Cypress bids for ISSI

T.J. Rodgers, Cypress Semiconductor CEO

His letter reads:

Jimmy S.M. Lee
Executive Chairman

Scott D. Howarth
President and Chief Executive Officer

Integrated Silicon Solution, Inc.
1623 Buckeye Drive
Milpitas, California 95035

Messrs. Lee and Howarth,

On behalf of Cypress Semiconductor Corporation (“Cypress”), I am writing to formally convey our proposal to acquire 100% of the outstanding shares of common stock of Integrated Silicon Solution, Inc. (“ISSI”) for $19.75 per share in cash. The board of directors of Cypress has approved this proposal. Our proposal is superior to the $19.25 per share sale price ISSI agreed to in the Agreement and Plan of Merger entered into with the “Consortium” on March 12, 2015 (the “Consortium Merger Agreement”).

Section 5.2 of the Consortium Merger Agreement explicitly permits ISSI’s board of directors, in the exercise of its fiduciary duties, to “participate or engage in discussions or negotiations with” a party that submits a Superior Proposal. A Superior Proposal is defined as a written acquisition proposal that is “more favorable from a financial point of view” to ISSI’s shareholders than the proposed transaction with the Consortium after “taking into account all relevant legal, financial and regulatory aspects” of the Superior Proposal “and the likelihood of consummation of” a transaction. We believe that our proposal clearly constitutes a Superior Proposal and that your board of directors must, consistent with its fiduciary duties and its obligations under Section 5.2 of the Consortium Merger Agreement, determine that our proposal is a Superior Proposal.

We have a full team, including financial and legal advisors, dedicated to the evaluation of ISSI and have conducted a thorough review of ISSI’s business and operations based on publicly available information. In order to finalize a transaction, we would need to complete customary confirmatory due diligence, which we would expect to complete expeditiously given our extensive knowledge of the industry. Please provide us with a draft of an Acceptable Confidentiality Agreement (as defined in the Consortium Merger Agreement) as soon as possible so we can start this work. Cypress and its financial and legal advisors are ready to engage in discussions regarding our proposal immediately.

Notwithstanding anything to the contrary contained herein, nothing in this letter constitutes a binding obligation of Cypress to proceed with or consummate a transaction. Any transaction between Cypress and ISSI will be subject to approval by our board of directors and the execution by Cypress of acceptable definitive agreements.

We would have preferred to participate in your sale process, but were not contacted. As such, we are submitting this proposal in accordance with the Consortium Merger Agreement. In light of the circumstances, we are simultaneously releasing this letter to the public as we believe that it is in the best interest of ISSI and its shareholders to have full information regarding our proposal.

We look forward to working with you toward completion of a successful transaction. If you have any questions regarding our proposal, please contact me or Thad Trent, our Chief Financial Officer.
Sincerely

Sincerely

T.J. Rodgers, Chief Executive Officer