Zygo Quits Telecom

Zygo Corporation (NASDAQ: ZIGO) announces that it will dispose of its Zygo TeraOptix business unit and facility located in Westborough, Massachusetts. ZYGO is seeking a buyer for this business. ZYGO will discontinue its telecommunications business in Westborough, Massachusetts, no later than November 30, 2002. The disposition of this business unit effectively terminates the Company’s venture into the telecommunications business. The Zygo TeraOptix operation had sales for the year ended June 30, 2002 of $4,158,000, or 5%, of ZYGO’s consolidated sales.With the dramatic changes in the telecommunications industry, including excess capacity, capital spending cutbacks, and delays in deployment of high-speed technologies, demand for the components produced by Zygo TeraOptix has significantly decreased. Disposition of the Zygo TeraOptix business unit allows ZYGO to concentrate on growth and profitability in its other two markets, semiconductor and industrial.The Company will record an impairment charge in accordance with SFAS 144 and other related exit costs for the quarter ended September 27, 2002. The amount of the charges, which have not yet been determined, will relate primarily to the difference between the net book value of the applicable fixed assets ($28,000,000) and the estimated proceeds from the disposition of these assets.

Zygo Corp. (Nasdaq: ZIGO)