ON Semiconductor Corporation
`5005 East McDowell Road
`Phoenix, Arizona 85008
`
`Exhibit (d)(2)
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`September 14, 2015
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`By email to mark.thompson@fairchildsemi.com:
`Mr. Mark S. Thompson
`President and Chief Executive Officer
`Fairchild Semiconductor International, Inc.
`3030 Orchard Parkway
`San Jose, California 95134
`
`Re: Confidentiality Agreement
`
`Mr. Thompson:
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`1.
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`Each of ON Semiconductor Corporation and Fairchild Semiconductor International, Inc. (each a “Party” and together, the “Parties”) have
`requested certain information from the other in connection with their mutual consideration of a potential negotiated transaction between the Parties (any
`such transaction, a “Transaction”). For purposes of this confidentiality agreement (this “Agreement”), each Party acknowledges that it may act as both a
`“Disclosing Party” (i.e., a Party disclosing information) and a “Recipient Party” (i.e., a Party receiving information) and it intends to be legally bound as
`both a Disclosing Party and Recipient Party, as applicable, by the terms set forth in this Agreement. This Agreement is entered into on and is effective as of
`the date first written above (the “Effective Date”).
`In consideration of the Parties furnishing such information, and as a condition to being furnished such information, each Party agrees that, except as
`expressly provided below, (i) the Recipient Party shall treat confidentially and not disclose to any person any information (whether prepared by a
`Party or (a) its directors, officers, employees, agents, consultants, advisors (including tax advisors), subsidiaries or affiliates or representatives of its
`agents, consultants, advisors, subsidiaries or affiliates and (b) only from and after such time as the other Party consents in writing (such consent not to
`be unreasonably withheld), potential sources of debt or equity financing to a Party (each of the foregoing under clauses (a) and (b), a
`“Representative”), and whether oral, written or electronic), that the Disclosing Party or its Representatives furnishes to the Recipient Party or its
`Representatives, or is otherwise ascertained by the Recipient Party or its Representatives through due diligence investigations
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`PI 2007
`Semiconductor Components v. Power Integrations
`IPR2016-01600
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`or discussions with employees or other Representatives of the Disclosing Party, together with all notes, reports, analyses, compilations, studies, files,
`summaries, forecasts, data or other documents or material in whatever form maintained, whether prepared by a Party, its Representatives or others,
`which are based on, contain or otherwise reflect, or are generated from, any such information (all such information, together with the Transaction
`Information (defined below), being collectively referred to herein as the “Evaluation Material”), and (ii) each Party shall take or abstain from taking
`certain other actions set forth herein. If a Party requests in writing the other Party’s consent to a potential source of financing under clause (b) above,
`such consent will be deemed given if the other Party does not reasonably object in writing within three business days after receiving such request.
`Notwithstanding anything to the contrary in this paragraph, either Party shall have the right at any time in its sole discretion to have one prospective
`lender become a Representative under this Agreement, provided that such Party disclose in writing to the other Party the identity of such prospective
`lender in a reasonably prompt manner, and in any event within two business days, after the prospective lender becomes a Representative. For the
`avoidance of doubt, if a Party exercises its right to have one (but not more than one) prospective lender become a Representative under the previous
`sentence, such Party shall have no obligation to seek the other Party’s consent in writing as to such prospective lender, and such other Party shall
`have no right to object to such prospective lender automatically becoming a Representative, but as to any other prospective lender of such Party, the
`above requirement for the other Party’s prior written consent shall continue to apply.
`Other than with respect to any Transaction Information, the term “Evaluation Material” does not include information that: (i) is or becomes generally
`available to the public, other than as a result of a disclosure, or any action or omission, by the Recipient Party or a Representative of the Recipient
`Party in breach of this Agreement; (ii) was available to the Recipient Party or a Representative of the Recipient Party, or has become available to the
`Recipient Party or a Representative of the Recipient Party, on a non-confidential basis from a source other than the Disclosing Party or its
`Representatives, provided that the source of such information was not bound by a confidentiality agreement with the Disclosing Party or any of its
`Representatives with respect to such material, or otherwise prohibited from transmitting the information to the Recipient Party or such Representative
`of the Recipient Party by a contractual, fiduciary or legal obligation; or (iii) the Recipient Party or a Representative of the Recipient Party
`independently developed without reference to Evaluation Material or any derivative thereof.
`The Recipient Party hereby agrees that the Evaluation Material shall be used by the Recipient Party or its Representatives solely for the purposes of
`evaluating or negotiating a possible Transaction and for no other purpose and shall not be disclosed to any person and will be kept strictly
`confidential by the Recipient Party and its Representatives. It is understood, however, that the Recipient Party may disclose Evaluation Material to
`its Representatives that require such material solely for the purpose of assisting the Recipient Party in evaluating a Transaction. The Recipient Party
`further agrees that it is responsible to the Disclosing Party for any breach of this Agreement by the Recipient Party or any breach of the terms of this
`Agreement applicable to Representatives by any Representative of the Recipient Party.
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`3.
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`4.
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`5.
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`The Recipient Party understands that some Evaluation Material deemed competitively sensitive may be designated for review solely by the Recipient
`Party’s outside advisors or by a limited number or category of the Recipient Party’s employees as designated and agreed upon by the parties in
`writing, and the Recipient Party agrees to, and agrees to cause its Representatives to, abide by such designation.
`Without the prior written consent of the other Party, a Party shall not, and shall cause its Representatives not to disclose, (i) to any person the fact that
`Evaluation Material has been requested or made available to the Parties or the Parties’ Representatives or that a Party or any Party’s Representative
`has inspected Evaluation Material; (ii) the fact that any discussions, investigations or negotiations are taking place or have taken place concerning a
`Transaction; (iii) any of the proposed terms, proposed conditions or other facts with respect to any Transaction, including the status thereof; or
`(iv) that this Agreement exists (the information of the types referred to in clauses (i) to (iv) being collectively referred to herein as “Transaction
`Information”). The obligations in the preceding sentence shall survive any return or destruction of the Evaluation Material pursuant to the provisions
`hereof until the termination or expiration of this Agreement.
`Notwithstanding anything in this Agreement to the contrary, in the event that the Recipient Party or any Representative of the Recipient Party is
`requested or required under applicable law or the applicable rules or regulations of any securities exchange or similar self-regulatory organization
`(including by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process), to
`disclose Evaluation Material or Transaction Information, it is agreed that the Recipient Party and any such Representative of the Recipient Party will
`provide the Disclosing Party with prompt notice of such event so that the Disclosing Party may seek a protective order or other appropriate remedy or
`waive compliance with the applicable provisions of this Agreement by the Recipient Party or such Representative of the Recipient Party. In the event
`the Disclosing Party determines to seek such protective order or other remedy, the Recipient Party and any such Representative of the Recipient Party
`will reasonably cooperate with the Disclosing Party in seeking such protective order or other remedy. In the event that disclosure of Evaluation
`Material or Transaction Information is required based on the advice of the Recipient Party’s outside legal counsel, the Recipient Party and its
`Representatives shall exercise commercially reasonable efforts to obtain assurance that confidential treatment will be accorded to such of the
`disclosed information which the Disclosing Party so designates, and the Recipient Party shall then disclose only that portion of the Evaluation
`Material that is legally required to be disclosed. It is understood that the Recipient Party or its Representatives shall not be deemed to be “legally
`required” to disclose any Evaluation Material solely by virtue of the fact that, absent such disclosure, the Recipient Party or its Representatives
`would be prohibited from (i) purchasing or selling any securities of the Disclosing Party, engaging in
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`6.
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`derivative transactions with respect to any securities of the Disclosing Party or otherwise proposing or making an offer to do so, or (ii) taking any of
`the actions described in paragraph 7 of this Agreement; provided, that, this clause (ii) shall terminate and be of no further effect upon the earlier of
`(x) the expiration of the Standstill Period specified in paragraph 7 of this Agreement and (y) the termination of the Standstill Period in accordance
`with the last sentence of paragraph 7.
`Each Party is aware, and each Party will advise its Representatives who are informed of the matters that are the subject of this Agreement, that
`applicable securities laws restrict persons with material, non-public information concerning the other Party (including matters that may be the subject
`of this Agreement) from purchasing or selling securities of such Party, or from communicating such information to any other person under
`circumstances in which it is reasonably foreseeable that such other person is likely to purchase or sell such securities.
`Each Party agrees that for a period of twelve months from the Effective Date (the “Standstill Period”), unless specifically invited in writing by the
`other Party, it will not, and will cause its Representatives not to in any manner, directly or indirectly: (a) effect or seek, offer or propose (whether
`publicly or otherwise) to effect, or cause or participate in, or in any other way knowingly assist (including, without limitation, through the provision
`of financing) any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in, (i) any acquisition
`of any securities (or beneficial ownership thereof) of the other Party or any of its subsidiaries, or rights, options or other derivative instruments to
`acquire any securities (or beneficial ownership thereof) of the other Party or any of its subsidiaries, or any assets (other than de minimis assets),
`indebtedness or businesses of the other Party or any of its subsidiaries, (ii) any tender or exchange offer involving the other Party, any of its
`subsidiaries or assets of its subsidiaries constituting a significant portion of the consolidated assets of the other Party and its subsidiaries, (iii) any
`merger, other business combination, recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the
`other Party or any of its subsidiaries or (iv) any “solicitation” of “proxies” (as such terms are used under the Securities Exchange Act of 1934, as
`amended, the “Exchange Act”) or consents with respect to any voting securities of the other Party (including, for the avoidance of doubt, consents or
`taking other action with respect to the calling of a special meeting of the other Party’s stockholders, seeking to advise or knowingly influence any
`person with respect to the voting of any securities of the other Party or making any stockholder proposal); (b) form, join or in any way participate in a
`“group” (as such term is used under the Exchange Act) with respect to any securities of the other Party and/or any of its securities or other matters
`contemplated by this paragraph; (c) otherwise knowingly act, alone or in concert with others, to (i) seek, or propose to seek, representation on or to
`control the management, board of directors or policies of the other Party or (ii) seek, or propose to seek, the removal of any member of management or
`board of directors of the other Party; (d) knowingly take any action that could reasonably be expected to result in the public disclosure of any
`Transaction Information or any part of the information contained in the Evaluation Material or any matters of the types set forth in this paragraph;
`(e) disclose or direct any
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`person to disclose, any intention, plan or arrangement inconsistent with the foregoing; (f) knowingly advise, assist or encourage or direct any person
`to advise, assist or encourage any other persons in connection with any of the foregoing or (g) request, directly or indirectly, the other Party or the
`other Party’s Representatives to amend, modify or waive any provision of this paragraph (including this clause (g)); provided, that, none of the
`provisions of this paragraph shall prohibit either Party from making a non-public proposal to the Board of Directors of the other Party or any
`executive officer or director of such Party with respect to the Transaction at any time within 60 calendar days after the Effective Date. If at any time
`during the Standstill Period (i) either Party publicly announces that its Board of Directors has approved, or such Party has entered into, a definitive
`agreement providing for such Party’s merger with or acquisition of a majority of its shares by, or sale of substantially all of its assets to, an unrelated
`third party or (ii) a tender or exchange offer is commenced which if consummated would result in the offeror acquiring 50% or more of the voting
`power of the outstanding securities of such Party, then the restrictions set forth in this paragraph 7 shall terminate (and the Standstill Period shall be
`deemed to have expired) and all other provisions of this Agreement shall continue to be in full force and effect in accordance with the terms hereof.
`Each Party agrees that neither it nor such Party’s Representatives will (a) initiate or cause to be initiated (other than through the Chief Executive
`Officer, the Chief Financial Officer, the Chief Operating Officer, the General Counsel, Secretary, or Vice President, Corporate Development) any
`communication concerning the Evaluation Material or any potential Transaction with any employee of the other Party or (b) make contact with any
`other person that is not aware that a Transaction is contemplated under circumstances that are reasonably likely to give rise to suspicions that a
`Transaction is contemplated or that the Parties may be interested in pursuing a Transaction. For the 18 month period from the Effective Date, each
`Party and its controlled affiliates will not hire, solicit (directly or indirectly) or cause to be solicited (directly or indirectly) the employment of, any
`executive officer of the other Party or any other officer or key employee of the other Party who became known to such Party by reason of such Party’s
`involvement in the consideration of the Transaction; provided, however, that the foregoing provisions will not prevent either Party from making
`general solicitations of employment (including the use of search firms) not specifically directed at employees of the other Party or from employing
`any such officer or employee who contacts such Party solely in response to any such general solicitations or contacts such Party on his or her sole
`initiative and without encouragement from such Party.
`In the event that either Party decides not to proceed with the Transaction, upon the written request of the Disclosing Party, the Recipient Party and its
`Representatives will promptly deliver or cause to be delivered to the Disclosing Party (or destroy at the Recipient Party’s discretion) all written or
`electronic Evaluation Material; provided, that neither Recipient Party nor any of its Representatives will be required to destroy any electronic copy
`of any Evaluation Material that is created pursuant to such Party’s standard electronic backup and archival procedures if (i) personnel whose
`functions are not primarily information technology
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`in nature do not have access to such retained copies and (ii) personnel whose functions are primarily information technology in nature have access to
`such copies only as reasonably necessary for the performance of their information technology duties (e.g., for purposes of system recovery). In any
`event, all destruction pursuant to this paragraph shall be certified in writing to the Disclosing Party by an authorized officer supervising such
`destruction within ten days of a request by the Disclosing Party to do so. Notwithstanding the foregoing, the Disclosing Party’s Evaluation Material
`may be retained by the other Party to the extent required to be retained by applicable law or regulation; provided that such materials referenced in
`this sentence shall indefinitely remain subject to the confidentiality obligations of this Agreement applicable to Evaluation Material.
`The Recipient Party understands and acknowledges that neither the Disclosing Party nor any of Representatives makes any representation or
`warranty, express or implied, as to the accuracy or completeness of the Evaluation Material or any other information provided to the Recipient Party
`or the Representatives of the Recipient Party by the Disclosing Party or its Representatives in connection with matters contemplated hereby. Only
`those representations and warranties that may be made to a Party in a definitive written agreement for a Transaction, when, as and if executed and
`subject to such limitations and restrictions as may be specified therein, shall have any legal effect, and each Party agrees that if it determines to
`engage in a Transaction such determination will be based solely on the terms of such definitive written agreement and on its own investigation,
`analysis and assessment of the Transaction. Except as provided in any such definitive written agreement, neither the Disclosing Party nor any of its
`Representatives shall have any liability to the Recipient Party or any other person, including, without limitation, the Representatives of the Recipient
`Party and equityholders, on any basis (including, without limitation, in contract, tort, under federal or state securities laws or otherwise), and neither
`the Recipient Party nor its Representatives will make any claims whatsoever against such other persons, with respect to a possible Transaction or
`resulting from the use of, or reliance on, Evaluation Material by the Recipient Party or the Representatives of the Recipient Party. Unless and until
`such a definitive written agreement is entered into, neither Party nor any of its Representatives, by virtue of this Agreement or any other written or
`oral expression, will be under any legal obligation of any kind whatsoever with respect to such a Transaction except for the matters specifically
`agreed to in this Agreement. Without limiting the generality of the foregoing, each Party specifically acknowledges and agrees that, unless and until a
`definitive written agreement is entered into stating otherwise, each Party may conduct and change the process with respect to any possible
`Transaction as it, in its sole discretion, shall determine, including, without limitation, at any time terminating access to the Evaluation Material by
`the other Party and its Representatives, rejecting any and all offers for a Transaction without stating reasons, negotiating with one or more other
`parties and entering into a definitive agreement for a Transaction without prior notice to the other Party or any other person.
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`11.
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`13.
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`14.
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`16.
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`Each Party shall comply with any relevant export control laws and regulations of the United States and/or any other country with jurisdiction over
`Evaluation Material and/or either Party to this Agreement.
`As used in this Agreement, the term “person” shall mean any individual, corporation, company, association, partnership, joint venture, trust or other
`unincorporated organization or entity.
`This Agreement may be modified or amended only by a separate writing signed by the Parties expressly so modifying or amending this Agreement. In
`addition, no waiver or of the terms and conditions hereof will be binding unless approved in writing by both of the Parties hereto.
`This Agreement contains the entire agreement between the parties concerning the subject matter hereof and supersedes all prior oral or written
`agreements or understandings that may exist between any of the Parties hereto, relating to the subject matter hereof.
`The Recipient Party also acknowledges that money damages would be both incalculable and an insufficient remedy for any breach of this Agreement
`by the Recipient Party or any Representative of the Recipient Party and that any such breach would cause the Disclosing Party irreparable harm.
`Accordingly, the Recipient Party also agrees that in the event of any breach or threatened breach of this Agreement, the Disclosing Party, in addition
`to any other remedies at law or in equity it may have, shall be entitled to equitable relief, including injunctive relief and specific performance,
`without the requirement of posting a bond or other security. It is understood and agreed that no failure or delay by the Disclosing Party in exercising
`any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further
`exercise thereof or the exercise of any other right, power or privilege hereunder.
`Each Party acknowledges that the Disclosing Party may be entitled to the protections of the attorney work-product doctrine, attorney-client privilege
`or similar protections or privileges with respect to portions of the Evaluation Material. The Disclosing Party is not waiving, and will not be deemed to
`have waived or diminished, any of its attorney work-product protections, attorney-client privileges or similar protections or privileges as a result of
`the disclosure of such Evaluation Material pursuant to this Agreement. The parties (i) share a common legal and commercial interest in such
`Evaluation Material, (ii) are or may become joint defendants in proceedings to which such Evaluation Material relates and (iii) intend that such
`protections and privileges remain intact should either Party become subject to any actual or threatened proceeding to which such Evaluation Material
`relates. In furtherance of the foregoing, neither Party will claim or contend, in proceedings involving either Party, that the other Party waived the
`protections of the attorney work-product doctrine, attorney-client privilege or similar protections or privileges as a result of the disclosure of
`Evaluation Material pursuant to this Agreement.
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`17.
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`18.
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`20.
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`The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this
`Agreement, which shall remain in full force and effect to the fullest extent permitted by law.
`Except as otherwise expressly provided herein or provided in any definitive written agreement with respect to a Transaction, the obligations under
`this Agreement shall continue for a period of 18 months from the Effective Date.
`This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware applicable to agreements made and to be
`performed within that state. The Parties agree and consent to the exclusive jurisdiction of the Delaware Chancery Court in Wilmington, Delaware
`(“Delaware Court”) in respect of any suit, action or proceeding arising out of this Agreement, agrees that venue for any action on this Agreement will
`be properly laid in the Delaware Court and waives any objection to the bringing of any suit, action or proceeding in the venue. Service of any
`process, summons, notice or document by U.S. registered mail addressed to a Party hereunder at the address set forth above shall be effective service
`of process for any such suit, action or proceeding brought against such Party in any such court. The Parties hereby irrevocably waive any and all right
`to trial by jury in any legal proceeding arising out of or related to this Agreement.
`This Agreement may be executed in two or more counterparts, and by the different Parties hereto in separate counterparts, each of which when
`executed shall be deemed to be an original but all of which taken together shall constitute one and the same instrument. Delivery of an executed
`counterpart of a signature to this Agreement by email or facsimile transmission shall be effective as delivery of a manually executed counterpart
`hereof.
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`[Signature page follows]
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`If you are in agreement with the foregoing, please sign and return one copy of this Agreement, which thereupon will constitute a binding
`agreement between us with respect to the subject matter hereof.
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`Very truly yours,
`
`ON Semiconductor Corporation
`
`By: /s/ Keith D. Jackson
`Name: Keith D. Jackson
`Title:
` Chief Executive Officer
`
`Confirmed and agreed to as of the date first above written:
`Fairchild Semiconductor
`International, Inc.
`
`
`By: /s/ Mark S. Thompson
`Name:
` Mark S. Thompson
`Title:
` Chief Executive Officer
`
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