America Electronic Components launches Artile Microsystems to provide rapid system-on-a-chip designs

TOSHIBA AMERICA ELECTRONIC COMPONENTS LAUNCHES ARTILE MICROSYSTEMS TO PROVIDE RAPID SYSTEM-ON-A-CHIP DESIGNS

ArTile's TX79 Microprocessor is the Core in the EmotionEngine[tm], a Processor Jointly Developed by Toshiba and Sony Computer Entertainment Inc. for the PlayStation®2 Computer Entertainment System

SAN JOSE, Calif., April 2, 2001 -- Toshiba America Electronic Components, Inc. (TAEC) today announced that it is spinning off its San Jose-based microprocessor (MPU) engineering division as a wholly owned subsidiary.

The new company, ArTile Microsystems, Inc.?, will provide customers with rapid development of system-on-a-chip (SOC) designs based on its TX79 reduced instruction set computer (RISC) microprocessor core. These designs will be used in diverse applications including networking, digital set-top boxes, digital TV and multimedia appliances.

The name "ArTile" combines the word ART with the word TILE to suggest the idea, concept and method of designing highly complex SOCs using new tile-based methodology.

The timing for the spin-off is in keeping with the healthy climate in the system level integration (SLI) segment of the semiconductor industry. SLI sector growth has outpaced that of the overall industry for the last several years, with the SLI business growing 27 percent cumulative aggregate growth rate between 2001 and 2004 from $30.5 billion to over $61.5 billion, according to reports by the Gartner Group.

"ArTile is well-positioned in the market, with essential know-how and an outstanding, highly motivated team. I have no doubt that the company with its commitment and leading-edge technology, will build a strong presence in the industry," said Hisashi Izumi, president of TAEC.

Tomohiso Shigematsu, a long-time Toshiba veteran, will be named chief executive officer (CEO) and Shardul Kazi will be named chief operating officer (COO). The company will be headquartered in San Jose.

ArTile is receiving an initial multi-million dollar capital contribution along with business infrastructure support from TAEC including access to TAEC's well-established sales channel. The company plans to raise additional capital in the equity markets and to eventually become a publicly traded company. ArTile plans to grow its annual revenue to US $250 million by 2004.

"ArTile's goal is to establish a firm foundation - enabled by our innovative approach to delivering SOCs to the marketplace faster - that will secure funding for future development, support an attractive IPO and enable business expansion," said Mr. Shigematsu. "We have an entrepreneurial organization of experienced development and marketing teams, which combined with tapping TAEC's established sales channel and other resources, is a clear roadmap for success."

Technical Details
ArTile is founded on a powerful technology base, which includes the TX79 family of 64-bit MIPs-based processors and an associated MPU product roadmap. The TX79 microprocessor has proven its high performance and capabilities through its usage as the core in the EmotionEngine[tm], a processor jointly developed by Toshiba and Sony Computer Entertainment Inc. for the PlayStation®2 computer entertainment system.

ArTile's scalable design methodology can deliver significant savings in time and resources in SOC design, enabling chip development to be cut by as much as 70 percent. ArTile's intellectual property (IP) and design methodology should enable the company to respond quickly to market requirements and achieve shorter product design cycles, while introducing high-performance SOCs to the market.

TAEC will continue to develop products based on its broad family of RISC and complex instruction set computer (CISC) processor cores and peripherals. TAEC's processor families offer various levels of performance, power consumption and pricing to satisfy the needs of applications as diverse as Internet appliances and networking systems.

About TAEC
TAEC, recognized as one of the largest suppliers of semiconductor, electronic component, and storage solutions, is the North American engineering, manufacturing, marketing, and sales arm of Japan's Toshiba Semiconductor Company and Toshiba Display Devices and Components Company. The Toshiba Semiconductor Company is one of the world's leading manufacturers and suppliers of semiconductor products including LSIs, microprocessors and controllers, and advanced memory products, in addition to discrete and analog peripheral components. TAEC is also responsible for sales and marketing of other major electronic components including liquid crystal displays, color display and picture tubes, lithium-ion and other secondary batteries. For additional information, please visit TAEC's web site at www.toshiba.com/taec.