Motorola Adds TSMC as Key Partner in Foundry Strategy

AUSTIN, TEXAS -- February 17, 1999 -- In a move designed to add capacity and provide more agile response to market fluctuations, Motorola has announced that it has entered into a manufacturing partnership with Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest dedicated IC foundry. Under the agreement, TSMC will build products across a wide portfolio for Motorola. The partnership reflects Motorolas' recently stated strategy of moving toward greater levels of outsourcing with major foundry partners.

"Major partnerships like this allow Motorola to sharpen its focus on the technology designs that are differentiators for our customers, while also gaining greater manufacturing flexibility," said Bill Walker, senior vice president and director of order fulfillment for Motorola's Semiconductor Products Sector. "This partnership adds technology to our portfolio, without additional R&D expense. It's a smart move for Motorola".

"The partnership with Motorola offers TSMC the opportunity to extend our relationship with one of the world's leading integrated device manufacturers. We have been working with Motorola on specific programs that are now ready for production at TSMC," said Magnus Ryde, president of TSMC, USA. "This agreement is the start of a major industry trend where foundries like TSMC will work with IDMs to accelerate their time to market using 0.25 micron and smaller geometries."

Financial terms of the agreement were not announced.

About TSMC

TSMC (ADS traded NYSE: TSM, also traded on TSE) is the world's largest dedicated integrated circuit (IC) foundry and offers a comprehensive set of IC fabrication processes, including processes to manufacture CMOS logic, mixed-mode, volatile and non-volatile memory and BiCMOS chips. Currently, TSMC operates two six-inch wafer fabs (Fab 1 and 2) and three eight-inch wafer fabs (Fab 3, 4, and 5), all located in Hsin-Chu, Taiwan. In mid-1998, TSMC announced that production wafers were being delivered from its first U.S foundry WaferTech, a joint venture with Altera, analog Devices and Integrated Silicon Solution, Inc. The company has broken ground in the new Tainan Park which will house Fabs 6 and 7. TSMC's corporate headquarters are in Taiwan. More information about TSMC is available through the World Wide Web at http://www.tsmc.com.

About Motorola

As the world's #1 producer of embedded processors, Motorola's Semiconductor Products Sector offers multiple DigitalDNA(tm) solutions which enable its customers in the consumer, networking and computing, transportation, and wireless communications markets, to create new business opportunities. Motorola's worldwide semiconductor sales were $7.3 billion (USD) in l998.

Motorola is a global leader in advanced electronic systems and services. It liberates the power of technology by creating software-enhanced products that provide integrated customer solutions and Internet access via wireless and satellite communications, as well as computing, networking, and automotive electronics. Motorola also provides essential digital building blocks in the form of embedded semiconductors, controls and systems. Global sales in 1998 were $29.4 billion (USD).