Tower Semiconductor Ltd. — Environmental & Social Information 2004

Feb 9, 2004

FOR IMMEDIATE RELEASE

TOWER SEMICONDUCTOR RECEIVES

ENVIRONMENTAL MANAGEMENT CERTIFICATION

ISO 14001 endorsement demonstrates commitment to highest standards for customers and environment

MIGDAL HAEMEK, Israel – February 09, 2004 – In conjunction with its corporate environmental management initiative, Tower Semiconductor Ltd. (NASDAQ: TSEM; TASE: TSEM) has received ISO 14001 certification from The Standards Institution of Israel.

A series of international standards on environmental management, ISO 14000 provides a framework for the development of an environmental management system and the supporting audit program. ISO 14001 is the cornerstone standard of the ISO 14000 series. It specifies a framework of control for an environmental management system against which an organization can be certified by a third party.

“Qualifying for ISO 14001 certification represents Tower’s involvement and interest in its surrounding community as well as in its customer requirements,” said Ziv Hilleli, quality system director at Tower Semiconductor. “As a global citizen, Tower must be aware of all environmental implications, and we must take all necessary measures to eliminate any negative impact. We are fully committed to implementing ISO 14001 principles to achieve continuous improvement in all environmental aspects.”

“I am very proud that Tower, the leading semiconductor foundry in Israel, is implementing the ISO 14000 standard”, said Ziva Patir, general director of The Standards Institution of Israel. “This standard is most important for promoting a policy of environmental management. All companies that implement the standard promote environmental quality in their respective activities and in modern society in general. There is n o d oubt”, added Mrs. Patir, “that this standard reflects the close interrelationship between the business community and the quality of life in our modern world”.

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The ISO 14001 certification applies to all Tower manufacturing facilities, including Fab 1 and the highly advanced Fab 2, where leading-edge semiconductor devices with 0.18-micron and lower geometries are being manufactured. The company’s design center in Netanya, Israel received certification, as well.

In other environmental news, Tower Semiconductor was awarded the Sony Green Partner certificate in December 2003. “This is a company-wide effort, and we are all continually working together to meet standard requirements,” said Rafi Nave, vice president of customer service at Tower Semiconductor. “Our considerable investment in quality management in general, and in environmental management in particular, contributes to our success and continuous growth. We act responsibly and respectfully in every aspect of our business – towards customers, suppliers and the environment. We are honored to be recognized for our efforts.”

About Tower Semiconductor Ltd.

Tower Semiconductor Ltd. is a pure-play independent wafer foundry established in 1993. The company manufactures integrated circuits with geometries ranging from 1.0 to 0.18 microns; it also provides complementary technical services and design support. In addition to digital CMOS process technology, Tower offers advanced non-volatile memory solutions, mixed-signal and CMOS image-sensor technologies. To provide world-class customer service, the company maintains two manufacturing facilities: Fab 1 has process technologies from 1.0 to 0.35 microns and can produce up to 16,000 150mm wafers per month. Fab 2 features 0.18-micron and below process technologies, including foundry-standard technology. When complete, Fab 2 is expected to offer full production capacity of 33,000 200mm wafers per month. The Tower Web site is located 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) the completion of the equipment installation, technology transfer and ramp-up of production in Fab 2, (ii) having sufficient funds to complete the Fab 2 project, (iii) the cyclical nature of the semiconductor industry

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and the resulting periodic overcapacity, (iv) operating our facilities at satisfactory utilization rates, (v) our ability to capitalize on increases in demand for foundry services, (vi) meeting the conditions to receive Israeli government grants and tax benefits approved for Fab 2 and obtaining the approval of the Israeli Investment Center to extend the five-year investment period under our Fab 2 approved enterprise program and of amendments to our modified business plan, (vii) attracting additional customers, (viii) not receiving orders from our wafer partners and technology providers, (ix) failing to maintain and develop our technology processes and services, (x) competing effectively, (xi) our large amount of debt and our satisfying the covenants set forth in our amended facility agreement, and (xii) achieving acceptable device yields, product performance and delivery times (xiii) the completion of the documentation for the Siliconix agreement. A more complete discussion of risks and uncertainties that may affect the accuracy of forwardlooking statements included in this press release or which may otherwise affect our business is included under the heading “Risk Factors” in our most recent Annual Report on Form 20-F and in our Form F-3, as amended, as were filed with the Securities and Exchange Commission and the Israel Securities Authority.

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Loomis GroupPR Agency ContactJulie Lass+1 (713) 526 3737lassj@loomisgroup.com	Fusion IR & CommunicationsInvestor Relations ContactSheldon Lutch+1 (212) 268 1816sheldon@fusionir.com	Tower Semiconductor USACorporate ContactMichael Axelrod+1 (408) 330 6871micha@tower-usa.com