Major European Device Manufacturer Orders Advanced Plasma Etch System From Tegal; Initial Order for ''Copy Exact'' Production in Asia Pacific Region

Business Wire, August 9, 2005

PETALUMA, Calif. -- Tegal Corporation (Nasdaq:TGAL) today announced that a major European integrated device manufacturer has placed an order with the Company for a new 6540 advanced plasma etch system, valued at over $2.5 million. The 6540 system, directed at an application that enables the production of high-K, de-coupling capacitors incorporated into cell phones and other wireless devices, will be installed in a production facility in the Asia-Pacific region later this year.

Earlier multiple system orders from this customer have either been installed in or are destined for its European-based production facility. Those orders, announced in April and July of this year, represented approximately $4.5 million in multiple systems bookings, and included both factory re-certified 6500 and 980 plasma etch systems.

"We have a long-standing R&D relationship with this customer and unique capabilities in this field, so we were pleased to be considered for this production order," said Thomas Mika, President and CEO of Tegal. "Even so, it was only due to the success of our recent financing that we were able to win this order. Although the financing was a difficult business decision, it allowed us to pursue this high volume production order from a Tier 1 semiconductor manufacturer. We are now in a good position to win additional follow-on orders from this customer over the next 12 months, as it ramps production of these unique devices."

"The basic etch process on which this application is based was co-developed by Tegal and this customer during an 18-month joint development program," said Steve Selbrede, Vice President and Chief Technology Officer of Tegal Corporation. "Tegal has developed significant, patented technology, along with unique process know-how in the area of 'difficult-to-etch' materials such as high-K dielectrics and non-volatile metals. These materials allow our customers to develop competitive capabilities in the areas such as chip level de-coupling capacitors, non-volatile memories, and other advanced devices."

Tegal will conduct a conference call following the release of its quarterly earnings for the period ending June 30, 2005 at 5:00pm EST (2:00pm PST) on Thursday, August 11, 2005. The dial-in numbers for the conference call are 866-700-7101 or 617-213-8837. Investors should reference passcode 74936079.

Tegal will also be holding its Annual Meeting of Stockholders in Petaluma, California, on Tuesday, September 13, 2005 at 10:00am PST, at which several matters, including the approval of the second part of its recent financing, will be subject to a stockholder vote. Stockholders of record as of July 27, 2005 will be entitled to vote by proxy or in person at the meeting.

Safe Harbor Statement

Except for historical information, matters discussed in this news release contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements, which are based on assumptions and describe our future plans, strategies and expectations, are generally identifiable by the use of the words "anticipate," "believe," "estimate," "expect," "intend," "project" or similar expressions. These forward-looking statements are subject to risks, uncertainties and assumptions about the Company including, but not limited to industry conditions, economic conditions, acceptance of new technologies and market acceptance of the Company's products and services. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements in this paragraph. For a further discussion of these risks and uncertainties, please refer to the Company's periodic filings with the Securities and Exchange Commission.

About Tegal

Tegal provides process and equipment solutions to leading edge suppliers of advanced semiconductor and nanotechnology devices. Incorporating unique, patented etch and deposition technologies, Tegal's system solutions are backed by over 35 years of advanced development and over 100 patents. Some examples of devices enabled by Tegal technology are energy efficient memories found in portable computers, cellphones, PDAs and RFID applications; megapixel imaging chips used in digital and cellphone cameras; power amplifiers for portable handsets and wireless networking gear; and MEMS devices like accelerometers for automotive airbags, microfluidic control devices for ink jet printers; and laboratory-on-a-chip medical test kits.

More information is available on the Internet at: www.tegal.com.