TSMC Shareholders Approved NT$2.5 Dividend

Hsinchu Science Park, Taiwan, May 10, 2005 – Taiwan Semiconductor Manufacturing Company Ltd. (TSMC) (NYSE: TSM) today held a shareholders’ meeting at which the shareholders approved the distribution of a dividend of NT$2.5 per common share, including a stock dividend of NT$0.5 per share (i.e. 5% stock dividend) and a cash dividend of NT$2 per share.

TSMC Spokesperson and Vice President Ms. Lora Ho stated that the major conclusions of this shareholders’ meeting are as follows:

1. Shareholders approved the 2004 Business Report and Financial Statements. Revenue for 2004 totaled NT$255,990 million and net income was NT$92,320 million, with earnings per share of NT$3.97.

2. Shareholders approved the proposal for distribution of 2004 profits:

(1) A dividend of NT$2.5 per common share, including a cash dividend of NT$2 per share and a stock dividend of 5% per share.

(2) Employees’ profit sharing will be distributed in both stock and cash. Profit sharing will amount to NT$3,086 million distributed in stock at par value and NT$3,086 million distributed in cash.

3. Shareholders approved revisions to the Articles of Incorporation. Approved TSMC to revise the relevant provisions with respect to management of corporate. The revision would allow the company more flexibility in planning the structure of senior management. And also approved TSMC to revise the Articles of Incorporation so that Directors who are also TSMC executives will not be eligible to receive bonus for Directors. The total percentage of profits allocated for directors and supervisors’ bonus will be capped at 0.3% of distributable profits, instead of the current fixed 0.3%.