<PAGE>


                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

                                   (Mark one)
       [X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2000

     [_] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                         Commission file number: 1-10938


                                SEMX CORPORATION
                    (Name of Business Issuer in Its Charter)


                 Delaware                            13-3584740
                 ----------------------------------------------
      (State or other jurisdiction of               (IRS Employer
       incorporation or organization)           Identification Number)

                  1 Labriola Court
                  Armonk, New York                    10504
                  -----------------------------------------
       (Address of principal executive offices)    (Zip Code)

         Issuer's telephone number, including area code: (914) 273-5500

Securities registered pursuant to Section 12(b) of the Exchange Act:

                                              Name of Each Exchange
Title of Each Class                            on Which Registered

Common Stock, $.10 par value                  NASDAQ National Market

Securities registered pursuant to Section 12(g) of the Exchange Act:  None.

Check whether the Registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the Registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. YES [X] NO [ ]

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
is not contained herein, and will not be contained, to the best of Registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

                     The Exhibit Index is located on page 18


<PAGE>

At March 19, 2001 the aggregate market value of the voting stock of the
Registrant held by non-affiliates was approximately $25,042,130.

At March 19, 2001 the Registrant had 6,322,278 shares of Common Stock
outstanding, $.10 par value ("Common Stock"). In addition, at such date, the
Registrant held 334,600 shares of Common Stock in treasury.


                      DOCUMENTS INCORPORATED BY REFERENCE:

DOCUMENT                                       Parts Into Which Incorporated

Portions of the Definitive                     Part III. Item 10, 11, 12 and 13
Proxy Statement prepared in
connection with the Company's
2001 Annual Meeting of Stockholders
which will be held on May 8, 2001.






















                                      -ii-


<PAGE>




                                     PART I

ITEM 1: BUSINESS

(a) General. SEMX Corporation consists of a Delaware corporation and its wholly
owned and majority owned subsidiaries (collectively the "Company"). The Company
principally manufactures proprietary thermal management materials,
microelectronic ceramic packages and interconnect products for critical
components that enable the growth of high bandwidth fiber optic communication
systems, wireless base stations and fixed wireless radio systems, Internet
servers and routers and other specialized microelectronic devices through its
Microelectronic Packaging (formerly known as "Materials") Group. The Company's
Wafer Reclaim Services (formerly known as "Services") Group reclaims silicon
test wafers for the semiconductor industry through facilities located in North
America, Europe and Asia, making it a wafer reclaim service with a worldwide
presence.

At the end of fiscal 2000, the Company's Microelectronic Packaging Group
consisted of the operating division of the parent company Semiconductor
Packaging Materials Company ("SPM") and its subsidiaries, Polese Company, Inc.
("Polese"), Semiconductor Materials S.A.R.L. ("S.A.R.L." and SPM(M) SDN.BHD
("MSDN.BHD"). The Microelectronic Packaging Group primarily designs, develops,
manufactures and markets metal matrix heat dissipation products, assembled
products and components, which include a high proportion of proprietary ceramic
materials that utilize heat dissipation products, bonding wire, precision metal
stampings, seal frames, tape on reel packaged products and other specialty
products and materials. Such products are incorporated into electronic
components used in Internet servers and routers, wireless products, automotive
control systems, fiber optic packages and thermal management components for the
RF industry. The Company also serves related markets outside of the electronics
industry. The Company's products are sold through internal sales personnel and a
network of independent sales representatives, principally to manufacturers and
assemblers of electronic devices.

The Company's Wafer Reclaim Services group consists of its American Silicon
Products, Inc. ("ASP") and American Silicon Products B.V. ("ASP B.V.")
subsidiaries and a majority owned Singapore corporation, International
Semiconductor Products Pte Ltd. ("ISP"). Each provide silicon wafer polishing
and reclaiming services to the semiconductor industry. Reclaimed wafers are used
in the evaluation and testing of equipment and processes in semiconductor
fabrication. ISP is 50.1% owned by the Company.

History - The registrant, SEMX Corporation, is a Delaware corporation
incorporated in 1988 as a successor to a company started in 1981. In December
1991 the Company had a public offering of its securities and became a public
company. In April 1998, the stockholders of the Company approved an amendment to
the Company's Certificate of Incorporation to change the name of the Company to
SEMX Corporation.

The Company has attained significant revenue growth over the last several years.
A substantial portion of that growth has been realized through the acquisition
of businesses and by applying financial and management resources to further the
growth of the companies.

(b) Financial Information about Industry Segments. The Company has operated in
two industry segments: microelectronic packaging and wafer reclaim services,
during each of its last three years.

(c) Narrative Description of Business. SEMX Corporation manufactures proprietary
thermal management materials, microelectronic packages and products, and
interconnect components in its Microelectronic Packaging Group for its target
markets - the fiber optic, wireless and Internet infrastructure industries. It
is committed to leveraging its strengths in advanced materials technology and
microelectronics assembly through vertical and horizontal integration and will
continue to enhance its capabilities through internal development and
acquisition of synergistic technologies. The Corporation's Wafer Reclaim
Services Group reclaims silicon test wafers for the semiconductor industry
through facilities located in North America, Europe and Asia.


SEMX's microelectronic materials and packaging products are critical components
in the systems that enable the growth of high bandwidth fiber optic
communication systems, wireless base stations and fixed wireless radio systems,
Internet servers and routers as well as automotive, medical and general
microelectronic devices and systems. The Corporation has built strong core
competencies in material science, engineering and manufacturing.



                                      -1-
<PAGE>

PRODUCTS

Thermal Management - Thermal management products are used to conduct heat away
from critical areas of electronic components. Polese utilizes a patented,
proprietary method to manufacture copper/tungsten heat dissipation products. The
Company has developed or acquired a family of other metal matrix composites to
become a full service provider of thermal management solutions.

Ceramic Packaging - Multi-layer ceramic technology is used for packaging and
housing of high performance microelectronic devices. Custom and standard designs
provide mechanical protection, manage heat and enable electrical
interconnection.

Wire, Stampings and Tape on Reel Products - The Company manufactures bonding
wire that is used to conduct electrical signals between two points of a circuit
and produces precision metal stampings out of various metals for interconnect or
heat dissipation purposes. Tape on reel packaging is produced to support surface
mount assembly operations.

Silicon Wafer Polishing and Reclaiming Services - ASP, ASP B.V. and ISP offer a
variety of high tech, state-of-the-art wafer polishing and reclaiming services
to the semiconductor industry. Reclaimed wafers are used in the evaluation and
testing of equipment and processes in semiconductor fabrication.

RAW MATERIALS AND PRINCIPAL SUPPLIERS

The Company in most cases utilizes two or more alternative sources of supply for
each of its raw materials. In certain instances, however, the Company will use a
single source of supply when directed by a customer or by need. In order to
ensure the quality of the Company's products, the Company has instituted strict
supplier evaluation and qualification procedures.

The SPM operating unit makes extensive use of precious metals, including gold,
as raw materials in the manufacture of certain products. Substantially all of
SPM's gold requirements are currently purchased from Fleet Precious Metals
("Fleet") pursuant to a consignment agreement. [See Management's Discussion and
Analysis of Financial Condition and Results of Operations].

PRODUCTION PROCESS

Products manufactured to customer specifications account for almost all of the
Company's total revenues.

The manufacturing process for metal matrix composite thermal management consists
of manufacturing a tool and die for the specific part, pressing the powdered
materials in a powdered metal press, sintering the parts in a furnace, and
machining them to the customer's specifications. The parts are then cleaned,
plated, tested and packaged for shipment.

For ceramic packaging, customer circuitry is transferred using metallic ink
paste on alumina tape to create arrays of circuits. These tapes are laminated
and fired at high temperature.

Wire and metal ribbon are manufactured by casting pure metals with selected
additives into cylindrical shapes which are then drawn through a series of
diamond dies to progressively reduce the metal to a finished size. Wire is then
either annealed in batches or strands. Metal ribbon is made by rolling wire into
a flat shape or by slitting strip into narrow widths.

The manufacturing process for stamping consists of casting specific metals or
alloy combinations into ingots which are passed through a series of rolling
mills to meet specified thickness requirements, and then slit to specified
widths. The material is stamped in a press that contains the die for the
customer's part.



                                      -2-
<PAGE>

Silicon wafer polishing and reclaiming services begin with incoming inspection
of customer wafers. The wafers are sorted for reclaim suitability and
conformance to customer specifications. The wafers are then processed to remove
all diffusions and deposited layers, polished and cleaned. All cleaning is done
in certified clean rooms utilizing deionized water.

OPERATING HOURS

SPM usually operates on an eight-hour daily shift five days per week, with its
tape on reel production and aluminum wire drawing operating on a two or three
shift basis, consistent with business requirements. Polese usually operates
seven days per week, with its various departments running two to three shifts
per day, consistent with business requirements. ASP usually operates on a
three-shift basis five days per week. Management believes that the Company
possesses sufficient capacity to expand production of its existing products.

QUALITY CONTROL

The Company utilizes extensive in-house statistical process quality control
procedures ("SPC"), and employs 56 persons engaged full-time in quality control
functions.

The Company is certified ISO 9000 (an international quality standard for the
European community) at five of its operations, and holds various quality awards
throughout the industries it serves. The Company believes that its ISO 9000
certifications are important in establishing the Company as a world class
supplier and greatly aids the Company in penetrating markets for the Company's
products throughout the world. The Company is also designated as a "Q-1"
supplier by The Ford Motor Company. SPM is QS 9000 Quality certified. The
Company believes that QS 9000 certification is important to the Company's status
as a world class supplier, especially within the automotive industry.

MARKETING AND SALES

The Company engages independent sales representatives in various regions
throughout the United States, Europe, Asia, the Far East and South America.
Pursuant to agreements with these representatives, such representatives are
prohibited from carrying a line of products that compete with the Company's
products. The Company believes that additional sales representatives are
available, if required.

The Company also currently employs inside sales and marketing personnel who are
responsible for direct sales to the Company's customers. The Company's sales
personnel also work closely with customers to solicit future orders and to
render technical assistance and advice. Other marketing efforts include
generation and distribution of the Company's product catalogs and brochures and
attendance at trade shows. The Company also advertises in trade publications,
primarily in the United States.

PRODUCT AND PROCESS DEVELOPMENT

Although the Company does some product and process development, the majority of
these activities are customer directed and related. These services are factored
into the price that is charged to the customer. In recent years, these efforts
have led to the development of various new proprietary products and processes.

CUSTOMERS

The Company's products are sold principally to customers servicing the high end
Internet server and router, wireless communications, automotive, aerospace,
military, medical and semiconductor industries. The Company's customers include
Agilent, Alcatel, Analog Devices, Chartered Semiconductor, Chows Electronics,
Cirent Technologies, Cisco Systems, Delphi Automotive Systems, Egide, Harris,
Hewlett-Packard, IBM, Interpoint, JDS Uniphase, Kyocera America, LM Ericsson,
Lockheed, Lucent Technologies, Medtronic, Motorola, National Semiconductor
Corporation, Northern Telecom, Olin Aegis, Philips Electronics, SONY, ST
Microelectronics, Sun Microsystems,


                                      -3-
<PAGE>

Teledyne Technologies, Texas Instruments, Triton Network Systems, Tyco
Electronics, Visteon Automotive Systems, WaferNet and Winbond.

For the years ended December 31, 2000 and 1999, sales of the Company's products
to the Company's five largest customers accounted for approximately 36% and 41%,
respectively, of the Company's revenues. For the year ended December 31, 2000,
one customer accounted for approximately 16% of the Company's total revenues,
whereas for the year ended December 31, 1999, two customers accounted for
approximately 21% and 10% of the Company's total revenues.
The Company does not maintain contracts with many of its customers and generally
sells its products pursuant to customer purchase orders. Certain of the
customers purchase orders provide for annual requirements of a particular
product. A substantial portion of the Company's orders for products which
include precious metals provide that the initial price quotation is adjusted to
reflect any changes in the price of precious metals at the time of shipment.

For the years ended December 31, 2000 and 1999, direct sales of the Company's
products into foreign markets accounted for approximately 28% and 24%,
respectively, of the Company's consolidated revenues. The Company believes that
a portion of its revenues will continue to be derived from the sale of its
products in foreign markets. These revenues will be subject to risks associated
with foreign sales, including economic or political instability, shipping
delays, fluctuations in foreign currency exchange rates, custom duties and
export quotas and other trade restrictions. The Company is not aware of any
foreign tariffs with respect to products marketed by the Company. Although
export sales are subject to certain governmental restrictions, the Company has
not experienced any difficulties with foreign or domestic trade restrictions.

BACKLOG

At December 31, 2000 and 1999, the Company's backlog of orders was approximately
$35,833,000 and $17,184,000, respectively. Certain orders in the backlog may be
canceled under certain conditions without significant penalty to the customer.
The Company believes that the majority of the Company's backlog of orders
existing as of December 31, 2000 will be shipped over the next twelve months.

COMPETITION

The market for the Company's products is highly competitive. The Company
competes with numerous well-established foreign and domestic companies, many of
which possess substantially greater financial, marketing, personnel and other
resources than the Company and have established reputations for success in the
development, sale and service of products. Competitors include many of the major
companies engaged in parts manufacturing for the microelectronics and
semiconductor industries.

The Company believes it maintains competitive advantages in customer response
time, pricing and quality. The Company also believes that it is one of a limited
number of manufacturers that produces all of its primary products and services
and that this capability creates an advantage in the marketing of products to
customers that seek to limit the total number of their suppliers.

PATENTS AND PROPRIETARY INFORMATION

The Company's ability to compete effectively may be materially dependent upon
the proprietary nature of its technologies. The Company has fifteen patents,
with five additional patents pending, which protect various Company products
and/or processes.

The Company relies on proprietary know-how and employs various methods to
protect its processes, concepts, ideas and documentation associated with its
proprietary products. However, such methods may not afford complete protection
and there can be no assurance that others will not independently develop such
processes, concepts, ideas and documentation. Although the Company has, and
expects to have, confidentiality agreements with its employees, there can be no
assurance that such arrangements will adequately protect the Company's trade
secrets.

GOVERNMENT REGULATION

The Company is subject to regulations administered by the United States
Environmental Protection Agency, the Occupational Safety


                                      -4-
<PAGE>

and Health Administration, various state agencies and county and local
authorities. Among other things, these regulatory bodies impose restrictions to
control air, soil and water pollution and dictate safety in the workplace. The
extensive regulatory framework imposes significant compliance burdens and risks
on the Company. Governmental authorities have the power to enforce compliance
with these regulations and to obtain injunctions and/or impose civil and
criminal fines or sanctions in the case of violations.

The Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended ("CERCLA"), imposes strict, joint and several liability on the
present and former owners and operators of facilities which release hazardous
substances into the environment. The Resource Conservation and Recovery Act of
1976, as amended ("RCRA"), regulates the generation, transportation, treatment,
storage and disposal of hazardous waste. The Company is also subject to various
state and local laws, which are the counterparts of CERCLA and/or RCRA in the
jurisdictions where the Company maintains facilities (New York, California, and
Rhode Island). The Company believes that it is in substantial compliance with
all material federal and state laws and regulations governing its operations.
The Company continually evaluates its environmental and safety practices with
respect to such requirements and maintains all required licenses or permits.

Various laws and regulations that relate to safe working conditions are
applicable to the Company, including the Occupational Safety and Health Act. The
Company believes it is currently in substantial compliance with all material
federal, state and local laws and regulations regarding safe working conditions.
The Company believes that the cost of compliance with such government and
environmental regulations is not material.

EMPLOYEES

As of December 31, 2000, the Company employed approximately 878 persons. All
manufacturing personnel are paid on an hourly basis. The majority of employees
are employed full-time. None of the Company's employees are covered by a
collective bargaining agreement. The Company considers its relationship with its
employees to be good.

ITEM 2: PROPERTIES

The Company's executive offices and SPM's manufacturing facility are located in
a Company-owned 43,700 square foot building in Armonk, New York. SPM leases a
3,000 square foot facility in Casablanca, Morocco to supply various products to
North Africa and Europe and leases a 3,440 square foot facility in Penang,
Malaysia to supply the Asian markets. All of SPM's facilities are suitable for
the Company's current needs and are well maintained and in good condition.

In San Diego, California, Polese leases approximately 24,211 square feet of
industrial space at 10103 Carroll Canyon Road, 34,615 square feet at 10111
Carroll Canyon Road and 22,976 square feet at 10121 Carroll Canyon Road. In
December 2000, Polese purchased the Miralani Business Park building located on
3.3 acres at 8680 Miralani Drive, San Diego, California where the Company houses
its plating operation. The building is approximately 34,240 square feet and
Polese currently utilizes approximately 60% of the building's capacity. The
remaining 40% of the building is leased out on a month-to-month basis and is
available for future expansion. The facilities are suitable for the Company's
current and future needs. The properties are well maintained and are in good
condition.

ASP owns a 28,000 square foot facility in Providence, Rhode Island. ASP
currently utilizes approximately 85% of the building's production capacity and
believes the facility is suitable for the Company's current needs. The property
is well maintained and is in good condition. On November 17, 2000, ASP purchased
a 3,832 square foot building located at 10 Cross Street near its Providence,
Rhode Island operation. It is being used for copper reclaim and as additional
warehouse space.

ASP B.V.'s operations are located in a Company-owned facility of approximately
25,800 square feet at Achterdijk 8, 5705 CB, Helmond, Netherlands. The Helmond
facility is suitable for the Company's current needs and is operating at
approximately 70% of its productive capacity. The facility consists of
production, office and warehouse space and is well maintained and in good
condition.

ITEM 3: LEGAL PROCEEDINGS



                                      -5-
<PAGE>

The Company is subject to claims and suits in the ordinary course of business.
Management believes that the ultimate resolution of such proceedings will not
have a material adverse effect on the Company.

An investigation by the Securities and Exchange Commission ("SEC") into certain
sales of the Company's common stock during 1996 is continuing. As a general
matter, the SEC takes the position that its investigation should not be
construed as an indication that any violations of law have occurred or as an
adverse reflection upon any person or security. The Company and any corporate
personnel involved have cooperated fully with the SEC in its investigations.

ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS

No matter was submitted to a vote of security holders during the quarter ended
December 31, 2000.





                                      -6-
<PAGE>

                                     PART II

ITEM 5: MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock trades on the NASDAQ National Market (Ticker Symbol:
SEMX). The prices of the Company's Common Stock for each quarter during 2000 and
1999 were as follows:

<TABLE>
<CAPTION>
                                                     2000                               1999
                                                     ----                               ----

                                            High              Low              High              Low
<S>                                         <C>               <C>              <C>               <C>
1st Quarter.........................       $14-1/4           $6-3/4           $4-3/4            $1-3/8
2nd Quarter.........................        12-3/8            6-3/4            3-3/8             1-1/2
3rd Quarter.........................        8-5/8             5                6-1/2             3-1/8
4th Quarter.........................       $7-5/8            $3-1/2           $8                $5-1/16
</TABLE>

As of March 19, 2001 there were approximately 95 holders of record of the
Company's Common Stock. On March 19, 2001, the high and low bid price of the
Common stock was $5 and $4-5/8 per share, respectively. The Company paid no
dividends on its Common Stock in 2000 or 1999.

On March 26, 1999, the Company's Board of Directors unanimously adopted a
shareholders rights plan (the "Rights Plan"), commonly referred to as a poison
pill. Under the Rights Plan, as amended in June, 2000, shareholders of record on
June 15, 1999 (unless excepted under the terms of the Rights Plan), until the
distribution date, will receive rights to purchase a unit consisting of one
one-thousandth of a Series of Preferred Shares of the Company at $50 per unit.

The Board of Directors may declare a distribution date within ten (10) business
days following (i) the acquisition of or right to acquire, by a person or group,
fifteen (15) percent or more of the outstanding shares of the Company or (ii)
the commencement of a tender offer or exchange offer that would, if consummated,
result in a person or group owning fifteen (15) percent or more outstanding
shares of the Company. Upon the declaration of a distribution date, each holder
of the right will have the right to receive, upon exercise, common shares having
a value equal to two times the exercise price of the right. In the alternative,
the Board of Directors, at its option, may exchange all outstanding and
exercisable rights for common shares at an exchange ratio of one common share
per each right. The Board may redeem the rights prior to an event triggering a
distribution date at $.001 per right.



                                      -7-
<PAGE>



ITEM 6: SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>

                                                                     Year Ended December 31,

(In thousands except per
share amounts)                             1996              1997             1998              1999             2000
---------------------------------------------------------------------------------------------------------------------------
Operating Data:
<S>                                       <C>              <C>               <C>              <C>               <C>
     Revenue                              $  46,027        $  71,076         $  65,903        $  63,524         $  74,089
---------------------------------------------------------------------------------------------------------------------------
     Net income (loss)                    $   3,805        $   3,793         $ (11,958)       $   7,383         $   2,614
---------------------------------------------------------------------------------------------------------------------------
Amounts Per Common Share:
---------------------------------------------------------------------------------------------------------------------------
     Basic                                $     .64        $     .62         $  (1.98)        $    1.22         $     .34
---------------------------------------------------------------------------------------------------------------------------
     Diluted                              $     .62        $     .61         $(  1.98)        $    1.19         $     .32
---------------------------------------------------------------------------------------------------------------------------
Weighted average number of common
  and common equivalent shares:
     Basic                                    5,968            6,070             6,054            6,047             6,213
---------------------------------------------------------------------------------------------------------------------------
     Diluted                                  6,170            6,232             6,054            6,223             6,601
---------------------------------------------------------------------------------------------------------------------------
Dividends declared                                0                0                 0                0                 0
---------------------------------------------------------------------------------------------------------------------------
Balance Sheet Data:
     Working capital (deficiency)         $  10,947        $   9,486         $ (14,064)       $   4,213         $   8,412
---------------------------------------------------------------------------------------------------------------------------
     Total assets                         $  56,489        $  91,865         $  82,324        $  61,072         $  80,089
---------------------------------------------------------------------------------------------------------------------------
     Long-term obligations                $  12,432        $  32,717         $  13,055        $  13,335         $  15,845
---------------------------------------------------------------------------------------------------------------------------
     Shareholders' equity                 $  33,940        $  37,458         $  25,371        $  32,564         $  36,544
---------------------------------------------------------------------------------------------------------------------------
</TABLE>

1)   Financial data presented includes the results of the following acquisitions
     and disposition: Acquisitions - American Silicon Products in December 1994,
     Retconn in January 1996, Silicon Materials Service in January 1997 and ST
     Electronics in July 1997. For details relating to these transactions please
     reference the Management Discussion and Analysis, Liquidity and Capital
     Resources sections. Dispositions - On February 19, 1999, the Company sold
     its Retconn and ST businesses and recorded a net after tax gain of $3,903
     on the transaction.

2)   Financial data presented for 1998 includes special charges. For details
     please reference the Management's Discussion and Analysis of Financial
     Condition and Results of Operations section.

3)   Amounts per common share for the years ended prior to December 31, 1997
     have been restated to conform to the provisions of Statement of Financial
     Accounting Standards No. 128, Earnings per Share, which was adopted during
     the fourth quarter of 1997.


                                      -8-
<PAGE>


ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The following table sets forth, for the periods indicated, certain financial
data as a percentage of net sales:

<TABLE>
<CAPTION>
Fiscal Year Ended December 31,                            2000               1999                1998
---------------------------------------------------- --------------- --- -------------- --- ---------------
<S>                                                       <C>                 <C>                <C>
Net Sales                                                 100.0               100.0              100.0
Cost of Sales                                              70.7                66.6               80.6
Gross Profit                                               29.3                33.4               19.4
Selling, General and Administrative Expenses               21.0                22.1               24.0
Operating Income (loss)                                     8.3                11.2              (21.6)
Interest Expense (Net)                                      2.2                 3.1                5.3
Income (Loss) before Income Taxes                           6.1                21.4              (26.9)
Provision (Credit) for Income Taxes                         2.1                 9.8               (8.3)
Net Income (Loss)                                           3.5                11.6              (18.1)
</TABLE>

RESULTS OF OPERATIONS (2000 compared to 1999)

Total revenue for the year 2000 of $74,089,000 increased $10,565,000 or 16.6%
from the comparable 1999 period. The 1999 period included sales of $2,122,000
from the Company's connector business, ("Retconn") through the February 1999
disposition date. Excluding Retconn sales, total revenue for 2000 increased
$12,687,000 or 20.7% compared to 1999.

The Microelectronic Packaging Group formerly known as The Materials Group
includes the Company's SPM and Polese business units as well as the Retconn
business unit through February 1999. Excluding Retconn, the Microelectronic
Packaging Group 2000 sales of $53,632,000 increased $9,088,000 or 20.4% from
1999 levels. SPM's 2000 sales increased by $4,263,000 or 32.3% as compared to
the comparable 1999 periods. SPM sales have increased due to increased sales of
gold wire as well as improved sales from overseas locations in Morocco and
Penang. Polese Company's 2000 sales increased by $4,825,000 or 15.4% as compared
to the prior year period. Polese sales have increased due to improved sales of
thermal management products, microprocessor lids, wireless technology products
and assembled products, made possible by the second quarter 2000 acquisitions of
assets and technology of a ceramics company and a electroless gold plating
company.

The Company's Wafer Reclaim Services Group formerly known as The Services Group
includes American Silicon Products ("ASP"), American Silicon Products B.V. ("ASP
B.V.") and Singapore based, International Semiconductor Products Pte. Ltd.
("ISP") business units. The Wafer Reclaim Services Group's 2000 revenues
increased $3,599,000 to $20,457,000 as compared to the prior year. The Wafer
Reclaim Services Group's 2000 revenue increase was primarily due to increased
demand for reclaimed wafers at the ISP business unit due to improved market
conditions and increased manufacturing capacity. The Wafer Reclaim Services
Group's revenue from ASP's U.S. and European operations for the year 2000
increased a total of $797,000 or 21.3% as compared to the comparable 1999
period. Revenue from ISP of $5,732,000 for 2000 increased by $2,802,000 or 95.6%
over the comparable 1999 period.

The Company does a significant amount of international business, both from its
domestic locations, as well as through overseas manufacturing locations. Direct
sales of the Company's products into foreign markets, as a percentage of
consolidated revenue ("foreign sales percentage") during 2000 was 28% compared
to 24% for 1999. The Company currently maintains foreign manufacturing
operations in the Netherlands ("ASP B.V."), in Morocco, Semiconductor Materials
S.A.R.L. ("S.A.R.L."), in Malaysia, SPM ("MSDN.BHD") and in Singapore, ISP. In
2000, the Company derived revenue from ASP B.V. of $3,161,000, from S.A.R.L. of
$843,000, from MSDN.BHD of $821,000 and from ISP of $5,732,000. Foreign sales
made through the Company's domestic operations are made through foreign
manufacturer's representatives and are priced and paid for in U.S. dollars.
Sales for ASP B.V., S.A.R.L., MSDN.BHD and ISP are conducted in the local
currencies of Dutch Guilders, Dirhams, Ringits, and Singapore Dollars,
respectively and are subject to currency fluctuations. These sales constitute a
foreign sales percentage of 14% in 2000 and 11% for 1999.



                                      -9-
<PAGE>

The Company's consolidated backlog as of December 31, 2000 was approximately
$35,833,000 compared to backlog of approximately $17,184,000 at December 31,
1999. The increase in consolidated backlog during 2000 was led by Polese's
increase from approximately $8,117,000 at December 31, 1999 to approximately
$27,009,000 at December 31, 2000. Backlog at ASP has improved significantly from
approximately $5,628,000 since the beginning of the year to approximately
$6,523,000 at December 31, 2000. The backlog for SPM has decreased approximately
$1,161,000 from beginning of year levels, to $2,280,000 at December 31, 2000.
The Company believes that the majority of the backlog of orders existing as of
December 31, 2000 will be shipped over the next twelve months. The Company
expects the consolidated backlog to remain strong for the remainder of 2001.

GROSS PROFIT

Gross profit of $21,680,000 for 2000 increased $474,000 or 2.2%, from the
comparable 1999 period. Excluding Retconn from all periods presented, 2000 gross
profit increased by $1,182,000 or 5.8%, from 1999 levels. Without Retconn the
Microelectronic Packaging Group's 2000 gross profit of $16,470,000 decreased
$140,000 or 0.8% as compared to 1999. The Microelectronic Packaging Group's
gross profit decrease primarily reflects temporary decreases in Polese's
manufacturing efficiencies due to the acquisition, integration and relocation of
the ceramics and electroless gold plating businesses. Gross profit for the Wafer
Reclaim Services Group was $5,210,000, an increase of $1,322,000 or 34% as
compared to the comparable period in 1999 primarily due to increased sales at
ISP.

GROSS MARGINS

The Company's gross margins decreased from 33.4% in 1999 to 29.3% in 2000. The
Microelectronic Packaging Group's 2000 gross margin decreased from 37.1% during
1999 to 30.7% for 2000 reflecting the integration of the acquired businesses.
The Wafer Reclaim Services Group's 2000 gross margins increased from 23.1% to
25.5% from the comparable 1999 periods, reflecting the consolidation of domestic
operations and improved performance at ISP.

SELLING, GENERAL AND ADMINISTRATIVE

Selling, general and administrative ("SG&A") expenses in 2000 increased
$1,474,000 or 10.5% from the comparable 1999 period. The increase in SG&A in
2000 reflects increased sales levels in both the Microelectronic Packaging and
Wafer Reclaim Services Groups. SG&A expenses as a percentage of revenue
decreased from 22.1% in 1999 to 21.0% in 2000 as a result of the above.

GAIN ON SALE OF CONNECTOR BUSINESS

Income before income taxes and minority interest for 1999 includes a pretax gain
of $8,430,000 on the sale of Retconn to Litton Corporation on February 19, 1999
as described below in Liquidity and Capital Resources.

INTEREST EXPENSE (NET)

Net interest expense for 2000 of $1,665,000 decreased by $295,000 from the
comparable 1999 period. The decrease in net interest expense is due to reduced
debt levels during 2000 partially as a result of Preferred Stock financing as
described below in Liquidity and Capital Resources.

PROVISION (CREDIT) FOR INCOME TAXES

A provision of $1,579,000 for income taxes has been recorded at an effective
rate of 35.2% for 2000 as compared to a provision of $6,201,000 at an effective
rate of 45.5% for 1999. The lower effective rates utilized in the 2000 periods
reflect state investment credits. The provision for 1999 includes taxes of
$4,527,000 associated with the gain on the sale of Retconn.

MINORITY INTEREST

The Company has a 50.1% interest in the Wafer Reclaim Services Group's Singapore
based ISP operation. In accordance with generally accepted accounting principles
the Company fully consolidates the operating results of ISP and then excluded
49.9% of

                                      -10-
<PAGE>

ISP's net income or loss from its consolidated net income, reflecting the
minority owner's share in ISP's results. In 2000, the Company has excluded from
net income, $287,000, reflecting the minority owners share of ISP's income, net
of tax. In 1999, the Company's net income excludes minority interest of $31,000,
associated with ISP, net of tax.

NET INCOME

As a result of the above, net income of $2,614,000 for 2000 decreased by
$4,769,000 from the comparable 1999 period.

NET INCOME AVAILABLE TO COMMON SHAREHOLDERS

Net income available to common shareholders is the numerator in the Company's
calculation of Basic and Diluted Income per common share and reflects dividends
payable to Preferred Stockholders and accretion of the carrying value of the
Series B Preferred Stock issued on June 1, 2000. The Company accrues
approximately $67,000 per month representing dividends payable and accretion
related to the Series B Preferred Stock.

RESULTS OF OPERATIONS (1999 COMPARED to 1998)

Total revenue for the 1999 period of $63,524,000 decreased $2,379,000 or 3.6%
from the comparable 1998 period. On February 19, 1999, the Company sold Retconn
as described herein. Retconn had sales through the February 1999 disposition
date of $2,122,000 compared to sales of $17,974,000 for the year 1998. Excluding
Retconn sales from all periods presented, the Company's total revenue for 1999
increased $13,473,000 or 28.1% from the comparable period in 1998.

The Microelectronic Packaging Group includes the Company's SPM, Polese and
Retconn business units. Excluding Retconn, the Microelectronic Packaging Group's
1999 sales of $44,544,000 increased $14,994,000 or 50.7% from 1998 levels. SPM's
1999 sales increased by $191,000 or 1.5% as compared to the comparable 1998
period. Polese's 1999 sales increased by $14,803,000 or 89.5% as compared to the
prior year period. Polese's sales have increased due to improved sales of
thermal management products, microprocessor lids, wireless technology products
and the introduction of new products.

The Wafer Reclaim Services Group includes American Silicon Products ("ASP"),
American Silicon Products B.V. ("ASP B.V.") and International Semiconductor
Products Pte. Ltd. ("ISP") business units. The Wafer Reclaim Services Group's
1999 revenues decreased $1,521,000 to $16,858,000 for 1999 as compared to the
prior year. The Wafer Reclaim Services Group's 1999 revenue decrease was the
result of a slowdown in the demand for reclaimed wafers and pricing pressures
caused by a downturn in the semiconductor industry. In July of 1998, the Company
closed its Texas operations and consolidated all of ASP's domestic business into
its Rhode Island facility. The 1999 and 1998 periods included $0 and $1,537,000,
respectively, in revenue from the Texas operation. The Wafer Reclaim Services
Group's revenue from ASP's U.S. and European operations for the year 1999
decreased a total of $2,515,000 or 16% as compared to the comparable 1998
period. Revenue from ISP of $2,930,000 for 1999 increased by $994,000 or 51%
over the comparable 1998 period.

Direct sales of the Company's products into foreign markets as a percentage of
consolidated revenue during 1999 was 24% compared to 18% for 1998. The Company
currently maintains foreign manufacturing operations in the Netherlands ("ASP
B.V."), in Morocco, Semiconductor Materials S.A.R.L. ("S.A.R.L."), in Malaysia,
SPM ("MSDN.BHD") and in Singapore, ISP. In 1999, the Company derived revenue
from ASP B.V. of $3,260,000, from S.A.R.L. of $770,000, from MSDN.BHD of
$115,000 and from ISP of $2,930,000. Foreign sales made through the Company's
domestic operations are made through foreign manufacturer's representatives and
are priced and paid for in U.S. dollars. Sales for ASP B.V., S.A.R.L., MSDN.BHD
and ISP are conducted in the local currencies of Dutch Guilders, Dirhams,
Ringits, and Singapore Dollars, respectively, and account for 11% of
consolidated revenues in 1999 and are subject to currency fluctuations.

The Company's consolidated backlog as of December 31, 1999 was $17,184,000 and,
excluding the backlog from the Retconn business, was $15,161,000 at December 31,
1998. The Polese backlog which was $5,003,000 at the end of 1998 improved to
$8,117,000 as of December 31, 1999. The backlog for SPM increased $219,000 to
$3,440,000 as of December 31, 1999. The backlog for ASP decreased $1,310,000 to
$5,627,000 since the end of 1998.


                                      -11-
<PAGE>

GROSS PROFIT

Gross profit of $21,206,000 for 1999 increased $8,428,000 or 66%, from the
comparable 1998 period. Excluding Retconn from all periods presented, 1999
gross profit increased by $12,456,000 or 159%, from 1998 levels. Without Retconn
the Microelectronic Packaging Group's 1999 gross profit of $16,427,000 increased
$11,804,000 or 255% as compared to 1998. The Microelectronic Packaging Group's
gross profit increases primarily reflected the increased sales at Polese
Company. The Wafer Reclaim Services Group's gross profit of $3,888,000 increased
$652,000 or 20% as compared to the comparable periods in 1998 primarily due to
the effects of cost reductions during 1999.

GROSS MARGINS

The Company's gross margins increased from 19% to 33% over the comparable 1998
period. Excluding Retconn, the Company's gross margin for 1999 increased from
28% to 35%. The Microelectronic Packaging Group's 1999 gross margin increased
from 16% to 37% from the comparable 1998 period. The Wafer Reclaim Services
Group's 1999 gross margins increased from 18% to 23% from the comparable 1998
period, reflecting the consolidation of domestic operations and improved
performance at ISP.

SELLING, GENERAL AND ADMINISTRATIVE

Selling, general and administrative ("SG&A") expenses in 1999, decreased
$1,727,000 or 11% from the comparable 1998 period. The decrease in SG&A in 1999
reflects savings realized by the closing of the Wafer Reclaim Services Group's
Texas plant during the second quarter of 1998 as well as reductions in SG&A due
to the sale of Retconn. Excluding Retconn, 1999 SG&A increased by $1,638,000 or
14%. SG&A expenses as a percentage of revenue decreased from 24% in 1998 to 22%
in 1999 as a result of the above.

SPECIAL CHARGES

In 1998, the Company recorded special charges of $11,217,000, primarily related
to adjustments of the carrying values of the Company's Wafer Reclaim Services
Group's assets and the closing of a Wafer Reclaim Services Group plant. During
1998 the Company performed a restructuring of the Wafer Reclaim Services Group
that included closing its Texas operation and consolidating domestic business
and equipment into the Group's Rhode Island facility. As a result of a more
severe than anticipated market decline, the division continued operating at a
loss in 1998 which triggered an impairment and utilization review of the Wafer
Reclaim Services Group's long lived assets. The review identified approximately
$4,700,000 of excess Wafer Reclaim Services Group equipment that was written
down to estimated fair value, less cost of disposal. In addition the Company
wrote down approximately $2,700,000 of Goodwill associated with certain Texas
facility customers and lines of business that were eliminated. Due to financial
problems experienced during 1998 at the Wafer Reclaim Services Group's 50.1%
owned Singapore operation, the Company recorded an asset impairment of
$1,000,000 in response to uncertainty regarding the ultimate recoverability of
its investment. The Company recorded no special charges during the year ended
December 31, 1999.

GAIN ON SALE OF CONNECTOR BUSINESS

Income before income taxes and minority interest for 1999 includes a pretax gain
of $8,430,000 on the sale of Retconn to Litton Corporation on February 19, 1999
as described below in Liquidity and Capital Resources.

INTEREST EXPENSE (NET)

Net interest expense for 1999 decreased $1,515,000 from the comparable 1998
period. The decrease in net interest expense is due to reduced debt levels from
February 19, 1999 forward due to the principal repayments from proceeds from the
sale of the Retconn business.


                                      -12-
<PAGE>

PROVISION (CREDIT) FOR INCOME TAXES

A provision of $6,201,000 for income taxes has been made for 1999 as compared to
a credit of $5,500,000 for the comparable 1998 period. The provision in 1999
includes $4,527,000 associated with the gain on the sale of Retconn. The Company
has Federal net operating loss carryforwards available to offset a substantial
portion of the income tax return liability associated with the gain. The credit
for 1998 includes a $3,477,000 income tax credit associated with the special
charges recorded during that year.

MINORITY INTEREST

In 1999 and 1998 the Company has included income of $31,000 and loss of $244,000
respectively, associated with ISP in its income (loss) before minority interest
in income (loss) of consolidated subsidiary, net of tax. The Company has a 50.1%
interest in the joint venture and has accordingly excluded 49.9% of such income
(loss) from its consolidated net income.

NET INCOME

As a result of the above, net income of $7,383,000 for 1999 increased by
$19,341,000 from the comparable 1998 period.


                                      -13-
<PAGE>



                         LIQUIDITY AND CAPITAL RESOURCES

GENERAL

To maintain its growth, the Company has historically made significant capital
expenditures to support its facilities and manufacturing processes as well as
working capital needs. The Company has financed its capital needs through cash
flow from operations, its line of credit facility, term loans from PNC Bank
(the "Bank"), Preferred Stock issuances, other bank financing including gold
consignment supply agreements, and capital leases.

SUMMARY OF 2000 ACTIVITY

At December 31, 2000, the Company had cash and cash equivalents of $1,300,000,
and an available balance on its revolving credit facility of $4,907,000 as
compared to $416,000 and $2,688,000 respectively at December 31, 1999.

Net cash provided by operating activities during 2000 amounted to $5,374,000 as
compared to cash provided of $5,882,000 in the comparable 1999 period. Cash
provided by operations decreased compared to 1999 principally as a result of
2000 income and working capital changes.

Cash used by investing activities during 2000 amounted to $15,817,000, compared
to cash provided of $19,561,000 during the year ended December 31, 1999. On
February 19, 1999 the Company completed the sale of Retconn, and realized cash
proceeds of $22,191,000. During the years ended December 31, 2000 and 1999, the
Company invested $13,218,000 and $2,719,000, respectively, in property and
equipment, including the purchase of a building used for manufacturing. This
investment excludes $991,000 and $896,000, respectively, in the 2000 and 1999
periods for equipment acquired under capital leases. During 2000, the Company
invested $1,858,000 in conjunction with the purchase of a ceramics business and
an electroless plating business and the repayment of liabilities in connection
with these businesses.

Net cash provided by financing activities amounted to $11,378,000 during 2000 as
compared to cash used of $26,131,000 during 1999. During the year ended December
31, 2000 the Company issued $10,000,000 of Series B Preferred Stock and realized
net proceeds of $9,100,000. During 2000 the Company made payments of $2,184,000
under Capital Leases and borrowed $1,906,000 under its revolving credit
facility. During the year ended December 31, 1999 the Company repaid $23,868,000
under a bank term loan facility and $6,173,000 under its previous Bank's
revolving line of credit.

CREDIT FACILITIES

On November 1, 1999 the Company entered into a Revolving Credit, Term Loan and
Security Agreement with PNC Bank. The Credit Facility replaced the existing
revolving credit and interim term loan facilities which the Company had with
First Union and Fleet. The Credit Facility, as amended, which has a three-year
term, consists of a formula based $10,000,000 revolving credit facility and a
$6,234,000 term loan that are secured by substantially all of the Company's
domestic assets. Revolving credit facility availability of up to S$4,000,000
Singapore dollars (approximately $2,300,000 US) is reserved for issuance of a
standby letter of credit in support of the Company's continuing guarantee of
ISP's debt. The interest rate on revolving credit borrowings are, at the
Company's option, based on either the prime rate or a floating Eurodollar rate
plus a margin of 2.75%. At the Company's option, the term loan interest rate is
based on either prime plus 0.5% or a floating Eurodollar rate plus a margin of
3.0%. Principal payments under the term loan are due in equal monthly
installments of $74,214 over the three-year term. Full payment of any
outstanding debt on the term loan is due on October 31, 2002.

In August 2000 the Company's 50.1% owned ISP subsidiary refinanced its existing
debt and entered into a credit facility with Keppel Tatlee Bank. The facility
provides for a total of S$11,950,000 (approximately $6,900,000 US) in term and
overdraft borrowings secured by ISP's property and equipment and is partially
guaranteed by the Company. Interest on the facility is payable at rates ranging
from 3.5% to 6.75% and the loans are repayable in monthly installments over a
period of five to ten years. In conjunction with the refinancing the Company was
able to reduce its guarantee of ISP's debt from S$5,000,000 Singapore dollars
(approximately $2,900,000 US) to S$4,000,000 (approximately $2,300,000 US). The
reduced guarantee is secured by a standby letter of credit of

                                      -14-
<PAGE>

up to S$4,000,000 issued by PNC Bank in favor of ISP's lenders. In the event of
default, as defined by ISP's lending agreements, Keppel Tatlee Bank could draw
down the S$4,000,000 standby letter of credit provided by the Company's Bank.

In December 1996, the Company entered into a consignment agreement (the "Gold
Consignment Agreement") with Fleet Precious Metals ("FPM") which, as amended,
expires June 30, 2002. Under the Gold Consignment Agreement, the Company
purchases gold used in its manufacturing of materials. The Gold Consignment
Agreement provides for gold on consignment not to exceed the lesser of 6,500
troy ounces of gold or gold having a market value of $2,400,000. The Gold
Consignment Agreement requires the Company to pay a consignment fee of 4.5% per
annum based upon the value of all gold consigned to the Company.

PREFERRED STOCK ISSUANCE

On June 1, 2000, the Company received $10,000,000 in gross proceeds from the
issuance of Series B Redeemable Preferred Stock to a group led by ACI Capital
Company ("ACI"). Attached to the instrument were warrants to purchase one (1)
million shares of SEMX Common Stock with an exercise price initially valued at
$10.00 per share, subject to a reset provision dependent on the underlying
market price of SEMX Common Stock, with a floor of $7.00 per share. The Company
paid approximately $900,000 in investment banking, financing, legal and
accounting fees in conjunction with the offering. Of this total approximately
$300,000 was paid to a firm affiliated with John Moorhead, who is a member of
the SEMX Board of Directors for services rendered in assistance with the
financing. Additionally, warrants to purchase an aggregate 60,000 shares of SEMX
common stock at an exercise price of $7.00 per share were issued to an
investment banking firm, a firm associated with John Moorhead, and certain other
individuals. The Series B Preferred Stock is subject to mandatory redemption in
five years and cash dividends are payable semiannually at a rate of 6%, subject
to successive rate increases in the event of uncured late payments or events of
default. The Series B Preferred Stock granted ACI the right to add two directors
to the SEMX Board of Directors.

OTHER

In conjunction with the Company's acquisition of Polese Company on May 27, 1993,
the Company acquired from Frank J. Polese, the former sole shareholder of Polese
Company, all of the rights, including a subsequently issued patent, for certain
powdered metal technology and its application to the electronics industry. For a
period of ten years from May 1993, Mr. Polese has the right to receive 10% of
(i) the pre-tax profit from the copper tungsten product line, after allocating
operating costs and (ii) the proceeds of the sale, if any, by the Company of the
powdered metal technology. During 2000, the Company charged against operations a
total of $249,000 under this agreement.

The Company continually seeks to broaden its product lines by various means,
including acquisitions. The Company intends to pursue only those acquisitions
for which it will be able to arrange the necessary financing by means of the
issuance of additional equity, the use of its cash or, through bank or other
debt financing.

FORWARD LOOKING STATEMENTS

Portions of the narrative set forth in this document that are not historical in
nature are forward looking statements. These forward-looking statements speak
only as of the date of this document, and the Company expressly disclaims any
obligation or undertaking to publicly release any updates or revisions to any
forward-looking statements contained herein. The Company's actual performance
may differ materially from that contemplated by the forward looking statements
as a result of a variety of factors that include, but are not limited to, the
general economic or business climate, business conditions of the microelectronic
and semiconductor markets and the automotive and communications industry which
the Company serves and the economic volatility in geographic markets, such as
Asia.

ITEM 7(A): QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Not applicable.

ITEM 8: FINANCIAL STATEMENTS


                                      -15-
<PAGE>

The Company's consolidated financial statements are set forth herein in Part IV
beginning at Page F-1.

ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

None.



                                      -16-
<PAGE>

                                    PART III

ITEM 10, 11, 12 AND 13: Directors and Executive Officers of the Registrant,
Executive Compensation, Security Ownership of Certain Beneficial Owners and
Management, and Certain Relationships and Related Transactions.

The information required by these Items is omitted because the Company will file
a definitive proxy statement pursuant to Regulation 14A with the Commission, not
later than 120 days after the end of the fiscal year, which information is
herein incorporated by reference as if set out in full.



                                      -17-
<PAGE>

                                     PART IV

ITEM 14: EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

The following is an index of the financial statements of the Company which are
incorporated herein.

(a) (1) Financial Statements:

<TABLE>
<CAPTION>
        <S>                                                                  <C>
        Report of Independent Auditors'                                          F-2

        Consolidated Balance Sheet as of December 31, 2000 and 1999              F-3

        Consolidated Statement of Income for the Years
        Ended December 31, 2000, 1999 and 1998                                   F-4

        Consolidated Statement of Shareholders' Equity for the Years
        Ended December 31, 2000, 1999 and 1998                                   F-5

        Consolidated Statement of Cash Flows for the Years
        Ended December 31, 2000, 1999 and 1998                                   F-6

        Notes to Consolidated Financial Statements                           F-7 - F-20
</TABLE>

(a) (2) Financial Statement Schedules:

All schedules have been omitted because of the absence of conditions under which
they are required or because the required information is given in the above
financial statements or the notes thereto included in this report.

     (b) Reports on Form 8-K

An 8-K Report was filed on September 25, 2000 disclosing a report regarding the
Company to brokers and potential market makers in satisfaction of the
requirements of Regulation FD.

(a) (3) Exhibits:

3.1           Certificate of Incorporation of the Company (1)

3.2           Amendment to Certificate of Incorporation (1)

3.3           Bylaws of the Company (1)

10.10         (a) Company's Employee Stock Option Plan (4)

              (b) Company's Amended Employee Stock Option Plan (6)

10.12         (a) Stock Purchase Agreement dated April 30, 1993 by and between
                  Registrant and Frank J. Polese (5)

              (b) Asset Purchase Agreement dated April 30, 1993 by and between
                  the Registrant and Frank J. Polese (5)

10.49         1994 Amendment to Employees' Incentive Stock Option Plan (9)


                                      -18-
<PAGE>

10.50         1995 Amendment to Employees' Incentive Stock Option Plan (9)

10.58         Joint Venture Agreement dated August 28, 1996 between
              Semiconductor Alliance Pte Ltd., the Company and International
              Semiconductor Products Pte Ltd. (11)

10.59         Intellectual Property License Agreement dated August 28, 1996
              between American Silicon Products, Inc. and International
              Semiconductor Products Pte Ltd. (11)

10.60         Purchase Agreement dated as of January 16, 1997 between American
              Silicon Products, Inc. and Air Products & Chemicals, Inc. (12)

10.63         Fifth Amendment and Forbearance Agreement among SEMX Corporation
              and Subsidiaries and First Union Bank dated as of January 13, 1999
              (14)

10.64         Asset Purchase Agreement by and among Litton Systems, Incorporated
              and SEMX Corporation, Retconn Incorporated, S.T. Electronics, Inc.
              and Retconn SPM (Malaysia) SDN. BHD. Dated as of January 26, 1999
              and related documents (14)

10.65         Sixth Amendment and Forbearance Agreement among SEMX Corporation
              and Subsidiaries and First Union National Bank dated as of
              February 19, 1999 (14)

10.66         Rights Agreement, dated as of June 15, 1999, between the Company
              and Continental Stock Transfer and Trust Company (15)

10.67         Seventh Amendment and Forbearance Agreement among SEMX Corporation
              and Subsidiaries and First Union National Bank dated as of
              June 29,1999 (16)

10.68         Employment agreement dated as of August 1, 1999 between the
              Company and Gilbert D. Raker (16)

10.69         Employment agreement dated as of August 1, 1999 between the
              Company and Frank J. Polese (16)

10.70         Revolving Credit, Term Loan and Security Agreement between the
              Company and Subsidiaries and PNC Bank National Association (as
              agent and lender) dated November 1, 1999 (17)

10.71         Seventh Amendment, Waiver and Modification to the Consignment
              agreement between Fleet Precious Metal Inc. and SEMX Corporation
              dated February 1, 2000(18)

10.72         Form of Intellectual Property Protection Agreement(18)

10.73         Employment agreement dated as of May 1, 1999 between American
              Silicon Products, Inc. and SEMX Corporation and Richard Brown(18)

10.74         Agreement between International Semiconductor Products Pte Ltd.
              and Keppel Tatlee Bank dated August 2000



                                      -19-
<PAGE>

10.75         Facility Agreement between International Semiconductor Products
              Pte Ltd. and Keppel Tatlee Bank Limited dated August 2000

10.76         Employment Agreement dated as of November 27, 2000 between the
              Company and Michael R. Best

22.0          List of Subsidiaries of the Company

23.1          The Consent of Goldstein Golub Kessler LLP, the Company's
              independent certified pubic accountants, to incorporation by
              reference to Registration Statement on Form S-8 of their report
              dated February 3, 2001

              (1)      Incorporated herein by reference to the Company's
                       Registration Statement No. 33-43640-NY on Form S-18,
                       filed with the Securities and Exchange Commission on
                       November 1, 1991

              (2)      Incorporated herein by reference to the Company's Annual
                       Report for the year ended December 31, 1991, filed with
                       the Securities and Exchange Commission on March 31, 1992

              (3)      Incorporated herein by reference to Amendment No. 1 to
                       the Company's Registration Statement No. 33-43640-NY on
                       Form S-18, filed with the Securities and Exchange
                       Commission on December 6, 1991

              (4)      Incorporated herein by reference to Amendment No. 2 to
                       the Company's Registration Statement No. 33-43640-NY on
                       Form S-18, filed with the Securities and Exchange
                       Commission on December 20, 1991

              (5)      Incorporated herein by reference to Current Report on
                       Form 8-K filed with the SEC on June 11, 1993, as amended
                       by Form 8-K/A

              (6)      Incorporated herein by reference to the Company's
                       Registration Statement No. 33-70876 on Form S-3 filed,
                       with the Securities and Exchange on October 28, 1993 and
                       as amended on December 30, 1993, January 20, 1994 and
                       February 7, 1994

              (7)      Incorporated herein by reference to Current Report on
                       Form 8-K filed with the SEC on December 29, 1994

              (8)      Incorporated herein by reference to the Company's Annual
                       Report for the year ended December 31, 1995, filed with
                       the SEC for March 31, 1995

              (9)      Incorporated herein by reference to the Company's
                       Registration Statement No. 33-93502 on Form SB-2 filed,
                       with the Securities and Exchange on June 16, 1995 and as
                       amended on July 19, 1995 and July 26, 1995

              (10)     Incorporated by reference to the Company's Form 8-K filed
                       January 4, 1996

              (11)     Incorporated by reference to the Company's 10-QSB filed
                       for the quarter ended September 30, 1996

              (12)     Incorporated by reference to the Company's Form 8-K filed



                                      -20-
<PAGE>

                       February 4, 1997 and amended by Form 8-K/A

              (13)     Incorporated by reference to the Company's Annual Report
                       for the year ended December 31, 1997, filed with the
                       Securities and Exchange Commission on March 20, 1998

              (14)     Incorporated by reference to the Company's Annual Report
                       for the year ended December 31, 1998, filed with the
                       Securities and Exchange Commission on April 15, 1999

              (15)     Incorporated by reference to the Company's Form 8-K filed
                       June 24, 1999

              (16)     Incorporated by reference to the Company's 10-Q filed for
                       the third quarter ended June 30, 1999

              (17)     Incorporated by reference to the Company's 10-Q filed for
                       the third quarter ended September 30, 1999

              (18)     Incorporated by reference to the Company's Annual Report
                       for the year ended December 31, 1999 filed with the
                       Securities and Exchange Commission on March 30, 2000.






                                      -21-

<PAGE>


SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Company has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.

                                SEMX CORPORATION
                                  (Registrant)

                           By: /s/ Gilbert D. Raker
                               --------------------
                               Gilbert D. Raker, Chief Executive
                               Officer, President, Chairman of the Board of
                               Directors and Director

Dated: March 19, 2001

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Company and in
the capacities and on the date indicated.

/s/ Gilbert D. Raker                                     March 19, 2001
--------------------
Gilbert D. Raker, Chief Executive
Officer, President, Chairman of
the Board of Directors and Director

/s/ Frank J. Polese                                      March 19, 2001
-------------------
Frank J. Polese, Vice Chairman
and Director

/s/ Michael R. Best                                      March 19, 2001
----------------
Vice President, Chief Financial Officer
Principal Financial and Accounting Officer

/s/ Mark A. Pinto                                        March 19, 2001
-----------------
Mark A. Pinto, Director

/s/ John U. Moorhead, II                                 March 19, 2001
------------------------
John U. Moorhead, II, Director

/s/ Andrew Lozyniak                                      March 19, 2001
-------------------
Andrew Lozyniak, Director

/s/ Kevin A. Penn                                        March 19, 2001
-----------------
Kevin A. Penn, Director

/s/ Douglas S. Holladay, Jr.                             March 19, 2001
----------------------------
Douglas S. Holladay, Jr., Director



                                      -22-
<PAGE>

<TABLE>
<CAPTION>

                        SEMX CORPORATION AND SUBSIDIARIES
                          INDEX TO FINANCIAL STATEMENTS
=====================================================================================================

     <S>                                                                              <C>
     Independent Auditors' Report                                                           F-2

     Consolidated Balance Sheet as of December 31, 2000 and 1999                            F-3

     Consolidated Statement of Operations for the Years Ended
         December 31, 2000, 1999 and 1998                                                   F-4

     Consolidated Statement of Shareholders' Equity for the Years Ended
         December 31, 2000, 1999 and 1998                                                   F-5

     Consolidated Statement of Cash Flows for the Years Ended
         December 31, 2000, 1999 and 1998                                                   F-6

     Notes to Consolidated Financial Statements                                         F-7 - F-20
</TABLE>




                                      -F-1-
<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors
SEMX Corporation


We have audited the accompanying consolidated balance sheets of SEMX Corporation
and Subsidiaries as of December 31, 2000 and 1999 and the related consolidated
statements of operations, shareholders' equity, and cash flows for each of the
three years in the period ended December 31, 2000. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of SEMX Corporation and
Subsidiaries as of December 31, 2000 and 1999 and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2000 in conformity with accounting principles generally accepted in
the United States of America.



GOLDSTEIN GOLUB KESSLER LLP
New York, New York

February 3, 2001



                                      -F-2-
<PAGE>



<TABLE>
<CAPTION>
                        SEMX CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)
===================================================================================================================================

<S>                                                                                                   <C>             <C>
  DECEMBER 31,                                                                                             2000            1999
  --------------------------------------------------------------------------------------------------- --------------- -------------
  ASSETS
  Current Assets:
     Cash and cash equivalents                                                                          $   1,300       $     416
     Accounts receivable, less allowance for doubtful accounts of $354 and $656, respectively              11,524           7,700
     Inventories                                                                                            8,074           5,903
     Prepaid expenses and other current assets                                                              1,802           1,024
     Deferred income tax assets                                                                               165             999
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL CURRENT ASSETS                                                                                     22,865          16,042
  --------------------------------------------------------------------------------------------------- --------------- -------------
     Property, Plant and Equipment, net                                                                    44,009          34,837
  --------------------------------------------------------------------------------------------------- --------------- -------------
  Other Assets:
     Goodwill                                                                                               9,350           8,573
     Technology rights and intellectual property                                                            1,754             897
     Other                                                                                                  2,111           1,139
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL OTHER ASSETS                                                                                       13,215          10,609
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL ASSETS                                                                                          $  80,089       $  61,488
  --------------------------------------------------------------------------------------------------- --------------- -------------
  LIABILITIES AND SHAREHOLDERS' EQUITY
  Current Liabilities:
     Accounts payable                                                                                   $   6,368       $   4,262
     Accrued expenses                                                                                       2,955           2,544
     Income taxes payable                                                                                     131             589
     Current portion of long-term debt and short-term obligations                                           2,556           1,893
     Current portion of obligations under capital leases                                                    2,443           2,541
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL CURRENT LIABILITIES                                                                                14,453          11,829
  --------------------------------------------------------------------------------------------------- --------------- -------------
  Deferred Income Tax Liabilities                                                                           2,610           2,431
  Long-term Debt                                                                                           12,862           9,255
  Obligations under Capital Leases                                                                          2,983           4,080
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL LIABILITIES                                                                                        32,908          27,595
  --------------------------------------------------------------------------------------------------- --------------- -------------
  Minority Interest in Subsidiary                                                                           1,564           1,329
  Redeemable Preferred Stock:
  Preferred stock - $.10 par value; authorized 1,000,000 shares;
     Designated as Series B Preferred Stock: $.10 par value, $100 stated value;
     100,000 shares issued and outstanding;                                                                 9,073               -
  Commitments and Contingencies
  Common Shareholders' Equity:
     Common stock - $.10 par value; authorized 20,000,000 shares, issued 6,645,128 and
       6,396,241 shares, respectively                                                                         665             640
     Additional paid-in-capital                                                                            30,098          28,296
     Accumulated other comprehensive loss                                                                    (722)           (611)
     Retained earnings                                                                                      6,715           4,451
  --------------------------------------------------------------------------------------------------- --------------- -------------
                                                                                                           36,756          32,776
  Less treasury stock: 334,600 shares, at cost                                                               (212)           (212)
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL COMMON SHAREHOLDERS' EQUITY                                                                        36,544          32,564
  --------------------------------------------------------------------------------------------------- --------------- -------------
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                                            $  80,089       $  61,488
  --------------------------------------------------------------------------------------------------- --------------- -------------
</TABLE>

         The accompanying notes are an integral part of these statements


                                      -F-3-
<PAGE>

<TABLE>
<CAPTION>
                        SEMX CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     (in thousands except per share amounts)
====================================================================================================================================

YEAR ENDED DECEMBER 31,                                                                  2000             1999              1998
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Revenue:
<S>                                                                                 <C>               <C>              <C>
   Net sales                                                                        $     53,632      $     46,666     $     47,524
   Service revenue                                                                        20,457            16,858           18,379
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
                                                                                          74,089            63,524           65,903
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Cost of goods sold and services performed:
   Cost of goods sold                                                                     37,162            29,348           37,982
   Cost of services performed                                                             15,247            12,970           15,143
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
                                                                                          52,409            42,318           53,125
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Gross profit                                                                              21,680            21,206           12,778
Selling, general and administrative expenses                                              15,535            14,061           15,788
Special charges                                                                                -                 -           11,217
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Operating income (loss)                                                                    6,145             7,145          (14,227)
Gain on sale of connector business                                                             -             8,430                -
Interest expense - net                                                                    (1,665)           (1,960)          (3,475)
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Income (loss) before provision (benefit) for income taxes and minority
   interest in consolidated subsidiary                                                     4,480            13,615          (17,702)
Provision (benefit) for income taxes                                                       1,579             6,201           (5,500)
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Income (loss) before minority interest in consolidated subsidiary                          2,901             7,414          (12,202)
Minority interest in income (loss) of consolidated subsidiary                                287                31             (244)
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
Net income (loss)                                                                          2,614             7,383          (11,958)
Preferred Stock Dividends and Accretion                                                     (473)                -                -
---------------------------------------------------------------------------------- ----------------- ---------------- --------------
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS                                         $      2,141      $      7,383     $    (11,958)
================================================================================== ================= ================ ==============
Earnings (loss) per common share:
   Basic                                                                            $        .34      $       1.22     $     (1.98)
   Diluted                                                                          $        .32      $       1.19     $     (1.98)
================================================================================== ================= ================ ==============
Shares used in computing earnings (loss) per common share:
   Basic                                                                                   6,213             6,047            6,054
   Diluted                                                                                 6,601             6,223            6,054
================================================================================== ================= ================ ==============
</TABLE>

         The accompanying notes are an integral part of these statements



                                      -F-4-
<PAGE>


<TABLE>
<CAPTION>
                        SEMX CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                             (dollars in thousands)
====================================================================================================================
<S>                                                <C>           <C>           <C>            <C>

                                                                                               ACCUMULATED OTHER
                                                                                 ADDITIONAL      COMPREHENSIVE
                                                          COMMON STOCK         PAID-IN CAPITAL   INCOME (LOSS)
                                                                                               -----------------
                                                      SHARES        AMOUNT
-------------------------------------------------- ------------- ------------- --------------- -----------------
Balance at January 1, 1998                          6,375,616       $   638      $  28,199         $   (405)
Purchase of treasury stock                                  -             -              -                -
Comprehensive loss:
   Net loss                                                 -             -              -                -
   Foreign currency translation adjustment -
   net of deferred taxes of $85                             -             -              -               83
Total comprehensive loss                                    -             -              -                -
-------------------------------------------------- ------------- ------------- --------------- -----------------
Balance at December 31, 1998                        6,375,616           638         28,199             (322)
Proceeds from exercise of stock options                20,625             2             56                -
Compensation expense from stock grants                      -             -             41                -
Comprehensive income:
   Net Income                                               -             -              -                -
   Foreign currency translation adjustment -
   net of deferred taxes of $160                            -             -              -             (289)
Total comprehsensive income                                 -             -              -                -
-------------------------------------------------- ------------- ------------- --------------- -----------------
Balance at December 31, 1999                        6,396,241           640         28,296             (611)
Proceeds from exercise of stock options               153,929            16            369                -
Issuance of shares for acquisitions                    94,958             9          1,416                -
Issurance of common stock warrants                          -             -            250                -
Common stock warrants issuance costs                        -             -           (110)               -
Dividends and cost accretion on preferred stock             -             -           (123)               -
Comprehensive Income:
   Net Income                                               -             -              -                -
   Foreign currency translation adjustment -
   net of deferred taxes of $84                             -             -              -             (111)
Total comprehensive income                                  -             -              -                -
-------------------------------------------------- ------------- ------------- --------------- -----------------
Balance at December 31, 2000                        6,645,128        $  665      $  30,098          $  (722)
================================================== ============= ============= =============== =================
</TABLE>


<PAGE>


<TABLE>
<CAPTION>

<S>               <C>           <C>           <C>


    RETAINED
    EARNINGS            TREASURY STOCK              TOTAL
  (ACCUMULATED                                  SHAREHOLDERS'
    DEFICIT)         SHARES        AMOUNT          EQUITY
----------------- ------------- ------------- ------------------
   $   9,026       (300,000)      $      -        $   37,458
           -        (34,600)          (212)             (212)

     (11,958)             -              -                 -

           -              -              -                 -
           -              -              -           (11,875)
----------------- ------------- ------------- ------------------
      (2,932)      (334,600)          (212)           25,371
           -              -              -                58
           -              -              -                41

       7,383              -              -                 -

           -              -              -                 -
           -              -              -             7,094
----------------- ------------- ------------- ------------------
       4,451       (334,600)          (212)           32,564
           -              -              -               385
           -              -              -             1,425
           -              -              -               250
           -              -              -              (110)
        (350)             -              -              (473)

       2,614              -              -                 -


           -              -              -                 -
           -              -              -             2,503
----------------- ------------- ------------- ------------------
   $   6,715       (334,600)     $    (212)       $   36,544
================= ============= ============= ==================
</TABLE>


         The accompanying notes are an integral part of these statements


                                      -F-5-
<PAGE>


                        SEMX CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                             (dollars in thousands)
<TABLE>
<CAPTION>

===================================================================================================================================
<S>                                                                                <C>               <C>              <C>
YEAR ENDED DECEMBER 31,                                                                  2000             1999              1998
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
Cash flows from operating activities:
   Net income (loss)                                                                  $   2,614         $   7,383        $ (11,958)
Adjustments  to  reconcile  net income  (loss) to net cash  provided by operating
activities:
   Gain on sale of connector business                                                         -            (8,430)               -
     Write-offs and accrued special charges                                                   -                 -            9,267
     Gain on sale of property, plant and equipment                                            -               (11)               -
     Depreciation and amortization of property, plant and equipment                       5,438             5,079            5,182
     Other amortization                                                                     619               629            1,022
     Compensation expense from issuance of stock grants                                       -                41                -
     Deferred income taxes                                                                1,013             4,906           (5,542)
     Minority interest in subsidiary income (loss)                                          287                31             (244)
   Changes in operating assets and liabilities:
     (Increase) decrease in accounts receivable                                          (3,923)           (2,007)           2,641
     (Increase) decrease in inventories                                                  (2,067)           (1,537)           1,994
     (Increase) decrease in prepaid expenses and other current assets                      (661)             (217)             539
     Increase (decrease) in accounts payable                                              2,141               (67)          (2,136)
     Increase (decrease) in accrued expenses                                                353              (497)             107
     Increase (decrease) in income taxes payable                                           (440)              579                -
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
         NET CASH PROVIDED BY OPERATING ACTIVITIES                                        5,374             5,882              872
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
Cash flows from investing activities:
     Purchase of property and equipment                                                 (13,218)           (2,719)          (3,063)
     Net proceeds from sales of connector business                                            -            22,191                -
     Payments for acquisition of subsidiaries, net of cash acquired                      (1,858)                -                -
     Proceeds from sale of property and equipment                                             -                64                -
     (Increase) decrease in other assets                                                   (741)               25              129
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
       NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                              (15,817)           19,561           (2,934)
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
Cash flows from financing activities:
     Proceeds from exercise of stock options                                                385                58                -
     Net proceeds under revolving credit                                                  1,906               528            4,925
     Payments under capital leases                                                       (2,184)           (2,487)          (2,222)
     Payments under long-term debt                                                       (2,546)          (30,041)          (3,371)
     Proceeds from long-term debt                                                         4,918             6,234            1,796
     Net Proceeds from issuance of Preferred Stock                                        9,100                 -                -
     Payment of Dividends on preferred stock                                               (201)                -                -
     Payment of financing costs                                                               -              (423)               -
     Purchase of treasury stock                                                               -                 -             (212)
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
       NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                               11,378           (26,131)             916
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
     Effect of foreign translation on cash                                                  (51)              (37)              27
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
     Net increase (decrease) in cash and cash equivalents                                   884              (725)          (1,119)
     Cash and cash equivalents at beginning of year                                         416             1,141            2,260
---------------------------------------------------------------------------------- ----------------- ---------------- -------------
     Cash and cash equivalents at end of year                                         $   1,300         $     416        $   1,141
================================================================================== ================= ================ =============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the year
     for:
     Interest                                                                         $   1,626         $   2,111        $   3,623
================================================================================== ================= ================ =============
     Income taxes                                                                     $   1,468         $     664        $     285
================================================================================== ================= ================ =============
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
     Machinery and equipment, net of trade-in, acquired under capital lease           $     991         $     896        $   3,078
================================================================================== ================= ================ =============
     Intellectual property rights acquired with restricted Common Stock               $   1,000         $       -        $       -
================================================================================== ================= ================ =============
     Acquisition finders' fee paid with non qualified stock options                   $     426         $       -        $       -
================================================================================== ================= ================ =============
</TABLE>

         The accompanying notes are an integral part of these statements



                                      -F-6-
<PAGE>

                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                              (dollars in thousands)
===============================================================================

1.     PRINCIPAL BUSINESS ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING
       POLICIES:

       The accompanying consolidated financial statements include the accounts
       of SEMX Corporation ("SEMX") and its wholly owned and majority-owned
       subsidiaries (collectively the "Company"). All significant intercompany
       transactions and balances have been eliminated.

       The Company manufactures proprietary thermal management materials,
       microelectronic packages and products, and interconnect components in its
       Microelectronic Packaging Group for its target markets - the fiber optic,
       wireless and Internet infrastructure industries. It is committed to
       leveraging its strengths in advanced materials technology and
       microelectronics assembly through vertical and horizontal integration and
       will continue to enhance its capabilities through internal development
       and acquisition of synergistic technologies. In addition, the
       Company's Wafer Reclaim Services Group reclaims silicon test wafers
       for the semiconductor industry through facilities located in North
       America, Europe and Asia, making it a wafer reclaim service with a
       worldwide presence.

       The Company operates in two business segments consisting of the
       Microelectronic Packaging Group and the Wafer Reclaim Services Group. The
       Microelectronic Packaging Group includes the Company's SPM division,
       Polese Company, Inc. ("Polese") and Retconn (through the February 1999
       disposition). The Wafer Reclaim Services Group includes the Company's
       American Silicon Products, Inc. ("ASP"), American Silicon Products B.V.
       ("ASP B.V.") and 50.1% owned International Semiconductor Products Pte
       Ltd. ("ISP"), business units.

       Revenue from the sale of products is generally recognized at the date of
       shipment to customers. Service revenue is recognized when the services
       are performed.

       The Company considers all investments purchased with an original maturity
       of three months or less to be cash equivalents.

       The Company maintains cash in bank accounts, which, at times, may exceed
       federally insured limits. The Company has not experienced any loss on
       these accounts.

       The financial position and results of operations of the Company's foreign
       subsidiaries are measured using local currency as the functional
       currency. Assets and liabilities of these subsidiaries have been
       translated at current exchange rates, and related revenue and expenses
       have been translated at average monthly exchange rates. The aggregate
       effect of translation adjustments net of deferred taxes is reflected as a
       separate component of shareholders' equity until there is a sale or
       liquidation of the underlying foreign investment.

       Inventories, which consist principally of work-in-process inventory,
       include raw materials, labor and manufacturing expenses and are stated at
       the lower of cost, determined by the first-in, first-out method, or
       market.

       Deferred income taxes arise from differences in bases between tax
       reporting and financial reporting (see Note 8).

       Depreciation and amortization of property and equipment is provided for
       by the straight-line method over the estimated useful lives of the
       related assets.

       The preparation of financial statements in conformity with generally
       accepted accounting principles requires the use of estimates by
       management affecting the reported amounts of assets and liabilities and
       revenue and expenses and the disclosure of contingent assets and
       liabilities. Actual results could differ from those estimates.



                                      -F-7-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       For comparability, certain 1999 amounts have been reclassified, where
       appropriate, to conform to the financial statement presentation used in
       2000.

       The excess of cost over fair value of net assets acquired (Goodwill),
       amounting to approximately $11,800 and $10,597 at December 31, 2000 and
       1999, respectively, is being amortized over periods ranging from 15 to 40
       years using the straight-line method (see Note 2). Accumulated
       amortization at December 31, 2000 and 1999 was approximately $2,450 and
       $2,024, respectively. The Company reviews the carrying value of Goodwill
       for impairment, periodically or whenever events or changes in
       circumstances indicate that the amounts may not be recoverable. The
       review for recoverability includes an estimate by the Company of the
       future undiscounted cash flows expected to result from the use of the
       assets acquired and their eventual disposition. An impairment will be
       recognized if the carrying value of the assets exceeds the estimated
       future undiscounted cash flows of those assets (see Note 13).

       Certain technology rights, proprietary rights and intellectual property,
       amounting to approximately $2,343 and $1,333 at December 31, 2000 and
       1999, respectively, are being amortized over periods ranging from 11 to
       17 years using the straight-line method. Accumulated amortization at
       December 31, 2000 and 1999 was approximately $589 and $436, respectively.

       The Company elected to measure compensation cost using APB Opinion No. 25
       as is permitted by Statement of Financial Accounting Standards ("SFAS")
       No. 123, Accounting for Stock-Based Compensation, and has elected to
       comply with other provisions and the disclosure-only requirements of SFAS
       No. 123 (see Note 10).

       Basic earnings per common share are computed using the weighted-average
       number of shares outstanding. Diluted earnings per common share is
       computed using the weighted-average number of shares outstanding adjusted
       for the incremental shares attributed to outstanding options to purchase
       common stock. Incremental shares of 387,198 in 2000 and 175,878 in 1999
       were used in the calculation of diluted earnings per common share. No
       incremental shares were used in the 1998 calculation of diluted earnings
       per common share since they would have had an antidilutive effect.

       The Company does not believe that any recently issued but not yet
       effective accounting standards will have a material effect on the
       Company's consolidated financial position, results of operations or cash
       flows.

2.     ACQUISITIONS AND DISPOSITIONS:

       On May 1, 2000, the Company's Polese subsidiary purchased the technology
       and assets of Engelhard Corporation's ("Engelhard") electroless gold
       plating business in Anaheim, CA for total cash consideration of $317. In
       addition, a finders' fee consisting of Non Qualified Stock options to
       purchase 40,000 shares of SEMX Common stock, valued at $426 was recorded.
       The fair value of assets acquired, including $426 allocated to Goodwill,
       amounted to $743. Electroless gold plated deposits satisfy manufacturing
       requirements for wire bonding, die-attachment and corrosion resistance,
       but eliminate many of the design restrictions brought about by
       conventional electrolytic gold plating. Polese Company vacated the
       Anaheim premises as of July 31, 2000 and has completed the integration of
       the electroless gold plating operations into Polese Company's existing
       facilities as of October 2000.

       On April 10, 2000, the Company's Polese Company subsidiary acquired the
       assets of Advanced Packaging Concepts ("APC"), a Vista, CA based
       manufacturer of ceramic packages for the wireless markets, in a business
       combination accounted for as a purchase. Polese Company acquired the
       assets of APC for $300 in cash and assumed selected liabilities amounting
       to $1,000 which was financed in part by a $1,000 interim term loan that
       was repaid during the second quarter of 2000. In addition, Polese Company
       paid approximately $241 in costs associated with the acquisition of APC.

       The fair value of assets acquired,


                                      -F-8-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       including approximately $817 allocated to Goodwill, amounted to
       approximately $1,541. In a companion transaction, associated intellectual
       property rights were acquired for approximately 95,000 shares of
       restricted SEMX common stock, valued at $1,000. The transaction provides
       the sellers of APC a royalty of 2-1/2% against future sales to certain
       existing customers for a period of three years. At closing, the Company
       advanced a total of $150 to the sellers against this royalty. The Company
       vacated the Vista premises as of July 31, 2000 and has completed the
       integration of APC's operations into Polese Company's existing facilities
       in October, 2000. The results of operations of APC are included in the
       Company's consolidated financial statements from the dates of
       acquisition. The effects of the operations of APC from January 1, 1999 to
       the date of the acquisition on Company's results of operations was
       immaterial.

       In February 1999, the Company sold its connector businesses, Retconn and
       ST, to Litton Corporation ("Litton"). Litton acquired the specified
       assets and assumed certain liabilities of Retconn and ST, as defined in
       the purchase agreement, in consideration for a cash payment to the
       Company of $23,871. The liabilities assumed by Litton amounted to
       approximately $3,500. The purchase price was subject to adjustment for
       changes in Retconn's closing date balance sheet and in December, 1999 the
       Company paid Litton $320 in settlement of the final purchase price
       adjustment. In addition, the Company is prevented from directly competing
       in the connector business for a period of three years. The Company
       recorded a pretax gain, during the first quarter of 1999, of $8,430 on
       the transaction.

3.     INVENTORIES:

       The components of inventories are as follows:

DECEMBER 31,                                       2000            1999
--------------------------------------------- --------------- ---------------
Precious metals                                  $  1,498        $  1,243
Nonprecious metals                                  6,576           4,660
--------------------------------------------- --------------- ---------------
                                                 $  8,074        $  5,903
============================================= =============== ===============

       The Company has a consignment arrangement with a bank, as described in
       Note 9, which provides for the leasing of precious metals by the Company.
       The Company pays for these precious metals based on actual usage.

4.     PROPERTY, PLANT AND EQUIPMENT:

       Property, plant and equipment, at cost, consists of the following:

<TABLE>
<CAPTION>
         <S>                                                    <C>                   <C>                  <C>
                                                                                                               ESTIMATED
         DECEMBER 31,                                                  2000                 1999              USEFUL LIFE
         ------------------------------------------------------ -------------------- -------------------- --------------------
         Land                                                         $   2,169            $     642
         Buildings and leasehold improvements                            13,545                10,856         3 to 39 years
         Machinery and equipment                                         50,424                40,771         2 to 15 years
         Construction-in-progress                                         1,134                  877
         ------------------------------------------------------ -------------------- -------------------- --------------------
                                                                         67,272               53,146
         Less accumulated depreciation and amortization                  23,263               18,309
         ------------------------------------------------------ -------------------- -------------------- --------------------
         Property, plant and equipment, net                           $  44,009            $  34,837
         ====================================================== ==================== ==================== ====================
</TABLE>

                                      -F-9-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       Included in machinery and equipment are approximately $16,220 and $15,229
       at December 31, 2000 and 1999 respectively, of property acquired under
       capital leases. Amortization of these assets is included in depreciation
       and amortization expense. Accumulated amortization of these assets
       amounted to approximately $6,444 and $5,486 at December 31, 2000 and
       1999, respectively. The property held under these leases is collateral
       for the related capital lease obligations described in Note 7. Included
       in machinery and equipment and in leasehold improvements are $15 and $63,
       respectively, of capitalized interest for the year ended December 31,
       2000.

5.       ACCRUED EXPENSES:

       Accrued expenses consist of the following:

<TABLE>
<CAPTION>
                DECEMBER 31,                                                                2000             1999
                --------------------------------------------------------------------- ----------------- ----------------
<S>                                                                                       <C>               <C>
                Accrued payroll, bonuses and vacations                                    $ 1,161           $ 1,423
                Other (all amounts are less than 5% of total current liabilities)           1,794             1,121
                --------------------------------------------------------------------- ----------------- ----------------
                                                                                          $ 2,955           $ 2,544
                ===================================================================== ================= ================
</TABLE>

6.       LONG-TERM DEBT AND SHORT-TERM OBLIGATIONS:

     Long-term debt and short-term obligations consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,                                               2000              1999
---------------------------------------------------- ----------------- -----------------
<S>                                                    <C>               <C>
Term loan (a) (g)                                      $   5,271         $   6,159
Line of credit (b) (g)                                     2,434               528
Term loan (c) (h)                                          2,473                 -
Term loan and overdraft facility (d) (h)                   4,362             3,895
Term loan (e) (h)                                            530               556
Term loan (f) (h)                                            348                 -
Other                                                          -                10
---------------------------------------------------- ----------------- -----------------
Total long-term debt and short-term obligations           15,418            11,148
Less current maturities                                    2,556             1,893
---------------------------------------------------- ----------------- -----------------
Long-term debt                                         $  12,862         $   9,255
==================================================== ================= =================
</TABLE>

(a)         The Company entered into a Term Loan and Security Agreement (and a
            revolving credit agreement discussed in (b)) in November 1999 with
            PNC Bank N.A. ("PNC") which has a three-year term and is secured by
            substantially all of the Company's domestic assets. The term loan
            interest, at the Company's option, is based on either prime plus
            1/2% or a floating Eurodollar rate plus an additional margin of 3%.
            At December 31, 2000, the interest rate was 10.0%. The term loan is
            payable in equal monthly installments of $74.

(b)         Pursuant to the November 1999 financing with PNC, the Company
            entered into a Revolving Credit Borrowing and Security Agreement, as
            amended ("the revolving credit facility"). The revolving credit
            facility has a three-year term and provides for up to $10,000 in
            borrowings based upon eligible accounts receivable and inventory.
            The revolving credit facility includes a standby letter of credit
            for approximately $2,300 (S$4,000 Singapore dollars) reserved for
            possible issuance under a continuing guarantee of a foreign
            subsidiary's debt. The


                                     -F-10-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

           interest rate is based on either prime or a floating Eurodollar rate
           plus a margin of 2.75%. At December 31, 2000, the interest rate was
           9.5% and the excess revolving credit borrowing availability was
           $4,907.

(c)        In conjunction with the purchase of a building in December 2000, the
           Company entered into a term loan with CNL Bank, in the principal
           amount of $2,473. The term loan bears interest at a fixed rate of
           10.05% with principal payable monthly over 25 years, and is subject
           to a prepayment penalty for the first five years.

(d)        In August 2000, the Company's 50.1% owned ISP subsidiary refinanced
           its existing debt and entered into a credit facility with Keppel
           Tatlee Bank. The facility provides for a total of S$11,950
           (approximately $6,900 US) in term and overdraft borrowings secured by
           ISP's property and equipment and partially guaranteed by the Company.
           Interest on the facility is payable at rates ranging from 3.5% to
           6.75% and the loans are repayable in monthly installments over a
           period of 5 to 10 years. In conjunction with the refinancing, the
           Company was able to reduce its guarantee of ISP's debt from S$5,000
           (approximately $2,900 US) to S$4,000 (approximately $2,300 US). The
           reduced guarantee is secured by a standby letter of credit of up to
           S$4,000 issued by PNC Bank in favor of ISP's lenders. In the event of
           default, as defined by ISP's lending agreements, Keppel Tatlee Bank
           could draw down the S$4,000 standby letter of credit provided by the
           Company's Bank.

(e)        In conjunction with the acquisition of a building, the Company
           entered into a term loan with a foreign bank in August 1998 in the
           principal amount of 1,300 Dutch Guilders (approximately $556
           translated at December 31, 2000 exchange rates). The loan bears
           interest at 5.25% for three years which increases to 5.5% for the
           remaining life of the loan and is payable in quarterly installments
           of approximately $9, plus interest, which commenced on December 15,
           1998. The facility matures in 2018.


(f)        In addition, the Company entered into a 1,000 Dutch Guilder
           (approximately $427 translated at December 31, 2000 exchange rates)
           overdraft facility with the foreign bank, which is collateralized by
           accounts receivable. Interest is payable monthly at the rate of 1.75%
           plus the central bank's promissory note discount rate. The facility
           matures in 2018.

(g)        Because the interest rates will change with changes in the prime rate
           and Eurodollar rate, the fair value of the bank debt approximates the
           carrying amount.

(h)        Based on market rates currently available to the Company for loans
           with similar terms and maturities, the fair value of the long-term
           debt does not vary significantly from the carrying amount.


       Maturities of long-term debt and short-term obligations are as follows:

         YEAR ENDING DECEMBER 31,
                   2001                       $   2,556
                   2002                           7,418
                   2003                             616
                   2004                             619
                   2005                             622
                Thereafter                        3,587
         ------------------------            -----------
                                               $ 15,418
         ========================            ===========

       The above bank loan agreements provide, among other things, that the
       Company is subject to restrictions related to the issuance of additional
       indebtedness, additional liens and security interests, capital
       expenditures and the payment of dividends. In addition, the above loans
       are collateralized by a blanket lien on substantially all the Company's
       assets, and require that the Company maintain a specific financial ratio.
       As of December 31, 2000, the Company is in compliance with all of its
       bank covenants.

7.     OBLIGATIONS UNDER CAPITAL LEASES:



                                     -F-11-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       The Company is the lessee of property and equipment acquired under
capital leases expiring in various years through 2005.

       Future lease payments under capital leases are as follows:


          YEAR ENDING DECEMBER 31,
                    2001                       $   2,822
                    2002                           2,007
                    2003                             845
                    2004                             331
                    2005                              90
--------------------------------------------- ------------
                                                   6,095
Less amount representing interest                    669
--------------------------------------------- ------------
                                                   5,426
Less current portion                               2,443
--------------------------------------------- ------------
                                               $   2,983
============================================= ============

       Interest rates on these capital leases range from 7.42% to 16.67% per
annum.

8.       INCOME TAXES:

       The provision (benefit) for income taxes for the years ended December 31,
       2000, 1999 and 1998 consists of the following components:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,                             2000              1999             1998
--------------------------------------------- ----------------- ----------------- ----------------
Current:
<S>                                              <C>               <C>               <C>
   Federal                                       $    522          $    312          $      -
   State                                               45               983                42
Deferred:
  Federal                                             654             5,152            (4,876)
  State                                                35               (94)             (113)
  Foreign                                             323              (152)             (553)
--------------------------------------------- ----------------- ----------------- ----------------
                                                 $  1,579          $  6,201          $ (5,500)
============================================= ================= ================= ================
</TABLE>

       The provision (benefit) for income taxes for the years ended December 31,
       2000, 1999 and 1998 differs from the amount computed using the federal
       statutory rate of 34% as a result of the following:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,                                               2000             1999              1998
--------------------------------------------------------------- ----------------- ---------------- -----------------
<S>                                                                    <C>               <C>             <C>
Tax at federal statutory rate                                          34.0%             34.0%           (34.0)%
Change in valuation allowance                                          (1.0)                -              4.3
State tax credit carryforwards generated                               (0.6)             (1.4)            (1.5)
State income tax provision (benefit), net of federal tax effect         1.5               4.8             (3.3)
Effect of permanent differences                                         2.1               7.7              1.8
Other                                                                  (0.8)              0.4              1.6
--------------------------------------------------------------- ----------------- ---------------- -----------------
                                                                       35.2%             45.5%           (31.1)%
=============================================================== ================= ================ =================
</TABLE>


                                     -F-12-
<PAGE>

                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================



       The tax effects of available tax carryforwards and temporary differences
       that give rise to the net short-term deferred income tax asset are
       presented below:

<TABLE>
<CAPTION>
DECEMBER 31,                                                          2000             1999
--------------------------------------------------------------- ----------------- ----------------
<S>                                                                <C>               <C>
Federal net operating loss and tax credit carryforwards            $      -          $    617
Other                                                                   165               382
--------------------------------------------------------------- ----------------- ----------------
                                                                   $    165          $    999
=============================================================== ================= ================
</TABLE>

       The tax effects of available tax carryforwards, temporary differences and
       foreign currency translation adjustments that give rise to the net
       long-term deferred income tax liabilities are presented below:

<TABLE>
<CAPTION>
DECEMBER 31,                                                          2000             1999
--------------------------------------------------------------- ----------------- ----------------
Deferred income tax liabilities:
<S>                                                                <C>               <C>
   Accelerated depreciation                                        $  3,740          $  3,818
   Basis difference in amortization of intangibles                      797               835
--------------------------------------------------------------- ----------------- ----------------
     TOTAL DEFERRED INCOME TAX LIABILITIES                            4,537             4,653
--------------------------------------------------------------- ----------------- ----------------
Deferred income tax assets:
   Net loss in foreign subsidiaries                                     533               838
   State tax, net operating loss carryforward                           644               694
   State investment tax credit carryforward                             825               781
   Accumulated translation adjustment                                   460               460
   Other                                                                172               202
--------------------------------------------------------------- ----------------- ----------------
     TOTAL DEFERRED INCOME TAX ASSET                                  2,634             2,975
   Less valuation allowance                                            (707)             (753)
--------------------------------------------------------------- ----------------- ----------------
     NET DEFERRED INCOME TAX ASSET                                    1,927             2,222
--------------------------------------------------------------- ----------------- ----------------
     NET LONG-TERM DEFERRED INCOME TAX LIABILITIES                 $  2,610          $  2,431
=============================================================== ================= ================
</TABLE>

       At December 31, 2000, the Company has state net operating loss
       carryforwards aggregating $13,995, which expire through 2005. State
       investment tax credit and research credit carryforwards aggregating $929
       at December 31, 2000 expire at various dates from 2003 through 2015. A
       valuation allowance has been established for the tax effect of those
       state net operating loss carryforwards and state investment tax credit
       and research credit carryforwards which are not expected to be realized.

       The Company files a consolidated federal income tax return that includes
       the results of all its domestic subsidiaries and separate state and local
       income tax returns.



                                     -F-13-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

9.       COMMITMENTS, CONTINGENCIES AND RELATED PARTY TRANSACTIONS:

       The Company has noncancelable operating leases expiring through 2004 for
       the rental of office and manufacturing facilities. The leases also
       require payments for real estate taxes and other operating costs. The
       Company also leases land at one of its foreign subsidiaries. This lease
       expires in January 2026 with an option to renew for an additional 29
       years.

       Approximate minimum future rental payments, exclusive of payments for
       real estate taxes and other operating costs under these leases, are as
       follows:

          YEAR ENDING DECEMBER 31,
                    2001                                            $   745
                    2002                                                752
                    2003                                                754
                    2004                                                395
                    2005                                                279
                 Thereafter                                           1,270
--------------------------------------------- ---------------------------------
                                                                    $ 4,195
============================================= =================================

       Rent expense charged to operations for the years ended December 31, 2000,
       1999 and 1998 amounted to $618, $741 and $853, respectively.

       The Company has employment agreements with five officers (the "Officers")
       expiring through 2004. The approximate aggregate commitment for future
       salaries, excluding bonuses, under these employment agreements is as
       follows:

          YEAR ENDING DECEMBER 31,
                    2001                                          $     873
                    2002                                                640
                    2003                                                250
                 Thereafter                                             125
--------------------------------------------- ---------------------------------
                                                                  $   1,888
============================================= =================================

       The employment agreement with one of these Officers automatically extends
       for one year and for two Officers automatically extend on a year to year
       basis unless modified or terminated by one of the parties.

       The Officers have agreed not to engage in a business that is competitive
       with the Company during the term of their agreement and for a period of
       one year thereafter.

       In December 1996, the Company entered into a consignment agreement (the
       "Gold Consignment Agreement") with Fleet Precious Metals ("FPM") which,
       as amended, expires June 30, 2002. Under the Gold Consignment Agreement,
       the Company purchases gold used in its manufacturing of materials. The
       Gold Consignment Agreement provides for gold on consignment not to exceed
       the lesser of 6,500 troy ounces of gold or gold having a market value of
       $2,400. The Gold Consignment Agreement requires the Company to pay a
       consignment fee of 4.5% per annum based upon the value of all gold
       consigned to the Company. At December 31, 2000, the Company's obligation
       under the Gold Consignment Agreement was approximately 3,776 troy ounces
       of gold valued at approximately $1,016.

       An investigation by the Securities and Exchange Commission ("SEC") into
       certain sales of the Company's common stock during


                                     -F-14-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       1996 is continuing. As a general matter, the SEC takes the position that
       its investigation should not be construed as an indication that any
       violations of law have occurred or as an adverse reflection upon any
       person or security. The Company and any corporate personnel involved have
       cooperated fully with the SEC in its investigations.

       In connection with the Company's acquisition of Polese in 1993, for a
       period of 10 years from the date of acquisition, the former sole
       shareholder of Polese and a current executive officer of the Company, is
       entitled to receive 10% of (i) the pretax profit from the Company's
       copper/tungsten product line after allocating operating costs, and (ii)
       the proceeds of the sale, if any, by the Company of the powdered metal
       technology. Amounts due pursuant to this agreement will be charged to
       operations as incurred. For the year ended December 31, 2000, 1999 and
       1998 $249, $500, and $0, respectively has been charged to operations
       pursuant to this agreement.

10.    CAPITAL TRANSACTIONS:

       REDEEMABLE PREFERRED STOCK: On June 1, 2000, the Company received $10,000
       in gross proceeds from Series B Redeemable Preferred Stock from a group
       led by ACI Capital Company ("ACI"). Attached to the instrument were
       warrants to purchase 1 million shares of SEMX Common Stock with an
       exercise price initially valued at $10.00 per share, subject to a reset
       provision dependent on the underlying market price of SEMX Common Stock,
       with a floor of $7.00 per share. On the accompanying Balance Sheet, a
       value of $250 was assigned to the warrants and an initial value of $9,750
       was assigned to the redeemable preferred stock. The $250 value assigned
       to the warrants was credited to additional paid in capital and will be
       accreted to the value of the Series B Preferred Stock over the five year
       term. The Company paid approximately $900 in investment banking,
       financing, legal and accounting fees in conjunction with the offering. A
       total of $800 of the fees associated with the offering were accounted for
       as a reduction in the carrying value of the preferred stock on the
       accompanying balance sheet and will be accreted to the value of the
       Series B Preferred Stock over the five year term. The remaining
       costs were allocated to expenses of issuing the warrants and were charged
       to paid in capital. Of this total approximately $300 was paid to a firm
       affiliated with John Moorhead, who is a member of the SEMX Board of
       Directors for services rendered in assistance with the financing.
       Additionally, warrants to purchase an aggregate 60,000 shares of SEMX
       common stock at an exercise price of $7.00 per share were issued to an
       investment banking firm; a firm associated with John Moorhead; and
       certain other individuals. The Series B Preferred Stock is subject to
       mandatory redemption in five years for $10,000 and cash dividends are
       payable semiannually at a rate of 6%, and in preference to any dividends
       on the Company's Common Stock, and are subject to successive rate
       increases in the event of uncured late dividend payments or other events
       of default. The Liquidation Preference of the Series B Preferred Stock is
       equal to the stated value plus accrued and unpaid dividends to the date
       of liquidation. The Series B Preferred Stock granted ACI the right to add
       two directors to the SEMX Board of Directors.

       SHAREHOLDER RIGHTS PLAN: On March 26, 1999, the Company's Board of
       Directors unanimously adopted a shareholder rights plan (the "Rights
       Plan"), commonly referred to as a "poison pill". Under the Rights Plan,
       shareholders of record on June 15, 1999 (unless excepted under the terms
       of the Rights Plan) will receive rights until the distribution date to
       purchase a unit consisting of one one-thousandth of a Series of Preferred
       Shares of the Company at $50 per unit.

       The Board of Directors may declare a distribution date within ten (10)
       business days following (i) the acquisition of or right to acquire, by a
       person or group, fifteen (15%) percent or more of the outstanding shares
       of the Company or (ii) the commencement of a tender offer or exchange
       offer that would, if consummated, result in a person or group owning
       fifteen (15%) percent or more of the outstanding shares of the Company.
       Upon the declaration of a distribution date, each holder of a right will
       have the right to receive, upon exercise, common shares having a value
       equal to two times the exercise price of the right. In the alternative,
       the Board of Directors, at its option, may exchange all outstanding and
       exercisable rights for common shares at an exchange ratio of one common
       share per each right. The Board may redeem the rights prior to an event
       triggering a distribution date at $.001 per right.



                                     -F-15-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       STOCK OPTIONS: The Company has an incentive stock option plan (the
       "Incentive Plan"), as amended, under which 900,000 common shares have
       been reserved for future issuance. The Incentive Plan provides for the
       sale of shares to employees of the Company at a price not less than the
       fair market value of the shares on the date of the option grant, provided
       that the exercise price of any option granted to an employee owning more
       than 10% of the outstanding common shares of the Company may not be less
       than 110% of the fair market value of the shares on the date of the
       option grant. The term of each option and the manner of exercise is
       determined by the board of directors, but in no case can the options be
       exercisable in excess of 10 years beyond the date of grant. In May 1995,
       the Company adopted a nonqualified stock option plan (the "Nonqualified
       Plan"), as amended, under which 300,000 shares have been reserved for
       future issuance.

       At December 31, 2000, options to purchase 890,767 and 253,500 shares of
       common stock (excluding lapsed shares) have been granted under the
       Incentive Plan and the Nonqualified Plan, respectively, since the
       inception of both plans. In addition, at December 31, 2000, options to
       purchase 203,750 shares of common stock have been granted outside the
       Incentive Plan and the Nonqualified Plan at a price equal to the fair
       market value of the shares at the date of grant.

       A summary of the status of the Company's options as of December 31, 2000,
       1999 and 1998, and changes during the years then ended is presented
       below:

<TABLE>
<CAPTION>
DECEMBER 31,                                             2000                        1999                         1998
--------------------------------------------- --------------------------- ---------------------------- ---------------------------

                                                            Weighted-Avera               Weighted-Avera            Weighted-Average
                                                              Exercise                     Exercise                    Exercise
                                                 Shares        Price      ge Shares         Price      ge Shares        Price
--------------------------------------------- ------------- ------------- -------------- ------------- ------------- -------------

<S>                                               <C>          <C>            <C>           <C>            <C>          <C>
Outstanding at Beginning of year                  740,025      $ 3.58         492,925       $ 5.01         644,950      $ 7.69
Canceled                                          (48,983)       4.23        (135,275)        6.11        (555,550)       7.73
Granted                                           360,500        5.84         403,000         2.64         403,525        4.48
Exercised                                        (153,929)       2.08         (20,625)        2.83               -         N/A
--------------------------------------------- ------------- ------------- -------------- ------------- ------------- -------------
Outstanding at end of year                        897,613      $ 4.62         740,025       $ 3.58         492,925      $ 5.01
--------------------------------------------- ------------- ------------- -------------- ------------- ------------- -------------
Options exercisable at year-end                   408,851                     467,025                      386,050
--------------------------------------------- ------------- ------------- -------------- ------------- ------------- -------------
Weighted - average fair value of options                       $ 4.00                       $ 1.54                      $ 1.83
granted during the year
--------------------------------------------- ------------- ------------- -------------- ------------- ------------- -------------
</TABLE>

       The Board of Directors approved a stock option exchange and repricing
       program pursuant to which, on December 1 and December 10, 1998, certain
       holders of qualified and nonqualified options were eligible to reduce by
       1/2 the number of their existing shares under option in exchange for
       repriced options at a price of $3.00 per share. The market price of the
       underlying shares was $2.47 and $2.94 on December 1 and December 10,
       respectively, and therefore, no compensation expense has been recorded by
       the repricing. The repriced options under the program continued the terms
       and vesting periods of the underlying exchanged options. Of the 695,700
       options outstanding as of December 1, 1998, approximately 491,800 shares
       were eligible for the exchange and repricing program. Holders exchanged a
       total of 403,550 shares under option resulting in a total of 201,775
       repriced shares which are included for purposes of the accompanying table
       as shares canceled and granted, respectively, during 1998.



                                     -F-16-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       The following table summarizes information about fixed stock options
outstanding at December 31, 2000:



<TABLE>
<CAPTION>
                                       OPTIONS OUTSTANDING                             OPTIONS EXERCISABLE
                        ---------------------------------------------------     ------------------------------
                            Number                                               Number
                        Outstanding at   Weighted-Average                    Exercisable at
       Range of          December 31,       Remaining      Weighted-Average   December 31,    Weighted-Average
   Exercise Prices           2000        Contractual Life  Exercise Price         2000        Exercise Price
----------------------- ---------------- ----------------- ---------------- ----------------- ----------------
<S>        <C>               <C>               <C>              <C>               <C>              <C>
 $  0.10 - $  1.79           204,875           7.4              $ 1.62            59,094           $ 1.56
 $  1.85 - $  3.94           236,738           5.6                3.30           141,757             3.05
 $  4.00 - $  6.63           149,000           5.5                4.72           141,500             4.76
 $  7.13 - $  8.25           266,000           8.4                7.25            35,500             7.49
 $  9.25 - $  9.88            41,000           4.0                9.76            31,000             9.50
----------------------- ---------------- ----------------- ---------------- ----------------- ----------------
 $  0.10 - $  9.88           897,613           6.8              $ 4.62           408,851           $ 4.30
======================= ================ ================= ================ ================= ================
</TABLE>

       The Company has elected, in accordance with the provisions of SFAS No.
       123, to apply the current accounting rules under APB Opinion No. 25 and
       related interpretations in accounting for its stock options and,
       accordingly, has presented the disclosure-only information as required by
       SFAS No. 123. If the Company had elected to recognize compensation cost
       based on the fair value of the options granted at the grant date as
       prescribed by SFAS No. 123, the Company's net income (loss) and earnings
       (loss) per common share for the years ended December 31, 2000, 1999 and
       1998 would approximate the pro forma amounts indicated in the table
       below:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,                             2000              1999             1998
--------------------------------------------- ----------------- ----------------- ----------------
<S>                                              <C>               <C>               <C>
Net income available to common shareholders      $    2,141        $    7,383        $  (11,958)
- as reported
============================================= ================= ================= ================
Net income available to common shareholders      $    1,771        $    7,124        $  (12,111)
- pro forma
============================================= ================= ================= ================
Earnings (loss) per share - as reported:
   Basic                                         $      .34        $     1.22        $   (1.98)
   Diluted                                       $      .32        $     1.19        $   (1.98)
============================================= ================= ================= ================
Earnings (loss) per share - pro forma:
   Basic                                         $      .29        $     1.18        $   (2.00)
   Diluted                                       $      .27        $     1.14        $   (2.00)
============================================= ================= ================= ================
</TABLE>

       The fair value of each option grant is estimated on the date of grant
       using the Black-Scholes option-pricing model with the following
       weighted-average assumptions used for the years ended December 31, 2000,
       1999 and 1998, respectively:


                                     -F-17-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       expected volatility of 85.11%, 79.3% and 66.6%, respectively; risk-free
       interest rates of 6.09%, 5.2% and 5.6%, respectively; and expected lives
       of 4.3 years, 4.1 years and 4.9 years, respectively.

11.    SEGMENT INFORMATION

       The Company operates primarily in two industry segments, the
       Microelectronic Packaging Group and the Wafer Reclaim Services Group. The
       tables below present information about reported segments:





<TABLE>
<CAPTION>
                                                MICROELECTRONIC
                 YEAR ENDED                        PACKAGING         WAFER RECLAIM       CORPORATE AND      CONSOLIDATED
             DECEMBER 31, 2000                       GROUP           SERVICES GROUP    RECONCILING ITEMS        TOTAL
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
<S>                                              <C>                  <C>                 <C>                <C>
Revenue                                          $  53,632            $  20,457           $       -          $  74,089
Cost of goods sold and services performed           37,162               15,247                   -             52,409
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Gross profit                                        16,470                5,210                   -             21,680
Operating expenses                                  11,323                4,212                   -             15,535
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Income (loss) from operations                    $   5,147            $     998           $       -          $   6,145
============================================= ==================== =================== ================== ==================
Segment assets                                   $  89,574            $  40,681           $     (50,166)     $  80,089
============================================= ==================== =================== ================== ==================
Capital expenditures                             $   8,548            $   4,670           $       -          $  13,218
============================================= ==================== =================== ================== ==================
Depreciation expense                             $   2,789            $   2,649           $       -          $   5,438
============================================= ==================== =================== ================== ==================

                 YEAR ENDED                     MICROELECTRONIC       WAFER RECLAIM       CORPORATE AND      CONSOLIDATED
             DECEMBER 31, 1999                     PACKAGING          SERVICES GROUP    RECONCILING ITEMS        TOTAL
                                                     GROUP
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Revenue                                          $  46,666            $  16,858           $       -          $  63,524
Cost of goods sold and services performed           29,348               12,970                   -             42,318
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Gross profit                                        17,318                3,888                   -             21,206
Operating expenses                                  10,065                3,996                   -             14,061
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Income (loss) from operations                    $   7,253            $    (108)          $       -          $   7,145
============================================= ==================== =================== ================== ==================
Segment assets                                   $  62,627            $  33,484           $ (35,039)         $  61,072
============================================= ==================== =================== ================== ==================
Capital expenditures                             $   2,468            $     251           $       -          $   2,719
============================================= ==================== =================== ================== ==================
Depreciation  expense                            $   2,530            $   2,549           $       -          $   5,079
============================================= ==================== =================== ================== ==================

                                                MICROELECTRONIC
                 YEAR ENDED                        PACKAGING         WAFER RECLAIM       CORPORATE AND      CONSOLIDATED
             DECEMBER 31, 1998                       GROUP           SERVICES GROUP    RECONCILING ITEMS        TOTAL
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Revenue                                          $  47,524            $  18,379           $       -          $  65,903
Cost of goods sold and services performed           37,982               15,143                   -             53,125
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Gross profit                                         9,542                3,236                   -             12,778
Operating expenses                                  12,319               14,686                   -             27,005
--------------------------------------------- -------------------- ------------------- ------------------ ------------------
Income (loss) from operations                    $  (2,777)           $ (11,450)          $       -          $ (14,227)
============================================= ==================== =================== ================== ==================
Segment assets                                   $  76,688            $  36,641           $ (31,005)         $  82,324
============================================= ==================== =================== ================== ==================
Capital expenditures                             $   2,036            $   1,027           $       -          $   3,063
============================================= ==================== =================== ================== ==================
Depreciation expense                             $   2,460            $   2,722           $       -          $   5,182
============================================= ==================== =================== ================== ==================
</TABLE>



                                     -F-18-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       The Company's areas of operation are principally in the United States.
       Operations outside the United States are worldwide and are primarily in
       Europe, North Africa and Asia. No single foreign country or geographic
       area is significant to the consolidated operations. Revenue from two
       customers accounted for 23% of the Company's total revenue for the year
       ended December 31, 2000. Revenue from the same customers accounted for
       31% of the Company's total revenue for the year ended December 31, 1999.
       For the year ended December 31, 1998 revenue from one of these customers
       accounted for 10% of the Company's total revenue.

12.    EXPORT REVENUE:

       For the years ended December 31, 2000, 1999 and 1998, export revenue to
       unaffiliated customers amounted to approximately 28%, 24% and 18%,
       respectively, of the Company's total revenue.

13.    SPECIAL CHARGES:

       In 1998, the Company recorded special charges of $11,217 ($7,740 after
       tax or $1.28 per share). The Company recorded $1,950 of this charge
       during the first quarter and the balance of $9,267 during the fourth
       quarter of the year. The majority of this charge relates to a review of
       the carrying values of the Company's Wafer Reclaim Services Group assets
       and the closing of a Service Group plant in the first quarter of 1998.

       During the first quarter of 1998, the Company recorded this charge of
       $1,950 in conjunction with a restructuring of the Wafer Reclaim Services
       Group that included closing its Texas operation and consolidating
       domestic business and equipment into the Group's Rhode Island facility.
       During 1998, the Company paid all of the $1,950 charges recorded in the
       first quarter. The Company recorded an additional $230 of charges in the
       fourth quarter related to a leased facility for costs which continued
       after the Texas facility was vacated.

       As a result of the Wafer Reclaim Services Group's inability to achieve
       the improvements anticipated by the restructuring plan, primarily due to
       a more severe than anticipated market decline, the division continued
       operating at a loss in 1998. This triggered an impairment and utilization
       review of the Wafer Reclaim Services Group's long-lived assets. The
       Company prepared revised projections by customer and product line which
       provided the basis for determining the continued usability and carrying
       value of its long-term assets. The Company identified approximately
       $4,700 of excess Wafer Reclaim Services Group equipment that was written
       down to estimated fair value, less cost of disposal. In addition, the
       Company wrote down approximately $2,700 of Goodwill associated with the
       Texas facility customers and lines of business that have been eliminated.
       Due to continuing financial problems of the Wafer Reclaim Services
       Group's 50.1% owned Singapore operation, the Company recorded an asset
       impairment of $1,000 in response to uncertainty regarding the ultimate
       recoverability of its investment.

       The Company's Microelectronic Packaging Group recorded a special charge
       of $620 in the fourth quarter of 1998, consisting of a write-down of $473
       in Goodwill associated with a line of business that has been eliminated
       and the write-down of $147 of unusable equipment.

14.    ALLOWANCE FOR DOUBTFUL ACCOUNTS:


                                     -F-19-
<PAGE>
                        SEMX CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (dollars in thousands)
===============================================================================

       Information relating to the allowance for doubtful accounts is as
follows:

<TABLE>
<CAPTION>
                                        BALANCE AT        CHARGED TO
                                       BEGINNING OF       COSTS AND                        BALANCE AT END
YEAR ENDED DECEMBER 31,                    YEAR            EXPENSES        DEDUCTIONS         OF YEAR

<S>             <C>                       <C>              <C>               <C>              <C>
                2000                      $  656           $   64            $  366 (a)       $  354
===================================== ================ ================= ================ =================
                1999                      $  245           $  417            $    6 (a)       $  656
===================================== ================ ================= ================ =================
                1998                      $  181           $  188            $  124 (a)       $  245
===================================== ================ ================= ================ =================
</TABLE>
(a)      Write-off of uncollectible accounts receivable.


15. QUARTERLY FINANCIAL DATA:

The following is a summary of the unaudited quarterly results of operations for
the years ended December 31, 2000 and 1999:

<TABLE>
<CAPTION>
                                                                       Net Income
                                                                      Available to             Basic               Diluted
Fiscal Year ended         Total          Gross         Net               Common             Earnings Per         Earnings Per
December 31, 2000        Revenue         Profit      Income           Shareholders             Share                Share
-----------------       ---------       --------    --------         --------------        --------------        -------------
<S>                    <C>             <C>          <C>                <C>                  <C>                    <C>
First quarter            $16,443         $ 5,231     $  843             $  843                $ .14                  $ .13
Second quarter            17,631           5,407        609                555                  .09                    .08
Third quarter             19,102           4,910        314                112                  .02                    .02
Fourth quarter            20,913           6,132        848                631                  .09                    .09
-----------------       ---------       --------    --------          -----------            --------               --------
                         $74,089         $21,680     $2,614             $2,141                $ .34                  $ .32
=================       =========       ========    ========          ===========            ========               ========

Fiscal Year ended
December 31, 1999

First quarter            $14,893         $ 4,371     $4,153             $4,153                $ .69                  $ .69
Second quarter            16,048           5,462        991                991                  .16                    .16
Third quarter             16,358           5,842      1,166              1,166                  .19                    .19
Fourth quarter            16,225           5,531      1,073              1,073                  .18                    .15
-----------------       ---------       --------    --------          -----------            --------               -------
                         $63,524         $21,206     $7,383             $7,383                $1.22                  $1.19
=================       =========       ========    ========          ===========            ========               =======
</TABLE>

Net Income for the quarter ended March 31, 1999 includes an after tax gain of
$3,903 on the sale of the Company's Retconn Subsidiary, as described in Note 2,
Acquisitions and Dispositions.


                                     -F-20-
<PAGE>