Macronix International and Tower Semiconductor Announce $75 Million Strategic Investment Agreement.Business Editors HSIN-CHU, Taiwan & MIGDAL HAEMEK Migdal HaEmek (Hebrew: מִגְדַּל הָעֶמֶק, also officially spelt Migdal HaEmeq, Arabic: , Israel--(BUSINESS WIRE)--Dec. 12, 2000 (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :TSEM TSEM Tower Semiconductor Ltd. (stock symbol) TSEM Transmission Scanning Electron Microscopy TSEM TOW System Evaluation Missile )(NASDAQ:MXICY) Macronix Joins SanDisk, Alliance and QuickLogic as a Wafer Partner in Tower's Fab 2 Project Additional $50 Million from Israel Corp. Complete $300 Million Equity Funding Required to Begin Construction of Fab 2 New Fab Construction is Expected to Start in Several Weeks Macronix International Co. Ltd. (NASDAQ:MXICY), and Tower Semiconductor Ltd. (NASDAQ:TSEM) jointly announced today that they have entered into a definitive agreement under which Macronix will make a $75 million strategic investment in Tower as part of Tower's plan to build its new Fab. In return for its investment, Macronix will receive equity, corresponding representation on Tower's Board of Directors and committed production capacity in the advanced fab that Tower intends to commence building within several weeks. In related announcements, Tower said its principal shareholder, Israel Corp., will invest, under similar terms, $50 million in Tower's Ordinary Shares, and another investment agreement was signed between Tower and QuickLogic Corporation (NASDAQ:QUIK). With these additional investments as well as amounts to be received under the agreement with Macronix and similar agreements announced earlier this year with SanDisk Corporation (NASDAQ:SNDK) and Alliance Semiconductor (NASDAQ:ALSC ALSC Association for Library Service to Children ALSC Adirondack Lakes Survey Corporation ALSC Afloat Logistics and Sealift Capability ALSC American Lumber Standards Committee, Inc. ALSC Advanced Logistics Systems Center (AFMC) ), Tower has obtained commitments for the funding of $300 million in equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. required to begin the construction of the new fab. The companies also agreed to expand the Manufacturing and Technology Cooperation Agreement entered into by Tower and Macronix in August of this year. Under the new agreement, Macronix will be able (subject to other rights) to offer microFLASH(R)-based integrated design The introduction to this article provides insufficient context for those unfamiliar with the subject matter. Please help [ improve the introduction] to meet Wikipedia's layout standards. You can discuss the issue on the talk page. and sub-contract manufacturing services. In return, Macronix agreed to make certain commitments, including loading of Fab 2. "Macronix' decision to invest in Tower's new fab is intended to help us meet the rapid growth of the Flash market and better support the needs of our strategic customers." Said Mr. Miin Wu, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Macronix, "The cooperation with Tower, that started earlier this year, has proven very rewarding. The new agreement will provide Macronix with complementary capacity and competitive embedded-Flash solutions that are essential to our System-On-Chip corporate strategy." Dr. Yoav Nissan-Cohen, Tower's Co-Chief Executive Officer, said, "The joining of Macronix as a wafer partner is a very significant step for Tower. Macronix is an established semiconductor manufacturer and will make a major contribution to bringing up the new facility into production. As a leading worldwide NVM (Non-Volatile RAM) See NVRAM. manufacturer, Macronix will help Tower position its microFLASH process as leading technology in the booming Flash market." Dr. Nissan-Cohen added: "With our obtaining commitments for $300 million of equity funding Equity funding An investment consisting of a life insurance policy and a mutual fund. The insurance policy is paid by the collateral value of fund shares, giving the investor the advantages of insurance protection with the growth potential of a mutual fund. and the Investment Center's decision to approve the $250 million government grant, we are very close to meeting all the requirements to start the construction. We expect to conclude definitive agreements with the banks on a credit line of $550 million, and be able to break ground within several weeks." Idan Ofer, Chairman of Israel Corporation and Tower commented: "Tower welcomes Macronix as a partner in its planned new Fab. The combined knowledge and experience of our partners is an invaluable resource that will help Tower's quality people and management team transform the company into a world class, leading edge semiconductor manufacturer over the next few years." Terms of the Tower-Macronix Investment Agreement Under the terms of the agreement, Macronix's investment will be made in several stages over close to two years period, against satisfactory completion of key milestones for the construction, equipping and commencement of production at the new wafer fab. Macronix will receive from Tower a guaranteed portion of the available wafer capacity at competitive pricing, with first production expected in 2002. Closing of the transaction with Macronix is subject to several conditions, including Tower's securing required bank financing, timely commencement of fab construction, and other third party required approvals. See additional information in the new "Frequently Asked Questions and Answers" section in our Tower's web site www.TowerSemi.com About Tower's New Fab Tower plans to construct an advanced fab adjacent to its current facility in Migdal Haemek, Israel. The new fab, referred to as "Fab 2," will employ approximately 1,000 professionals and produce up to 33,000 200-mm wafers per month in geometries of 0.18 micron and below, using advanced CMOS (Complementary Metal Oxide Semiconductor) Pronounced "c-moss." The most widely used integrated circuit design. It is found in almost every electronic product from handheld devices to mainframes. technology from Toshiba. Funding for the project will come from wafer partners, Israel Corp, Israeli government grant, bank loans and the Tower's own resources. Wafer partners include SanDisk Corporation (NASDAQ:SNDK), Alliance Semiconductor (NASDAQ:ALSC), QuickLogic Corporation (NASDAQ:QUIK) and Macronix International (NASDAQ:MXICY). The Israeli Investment Center has recently decided to approve a government grant of $250 million. Tower has already started the detailed design, employee recruiting and technology transfer for the new Fab, and is expecting to begin construction in the next several weeks. About Macronix International Co., Ltd. Since its inception in December 1989, Macronix has been a leading provider of innovative customer/application driven non-volatile memory Refers to memory chips that hold their content without power being applied. It may refer to chips that are not changeable, such as ROMs and PROMs, or to chips that can be rewritten many times such as flash memory. requiring state-of-the-art technology. In the past ten years, Macronix has established remarkable world-class customers in Japan, United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Europe, and Asia Pacific. Macronix is on the Taiwan Stock Exchange Taiwan Stock Exchange (TSEC) Established in 1961, the only centralized securities market in Taiwan. (code: 2337) and was the first company based in Taiwan to be listed listed in NASDAQ (MXICY). Macronix is well known as one of the world's leading suppliers of non-volatile memory. Macronix delivers total solutions in Flash, EPROM EPROM in full erasable programmable read-only memory Form of computer memory that does not lose its content when the power supply is cut off and that can be erased and reused. , and Mask ROM (mask Read Only Memory) Refers to ROM chips. The term is used to differentiate static ROM chips from programmable ROM varieties (EPROM, EEPROM, flash ROM). See ROM. . In addition, Macronix has a strong capability to provide competitive know-how in the areas of audio, video, and networking. These building blocks enable Macronix to offer System-on-a-Chip (SOC) solutions for multimedia applications in the post-PC era. For further information visit www.macronix.com. About Tower Semiconductor Tower Semiconductor Ltd. is an independent wafer manufacturer, strategically focused on advanced Flash memory and CMOS Image Sensor A CMOS-based chip that records the intensities of light as variable charges similar to a CCD chip. Although initially used in less expensive digital cameras, the quality of CMOS sensors has improved steadily. CMOS sensors have advantages over CCDs. technologies. Tower provides manufacturing and turnkey services for integrated circuits (IC) on silicon wafers in geometries from 1.0 to 0.35 micron, using its advanced technological capabilities and the proprietary designs of its customers. In addition, Tower offers manufacturing services for mixed signal and core CMOS devices. To meet anticipated demand, Tower plans to construct a second fab adjacent to its current facility that will operate in geometries of 0.18-micron and below, utilizing advanced materials and advanced CMOS technology from Toshiba. For additional information please visit www.TowerSemi.com microFLASH(R) is a registered trademark of Tower Semiconductor Ltd. Tower's microFLASH process was jointly developed with Saifun Semiconductor Ltd. and is based on Saifun NROM NROM Nitrided Read Only Memory NROM Nitride Read Only Memory NROM Non Volatile Rom (tm)technology. This press release includes forward-looking statements, which are subject to risks and uncertainties. Actual results may vary from those projected or implied by such forward-looking statements. Potential risks and uncertainties include, without limitation, risks and uncertainties associated with (i) satisfaction of the conditions to the closing of the agreement with Macronix and other wafer partners, including obtaining commitments for debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay and government grants, (ii) initiating and completing the construction of a new wafer manufacturing facility, (iii) conditions in the market for foundry manufacturing services and in the market for semiconductor products generally, (iv) successful completion of the development and/or transfer of the microFLASH process and other advanced CMOS technologies to be utilized in the new Fab, (v) market acceptance and competitiveness of the products to be manufactured by Tower for Macronix using these technologies, (vi) successful acceptance in the market for Macronix microFLASH-based products and (vii) ramp-up at Tower's new fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. facility. A more complete discussion of risks and uncertainties that may affect the accuracy of these statements, and Tower's business generally, is included at "Item 1. Business -- Factors Which May Influence Future Results and Accuracy of Forward-Looking Statements" in Tower's most recent Annual Report on Form 20-F, as filed by Tower with the Securities and Exchange Commission. This release and prior releases are available on the KCSA KCSA Krannert Center Student Association KCSA Kentucky Crushed Stone Association (Frankfort, KY) KCSA Kyiv City State Administration KCSA Kalamazoo Christian School Association KCSA Kentucky-Canadian Studies Association Public Relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most Worldwide website at www.kcsa.com |
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