Security and Issuer

The class of equity securities to which this Statement relates is the Common Stock, $0.00l par value, of Southwall Technologies Inc., a Delaware corporation (“Southwall”).  The principal executive offices of Southwall are located at 1029 Corporation Way, Palo Alto, CA  94303.

Identity and Background

a.             This Statement is being filed by Teijin Limited, a Japanese corporation (“Teijin”), and Teijin Films Limited, a Japanese corporation (“Teijin Films,” together with Teijin, the “Reporting Persons”).  The registered office of Teijin is at 6-7, Minami-honmachi 1-Chome, Chuo-ku, Osaka 541, JAPAN.  The registered office of Teijin Films is at 1-1 Uchisaiwai-cho 2-chome, Chiyoda-ku, Tokyo 100-8585, JAPAN.

b.             Teijin is a US$6 billion diversified chemicals and plastics, fibers, pharmaceutical and medical products, information systems and media company based in Osaka, Japan.  Its operations include the manufacture and sale of polyester (PET) films which are used in a variety of applications.  Teijin Films is a wholly owned subsidiary of Teijin.  The name, business address, present principal occupation and citizenship of each executive officer and director of Teijin and Teijin Films are set forth in Appendices A and B attached hereto, which are incorporated herein by reference. 

c.             During the last five years, none of the Reporting Persons or, to the best of their knowledge, any of the Reporting Persons’ executive officers or directors, has been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors).

d.             During the last five years, none of the Reporting Persons or, to the best of their knowledge, any of the Reporting Persons’ executive officers or directors, has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding is or was subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violations with respect to such laws.

Source and Amount of Funds or Other Consideration

Effective as of April 1, 2003, pursuant to a reorganization plan adopted by the board of directors of Teijin on January 29, 2003, Teijin transferred certain assets to Teijin Films in exchange for all the shares of Teijin Films.  The transferred assets included Teijin’s entire interest

in 667,000 shares of the Common Stock of Southwall (the “Southwall Common Stock”).  There are no funds or other consideration required to be disclosed in connection with the transfer of 667,000 shares of the Southwall Common Stock from Teijin to Teijin Films.

Purpose of Transaction

The Reporting Persons will hold the shares of Southwall for investment purposes in order to further their cooperative relationship with Southwall.  The Reporting Persons currently do not intend to acquire control of Southwall, although they may buy or sell (from time to time in open market transactions) additional shares of the Southwall Common Stock.  In determining whether to buy or sell additional shares of the Southwall Common Stock, the Reporting Persons will consider various factors, including Southwall’s financial condition, business and prospects, price levels of the Southwall Common Stock, the business relationship between the Reporting Persons and Southwall, other opportunities available to the Reporting Persons, and general economic, money and stock market conditions.  Depending upon, among other things, the matters referred to above, the Reporting Persons may determine to dispose of all or a portion of their shares of the Southwall Common Stock.  The Reporting Persons currently have the right to nominate one of the six directors on Southwall’s board of directors each year.  At the time of this filing, Mr. Noriyuki Nakamura, President of Teijin Holdings USA Inc., serves as the Reporting Persons’ representative on Southwall’s board of directors, and his tenure will continue until April 1, 2004.

Except as discussed above, the Reporting Persons do not have any plans or proposals which relate to or would result in any of the following:

On July 8, 2002, Southwall completed a follow-on public offering of 3,500,000 shares of its common stock at a price of $4.50 per share.  On August 5, 2002, Southwall sold an additional 307,300 shares at a price of $4.50 per share, when its underwriters exercised part of their overall allotment option.  The net proceeds to Southwall from the offering and the over allotment option after deducting underwriting discounts and commission and offering expenses were approximately $15.1 million.  On November 6, 2002, Southwall used the net proceeds to prepay $2.5 million of the Japanese bank loan, in addition to the scheduled principal payment of $1.25 million, leaving an outstanding balance of $2.5 million.  Upon such prepayment, Teijin released its security interest in the Southwall Collateral except for certain machines located at Southwall’s Tempe plant.

Teijin and Mr. Hideo Nakamori entered into the Compensation Agreement on or about July 1, 1999.  As a result of the Compensation Agreement, the Reporting Persons share dispositive and voting power with respect to 696 shares of the Southwall Common Stock owned of record by Mr. Hideo Nakamori.

On January 29, 2003, the board of directors of Teijin approved a reorganization plan for Teijin.  Pursuant to the reorganization plan, a new subsidiary corporation, Teijin Films, was formed in Japan.  Effective as of April 1, 2003, Teijin transferred certain assets to Teijin Films in exchange for all the shares of Teijin Films.  The transferred assets included Teijin’s entire interest in 667,000 shares of the Southwall Common Stock.

As a result of the Reporting Persons’ beneficial ownership of 667,696 shares of the Southwall Common Stock, the Reporting Persons currently have the right to nominate one of the six directors on Southwall’s board of directors each year.  At the time of this filing, Mr. Noriyuki Nakamura, President of Teijin Holdings USA Inc., serves as the Reporting Persons’ representative on Southwall’s board of directors, and his tenure will continue until April 1, 2004.

Material to Be Filed as Exhibits

Exhibit A                Joint Filing Agreement, dated April 1, 2003, between Teijin and Teijin Films.