UMC AND XILINX ON TRACK TO MANUFACTURE 90NM PROGRAMMABLE CHIPS ON 300MM WAFERS IN 2003

Investment in 90nm will enable Xilinx to drive down pricing to under $25 for 1M FPGA gates for its next-generation devices

HSINCHU, Taiwan and SAN JOSE, Calif., December 16, 2002 - UMC (NYSE:UMC) and Xilinx, Inc. (NASDAQ: XLNX) today reported that the companies are on track to produce a new family of Xilinx programmable chips in the second half of 2003 using UMC's advanced 90 nanometer (nm) chip-making process technology.

UMC is preparing to manufacture the line of Xilinx field programmable gate arrays (FPGAs) at its 300mm fabrication facility and has produced an FPGA test chip. At 90nm, Xilinx engineers can pack more transistors, layers, interconnect and product features into a single chip, reducing die size by 50 to 80 percent, compared to any competing FPGA solution. UMC's L90 process integrates nine layers of high-speed copper interconnect, 1.2V high performance transistors and low-k dielectric material into a single manufacturing process.

Xilinx's investment in 90nm manufacturing technology with UMC will enable the company to drive pricing down to under $25 for a one-million-gate FPGA (approximately 17,000 logic cells)*, which represents a savings of 35 to 70 percent compared to any competitive offering. A smaller die size results in more die per wafer, which improves device densities and yields, thereby reducing overall production costs. This in turn leads to a more highly integrated, less expensive product that takes up less board space when designed by a customer into an end product.

"UMC and Xilinx have worked together on the early introduction of FPGA products across many process generations, and we are happy to extend the cooperation down to 90nm," said John Hsuan, vice chairman and CEO of UMC. "Xilinx stands to gain the maximum cost advantages of manufacturing products on 300mm wafers using 90nm process technology, due to fundamental device architecture and die size of its FPGAs. We're looking forward to helping Xilinx bring to its customers the full benefits of this advanced manufacturing."

Xilinx, one of the pioneers of the fabless semiconductor model more than 18 years ago, continues to be at the forefront of the race to advanced manufacturing processes and has established an impressive track record of industry firsts - including first to 150nm in 2001 and first to 130nm in 2002. Currently, the company is also the highest volume purchaser of 300mm (12-inch) wafers in the world.

"This announcement marks a major technology milestone for our longtime manufacturing partnership with UMC," said Wim Roelandts, Xilinx president and CEO. "We've had many breakthroughs already this year at UMC's 300mm Fab 12A, resulting in 90 percent yields for Xilinx FPGAs. Using UMC's most advanced 90nm process, we'll be able to deliver unprecedented FPGA price-performance levels to our customers, opening up entirely new markets for programmable logic."

For nearly a decade, Xilinx has successfully partnered with UMC as its primary semiconductor manufacturing partner for high-volume production of the company's programmable chips. Over the past several years, UMC and Xilinx have aligned to target a number of programmable devices to UMC's deep submicron processes. Most recently, the Virtex-II FPGAs were targeted to 130nm - and now the two companies are working to target specific designs to the 90nm manufacturing processes. Due to the regular structure and reprogrammability of Xilinx devices, defects can be more easily identified and isolated during manufacturing than with traditional, fixed semiconductor device architectures, making it an ideal process migration partner for a manufacturer such as UMC.


NOTE CONCERNING FORWARD-LOOKING STATEMENTS

Some of the statements in the foregoing announcement are forward looking within the meaning of the U.S. Federal Securities laws, including statements about future outsourcing, wafer capacity, technologies, business relationships and market conditions. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy, acceptance and demand for products, and technological and development risks.

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*Pricing in quantities of 250,000 in volume production in 2004.

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