Thank you and welcome to TowerJazz Financial Results Conference Call for the Second Quarter of 2013. Russell will open the call followed by Oren with a discussion of our results. After managements' prepared remarks, we will open up the call to the question-and-answer session. Before we begin, I would like to remind you that some statements made during this call may be forward-looking and are subject to uncertainties and risk factors that could cause actual results to be different from those currently expected. These uncertainties and risk factors are fully disclosed in our Form 20-F, F-4, F-3, and 6-K filed with the Securities and Exchange Commission, as well as filings with the Israeli Securities Authority. They are also available on our website. TowerJazz assumes no obligation to update any such forward-looking statements. Now, I'd like to turn the call to our CEO, Mr. Russell Ellwanger. Russell, please go ahead.

Thank you, Noit. Welcome everyone to our second quarter 2013 results conference call. During today's call, I'll review our business performance in the second quarter of 2013 by get into the rest of the year and beyond. Oren will then provide detailed financial summary and 2013 financial results. Our revenues in the quarter came in at $125 million in the midrange of our guidance, an increase of 11% over the previous quarter. This represents a 26% decrease against Q2 2012, which period had a high micron M&A-base contractual revenue. However, the $125 million is an increasing core business wafer revenue, which will increase further in Q3. The second quarter had several noteworthy achievements. The second quarter as well as the first half year show more than 15% increase in design wins against the same period in the previous year. As stated in previous calls, the design win is the first stage of bringing new and additional customer products into our factories with an average two-year horizon to reach volume levels of production. The entrance of a customer mask-set is the last step to enable a production ramp and typically takes an average of one-year to reach volume with the one to maybe two-year lifetime from that point. We realized a record 7,500 masks entering into our factories during the first half of 2013. This being 30% higher than the same period in 2012. Design wins and the number of mask entering the factory are the most important indicators for continuous revenue growth during the years to come. The latter being closely tied to revenue and utilization performance one-year from now. Looking at the individual business units, each and every one saw strong achievements in the previous quarter. In our CMOS image sensor unit, our focus remained medical, dental, non-destructive test…

Thank you, Russell and hello everyone. I'd like to start my financial review by providing a balance sheet analysis as of the end of the second quarter of 2013. We have significantly strengthened our balance sheet beyond 2013. Our net current assets, which is the amount of our current asset less amount of our current liabilities increased from $129 million as of December 31 2012 and $141 million as of March 31, 2013 to $157 million as of the end of June 2013. Our current ratio which have improved from 1.8x as of the end of 2012, to 2.0 as of March 31 2013, and now stands at 2.1 as of the end of the second quarter of 2013. It is important to bear in mind that following the close of the quarter in July, we added a further $18 million to our cash position from the exercise of warrants from the right offering which I will discuss in a few minutes and this is not yet deflected in the net current assets figure, I just mentioned. Our short-term debt was reduced from $50 million on December 31, 2012 to $35 million as of June 30, 2013. Our shareholders equity was $184 million at the end of the second quarter. Our cash balance as of June 30, 2013 includes $117 million of cash and deposits again excluding the additional $18 million we received from the recent warrant exercised in July. Cash from operations excluding interest payment was a positive $25 million in H1 2013 or a positive $9 million net after payment of all interest. Capital investments during the quarter were $19 million. Our loan extension agreement with our Israeli lending banks signed in 2013 further strengthened our balance sheet and reduced the principal maturity do in 2013 and 2014…

Thank you, Oren. Before I open up the call to the Q&A session, I would like now to add a general and legal statement to our results in regard to statements made and to be made during this call. Please note that the first quarter of 2013 financial results have been prepared in accordance with U.S. GAAP, and the financial tables in today's earnings release includes financial information that may be considered non-GAAP financial measures under Regulation G and related reporting requirements as established by the Securities and Exchange Commission as they apply to our company. Mainly, this release also presents its financial data, which is reconciled as indicated by the footnote below the table, on a non-GAAP basis after deducting depreciation and amortization, two, compensation expenses in respect to options grants and three, finance expenses, net other than interest accrued, such that non-GAAP financial expenses, net include only interest accrued during the reported period. Non-GAAP financial measures should be evaluated in conjunction with, and are not substitute for, GAAP financial measures. The tables also contain the comparable GAAP financial measures to the non-GAAP financial measures, as well as the reconciliation between the non-GAAP financial measures and the most comparable GAAP financial measures. EBITDA as presented is defined in our quarterly financial release. EBITDA is not a required GAAP financial measure and may not be comparable to a similarly titled measure employed by other companies. EBITDA and the non-GAAP financial information presented herein should not be considered in isolation or as a substitute for operating income, net income or loss, cash flows provided by operating, investing and financing activities, social data or other income or cash flow statement data prepared in accordance with GAAP and is not necessarily consistent with the non-GAAP data presented in previous filings. I would now like to turn the call over to the operator. Operator?

Thank you. (Operator Instructions) The first question is from Jay Srivasta of Chardan Capital Markets. Please go ahead.

Yes, thanks for taking my question. Russell, as we look at the macro conditions reflected by our Q2 results and guidance, are we to conclude that we might be in the beginning stages of recovering the semiconductor market and if that’s not the case, could you help us clarify what your view is in terms of the overall sector?

I try not to make prophetic statements about overall sector and what’s happening in the general industry. For the blanket semiconductor. For the specific segments that we are involved in, we certainly see good demand at this point. The discrete market has come back pretty strong to the levels that we have been seeing in the past part of that has seen through the contract that we had done with international rectifier. Certainly the whole realm and range power management is a very big focus everywhere right now. I think the demand that we will be seeing overall on the LED lighting will drive a lot of activity. The RF side, I think has been strong for a long time, there is even relative slowdown of bubble fall in demand, it’s a huge market. And for us, specifically it’s a market that our shares growing immensely in. Now, we have talked about it for I think the past some three quarters. But, the moments of the antenna switch from gallium arsenide PHEMT to SOI and our positioning in capability with the SOI for that. We are poised for very, very strong growth in this area from a market that we didn’t serve at all to a true share of market that we are going after of $150 million to $200 million. And I think the activities are in place for us to lamp into that and to achieve that and growing into in 2014 and achieve it in 2015. And so, in those specific areas we really are doing very, very well. On power management to our platforms are growing nicely, I was again, in Korea last week. I met with a variety of customers and in our case all of it is really new substantial market entrants in market share growth. So, how is the overall semi industry doing, I can’t say that’s its popping out, I mean, there is some reports right now that its slowing down. I think some of the other foundry growth and guidance from Q2 to Q3 isn’t necessarily overly strong. Our guidance I think is very nice at the 8% especially if one consider that’s still substantially back filling reductions in the Nishiwaki Micron contract. So for us, we are doing very well. It is the overall industry doing well certainly the discrete market I think is looking strong from the demand that we are seeing. And the power management market is flourishing. The demand that we are seeing and the excitement from customers within the RF module, not just the SOI switch but our capabilities with silicon germanium based power amplifier. Now this is all I think going very, very nice. So, I know that didn’t 100% answer your question Jay but that’s really what I could say.

No, that gives good color. In the last quarter, you have had a lot of design activity and agreements, the Nujira, the International Rectifier, and the Crocus. Help us understand when do you expect some of these agreements to really start to materially impact your top and bottom line as you look ahead for the next, say, year or so.

Nujira expects very nice ramps within 2014 from what we are seeing there that should be going up in that realm. The International Rectifier has been strong revenue its continuing to grow in strong revenue. We have transferred platforms in the past, this contract has stated in the PR, I don’t want to state beyond the PR, its just for multiple platforms, so we would see that continuing to grow but the International Rectifier activity has been substantial for us top and bottom line for a while. And the Crocus you mentioned was another one? Crocus is targeted for volume release for us in December and the forecast there, again, a little bit specific for me to be talking about customers and forecast and but I think from everything that we are talking about and that we see where is (inaudible) his market looks very strong. So, we would expect that to be ramping through 2014 and 2015. All right, area that you didn’t ask about is probably one of the bigger incremental areas for the company and that’s where we are building an annex to be able to do a full flow infrared detector, infrared sensor. So, in that case, there can be very, very large revenue. The activity is a very new activity for us. It’s an activity that’s aligned with and partnering with a customer. But, I would see that is having some portion of revenue coming in 2014. But, very, very substantial incremental market and upside in the 15, 16, 17 regions, I’m really talking substantial numbers. I mean very substantial. That’s a very nice margin. So, I think that if you look at the activities that we announced in the last quarter many of them are very powerful, the IR contract I mentioned is the second wafer based second largest wafer based commercial contract the company has ever done. The activity that we are doing with the IR sensor is also promising to be extremely large. I mean, its just a question of the traction in the commercial environment.

Okay. Your comments on the India project seems to suggest some uncertainty in terms of timing and when it should come to fruition. Realistically, what is your read on it, on when do you expect to be able to proceed on this project and start to see material revenues from this?

I can only state what the Minister Sibal stated to me. And that was that they would be bringing it, he would be bringing to the cabinet in July and we would be hearing shortly after. I think its being going around long enough if you look at the amount of press there has been in India in the past week, it’s a huge amount of press quoting and citing many, many different officials. I think from the amount of activity and emotion that’s around it. I would expect to hear something one way or the other in the very short-term, I mean, within the next 1 month to six weeks. But that’s just my expectation Jay, I certainly do not speak for a government announcing a decision.

All right. Last question Oren looks like there was a nice jump in gross margins as you look at Q3 with higher utilization and revenue run rate would it be fair to expect margins to expand?

Yes, generally speaking for each $10 million increase in revenues which is the middle range of the guidance. You expect 50% to 60% incremental margin, this quarter actually it was better, we have a 100%. The reason was that on top of the fact that we had more revenues and quantities, we also had more inventories in the line and finished goods because we saw that Q3 coming. So accountingtly when you have more inventories with or finished goods, it’s of course in profit margin and we expect the same thing on Q3. So, I wouldn’t expect 100% incremental margin, you cannot do that every quarter 50% to 60% is a conservative assumption, yes.

Thank you. Good luck.

Thank you.

The next question is from Ken Nagy of Zacks Investment Research. Please go ahead.

Thanks for taking my question. Just assuming you get the India plant, can you just explain why the margins would be so high on that?

One more time the question.

Assuming you get the India plant, can you just explain why the margins would look so high on that?

Sorry, I don’t know what you are referring to as far as anything reported about what the margins would be on the India plant I don’t know that we have ever spoken to that. But I could explain why that would be very high margins.

Sure.

The activity that we are doing there for the first year, this is a service activity. Almost every dollars that we would get for the first three years is very close to 100% gross margin, it’s activity against a head count that isn’t huge head count, it’s not an activity against any COGS, it’s just against the head count.

Yes, maybe I will take. Overall, it’s not here to build favor. I mean, we are not investing cash also. We are not participating in the investment. We are just providing managerial – just management in terms of property and other services, like Russell also mentioned. So our only cost is that some head count that we will put on that and therefore margin al the cashing that we will get doesn’t have against it cost or investment in the firm.

After the factory is completed, we will also be involved and we would have portion of the factory for our own sales, our own capability. And then we would come more into a standard fab model on the margin that would be selling half of the usage in the factory. But, we would have a capacity in the factory, that’s a very expensive factory half of having enabled the factory to be built rather than half of a capital investment.

Great, thank you.

The next question is from George Berman at J.P. Turner & Co. Please go ahead. George Berman - J.P. Turner & Company: Good morning, gentlemen and thank you for taking my call.

You are very welcome. George Berman - J.P. Turner & Company: As always, a great presentation. I have a couple of questions. Number one, explain to me the acquisition that you made in Japan, in the (Nuvada) facility, and the current fluctuations downwards guidance in Japanese yen. How does that, if at all, help us going forward and how are you looking at the switchover from the Micron revenues to your own revenues? How is that going?

You should mention the exchange rate.

I will talk about, Oren, talked you about the exchange rate, that’s we are working that, but I will answer on the transition, during the script, I have mentioned several activities. One of them being the previously announced contract with Vishay Siliconix and some of their flow families being bought up and qualified in the Nishiwaki facility. In the International Rectifier contract that we just announced, it was also stated that some of that will also go into the Japan factory. In the script that I just read, I talked about qualifying for a Korean customer that has a potential of being at 20,000 wafer a month. So, those are the three big activities to drive the volumes in the factory. In addition to that, I have mentioned that our power management platform is qualified there with the first lots coming out at 98% yield. So, at this point, we have the ability to cross qualify and allow ourselves as we see and forecast our revenue ramp throughout 2014, so move products into the Nishiwaki factory and to have that added capacity for us. So that’s the other area there and then there is a variety of Japanese customers themselves that have been brought into the factory as well as some Japanese customers that are brought into other factories for example into Newport Beach for some silicon germanium an SOI switch technologies. So, that’s the methodology to fill the factory. At present, the factory is at about 40% utilization which was within our plans, we bought it meaning that we bought the factory with the idea that we truly needed to have added capacity. It’s now the challenge in the task to fill the factory within the next year and to get up to a point of utilization that the factory becomes break even in and of itself. The first several years of running the factory, the factory has produced a good amount of cash for the company. George Berman - J.P. Turner & Company: Great, so the advantage of having qualified personnel on hand, the logistical positioning right across basically from China, close to Korea, should also help in gaining additional contracts?

Yes, the big Korean customer that we are talking about the deal was specific for Japan. So you are 100% correct. George Berman - J.P. Turner & Company: So the -- according to press reports, one sees the Japanese yen dropping further in the value. That would all be additional gains for us?

Well, so far until now and also for the coming year we have the major customer in Japan is Micron and contract prices with Micron are in yen. And on the other hand all the expenses – almost all the expense in Japan are in yen. So actually we have a natural edge that all our revenues are edged against all our expenses because everything, not everything but 90% of the expenses and the revenues are in yen. So it actually does not affect us at all. For the future, actually if the yen is becoming like 100, 105, 110 it’s an advantage for us because the revenues will be in dollar and expenses will be in yen. It’s important to know that our initial business plans and all the forecast was done when the yen was 75 to 80. So now we have an upside of 20% compared to those plans. George Berman - J.P. Turner & Company: Right. Next question, explain to me the reasoning for the recent rights offering. It looks to me like you had even before this rights offering ample amounts of cash. The company’s generating positive cash flow. And I think the only sort of roadblock between a significantly higher valuation and the current price is the extraordinary amount of depreciation and amortization you have to carry every quarter, but even that seems to be reducing quite nicely by about $9 million from a year ago.

Yes well, we wanted, I mean we have either corporation our strategic, our major shareholder that really knows our plans and strategic direction and we present from time to time to the board. And we were in the mindset that an equity investment, I mean an investment by other corp was something that it want to pursue and we also want to pursue. And equity to -- strengthen the equity, so basically we had two reasons, one is the lack of desires to invest, and invest in equity, the other we wanted to give the entire shareholders, the opportunity to participate in the same terms. And the third reasoning for that was strengthening the balance sheet. So you are correct George, that we have enough cash and balance sheet is strong. But still if you check like the ratio of shareholders equity in the balance sheet to total balance sheet. So, it maybe 0.2, 0.25, the ratio of shareholders equity to debt. Also like, we believe before the right offering that it should have been front-front and this is where we chosen avenue which is on the one hand an equity fund raising, on the other hand not dilutive because it enabled shareholders to participate in the same-term and everybody does participate maintained this percentage. So, this was the initial idea behind that. George Berman - J.P. Turner & Company: Yes, we participated 100% in the two rights offering so far. The depreciation amounts, there is many companies that have depreciation exceeding -- it's exceedingly high. For some reason, it seems to me like Tower Semiconductor gets especially punished for having the GAAP loss versus the non-GAAP income. If you earned $0.35 for the last quarter, as you state today, I am certain your stock would not be trading at below $5.

Yes, I agree with you that on the depreciation we are like a special case, and you can really see it’s not the entire TowerJazz, its specifically fab 2, I mean. If you have a look how much it costs us to buy a fab 4 which is the Nishiwaki fab. So about $40 million cash and 20 shares, so $60 million took to purchase the Jazz facility fab 3 cost between $20 million to $30 million. But to built fab 2 cost us $1.5 billion. So actually this huge cost of establishing a fab from scratch fab 2, creates for us now such a burden of accounting of reflecting the historical expensive investment. So it’s really our assumption that we believe we should show to the investors, also the numbers excluding that. And this is why really and you really see that the CapEx ongoing, I mean CapEx for this quarter I said it in the street was $19 million, 1-9. So its an annual outlet of $76 million but the depreciation on rate is doubled that amount. George Berman - J.P. Turner & Company: Yes, yes.

Oh, it’s really specialized item, we believe that, we focus that within two years the numbers of depreciation will go down to the level of the numbers of the CapEx then we can really be much more profitable and we don’t need to show the non-GAAP anymore, because the GAAP will reflect the operation efficiency. George Berman - J.P. Turner & Company: Yes, all right. In the meantime, you just need to educate investors about the strength of your Company. Thanks for your time today and we will be continuing to follow you.

Thank you very much

The next question is from Ziv Gill of Ramont. Please go ahead. Ziv Gill – Ramont: Hi, Oren; hi, Russell.

Hi. Ziv Gill – Ramont: Russell, I have a question. I am trying to get an indication of the future capital allocation decisions. So when you look at your business, the business that you see in, say, 2014 and 2015, given the design wins that Matthew described, how far are you from your desired portfolio? I'm not asking about specific customers or specific segments, but when you try to think about the portfolio, how far are you and what do you think is needed in terms of additional capacity, perhaps?

Portfolio, you mean the portfolio of our product offerings, of our platform offering? Ziv Gill – Ramont: Right, right. The combined revenue, which you give a certain breakdown, but it is not easy to see the whole breakdown, of course.

We have mentioned in the script having had a partnership for backside illumination. The backside illumination image sensor is a technology that some companies have right now variety foundries but a few foundries have it. It’s to enter into it a very high investment and especially because the first two years of the backside elimination, you are not going to have very, very high volumes. So, the ROIs on the CapEx is long coming. The first line for backside illumination itself and I apologize this is a detailed answer but its – this is just an example and then I will get into it maybe a more generic overall answer. But the CapEx to get involved in it. So the first capability is maybe somewhere around the order of $80 million. Now, if we do CapEx investment for expansion, we typically target at the worst a 9 month return on the investment half of the utilization on the capacity increase. This wasn’t always the case in the company. It is the case for the past years as Oren mentioned the initial investment for the company is so being depreciated and very difficult to handle. But as long as every incremental and investment we do on CapEx, new CapEx for expansion or for capability, if its targeted on a 9 month ROI, then I think it’s a very model and very justifiable. The backside illumination would probably be on a three or four year ROI because you first have to do the development and then get the customers qualified on it and then drive the activity. So, in those areas, we are building a portfolio by trying to generate a partnership with somebody that has that capability where we are buying the service at first as we build up the customer…

Thank you. There are no further questions at this time. Mr. Ellwanger, would you like to make a concluding statement?

Yes. Firstly, again, I really do thank everyone for their interest in the company we held today Migdal Haemek, a middle management meeting. We talked about where we are at, where we are going certainly some information that’s – they are non-public that we wouldn’t share with the public at this point. But, the company is in a very strong trajectory. I think the directions we are in, things we are doing are for everyone that’s within the company and sees it quite exciting. We held last week, I’m sorry, the week before last in Japan a very large technical symposium for a variety of customers. We had 130 customers at the conference some existing customers, some people that were looking and interested. But it was a really an atmosphere that was so exciting during the reception after the conference was completed. I had given the opening key note and I was so thrilled at customers that came up to me and just being proud of the fact that they have just taped out into the Nishiwaki factory. They would be taping out shortly into the Nishiwaki factory. So we are making an impact there I think that the activities are strong. Now, I’m not saying that these activities and these 130 customers that were there are 10 to 1000s of wafers per customers. It’s not I mean, Japan moved slowly but the organic capability in Japan is moving steadily. And that’s an exciting thing to see. I was in Korea last week as I mentioned, and boy the relationships there, the excitement there, our capabilities there, customers talking about our platforms, you look at it an AMOLED driver and a customer explaining to me how our platform was absolutely differentiated from an application that they had, the design that they wanted to do. Any other platform that anyone else was providing. When you have customers that are that excited about your offering that makes any leader in a company extremely satisfied with where we are at. So, if you look at the present, we have come a very long way, we see Q3 as we guided with a nice piece of growth that 8% mid-range. Q4 is pretty visible at this point, we see continued growth in Q4. Q1 maybe a little less but visible enough that we would see growth in Q1. And then they are stated with these amount of mask sets entering our factories with all the things going on with SOI. We would believe that target and continued growth throughout 2014 is very realistic. So that’s my summary. Thank everyone for involvement in the company. I want to thank all the shareholders who are very, very successful rights offering. We are very excited about the subscription there and the belief that you have in the company. Thank you very much.