Company: TSEM
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001178913-25-001537
Chunk: 54

Company: TOWER SEMICONDUCTOR LTD
Filing Date: 2025-04-30
Form: 20-F
Item: Item 3
Chunk 54
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 approximately 51,900 square foot area capable of being used as a special “clean room.” Fab 1 supported geometries
ranging from 1.0 micron to 0.35 micron.

Fab 2

In 2003, we commenced operations in Fab 2, also located in Migdal
Haemek, Israel. Fab 2 supports geometries ranging from 0.35 to 0.13-micron, using advanced CMOS technology, including CMOS image sensors,
embedded flash, advanced analog, RF SOI, power platforms and mixed-signal technologies. The overall clean room area in Fab 2 is approximately
100,000 square feet. We have invested significantly in the purchase of fixed assets, primarily in connection with the construction of
Fab 2, technological advancement and capacity expansion. The land on which Fab 2 is located is subject to a long-term lease from
the Israel Lands Authority that expires in 2049.

36

Fab 3

NPB Co.’s facility, Fab 3, is located in Newport Beach, California.
Fab 3 supports geometries ranging from 0.80 to 0.13-micron. The facility comprises 320,000 square feet, including 120,000 square feet
of overall clean room area.

NPB Co. leases its facility under a lease agreement that was initially
in effect until March 2022, and provided NPB Co. an option, at its sole discretion, to extend the lease for an additional five-year period,
which NPB Co. exercised, extending the lease through March 2027. Under the lease agreement as currently in effect, (i) NPB Co. pays fixed
base rent and certain expenses incurred by the landlord in respect of the leased premises, including property taxes, building insurance
and common area maintenance; and (ii) the lease agreement includes certain obligations of the parties, including certain noise abatement
actions, in relation to the facility. The landlord has made claims that NPB Co.’s noise abatement efforts are not adequate under
the terms of the amended lease and has sought a judicial declaration that NPB Co. has committed a material non-curable breach of the lease
and that, in accordance with the lease, the landlord would be entitled to terminate the lease. NPB Co. does not agree and is disputing
these claims.

In the absence of an agreement to acquire the property or an extension
of the lease agreement beyond March 2027