Item 1.01. Entry into a Material Definitive Agreement.
On December 9, 2024, Semiconductor Components Industries, LLC, a Delaware limited liability company and a wholly-owned subsidiary of onsemi (as defined below) (“Purchaser”), Qorvo US, Inc., a Delaware corporation (“Parent”), United Silicon Carbide, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (the “U.S. Transferred Company”), and solely for the purposes of Article V and Section 6.15 thereto, ON Semiconductor Corporation, a Delaware corporation (“onsemi”), entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) to acquire the Silicon Carbide Junction Field-Effect Transistor technology business of Parent and the Transferred Companies (as defined below) (the “Business”).
Pursuant to the terms of the Stock Purchase Agreement and subject to the satisfaction or waiver of certain conditions set forth in the Stock Purchase Agreement, Purchaser will purchase (i) all of the outstanding shares of capital stock of the U.S. Transferred Company and Qorvo Philippines Silicon Carbide, Inc., a corporation organized under the laws of the Philippines (the “Philippines Transferred Company,” and together with the U.S. Transferred Company, the “Transferred Companies”) and (ii) specified material assets related to the Business that sit outside of the Transferred Companies, for a base purchase price of $115 million in cash, subject to customary purchase price adjustments (the “Transaction”). At the closing of the Transaction, the parties will enter into certain ancillary agreements including, among others, a transition services agreement and certain intellectual property agreements.
Completion of the Transaction is subject to the satisfaction of customary closing conditions including, among other things things, the completion of certain pre-closing transactions, retention of certain key employees and material performance of covenants.
The Stock Purchase Agreement may be terminated under certain circumstances including, but not limited to, by mutual consent or by either Parent or Purchaser, as applicable, and subject to certain conditions (i) if the Transaction has not been completed on or before April 9, 2025, (ii) if any legal restraint permanently prevents the consummation of the Transaction, or (iii) upon a breach or inaccuracy of any representation and warranty by the other party that would result in the failure of a closing condition that is incapable to be cured or capable of being satisfied that remains uncured.
Parent, the Transferred Companies and Purchaser have each made customary representations, warranties and covenants in the Stock Purchase Agreement.
The foregoing description of the Transaction and the Stock Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Stock Purchase Agreement, which is attached to, and incorporated by reference into, this Current Report on Form 8-K (this “Form 8-K”) as Exhibit 2.1. The Stock Purchase Agreement has been incorporated into this Form 8-K by reference to provide information regarding the terms of the Stock Purchase Agreement and is not intended to modify or supplement any factual disclosures about Parent, Purchaser, onsemi or the Transferred Companies in any public reports filed with the Securities and Exchange Commission (the “SEC”) by onsemi. In particular, the assertions embodied in the representations, warranties and covenants contained in the Stock Purchase Agreement were made only for purposes of the Stock Purchase Agreement, were solely for the benefit of the parties to the Stock Purchase Agreement, and may be subject to limitations agreed upon by the contracting parties, including being qualified by information in confidential disclosure schedules provided by Parent to onsemi and Purchaser in connection with the execution of the Stock Purchase Agreement. The disclosure schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Stock Purchase Agreement. Moreover, the representations and warranties in the Stock Purchase Agreement were used for the purpose of allocating risk between Parent, onsemi, Purchaser and the Transferred Companies, rather than establishing matters of fact. Accordingly, the representations and warranties in the Stock Purchase Agreement may not constitute the actual state of facts with respect to Parent, onsemi, Purchaser or the Transferred Companies. The representations and warranties set forth in the Stock Purchase Agreement may also be subject to a contractual standard of materiality different from that generally applicable to investors under federal securities laws. Therefore, the Stock Purchase Agreement is included with this Form 8-K only to provide investors with information regarding the terms of the Stock Purchase Agreement and not to provide investors with any other factual information regarding the parties or their respective businesses.
Item 7.01. Regulation FD Disclosure.
