TowerJazz raises $100 million in debentures offering

MIGDAL-HAEMEK, ISRAEL: TowerJazz announced the completion of its previously announced fundraising in Israel, following a public tender executed today resulting in excess demand of 150 percent.

TowerJazz raised an aggregate of approximately NIS 380 million through the issuance of new Series F debentures. The debentures were issued at 96 percent of par value.

The series F convertible debentures are linked to the US dollar, bear interest of 7.8 percent per annum, payable semi-annually on June 30 and on December 31 of each year through 2016, commencing December 31, 2010, and are convertible into the Company’s ordinary shares commencing September 2012 at about 20 percent premium over the company’s ordinary shares.

The placement agents acted in the transaction were Leader Issuances (1993) Ltd., Clal Finance Underwriting Ltd, Leumi Partners Underwriters Ltd., Apax Underwriting Management and Issuances Ltd., Poalim I.B.I – Underwriting and Issuances Ltd. and Barak Capital Underwriting Ltd.

Russell Ellwanger, TowerJazz CEO, stated: “With this $100 million fund raising, we completed the comprehensive debt restructure carried out over the past several months. This restructure comprised the extension of the $45 million Wells-Fargo credit lines, $80 million Jazz level bonds exchange to bonds due in 2015, $50 million pay down and restructure of the remaining $160 million Israeli banks debt to a long term loan and this deal.

"The composite has created a new balance sheet with zero bank loans’ principal due during the coming three years, servable debt ratios and a cash balance which will enable quick execution on synergistic business opportunities. I am extremely excited that sophisticated investors have expressed such strong confidence in our business model and belief in our future success by investing $100 million in newly issued long-term debentures.

"We received extreme positive feedback from the many investors who we met during the recent road show. With the new balance sheet, debt ratios, cash balance and $500 million annualized quarterly revenue run rate, we are in a financial and business position unlike any in our company's history and are fully focused to fulfill our corporate vision ‘to be the world leader in specialty foundry solutions as measured by our customers, employees and investors’.”

TowerJazz thanks its counsel, David Schapiro, a partner of the Law Firm of Yigal Arnon & Co. and Rami Chalaf, a partner of the Accounting Firm of Deloitte Brightman Almagor Zohar.