ON Semiconductor (ONNN)

Note 11: Subsequent Events

Catalyst Acquisition

As previously announced on July 17, 2008, the Company and Catalyst entered into a merger agreement on July 16, 2008, under which Catalyst became a wholly-owned subsidiary of the Company. The merger occurred on October 10, 2008, at which time each issued and outstanding share of common stock of Catalyst was converted into the right to receive 0.706 shares of the Company’s common stock. This merger consideration had an approximate value of $97.2 million, the average closing price of ON’s common stock for the two days prior to, and two days subsequent to when the merger was announced on July 17, 2008. The Company issued approximately 10.9 million shares of its common stock upon closing the merger.

Atmel Acquisition

On October 1, 2008, the Company and Microchip Technology, Incorporated, (“Mircochip”), sent a proposal to the Board of Directors at Atmel, to acquire Atmel for $5.00 per share in cash. Under this proposal, the acquisition will be led by Microchip and financed in part by the sale of Atmel’s nonvolatile memory, radio frequency and automotive businesses to the Company immediately prior to the merger closing. The Company intends to finance the potential purchase using a combination of existing cash resources, borrowings under its existing credit facility and additional financing, as appropriate. This transaction is in its early stages and the completion of it is subject to several contingent events, including but not limited to, the following: approval of transaction by the Atmel Board of Directors and shareholders; the Company’s ability to obtain financing; the possibility that the Company and Microchip will be unable to reach agreement on terms of the sale of certain Atmel assets; and approval by certain government regulatory agencies.

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(unaudited)

Note 11: Subsequent Events

On July 16, 2008, the Company and Catalyst Semiconductor, Inc., (“Catalyst”), a Delaware corporation entered into a merger agreement, under which Catalyst will become a wholly-owned subsidiary of the Company. The merger agreement has been approved by the Boards of Directors of both companies, but is contingent upon the approval of Catalyst’s stockholders. At the effective time of the merger, each issued and outstanding share of common stock of Catalyst will be converted into the right to receive 0.706 shares of the Company’s common stock, which had an estimated value of $96.1 million when the merger was announced on July 17, 2008. Consummation of the merger is subject to several closing conditions, including the adoption of the merger agreement by a majority of the outstanding shares of Catalyst’s common stock, the expiration of applicable waiting periods in certain jurisdictions, the absence of certain governmental restraints and the effectiveness of a Form S-4 registration statement filed by the Company.

The merger agreement contains certain termination rights for both the Company and Catalyst and provides that a specified fee must be paid by one party to the other in connection with certain termination events. In certain specified circumstances, Catalyst must pay the Company a termination fee of approximately $3.3 million (generally in the event the Board of Directors of Catalyst changes its recommendation that its stockholders adopt the merger agreement, or elects to pursue an alternative acquisition proposal from a third party).

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(unaudited)

Note 5: Subsequent Events

In June 2006, the Company commenced an offer to exchange all of its then outstanding $260.0 million principal amount of zero coupon convertible senior subordinated notes due 2024 for a like principal amount of the new notes plus an exchange fee of $2.50 per $1,000 principal amount of their old notes validly tendered and accepted for exchange. The new notes contain a net share settlement feature, which will reduce the amount of shares included in diluted net income per share beginning in the third quarter of 2006. On July 21, 2006, the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(unaudited)

Company issued $259.5 million aggregate principal amount of new notes that are convertible into cash up to the par value, at a conversion rate of 101.8849 shares per $1,000 principle under certain circumstances. The excess of fair value over par value is convertible into stock. The exchange expired on July 19, 2006, and 99.8% of the aggregate principal amount of the old notes were tendered and subsequently exchanged.

Note 4: Subsequent Events

Effective April 5, 2006, SCI LLC entered into an asset purchase agreement with LSI Logic Corporation (“LSI”). Under the terms of the purchase agreement, SCI LLC will purchase LSI’s Gresham, Oregon wafer fabrication facility, including real property, tangible personal property, certain intellectual property, other specified manufacturing equipment and related information. The assets to be purchased include an approximately 83 acre campus with an estimated 500,000 square feet of building space of which approximately 98,000 square feet is clean room. Pursuant to the purchase agreement, SCI LLC will offer employment to substantially all of

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(unaudited)

LSI’s manufacturing employees currently working at the Gresham facility. At the closing of the transaction, SCI LLC will enter into several ancillary agreements including, but not limited to, a wafer supply and test agreement, intellectual property license agreement, transition services agreement and facility use agreement.

The aggregate purchase price for the acquired assets is approximately $105 million. In connection with the execution of the purchase agreement, the Company paid LSI a deposit of $10.5 million. In addition, the purchase agreement obligates SCI LLC to pay $79.5 million at the closing of the transaction and the remaining balance within 90 days thereafter. The transaction is expected to close after the satisfaction or waiver of all conditions set forth in the purchase agreement, including any necessary regulatory approvals, which is expected to occur during May of 2006.

To finance a portion of the purchase, the Company completed a public offering on April 6, 2006, of common stock registered pursuant to a shelf registration statement originally filed with the Securities and Exchange Commission on January 2, 2004. In connection with this offering, the Company issued approximately 11.2 million shares (which includes 0.7 million shares issued as over-allotments) of its common stock at a price of $7.00 per share. The net proceeds from this offering received by the Company were $75.2 million after deducting the underwriting discount of $1.6 million ($0.14 per share) and offering expenses of $1.3 million.