Electroglas Announces Voluntary Chapter 11 Petition Filing

SAN JOSE, Calif., July 10, 2009 (GLOBE NEWSWIRE) -- Electroglas, Inc.
(OTCBB:EGLS), a leading supplier of wafer probers and software solutions for the
semiconductor industry, today announced that the company has filed a voluntary
petition under Chapter 11 of the U.S. Bankruptcy Code.

As a result of the global economic recession, demand for semiconductor
manufacturing equipment has declined dramatically. Over the past several months,
Electroglas has undertaken significant efforts to reduce its expenses and
working capital requirements in response to these unprecedented market
conditions. These efforts have included significant work force reductions,
salary cuts, mandatory time off for all of the company's employees and
significant decreases in non-labor expenses. At the same time, the company has
been working with Needham & Company, LLC and others to review and pursue
financial and strategic options for the company to maximize value on behalf of
all of the company's stakeholders, including merging with or into another
company, and a sale of all or substantially all of the company's assets.

The current plan is for certain of our bondholders to provide Debtor in
Possession ("DIP") financing to sustain the Company during the bankruptcy
process and for the Company to conduct an auction to sell the Company. In the
meantime the company expects to continue essential operations, including sales,
product support, service and warranty programs.

About Electroglas

Electroglas is a leading supplier of innovative wafer probers and software
solutions for the semiconductor industry. For more than 45 years, Electroglas
has helped integrated device manufacturers (IDMs), wafer foundries and
outsourced assembly and test (OSAT) suppliers improve the overall effectiveness
of semiconductor manufacturers' wafer testing. Headquartered in San Jose,
California, the company has shipped more than 16,500 systems worldwide.
Electroglas' stock trades on the OTCBB National Market under the symbol
"EGLS.OB." More information about the company and its products is available at
www.electroglas.com.

Safe Harbor Statement

This news release contains forward-looking statements including statements
relating to Electroglas' business and the Chapter 11 Bankruptcy process. These
forward-looking statements involve risks and uncertainties including, but not
limited to, the risk of continued adverse changes in global and domestic
economic conditions, continued downturn in the semiconductor and electronics
industries, a continued downturn or decrease in customer utilization rates,
unforeseen technical difficulties related to the development and manufacture of
Electroglas' products, and a failure of its new products to achieve broad market
acceptance as a result of competing technologies and an inability to
successfully market our precision motion control technology to users outside the
wafer probing market. Electroglas assumes no obligation to update this
information. For a further discussion of risks and uncertainties that could
cause actual results to differ from those expressed in these forward-looking
statements, as well as risks relating to Electroglas' business in general, see
the risk disclosures in Electroglas' SEC filings, including its most recent
annual report on Form 10-K for the year ended May 31, 2008, its quarterly
reports on Form 10-Q and periodic reports on Form 8-K filed from time to time
with the SEC.

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CONTACT: Electroglas, Inc.
Investor Relations
Candi Lattyak
+1 408.528.3801
clattyak@electroglas.com