September 22, 2005 – Nanometrics Inc. today announced it has agreed to sell its flat panel display (FPD) business unit to Toho Technology Corp. of Nagoya, Japan. Under the conditions of the sale, Nanometrics’ metrology technology will be licensed to Toho exclusively for use in the FPD market. The transaction is expected to close by year’s end.

Commenting on the transaction, John Heaton, Nanometrics president and CEO, said, “We are very pleased to be working with Toho Technology. This sale is another milestone in our corporate strategy to focus our business and technology efforts on growing market segments within our core industry, semiconductors.”

Hideyuki Tomita, president of Toho Technology, also commented; “We are grateful for this opportunity to work together with Nanometrics and to further develop our FPD business. Since 1819, our business has been built on relationships with customers and business partners. The Nanometrics technology compliments our existing portfolio.”