Tower Semiconductor and Virage Logic Announce License Agreement of NOVeA Family of Embedded Non-Volatile Memories

Virage Logic's NOVeA Available to Tower Customers Later this Year

Migdal Haemek, Israel and Fremont, CA - June  4,  2002, Tower Semiconductor (NASDAQ: TSEM, TASE: TOWER), an independent wafer foundry strategically focused on advanced flash memory and CMOS image-sensor technologies, and Virage Logic Corp. (NASDAQ: VIRL), the global leader in embedded memory technology, today announced a multiyear licensing agreement. The agreement enables Virage Logic to develop and license to Tower, and it's customers, the NOVeA family of non-volatile embedded memories on Tower's 0.18-micron technology. Tower expects the embedded memories to be available by the fourth quarter of 2002. The agreement also grants Tower the right to license Virage Logic's 0.13-micron process technology for NOVeA in the future.

"Through this agreement, we have significantly enhanced our process portfolio and increased our customers' options for cost-effective, non-volatile embedded memory solutions," said Ishai Nachumovsky, senior director of Foundry Technologies at Tower. "NOVeA will complement our high-density microFLASH® memory offering for SoC applications by providing a low-density alternative that requires fewer processing steps. This can substantially lower production costs and accelerate time-to-market for customers who need a small amount of programmable non-volatile memory."

NOVeA, which can be reprogrammed numerous times, is designed for integration into system-on-chip (SoC) applications. It is the first non-volatile, electrically alterable embedded memory solution that can be produced using standard logic processes. Most embedded non-volatile memory solutions require special process technology that adds steps and photomasks to fabrication, which increases costs and delivery time. Since NOVeA can be manufactured by using a standard logic process, additional process steps and masks are not necessary, thereby reducing costs and delivery time. By employing sub-micron geometries, NOVeA technology can help reduce overall system size, lower power consumption and increase performance.

"Making NOVeA widely available in a variety of sub-micron logic processes meets the needs of a broad market, enabling those customers who are developing Internet routing equipment, wireless communications and consumer applications to build better products faster and more economically," said Adam Kablanian, Virage Logic's president and chief executive officer, "We look forward to working with Tower to ensure that our mutual customers have access to a non-volatile embedded memory solution that enables high-volume production, quickly."

In addition to offering NOVeA embedded memory, Tower delivers its unique microFLASH technology, which is the industry's smallest cell size and simplest manufacturing process for high-density flash. Based on Saifun NROM™ technology, Tower's flash architecture stores two bits in each cell, effectively doubling memory density. The production of microFLASH modules is compatible with standard CMOS processes, making the modules ideal for integration with functional logic and analog circuitry.

SAFE HARBOR FOR TOWER SEMICONDUCTOR LTD

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 successful completion of the development of the advanced technology to be utilized in Tower's existing facility and in Fab 2, (ii) market acceptance and competitiveness of the products to be manufactured by Tower using these technologies (iii) the successful ramp-up of production of the developed technology (iv) obtaining additional business from new and existing customers, (v) obtaining additional financing for the Fab 2 project from equity and/or wafer partners and/or other sources, (vi) 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, (vii) 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, (viii) satisfaction of all other conditions under the agreements with the Fab 2 equity and wafer partners, the Israeli Investment Center and Tower's banks, (ix) completing the construction of a new wafer manufacturing facility, (x) conditions in the market for foundry manufacturing services and in the market for semiconductor products generally, (xi) 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, and the Company's report on Form 6-K for the month of April 2002, as filed with the Securities and Exchange Commission.

SAFE HARBOR STATEMENT FOR VIRAGE LOGIC UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:

Statements made in this news release other than statements of historical fact are forward-looking statements, including, for example, statements relating to Virage Logic's business outlook, new products and new relationships. Forward-looking statements are subject to a number of known and unknown risks and uncertainties, which might cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include Virage Logic's ability to maintain and develop new relationships with third-party foundries, adoption of technologies by semiconductor companies and increases in the demand for their products, the company's ability to overcome the challenges associated with establishing licensing relationships with semiconductor companies, the company's ability to obtain royalty revenues from customers in addition to license fees, business and economic conditions generally and in the semiconductor industry in particular, competition in the market for embedded memories and other risks including those described in the Company's Annual Report on Form 10-K for the period ended September 30, 2001, filed with the Securities and Exchange Commission (SEC) on December 19, 2001, and in Virage Logic's other periodic reports filed with the SEC, all of which are available from Virage Logic or from the SEC's website (www.sec.gov), and in press releases and other communications. Virage Logic disclaims any intention or duty to update any forward-looking statements made in this news release.

microFLASH is a registered trademark of Tower Semiconductor Ltd. NROM is a trademark of Saifun Semiconductor Ltd. NOVeA is a trademark of Virage Logic Corp. All trademarks and copyrights are property of their respective owners and are protected therein

Contact Virage Logic Fill out this form for contacting a Virage Logic representative. Your Name: Your E-mail address: Your Company address: Your Phone Number: Write your message: