its decision. The Virginia Department of Business Assistance will provide workforce training services. A performance-based grant for Infineon Technologies Richmond will be included in the Governor's budget that will be proposed to the General Assembly when it convenes in January.

"We decided to expand our operations in Virginia because of the ongoing technology and education infrastructure assistance from the state and Henrico County," said Henry Becker, President of Infineon Technologies Richmond. "Because of our recent success, we were already in the process of hiring 300 new employees. Our partnership with Governor Gilmore and the Commonwealth of Virginia made the difference in our final decision."

In order to increase production capacity for leading-edge communication integrated circuits (ICs), Infineon Technologies Richmond will equip a new shell building now under construction on its current site. Under the first phase, the company will start to outfit the new module with 300 mm equipment. Leading-edge memory chips, which are currently manufactured on the 200 mm line will move to the 300 mm line, making existing capacity available for production of communication ICs. Investments for similar facilities throughout the world have ranged from $1 billion to $1.5 billion at full completion.

Infineon Technologies Richmond was founded in 1996 as White Oak Semiconductor. The plant began manufacturing memory IC products in August 1998, less than 18 months after construction began on its first production module. The 800,000-square-foot-facility, which produces 128M and 256M SDRAM devices in 0.17 micron technology for personal and notebook computers, work stations, servers, communication, computer peripherals and graphic applications, is part of Infineon's network of 19 worldwide manufacturing plants. Infineon Technologies Richmond employs approximately 1,700 employees. In 1999, the trade magazine Semiconductor International named White Oak Semiconductor "Top Fab of the Year."

"We commend Infineon Technologies Richmond for its ongoing success and are pleased with this exciting news," said Secretary of Commerce and Trade Barry E. DuVal. "This additional fab will help Virginia to continue to emerge as a leader in the semiconductor industry."

About Infineon
Infineon Technologies AG, Munich, Germany, offers semiconductor and system solutions for applications in the wired and wireless communications markets, for security systems and smart cards, for the automotive and industrial sectors, as well as memory products. With a global presence, Infineon operates in the U.S. from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from Tokyo. In the fiscal year 2000 (ending September), the company achieved sales of EURO 7.28 billion with about 29,000 employees worldwide. Infineon is listed on the DAX index of the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol: IFX).