April 21, 2003 – Migdal Haemek, Israel – Tower Semiconductor Ltd. said that its new fabrication plant will not meet its final milestone in July.

In a notice to regulators, Tower said market conditions have caused it to delay the acquisition of equipment for the Fab 2 plant, so it doesn’t expect to achieve by July the fifth milestone of manufacturing 5,000 silicon wafers/month in two full consecutive months, reported Dow Jones.

The company will ask shareholders at a special May 14 meeting to approve a plan to have strategic partners SanDisk Corp., Alliance Semiconductor Corp., Macronix International Co., and QuickLogic Corp. advance their investments in connection with the fifth milestone payment.

A first installment, equal to 60% of the total fifth milestone payment, would be transferred within five business days following the receipt of all required approvals. This amount would range between $24.2 and $26.8 million.

A second installment, which would constitute the balance of the payment and total between $16.1 and $17.9 million, would be paid by August 2003, or within five business days after the company has raised $22.1 million from other sources.