The reorganization of semiconductor manufacturers and the intense competition within the semiconductor production equipment industry, are continuing along with the increased pace of changes in the roles and expectations of equipment manufacturers and in customers' needs for production equipment. During the previous fiscal year, based on the company's policy that flexible and swift responses to these changes will contribute to improved financial results, TEL expanded its technology and development divisions and reinforced its product development and process development capabilities in new business and technology fields. In addition, as described below, TEL has now decided to carry out a reorganization that will include subsidiaries, effective April 1, 2006. The reorganization is based on the following objectives: (1) to enhance the product marketing, equipment development, and manufacturing technology capabilities of business units (BUs) in the semiconductor production equipment divisions and manufacturing plants; and (2) to enhance customer response speed and capabilities through integrating sales and services divisions.

1. Outline of the April 1, 2006 Reorganization

(1) The semiconductor production equipment division will be divided into four divisions, with each division focusing on a specific business area.

(2) Manufacturing plants responsible for manufacturing functions will be separated and consolidated by each division.

(3) BUs organized on a product basis will be restructured as organizations in charge of product marketing, product strategies, and customer (sales) strategies.

(4) The new Sales & Services Division organized on a customer basis will be established (the current Business Development & Account Management will be eliminated) and Regional Sales & Services will be established under the Sales & Services Division. The Regional Sales & Services will incorporate sales promotion, BU sales functions, and BU service functions, to reinforce customer response capabilities and speed.

2. Details of the Reorganization

(1) Introduction of business divisions in the semiconductor production equipment

(i) The new SPE-1 Division will be established and a CT BU and SPS BU will be created within the division.

* Tokyo Electron Kyushu Limited will perform the SPE-1 Division's production functions.

(ii) The new SPE-2 Division will be established and the ES BU and SD BU will be created within the division.

* Tokyo Electron AT Limited will perform the SPE-2 Division's production functions

(iii) The new SPE-3 Division will be established and a TPS BU will be created within the division.

* Tokyo Electron AT Limited's thermal processing systems divisions will be separated and a new company will be established (Tokyo Electron Tohoku Limited) to perform the SPE-3 Division's production functions.

(iv) The new SPE-4 Division will be established and a TS BU will be created within the division.

* Tokyo Electron AT Limited's test systems divisions will be separated and a new company will be established (Tokyo Electron TS Limited) to perform the SPE-4 Division's production functions.

(v) The department-level names of each BU will be changed.

1. The Clean Track Department will be renamed the Clean Track Business Planning Department.

2. The Surface Preparation Systems Department will be renamed the Surface Preparation Systems Business Planning Department.

3. The Etch Systems Department will be renamed the Etch Systems Business Planning Department.

4. The Single Wafer Deposition Department will be renamed the Single Wafer Deposition Business Planning Department.

5. The Thermal Processing Systems Department will be renamed the Thermal Processing Systems Business Planning Department.

6. The Test Systems Department will be renamed the Test Systems Business Planning Department.

(2) Creation of the Sales & Services Division

(i) The Sales & Services, Japan, US & Europe, Korea, Asia, and AIM Dept. (currently within the semiconductor production equipment divisions) will be established within the Sales & Services Division.

(ii) The following new department-level organizations are to be established within the Sales & Services, Japan.

1. Clean Track Department

2. Surface Preparation Systems Department

3. Etch Systems Department

4. Single Wafer Deposition Department

5. Thermal Processing Systems Department

6. Test Systems Department

(iii) The Post Sales will be established within the Sales & Services Division to reinforce after-sales service. The Services Strategy Planning Department will be created within the Post Sales. The Global Services Strategic Planning Department will be eliminated and its functions will be transferred to the Services Strategy Planning Department.

3. Personnel Changes Effective April 1, 2006

New Position	Name	Now Position	Continuing Position
SVP General Manager, SPE-1 Division	Haruo Iwatsu		Director and President & Representative Director, Tokyo Electron Kyushu Ltd. and Chairman, Tokyo Electron Taiwan Ltd.
Deputy General Manager, SPE-1 Division	Hikaru Ito		VP and Clean Track BUGM and Corporate Director, Tokyo Electron Kyushu Ltd.
Deputy General Manager, SPE-1 Division	Masaaki Hata		VP and Surface Preparation Systems BUGM
VP General Manager, SPE-2 Division and President & Representative Director, Tokyo Electron AT Ltd. and Chaiman & CEO, Tokyo Electron Massachusetts, LLC	Kozo Hara	EVP, Tokyo Electron AT Ltd.
Deputy General Manager, SPE-2 Division	Takashi Ito		VP and Etch Systems BUGM
Deputy General Manager, SPE-2 Division	Kenji Washino		VP and Single Wafer Deposition BUGM
VP, General Manager, SPE-3 Division and President & Representative Director, [Tokyo Electron Tohoku Ltd.]	Hirofumi Kitayama	President & Representative Director, Tokyo Electron AT Ltd. and Chairman & CEO, Tokyo Electron Massachusetts, LLC
Deputy General Manager, SPE-3 Division	Hiroshi Takenaka		VP and Thermal Processing Systems BUGM
VP, General Manager, SPE-4 Division and President & Representative Director, [Tokyo Electron TS Ltd.]	Tsuyoshi Aruga	EVP, Tokyo Electron Taiwan Ltd.
Deputy General Manager, SPE-4 Division	Shunro Nagasawa		VP and Test Systems BUGM
General Manager, Sales & Services Division and General Manager, Sales & Services, Japan	Makoto Mizokuchi	Business Development & Account Management SVP and General Manager, Business Development & Account Management, Japan	SVP
General Manager, Sales & Services, North America & Europe	Kiyoshi Sunohara	General Manager, Business Development & Account Management, North America & Europe	VP and Corporate Director, Tokyo Electron U.S. Holdings, Inc. and SVP, Tokyo Electron America, Inc. and Corporate Director, Tokyo Electron Europe Ltd.
General Manager, Sales & Services, Korea	Yasuyuki Kuriki	General Manager, Business Development & Account Management, Korea	VP and President, Tokyo Electron Korea Ltd.
General Manager, Sales & Services, Asia	Chiaki Yamaguchi	General Manager, Business Development & Account Management, Asia	VP and Director, Tokyo Electron Taiwan Ltd. and Director, Tokyo Electron (Shanghai) Ltd. and Director, Tokyo Electron (Shanghai) Logistic Center, Ltd.
Deputy General Manager, Sales & Services Division And Post Sales and President & Representative Director, [Tokyo Electron PS Ltd.]	Jinzaburo Sakamoto	Field Engineering	VP and President & Representative Director, Tokyo Electron FE Ltd. and Global Service Strategic Planning Dept.

4. Corporate Separation of Subsidiary (Tokyo Electron AT Limited)



Effective April 1, 2006, Tokyo Electron AT Limited will be split into three––Tokyo Electron AT, Tokyo Electron Tohoku, and Tokyo Electron TS––with all shares in the two newly established companies allocated to the shareholders of Tokyo Electron AT.

	Before separation	After separation
	Company to separated	Company to separated	New company	New company
Company Name	Tokyo Electron AT Linited	Tokyo Electron AT Linited	Tokyo Electron Tohoku Linited	Tokyo Electron TS Linited
Headquarters	Miyagi, Japan	Miyagi, Japan	Iwate, Japan	Yamanashi, Japan
Shareholders	TEL 100%	TEL 100%	TEL 100%	TEL 100%
Products	Plasma Etch System, Single Wafer CVD System, Thermal Processing System, Wafer Prober, FPD Plasma Etch/Ash System	Plasma Etch System, Single Wafer CVD System, FPD Plasma Etch/Ash System	Thermal Processing System	Wafer Prober
President	Hirofumi Kitayama	Kozo Hara	Hirofumi Kitayama	Tsuyoshi Aruga
Capital	4,200M (Yen)	4,000M (Yen)	100M (Yen)	100M (Yen)
Number of shares to be issued	84,000	84,000	2,000	2,000
Total number of shares issued	336,000	336,000	8,000	8,000

Since the separation will be carried out as a wholly-owned subsidiary, it will not have any impact on TEL's consolidated financial results.