Tower Semiconductor Broadens its U.S. Activities.

Business Editors & High Tech Writers

MIGDAL HA'EMEK, Israel--(BUSINESS WIRE)--July 24, 2002

Tower Semiconductor Ltd. has strengthened the team of its U.S. subsidiary, Tower Semiconductor USA, by hiring two marketing, sales and customer support professionals. John O'Boyle was recruited as worldwide director of strategic marketing and Leslie T. "L.T." Guttadauro will be serving as vice president of sales.

"We expect to boost Fab 2 sales activity and enhance the support of our current customer base through the coordinated efforts of John and L.T.," said Doron Simon, president of Tower USA. "As Fab 2's production launch date approaches, we are strengthening our team by adding resources and very experienced personnel. John and L.T. are seasoned professionals with solid backgrounds in semiconductor sales and marketing, and we're confident they will make a significant contribution to Tower Semiconductor."

As worldwide director of strategic marketing, O'Boyle will focus on developing strategic direction and tactical marketing for the company and will have a part in shaping the company's position as a foundry specializing in certain technologies.

O'Boyle brings more than 30 years of experience in the semiconductor industry to his new role. His areas of expertise include chip design, intellectual property, product definition, business development, sales and marketing, public relations and strategic planning. Most recently, O'Boyle served as marketing director for Samsung Semiconductor, the U.S. division of Samsung Industries, Korea. In that position, he coordinated an international team that marketed Samsung's application-specific integrated circuits (ASIC) and system-on-chip (SoC) devices. Prior to Samsung, O'Boyle held various management and engineering positions with National Semiconductor, Virtual Silicon Technology, Color Planar Displays, Dataquest, Gnostic Concepts, and Fairchild. O'Boyle has received patents and industry awards, and has published numerous technical papers. He earned a bachelor's degree in electrical engineering and master's degrees in business administration and electrical engineering from the University of Santa Clara in California.

In his new role as vice president of sales, Guttadauro will lead Tower USA's sales organization, based in San Jose, California, which includes the company's internal sales team and Tower's manufacturer representatives. His responsibilities will include securing new business for both Fab 1 and Fab 2 and managing existing customer relationships.

Also a veteran of the semiconductor industry, Guttadauro has more than 35 years of experience in sales, marketing and engineering, including intellectual property negotiations, and ASIC chip design. Prior to joining Tower USA, he was senior director of sales development at Amkor Technology. In that capacity, he developed and implemented sales programs to increase sales of Amkor's wafer fabrication services. Guttadauro has held various engineering and management positions during his career with IBM, Zilog and VLSI Technology. Guttadauro earned a bachelor's degree in materials science and engineering from Lowell Institute of Technology in Massachusetts and a bachelor's degree in business management and administration from Columbia Pacific University in California.

About Tower Semiconductor USA

Tower Semiconductor USA is a wholly owned subsidiary of Tower Semiconductor Ltd. (Nasdaq:TSEM) (TASE:TOWER), focused on marketing, sales and technical support for Tower's customers in the United States.

About Tower Semiconductor Ltd.

Tower Semiconductor Ltd. is an independent wafer manufacturer that provides design support, manufacturing and turnkey services for integrated circuits (ICs) on silicon wafers in geometries from 1.0 to 0.18 microns. Tower is strategically focused on advanced non-volatile memory solutions, mixed-signal and CMOS image-sensor technologies. The company is now prototyping 0.18-micron products in its new fabrication facility, Fab 2. When complete, Fab 2 will offer 0.18-micron and below process technologies, produce up to 33,000 200mm wafers per month and employ approximately 1,100 people. Fab 2 features advanced CMOS technology licensed from Toshiba Corporation (NIKKEI:TSE), as well as foundry-standard technology, which is applicable to digital, mixed-signal, CMOS image-sensor and flash memory processes. Tower maintains a Web site at www.towersemi.com.

Safe Harbor 

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) obtaining additional financing for the Fab 2 project from equity and/or wafer partners and/or other sources, (ii) a failure by Tower to raise funding by the deadlines set forth in its agreement with its banks and/or a failure by Tower to reach an agreement with its banks to extend the deadlines to raise additional financing in 2002 and 2003, which would result in an event of default of Tower's loan agreement, in which event the banks would have the right to call the loans and exercise its liens against Tower's assets, (iii) a declaration of default by Tower's wafer partners, financial investors and the Investment Center of the State of Israel should Tower's banks call the loans, (iv) satisfaction of all other conditions under the agreements with the Fab 2 equity and wafer partners, the Israeli Investment Center and Tower's banks, (v) completing the construction of a new wafer manufacturing facility, (vi) conditions in the market for foundry manufacturing services and in the market for semiconductor products generally, (vii) successful completion of the development and/or transfer of advanced CMOS process technologies to be utilized in Tower's existing facility and in Fab 2, (viii) obtaining additional business from new and existing customers, (ix) market acceptance and competitiveness of the products to be manufactured by Tower for customers using these technologies and (x) ramp-up of production at Fab 2.

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 3. Key Information--Risk Factors" in Tower's most recent Annual Report on Form 20-F, as filed with the Securities and Exchange Commission.