Chartered and Microsoft Sign 65-Nanometer Manufacturing Agreement for Xbox 360 CPU

MILPITAS, Calif. & SINGAPORE--April 20, 2006--Chartered Semiconductor Manufacturing (Nasdaq:CHRT) (SGX-ST:CHARTERED), one of the world's top dedicated semiconductor foundries, has signed an agreement with Microsoft for the manufacturing of CPU products -- using 65-nanometer (nm) Silicon-on-Insulator (SOI) semiconductor technology -- for Microsoft's Xbox 360 game consoles. Production is expected to begin in the first quarter of 2007, and will support the Xbox 360's growing demand and expanding market reach. The announcement follows Chartered's successful manufacturing of 90nm SOI CPU products for the Xbox 360 console's launch, through an agreement with IBM.

"We look forward to working with Chartered on the production of such an important component of our Xbox 360 system," said Larry Yang, General Manager of Xbox Console Development at Microsoft. "Chartered's ability to demonstrate the manufacturability of IBM's advanced SOI technology in Fab 7 was key to our selection. We plan to continue with our strategy of dual sourcing from Chartered and IBM's fabs, which are operationally aligned and compatible, to give us the consistent product quality and flexibility we will need."

"We are excited to expand our manufacturing relationship with Microsoft and leverage the innovative 65nm SOI technology made available to us through our agreement with IBM," said Kay Chai "KC" Ang, senior vice president of fab operations at Chartered. "This is both a recognition of Chartered's 300mm manufacturing excellence and increasing customer confidence in our ability to enable cutting-edge technologies as products transition to 65nm. By working closely with IBM to enable manufacturing compatibility and dual-sourcing capability, our goal is to continue to be a reliable manufacturing source to Microsoft."

"Together, Chartered and IBM offer a unique dual source capability that delivers superior redundancy and flexibility," said Jim Comfort, vice president, Microsoft Client Executive, IBM. "Chartered's decision to adopt our advanced Silicon on Insulator technology at 65nm is further evidence of the success of the IBM/Chartered Common Platform strategy."

* SOI refers to placing a thin layer of silicon on top of an insulator, such as silicon oxide or glass. The transistors (switches that are used in microprocessors) are then built on top of this thin layer of SOI. The basic idea is that the SOI layer reduces the capacitance of the switch, so it operates faster.

About Chartered

Chartered Semiconductor Manufacturing (Nasdaq:CHRT) (SGX-ST:CHARTERED), one of the world's top dedicated semiconductor foundries, offers leading-edge technologies down to 65 nanometer (nm), enabling today's system-on-chip designs. The company further serves the needs of customers through its collaborative, joint development approach on a technology roadmap that extends to 45nm. Chartered's strategy is based on open and comprehensive design enablement solutions, manufacturing enhancement methodologies, and a commitment to flexible sourcing. In Singapore, the company operates a 300mm fabrication facility and four 200mm facilities. Information about Chartered can be found at http://www.charteredsemi.com.