S-4 1 d708439ds4.htm S-4 S-4
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As filed with the Securities and Exchange Commission on April 14, 2014

Registration No. 333-[]

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

ROCKY HOLDING, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   3674   46-5288992

(State or Other Jurisdiction of

Incorporation or Organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(IRS Employer

Identification Number)

c/o RF Micro Devices, Inc.

7628 Thorndike Road

Greensboro, North Carolina 27409-9421

(336) 664-1233

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

 

Robert A. Bruggeworth

Chief Executive Officer

Rocky Holding, Inc.

c/o RF Micro Devices, Inc.

7628 Thorndike Road

Greensboro, North Carolina 27409-9421

(336) 664-1233

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

With copies to:

 

Roy W. Tucker

John R. Thomas

Perkins Coie LLP

1120 N.W. Couch Street,

Tenth Floor

Portland, Oregon 97209

(503) 727-2000

 

Ralph G. Quinsey

Chief Executive Officer

TriQuint Semiconductor, Inc.

2300 N.E. Brookwood Parkway

Hillsboro, Oregon 97124

(503) 615-9000

 

Keith Flaum

Jane Ross

Weil, Gotshal & Manges LLP

201 Redwood Shores Parkway

Redwood Shores, California

94065–1134

(650) 802-3000

 

Jeffrey C. Howland

Womble Carlyle Sandridge &

Rice, LLP

One West Fourth Street

Winston-Salem, North Carolina 27101

(336) 721-3600

 

 

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement. becomes effective and upon completion of the mergers described in the enclosed joint proxy statement/prospectus.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer   ¨    Accelerated filer   ¨
Non-accelerated filer   x   (Do not check if a smaller reporting company)    Smaller reporting company   ¨

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of

Securities to be Registered

 

Amount

to be

Registered(1)

 

Proposed

Maximum

Offering Price

Per Share

 

Proposed

Maximum
Aggregate

Offering Price(2)

  Amount of
Registration Fee(3)

Common Stock, $.0001 par value per share

  154,817,378   Not Applicable   $4,726,620,562.32   $608,788.73

 

 

(1) Represents the maximum number of shares of common stock, par value $0.0001 per share, of the registrant (“Rocky Holding common stock”) estimated to be issuable in the mergers described herein, equal to the sum of (a) the product obtained by multiplying (i) the sum of (A) 284,918,448 (the number of shares of common stock, no par value, of RF Micro Devices, Inc., or RFMD common stock, outstanding as of April 7, 2014) and (B) 15,000,000 (which includes (1) the maximum number of shares of RFMD common stock estimated to be issuable before the mergers are completed, including shares issuable upon the exercise or settlement of RFMD stock options and restricted stock units outstanding as of April 7, 2014 and that RFMD is permitted to grant prior to the closing, and (2) the maximum number of shares of RFMD common stock estimated to be issuable upon the exercise or settlement of RFMD stock options and restricted stock that the registrant does not plan to register on Form S-8, to the extent not included in (1)) by (ii) the exchange ratio of 0.2500 per share of Rocky Holding common stock for each share of RFMD common stock, plus (b) the product obtained by multiplying (i) the sum of (A) 168,680,120 (the number of shares of common stock, par value $0.001 per share, of TriQuint Semiconductor, Inc., or TriQuint common stock, outstanding as of April 7, 2014) and (B) 22,000,000 (which includes (1) the maximum number of shares of TriQuint common stock estimated to be issuable before the mergers are completed, including shares issuable upon the exercise or settlement of TriQuint stock options and restricted stock units outstanding as of April 7, 2014 and that TriQuint is permitted to grant prior to the closing, and (2) the maximum number of shares of TriQuint common stock estimated to be issuable upon the exercise or settlement of TriQuint stock options and restricted stock units that the registrant does not plan to register on Form S-8, to the extent not included in (1)) by (ii) the exchange ratio of 0.4187 per share of Rocky Holding common stock for each share of TriQuint common stock.
(2) Pursuant to Rules 457(f)(1) and 457(c) under the Securities Act of 1933 and solely for the purpose of calculating the registration fee, the proposed maximum aggregate offering price is the sum of (a) the product obtained by multiplying (i) $7.59 (the average of the high and low prices of RFMD common stock on April 7, 2014) by (ii) 299,918,448 shares of RFMD common stock (the maximum number of shares of RFMD common stock that may be exchanged in the RFMD merger, as described in note (1) above), plus (b) the product obtained by multiplying (x) $12.85 (the average of the high and low prices of TriQuint common stock on April 7, 2014) by (y) 190,680,120 shares of TriQuint common stock (the maximum number of shares of TriQuint common stock that may be exchanged in the TriQuint merger, as described in note (1) above).
(3) Determined in accordance with Section 6(b) of the Securities Act of 1933 at a rate equal to $128.80 per $1,000,000 of the proposed maximum aggregate offering price.

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such dates as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 


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Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This document shall not constitute an offer to sell or the solicitation of any offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

 

PRELIMINARY — SUBJECT TO COMPLETION — DATED APRIL 14, 2014

 

            LOGO            LOGO
           RF Micro Devices, Inc.           TriQuint Semiconductor, Inc.

TO THE STOCKHOLDERS OF RF MICRO DEVICES, INC. AND TRIQUINT SEMICONDUCTOR, INC.

MERGER PROPOSAL — YOUR VOTE IS VERY IMPORTANT

[], 2014

Dear Stockholders:

RF Micro Devices, Inc. (“RFMD”) and TriQuint Semiconductor, Inc. (“TriQuint”) have entered into a merger agreement providing for the combination of RFMD and TriQuint in a merger of equals under a new holding company currently named Rocky Holding, Inc. We believe the combination will create a new leader in radio frequency solutions, with new growth opportunities and a broad portfolio of enabling technologies. Robert A. Bruggeworth will serve as President and Chief Executive Officer of the combined company and Ralph G. Quinsey will serve as the non-executive Chairman of the Board of Directors. The combined company’s board will consist of ten directors, with five directors from the existing boards of each company, and eight of the ten directors will be independent.

Upon completion of the mergers, RFMD shareholders will receive 0.2500 of a share of common stock of the new holding company for each share of RFMD common stock, and TriQuint stockholders will receive 0.4187 of a share of common stock of the new holding company for each share of TriQuint common stock. We anticipate that RFMD shareholders, on the one hand, and TriQuint stockholders, on the other hand, will each hold approximately 50% of the shares of common stock of the new holding company issued and outstanding immediately after completion of the mergers. Rocky Holding, Inc. intends to apply to list its common stock on the NASDAQ Global Select Market, subject to official notice of issuance. Prior to completion of the mergers, we anticipate that Rocky Holding, Inc. will change its name, adopt a NASDAQ symbol for its common stock, and register a new trade name and logo that reflect the key attributes of the combined company.

Completion of the mergers requires, among other things, the separate approvals of both RFMD shareholders and TriQuint stockholders. To obtain these required approvals, RFMD will hold a special meeting of RFMD shareholders on [], 2014 and TriQuint will hold a special meeting of TriQuint stockholders on [], 2014.

 

THE RFMD AND TRIQUINT BOARDS OF DIRECTORS UNANIMOUSLY RECOMMEND THAT YOU VOTE “FOR” THE PROPOSALS TO APPROVE OR ADOPT THE MERGER AGREEMENT, AS APPLICABLE.

Information about the special meetings, the mergers and the other business to be considered by RFMD shareholders and TriQuint stockholders is contained in this document and the documents incorporated by reference, which we urge you to read carefully. In particular, see “Risk Factors ” beginning on page 32.

Your vote is very important. Whether or not you plan to attend the special meeting of RFMD shareholders or the special meeting of TriQuint stockholders, as applicable, please submit a proxy to vote your shares as soon as possible to make sure your shares are represented at the applicable special meeting. Your failure to vote will have the same effect as voting against the proposal to approve or adopt the merger agreement, as applicable.

 

[SIGNATURE]   [SIGNATURE]
Robert A. Bruggeworth   Ralph G. Quinsey
President and Chief Executive Officer   President and Chief Executive Officer
RF Micro Devices, Inc.   TriQuint Semiconductor, Inc.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved the securities to be issued in connection with the mergers or determined if the accompanying joint proxy statement/prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

The accompanying joint proxy statement/prospectus is dated [], and is first being mailed or otherwise delivered to shareholders of RFMD and stockholders of TriQuint on or about [].


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ADDITIONAL INFORMATION

The accompanying joint proxy statement/prospectus incorporates by reference important business and financial information about RFMD and TriQuint from documents that are not included in or delivered with the joint proxy statement/prospectus. This information is available to you without charge upon your written or oral request. You can obtain the documents incorporated by reference in the joint proxy statement/prospectus by requesting them in writing or by telephone from the appropriate company at the addresses and telephone numbers listed below. To obtain timely delivery, you must request the information no later than five business days before you must make your investment decision.

 

RF Micro Devices, Inc.   TriQuint Semiconductor, Inc.
7628 Thorndike Road   2300 N.E. Brookwood Parkway
Greensboro, North Carolina 27409-9421   Hillsboro, Oregon 97124
Attention: Investor Relations   Attention: Investor Relations
(336) 678-7088   (503) 615-9413
www.rfmd.com (“Investor Relations” page)   www.triquint.com (“Investor Relations” page)

In addition, if you have questions about the mergers or the special meetings, or if you need to obtain copies of the accompanying joint proxy statement/prospectus, proxy cards, election forms or other documents incorporated by reference in the joint proxy statement/prospectus, you may contact the appropriate contact listed below. You will not be charged for any of the documents you request.

 

If you are an RFMD shareholder:   If you are a TriQuint stockholder:
Innisfree M&A Incorporated   The Proxy Advisory Group, LLC ®
501 Madison Avenue, 20th Floor   18 East 41st Street, 20th Floor
New York, NY 10022   New York, NY 10017
Shareholders call toll free: (888) 750-5834   Call toll free: (888) 557-7699
Banks and brokers call collect: (212) 750-5833   or (888) 55-PROXY

If you would like to request documents, you must do so by [], 2014, in order to receive them before the special meetings.

For a more detailed description of the information incorporated by reference in the accompanying joint proxy statement/prospectus and how you may obtain it, see “Where You Can Find More Information” beginning on page 209 of the accompanying joint proxy statement/prospectus.


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LOGO

RF MICRO DEVICES, INC.

7628 Thorndike Road

Greensboro, North Carolina 27409-9421

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS OF RF MICRO DEVICES, INC. [], 2014

To the Shareholders of RF Micro Devices, Inc.:

A special meeting of the shareholders of RF Micro Devices, Inc., a North Carolina corporation (“RFMD”), will be held on [], 2014, at [] Eastern time at [] (the “RFMD special meeting”) to consider and vote upon the following matters:

 

  1. to approve the Agreement and Plan of Merger and Reorganization, dated as of February 22, 2014 (the “merger agreement”), by and among RFMD, TriQuint Semiconductor, Inc., a Delaware corporation (“TriQuint”), and Rocky Holding, Inc., a newly formed Delaware corporation (“Rocky Holding”);

 

  2. to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement);

 

  3. to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers; and

 

  4. to transact any other business that may properly come before the RFMD special meeting or any adjournment thereof.

 

THE RFMD BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT RFMD SHAREHOLDERS VOTE “FOR” EACH PROPOSAL.

The above matters are more fully described in this document, which also includes, as Annex A, a copy of the merger agreement. The record date for the determination of the shareholders entitled to notice of, and to vote at, the RFMD special meeting, or any adjournment or postponement of the RFMD special meeting, was the close of business on [], 2014. At least 10 days prior to the RFMD special meeting, a complete list of shareholders of record as of [], 2014 will be available for inspection by any shareholder for any purpose germane to the RFMD special meeting, during ordinary business hours, at the office of the Secretary of the Company at 7628 Thorndike Road, Greensboro, North Carolina. As a shareholder of record, you are cordially invited to attend the RFMD special meeting in person. Regardless of whether you expect to be present at the RFMD special meeting, please either complete, sign and date the enclosed proxy card and mail it promptly in the enclosed envelope or vote electronically via the Internet or telephone as described in greater detail in the joint proxy statement/prospectus and on the enclosed proxy card. Returning the enclosed proxy card, or voting electronically or telephonically, will not affect your right to vote in person if you attend the RFMD special meeting. You should NOT send certificates representing RFMD common stock with the proxy.

 

By Order of the Board of Directors,

 

William A. Priddy, Jr.
Chief Financial Officer, Vice President of Administration and Secretary
[], 2014

YOUR VOTE IS VERY IMPORTANT. PLEASE VOTE YOUR SHARES PROMPTLY, WHETHER OR NOT YOU EXPECT TO ATTEND THE RFMD SPECIAL MEETING. YOU CAN FIND INSTRUCTIONS FOR VOTING ON THE ENCLOSED PROXY CARD. IF YOU HAVE QUESTIONS ABOUT THE MERGERS OR THE RFMD SPECIAL MEETING, PLEASE CONTACT RF MICRO DEVICES, INC., ATTENTION: INVESTOR RELATIONS, 7628 THORNDIKE ROAD, GREENSBORO, NORTH CAROLINA 27409, (336) 678-7088. IF YOU HAVE QUESTIONS ABOUT VOTING YOUR SHARES, PLEASE FOLLOW THE CONTACT INSTRUCTIONS ON YOUR PROXY CARD.


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LOGO

TRIQUINT SEMICONDUCTOR, INC.

2300 N.E. Brookwood Parkway

Hillsboro, Oregon 97124

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS OF TRIQUINT SEMICONDUCTOR, INC. [], 2014

To the Stockholders of TriQuint Semiconductor, Inc.:

A special meeting of the stockholders of TriQuint Semiconductor, Inc., a Delaware corporation (“TriQuint”), will be held on [], 2014, at [] Pacific time, at [] (the “TriQuint special meeting”), for the following purposes:

 

  1. to adopt the Agreement and Plan of Merger and Reorganization, dated as of February 22, 2014 (the “merger agreement”), by and among TriQuint, RF Micro Devices, Inc., a North Carolina corporation (“RFMD”), and Rocky Holding, Inc., a newly formed Delaware corporation (“Rocky Holding”);

 

  2. to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

 

  3. to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers;

 

  4. to approve the amended TriQuint 2013 Incentive Plan; and

 

  5. to transact any other business that may properly come before the TriQuint special meeting or any adjournment thereof.

 

THE TRIQUINT BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT TRIQUINT STOCKHOLDERS VOTE “FOR” EACH PROPOSAL.

Holders of TriQuint common stock of record at the close of business on [], 2014 are entitled to vote at the TriQuint special meeting, or any adjournment or postponement of the TriQuint special meeting. At least 10 days prior to the TriQuint special meeting, a complete list of stockholders of record as of [], 2014 will be available for inspection by any stockholder for any legally valid purpose relating to the TriQuint special meeting, during ordinary business hours, at our headquarters located at 2300 N.E. Brookwood Parkway, Hillsboro, Oregon 97124. As a stockholder of record, you are cordially invited to attend the TriQuint special meeting in person. Regardless of whether you expect to be present at the TriQuint special meeting, please either complete, sign and date the enclosed proxy card and mail it promptly in the enclosed envelope or vote electronically via the Internet or telephone as described in greater detail in the joint proxy statement/prospectus and on the enclosed proxy card. Returning the enclosed proxy card, or voting electronically or telephonically, will not affect your right to vote in person if you attend the TriQuint special meeting. You should NOT send certificates representing TriQuint common stock with the proxy.

 

For the Board of Directors of
TRIQUINT SEMICONDUCTOR, INC.

 

Steven J. Buhaly
Chief Financial Officer, Vice President of Finance and Information Technology, and Secretary
[], 2014

YOUR VOTE IS VERY IMPORTANT. PLEASE VOTE YOUR SHARES PROMPTLY, WHETHER OR NOT YOU EXPECT TO ATTEND THE TRIQUINT SPECIAL MEETING. YOU CAN FIND INSTRUCTIONS FOR VOTING ON THE ENCLOSED PROXY CARD. IF YOU HAVE QUESTIONS ABOUT THE MERGERS OR THE TRIQUINT SPECIAL MEETING, PLEASE CONTACT TRIQUINT SEMICONDUCTOR, INC., ATTENTION: INVESTOR RELATIONS, 2300 N.E. BROOKWOOD PARKWAY, HILLSBORO, OREGON 97124, (503) 615-9413. IF YOU HAVE QUESTIONS ABOUT VOTING YOUR SHARES, PLEASE FOLLOW THE CONTACT INSTRUCTIONS ON YOUR PROXY CARD.


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JOINT PROXY STATEMENT/PROSPECTUS TABLE OF CONTENTS

 

     Page  

QUESTIONS AND ANSWERS ABOUT THE MERGERS AND THE SPECIAL MEETINGS

     1   

SUMMARY

     12   

Information About the Companies

     12   

The Mergers

     12   

Merger Consideration Received by TriQuint Stockholders

     14   

Merger Consideration Received by RFMD Shareholders

     14   

Total Rocky Holding Shares to Be Issued

     15   

Comparative Per Share Market Price and Dividend Information

     15   

TriQuint Special Meeting

     15   

RFMD Special Meeting

     17   

Recommendation of the TriQuint Board

     18   

Recommendation of the RFMD Board

     19   

Opinion of Financial Advisor to TriQuint

     19   

Opinion of Financial Advisor to RFMD

     19   

Interests of Officers and Directors in the Mergers

     20   

Governmental and Regulatory Approvals

     20   

No Solicitation

     20   

Restrictions on Recommendation Withdrawal

     21   

Conditions to Completion of the Mergers

     21   

Closing

     22   

Termination

     22   

Termination Fees; Expenses

     22   

Material U.S. Federal Income Tax Consequences

     23   

Appraisal Rights

     23   

Listing of Rocky Holding Common Stock on NASDAQ

     23   

Comparison of Stockholder Rights

     23   

Litigation Relating to the Mergers

     24   

SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF RFMD

     25   

SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF TRIQUINT

     27   

SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

     29   

COMPARATIVE PER SHARE DATA

     30   

COMPARATIVE PER SHARE MARKET PRICE DATA AND DIVIDEND INFORMATION

     31   

RISK FACTORS

     32   

Risk Factors Relating to the Mergers

     32   

Risk Factors Relating to Rocky Holding After Completion of the Mergers

     36   

RFMD AND TRIQUINT UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

     40   

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

     56   

INFORMATION ABOUT THE COMPANIES

     57   

RF Micro Devices, Inc.

     57   

TriQuint Semiconductor, Inc.

     57   

Rocky Holding, Inc.

     57   

THE TRIQUINT SPECIAL MEETING

     58   

Date, Time and Place

     58   

Purpose

     58   

Recommendation of the TriQuint Board

     58   

Record Date; Shares Entitled to Vote

     59   

Quorum; Broker Non-Votes

     59   

 

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Vote Required

     59   

Voting by TriQuint’s Directors and Executive Officers

     60   

How to Vote

     60   

Voting of Proxies

     61   

Revoking Your Proxy

     61   

Attending the Special Meeting

     62   

Confidential Voting

     62   

Stockholders Sharing an Address; Householding

     62   

Solicitation of Proxies

     62   

Other Business

     62   

Assistance

     63   

THE RFMD SPECIAL MEETING

     63   

Date, Time and Place

     63   

Purpose

     63   

Recommendation of the RFMD Board

     63   

Record Date; Shares Entitled to Vote

     64   

Quorum; Broker Non-Votes

     64   

Vote Required

     65   

Voting by RFMD’s Directors and Executive Officers

     65   

How to Vote

     65   

Voting of Proxies

     66   

Revoking Your Proxy

     66   

Attending the Special Meeting

     66   

Householding of Shareholder Materials

     66   

Solicitation of Proxies

     67   

Other Business

     67   

Assistance

     67   

THE MERGERS

     68   

General

     68   

Background of the Mergers

     68   

Recommendation of the TriQuint Board; TriQuint’s Reasons for the Mergers

     79   

Financial Projections Reviewed by the TriQuint Board and TriQuint’s Financial Advisor

     83   

Opinion of Financial Advisor to TriQuint

     86   

Recommendation of the RFMD Board; RFMD’s Reasons for the Mergers

     94   

Financial Projections Reviewed by the RFMD Board and RFMD’s Financial Advisor

     97   

Opinion of Financial Advisor to RFMD

     101   

Interests of Officers and Directors in the Mergers

     110   

Rocky Holding’s Board of Directors and Management After the Mergers

     119   

Conversion of Shares; Exchange of Certificates; No Fractional Shares

     120   

Governmental and Regulatory Approvals

     122   

Merger Expenses, Fees and Costs

     124   

Material U.S. Federal Income Tax Consequences

     124   

Accounting Treatment of the Mergers

     126   

Appraisal Rights

     127   

Listing of Rocky Holding Common Stock on NASDAQ

     127   

Delisting and Deregistration of TriQuint Common Stock

     127   

Delisting and Deregistration of RFMD Common Stock

     127   

Litigation Relating to the Mergers

     127   

THE MERGER AGREEMENT

     129   

Structure of the Mergers

     129   

Closing

     130   

Effective Times

     130   

 

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Merger Consideration to be Received by RFMD Shareholders

     130   

Merger Consideration to be Received by TriQuint Stockholders

     130   

Treatment of RFMD Stock Options, Other Stock Awards and Restricted Stock

     130   

Treatment of TriQuint Stock Options, Other Stock Awards and Restricted Stock

     131   

Conversion of Shares; Exchange of Certificates; No Fractional Shares

     132   

Representations and Warranties

     134   

Covenants of the Parties

     136   

Conditions to the Merger

     149   

Termination

     151   

Effect of Termination

     153   

Termination Fees; Expenses

     153   

Amendment and Waiver

     154   

Specific Performance; Third-Party Beneficiaries

     155   

Treatment of RFMD Equity Compensation Plans Following the Mergers

     155   

Treatment of the TriQuint Employee Stock Purchase Plan Following the Mergers

     165   

RFMD PROPOSAL NO. 3: ADVISORY VOTE TO APPROVE MERGER-RELATED COMPENSATION FOR RFMD NAMED EXECUTIVE  OFFICERS

     169   

Golden Parachute Compensation

     169   

Merger-Related Compensation Proposal

     172   

Vote Required and RFMD Board Recommendation

     172   

TRIQUINT PROPOSAL NO. 3: ADVISORY VOTE TO APPROVE MERGER-RELATED COMPENSATION FOR TRIQUINT NAMED EXECUTIVE OFFICERS

     173   

Golden Parachute Compensation

     173   

Merger-Related Compensation Proposal

     175   

Vote Required and TriQuint Board Recommendation

     176   

DESCRIPTION OF ROCKY HOLDING’S CAPITAL STOCK

     176   

CERTAIN BENEFICIAL OWNERS OF RFMD COMMON STOCK

     177   

CERTAIN BENEFICIAL OWNERS OF TRIQUINT COMMON STOCK

     179   

COMPARISON OF STOCKHOLDER RIGHTS

     181   

TRIQUINT PROPOSAL NO. 4: APPROVE THE AMENDED TRIQUINT 2013 INCENTIVE PLAN

     197   

TRIQUINT EQUITY COMPENSATION PLAN INFORMATION

     205   

EXPERTS

     208   

LEGAL MATTERS

     208   

FUTURE STOCKHOLDER PROPOSALS

     208   

WHERE YOU CAN FIND MORE INFORMATION

     208   

ANNEX A — Agreement and Plan of Merger and Reorganization

     A-1   

ANNEX B — Opinion of Goldman, Sachs & Co.

     B-1   

ANNEX C — Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated

     C-1   

ANNEX D — Certificate of Incorporation of Rocky Holding, Inc.

     D-1   

ANNEX E — Bylaws of Rocky Holding, Inc.

     E-1   

ANNEX F — TriQuint 2013 Incentive Plan, as amended

     F-1   

 

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QUESTIONS AND ANSWERS ABOUT THE MERGERS AND THE SPECIAL MEETINGS

The following questions and answers are intended to briefly address some commonly asked questions regarding the mergers and the special meetings. These questions and answers may not address all questions that may be important to you as a stockholder. To better understand these matters, and for a description of the legal terms governing the mergers, you should carefully read this entire joint proxy statement/prospectus, including the annexes, as well as the documents that have been incorporated by reference in this joint proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 209. All references in this joint proxy statement/prospectus to “RFMD” refer to RF Micro Devices, Inc., a North Carolina corporation; all references to “TriQuint” refer to TriQuint Semiconductor, Inc., a Delaware corporation; all references to “Rocky Holding” refer to Rocky Holding, Inc. (which we anticipate will change its name prior to completion of the mergers), a Delaware corporation and a direct wholly owned subsidiary of RFMD; all references to “Rocky Merger Sub” refer to a to-be-formed direct wholly owned subsidiary of Rocky Holding, which will be used to effect the RFMD merger; all references to “Trident Merger Sub” refer to a to-be-formed direct wholly owned subsidiary of Rocky Holding, which will be used to effect the TriQuint merger; and all references to the “Merger Subs” refer to Rocky Merger Sub and Trident Merger Sub, collectively. Unless otherwise indicated or as the context requires, all references in this joint proxy statement/prospectus to “we” refer to RFMD and TriQuint, and all references to the “merger agreement” refer to the Agreement and Plan of Merger and Reorganization, dated as of February 22, 2014, as it may be amended from time to time, by and among RFMD, TriQuint and Rocky Holding, a copy of which is attached as Annex A to this joint proxy statement/prospectus.

About the Mergers

 

Q: What is the proposed transaction on which I am being asked to vote?

 

A: RFMD, TriQuint and Rocky Holding, a new Delaware holding company, have entered into the merger agreement providing for the business combination of RFMD and TriQuint. Prior to the closing, Rocky Holding will form two direct subsidiaries, Trident Merger Sub and Rocky Merger Sub. Pursuant to the merger agreement, Trident Merger Sub will merge with and into TriQuint, and Rocky Merger Sub will merge with and into RFMD. We refer to these mergers as the TriQuint merger and the RFMD merger, respectively, and together as the mergers. As a result of the mergers, TriQuint and RFMD will each become a wholly owned subsidiary of Rocky Holding. As a result of the transactions contemplated by the merger agreement, former TriQuint stockholders and former RFMD shareholders will own common stock in Rocky Holding, which will be listed for trading on the NASDAQ Global Select Market, which we refer to as NASDAQ.

 

Q: Why am I receiving this joint proxy statement/prospectus?

 

A: TriQuint is holding a special meeting of stockholders, which we refer to as the TriQuint special meeting, in order to obtain the stockholder approval necessary to adopt the merger agreement, which we refer to as the TriQuint stockholder approval. TriQuint stockholders will also be asked to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement), to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers, and to approve the amended TriQuint 2013 Incentive Plan.

RFMD is holding a special meeting of shareholders, which we refer to as the RFMD special meeting, in order to obtain the shareholder vote necessary to approve the merger agreement, which we refer to as the RFMD shareholder approval. RFMD shareholders will also be asked to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement) and to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers.

 

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We will be unable to complete the mergers unless both the RFMD shareholder approval and the TriQuint stockholder approval are obtained at the respective special meetings, in addition to other conditions and required approvals.

We have included in this joint proxy statement/prospectus important information about the mergers, the merger agreement (a copy of which is attached as Annex A) and the RFMD and TriQuint special meetings. You should read this information carefully and in its entirety. The enclosed voting materials allow you to vote your shares without attending the applicable special meeting. Your vote is very important and we encourage you to submit your proxy as soon as possible.

 

Q: What will TriQuint stockholders receive in the TriQuint merger?

 

A: Upon completion of the TriQuint merger, each share of common stock of TriQuint, par value $0.001 per share, which we refer to as TriQuint common stock, other than TriQuint excluded shares, will be converted into the right to receive 0.4187 (which we refer to as the TriQuint Exchange Ratio) of a share of validly issued, fully paid and non-assessable Rocky Holding common stock, par value $0.0001 per share, which we refer to as the TriQuint merger consideration. Shares of TriQuint common stock held by TriQuint or Trident Merger Sub, which we refer to as TriQuint excluded shares, will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration.

TriQuint stockholders will not receive any fractional shares of Rocky Holding common stock in the TriQuint merger. Instead of receiving any fractional shares, each holder of TriQuint common stock will be paid an amount in cash, without interest, rounded to the nearest cent, determined by (a) dividing that fraction by the TriQuint Exchange Ratio and (b) multiplying the result by the average closing price of a share of TriQuint common stock on NASDAQ for the 10 most recent trading days that the TriQuint common stock has traded, ending on the trading day one day prior to the date on which the closing of the mergers takes place, which we refer to as the closing date.

 

Q: What will RFMD shareholders receive in the RFMD merger?

 

A: Upon completion of the RFMD merger, each share of common stock of RFMD, no par value, which we refer to as RFMD common stock, other than RFMD excluded shares, will be converted into the right to receive 0.2500 (which we refer to as the RFMD Exchange Ratio) of a share of validly issued, fully paid and non-assessable Rocky Holding common stock, par value $0.0001 per share, which we refer to as the RFMD merger consideration. Shares of RFMD common stock held by RFMD or Rocky Merger Sub, which we refer to as RFMD excluded shares, will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration.

RFMD shareholders will not receive any fractional shares of Rocky Holding common stock in the RFMD merger. Instead of receiving any fractional shares, each holder of RFMD common stock will be paid an amount in cash, without interest, rounded to the nearest cent, determined by (a) dividing that fraction by the RFMD Exchange Ratio and (b) multiplying the result by the average closing price of a share of RFMD common stock on NASDAQ for the 10 most recent trading days that the RFMD common stock has traded, ending on the trading day one day prior to the closing date.

 

Q: Should I send in my share certificates now for the exchange?

 

A: No. RFMD shareholders and TriQuint stockholders should keep any share certificates they hold at this time. After the mergers are completed, TriQuint stockholders and RFMD shareholders will each receive from Rocky Holding’s exchange agent a letter of transmittal and instructions on how to obtain the TriQuint merger consideration or RFMD merger consideration, as applicable.

 

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Q: What equity stake will former TriQuint stockholders and former RFMD shareholders hold in Rocky Holding?

 

A: Upon completion of the mergers, it is anticipated that RFMD shareholders, on the one hand, and TriQuint stockholders, on the other hand, will each hold approximately 50% of the shares of Rocky Holding common stock issued and outstanding immediately after completion of the mergers.

 

Q: How do I calculate the value of the TriQuint merger consideration?

 

A: Because Rocky Holding will issue a fixed number of shares of Rocky Holding common stock in exchange for each share of TriQuint common stock, the value of the TriQuint merger consideration that TriQuint stockholders will receive in the TriQuint merger for each share of TriQuint common stock will depend on the price per share of RFMD common stock at the time the merger is completed. That price will not be known at the time of the TriQuint special meeting and may be greater or less than the current price of RFMD common stock or the price of RFMD common stock at the time of the TriQuint special meeting.

Based on the closing price of $5.81 per share of RFMD common stock on NASDAQ on February 21, 2014, the last trading day before the execution of the merger agreement, the TriQuint merger consideration represented approximately $9.73 per share of TriQuint common stock, a premium of 5.4% over the closing price of $9.23 per share of TriQuint common stock on NASDAQ on February 21, 2014. Based on the closing price of $[] per share of RFMD common stock on NASDAQ on [], 2014, the latest practicable date before the printing of this joint proxy statement/prospectus, the TriQuint merger consideration represented approximately $[] per share of TriQuint common stock.

 

Q: How do I calculate the value of the RFMD merger consideration?

 

A: Because Rocky Holding will issue a fixed number of shares of Rocky Holding common stock in exchange for each share of RFMD common stock, the value of the RFMD merger consideration that RFMD shareholders will receive in the RFMD merger for each share of RFMD common stock will depend on the price per share of RFMD common stock at the time the merger is completed. That price will not be known at the time of the RFMD special meeting and may be greater or less than the current price or the price at the time of the RFMD special meeting.

Based on the closing price of $5.81 per share of RFMD common stock on NASDAQ on February 21, 2014, the last trading day before the execution of the merger agreement, the RFMD merger consideration represented $5.81 per share of RFMD common stock. Based on the closing price of $[] per share of RFMD common stock on NASDAQ on [], 2014, the latest practicable date before the printing of this joint proxy statement/prospectus, the RFMD merger consideration represented approximately $[] per share of RFMD common stock.

 

Q: When do you expect the mergers to be completed?

 

A: RFMD and TriQuint are working to complete the mergers as quickly as possible, and we anticipate they will be completed in the second half of 2014. The mergers are subject to various regulatory approvals and other conditions, however, that are described in more detail in this joint proxy statement/prospectus, and it is possible that factors outside the control of either company could result in the mergers being completed at a later time, or not at all.

 

Q: What effects will the proposed mergers have on RFMD and TriQuint?

 

A:

Upon completion of the proposed mergers, each of RFMD and TriQuint will cease to be a publicly traded company and will be wholly owned by Rocky Holding, which means that Rocky Holding will be the only shareholder of RFMD and the only stockholder of TriQuint. As a result, you will own shares in Rocky Holding only and will not directly own any shares in RFMD or TriQuint. Following completion of the mergers, the registration of RFMD’s and TriQuint’s common stock and their reporting obligations with respect to their common stock under the Securities Exchange Act of 1934 (as amended), which we refer to

 

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  as the Exchange Act, will be terminated. In addition, upon completion of the proposed mergers, shares of RFMD common stock and TriQuint common stock will no longer be quoted on NASDAQ or any other stock exchange or quotation system. Although you will no longer be a shareholder of RFMD or a stockholder of TriQuint, as applicable, you will have an indirect interest in both RFMD and TriQuint through your ownership of Rocky Holding common stock. If you become a Rocky Holding stockholder, you can expect that the value of your investment will depend, among other things, on the performance of both RFMD and TriQuint and Rocky Holding’s ability to integrate the two companies.

 

Q: What effects will the proposed mergers have on Rocky Holding?

 

A: Upon completion of the proposed mergers, Rocky Holding will become the holding company of RFMD and TriQuint and will become a new public company. As a condition to closing, the shares of Rocky Holding common stock issued in connection with the mergers will be approved for listing on NASDAQ.

 

Q: What happens if the mergers are not completed?

 

A: If the merger agreement is not approved by the RFMD shareholders or adopted by the TriQuint stockholders, or if the mergers are not completed for any other reason, neither RFMD shareholders nor TriQuint stockholders will receive any merger consideration for their shares of RFMD common stock or TriQuint common stock pursuant to the merger agreement or otherwise. Instead, RFMD and TriQuint will remain separate public companies, and each company expects that its common stock will continue to be registered under the Exchange Act and traded on NASDAQ. In specified circumstances, either RFMD or TriQuint may be required to pay to the other party a termination fee, as described in “The Merger Agreement — Termination Fees; Expenses” beginning on page 153.

 

Q: Where can I find information about RFMD and TriQuint?

 

A: You can find information about RFMD and TriQuint by reading this joint proxy statement/prospectus and the documents described in the section entitled “Where You Can Find More Information” beginning on page 209.

 

Q: What will happen to stock options and other stock awards to acquire TriQuint common stock?

 

A: Generally, each TriQuint stock option that is outstanding (whether or not vested or exercisable) and each TriQuint restricted stock unit or market-based restricted unit with respect to shares of TriQuint common stock that remain unvested, in each case as of the initial effective time of the TriQuint merger, will be converted automatically into a substantially similar option to purchase, or award for, Rocky Holding common stock and will remain subject to the same terms, conditions and restrictions as the original option or award, subject to specified adjustments to reflect the effect of the TriQuint Exchange Ratio. In addition, for individuals participating in TriQuint’s employee stock purchase plan (which we refer to as an ESPP), the current ESPP offering will end no later than the closing date, and each participant’s accumulated contributions under the TriQuint ESPP will be used to purchase shares of TriQuint common stock in accordance with the terms of the ESPP. More information on the effects of the TriQuint merger on TriQuint stock options and other stock awards may be found under the section entitled “The Merger Agreement — Treatment of TriQuint Stock Options, Other Stock Awards and Restricted Stock” beginning on page 131 and “The Merger Agreement — Treatment of the TriQuint Employee Stock Purchase Plan Following the Mergers” beginning on page 165.

 

Q: What will happen to stock options and other stock awards to acquire RFMD common stock?

 

A:

Generally, each RFMD stock option that is outstanding (whether or not vested or exercisable) and each RFMD restricted stock unit or performance stock unit with respect to which shares of RFMD common stock remain unvested or unissued, in each case as of the effective time of the RFMD merger, will be converted automatically into a substantially similar option to purchase, or award for, Rocky Holding common stock

 

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  and will remain subject to the same terms, conditions and restrictions as the original option or award, subject to specified adjustments to reflect the effect of the RFMD Exchange Ratio. In addition, for individuals participating in RFMD’s ESPP, the current ESPP offering will end no later than the closing date, and each participant’s accumulated contributions under the ESPP will be used to purchase shares of RFMD common stock in accordance with the terms of the ESPP. More information on the effects of the RFMD merger on RFMD stock options and other stock awards may be found under the section entitled “The Merger Agreement — Treatment of RFMD Stock Options, Other Stock Awards and Restricted Stock” beginning on page 130 and “The Merger Agreement — Treatment of RFMD Equity Compensation Plans Following the Mergers” beginning on page 155.

 

Q: What vote is required to approve each TriQuint proposal?

 

A: Proposal to Adopt the Merger Agreement by TriQuint Stockholders: Adopting the merger agreement requires the affirmative vote of holders of a majority of the shares of TriQuint common stock outstanding and entitled to vote. Accordingly, a TriQuint stockholder’s failure to submit a proxy card or to vote in person at the TriQuint special meeting, an abstention from voting, or the failure of a TriQuint stockholder who holds his, her or its shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

Proposal to Adjourn the TriQuint Special Meeting by TriQuint Stockholders: Approving the adjournment of the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement) requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote on the adjournment proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to adjourn the TriQuint special meeting, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to adjourn the TriQuint special meeting.

Proposal Regarding TriQuint Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, TriQuint is providing stockholders with the opportunity to approve, by non-binding advisory vote, compensation payments for TriQuint’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “TriQuint Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for TriQuint Named Executive Officers” beginning on page 173. Approving this merger-related executive compensation, on a non-binding advisory basis, requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote on the merger-related compensation proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the merger-related executive compensation, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

Proposal to Approve the Amended TriQuint 2013 Incentive Plan by TriQuint Stockholders: Approving the amended TriQuint 2013 Incentive Plan requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the amended TriQuint 2013 Incentive Plan, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to approve the amended TriQuint 2013 Incentive Plan.

 

Q: What vote is required to approve each RFMD proposal?

 

A:

Proposal to Approve the Merger Agreement by RFMD Shareholders: Approving the merger agreement requires the affirmative vote of holders of a majority of the shares of RFMD common stock outstanding and entitled to vote. Accordingly, an RFMD shareholder’s failure to submit a proxy card or to vote in person at the RFMD special meeting, an abstention from voting, or the failure of an RFMD shareholder who holds

 

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  his, her or its shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to approve the merger agreement.

Proposal to Adjourn the RFMD Special Meeting by RFMD Shareholders: Approving the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement) requires that the votes “FOR” the proposal to adjourn the RFMD special meeting exceed the votes “AGAINST” such proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to adjourn the RFMD special meeting.

Proposal Regarding Certain RFMD Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, RFMD is providing shareholders with the opportunity to approve, by non-binding advisory vote, compensation payments for RFMD’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “RFMD Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for RFMD Named Executive Officers” beginning on page 169. Approving this merger-related executive compensation, on a non-binding advisory basis, requires that the votes “FOR” the merger-related compensation proposal exceed the votes “AGAINST” the merger-related compensation proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

 

Q: What are the recommendations of the TriQuint board of directors?

 

A: The TriQuint board has unanimously (a) approved the merger agreement and the TriQuint merger and the transactions contemplated by the merger agreement upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the mergers are fair to, advisable and in the best interests of TriQuint and its stockholders, (c) authorized management to submit the merger agreement to the TriQuint stockholders for adoption at the TriQuint special meeting, and (d) recommended that TriQuint’s stockholders adopt the merger agreement.

The TriQuint board unanimously recommends that TriQuint stockholders vote:

“FOR” the proposal to adopt the merger agreement;

“FOR” the proposal to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

“FOR” the proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers contemplated by the merger agreement; and

“FOR” the proposal to approve the amended TriQuint 2013 Incentive Plan.

See “The Mergers — Recommendation of the TriQuint Board; TriQuint’s Reasons for the Merger” beginning on page 79.

 

Q: What are the recommendations of the RFMD board of directors?

 

A: The RFMD board has unanimously (a) adopted the merger agreement and approved the completion of the RFMD merger upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the terms of the merger agreement, the RFMD merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, RFMD and its shareholders, (c) directed that the merger agreement be submitted to RFMD shareholders for approval at the RFMD special meeting, (d) recommended that RFMD’s shareholders approve the merger agreement, and (e) declared that the merger agreement is advisable.

 

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The RFMD board unanimously recommends that RFMD shareholders vote:

“FOR” the proposal to approve the merger agreement;

“FOR” the proposal to approve the adjournment of the RFMD special meeting (if it is necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement); and

“FOR” the proposal to approve, by non-binding advisory vote, certain compensation arrangements for RFMD’s named executive officers in connection with the mergers contemplated by the merger agreement.

See “The Mergers — Recommendation of the RFMD Board; RFMD’s Reasons for the Mergers” beginning on page 94.

 

Q: What are my material U.S. federal income tax consequences as a result of the mergers?

 

A: We anticipate that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the Code. TriQuint’s obligation to complete the TriQuint merger is conditioned on TriQuint receiving a written opinion of its counsel, Perkins Coie LLP, which we refer to as Perkins Coie, to the effect that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Code. RFMD’s obligation to complete the RFMD merger is conditioned on RFMD receiving an opinion of its counsel, Weil, Gotshal & Manges LLP, which we refer to as Weil Gotshal, to the effect that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Code. If each of the TriQuint merger and the RFMD merger constitutes a reorganization within the meaning of Section 368(a), then U.S. holders (as defined in the section entitled “The Mergers — Material U.S. Federal Income Tax Consequences” beginning on page 124) of TriQuint common stock and RFMD common stock generally will not recognize gain or loss for U.S. federal income tax purposes as a result of the exchange of TriQuint common stock and RFMD common stock, respectively, for Rocky Holding common stock except for any cash received in lieu of a fractional share of Rocky Holding common stock.

You are strongly urged to consult with a tax advisor to determine the particular U.S. federal, state or local or foreign income or other tax consequences of the mergers to you. See “The Mergers — Material U.S. Federal Income Tax Consequences” beginning on page 124.

 

Q: Are TriQuint stockholders entitled to appraisal rights?

 

A: No. Under Delaware corporate law, holders of TriQuint common stock are not entitled to an appraisal in connection with the TriQuint merger.

 

Q: Are RFMD shareholders entitled to appraisal rights?

 

A: No. Under North Carolina corporate law, holders of RFMD common stock are not entitled to an appraisal in connection with the RFMD merger.

 

Q: If the mergers are completed, when can I expect to receive the TriQuint merger consideration for my shares of TriQuint common stock?

 

A:

As soon as reasonably practicable after the effective time of the TriQuint merger, Rocky Holding will cause an exchange agent to mail to each record holder of TriQuint common stock immediately prior to the effective time a form of letter of transmittal and instructions for use in effecting the exchange of TriQuint common stock for the TriQuint merger consideration. After receiving the proper documentation from a holder of TriQuint common stock, the exchange agent will deliver the Rocky Holding common stock (and

 

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  cash in lieu of any fractional share of Rocky Holding common stock) to which the holder is entitled under the merger agreement. More information on the exchange of TriQuint common stock may be found under the section entitled “The Mergers — Conversion of Shares; Exchange of Certificates; No Fractional Shares” beginning on page 132.

 

Q: If the mergers are completed, when can I expect to receive the RFMD merger consideration for my shares of RFMD common stock?

 

A: As soon as reasonably practicable after the effective time of the RFMD merger, Rocky Holding will cause an exchange agent to mail to each record holder of RFMD common stock immediately prior to the effective time a form of letter of transmittal and instructions for use in effecting the exchange of RFMD common stock for the RFMD merger consideration. After receiving the proper documentation from a holder of RFMD common stock, the exchange agent will deliver the Rocky Holding common stock (and cash in lieu of any fractional share of Rocky Holding common stock) to which the holder is entitled under the merger agreement. More information on the exchange of RFMD common stock may be found under the section entitled “The Mergers — Conversion of Shares; Exchange of Certificates; No Fractional Shares” beginning on page 132.

 

Q: What happens if I sell my shares of TriQuint common stock or RFMD common stock before the applicable special meeting?

 

A: The record date for the TriQuint special meeting, which we refer to as the TriQuint record date, and the record date for the RFMD special meeting, which we refer to as the RFMD record date, are earlier than the date of the special meetings and the date that the mergers are expected to be completed. If you transfer your shares after the applicable record date, but before the applicable special meeting, unless the transferee requests a proxy, you will retain your right to vote at the special meeting, but will have transferred to the transferee the right to receive the TriQuint merger consideration or the RFMD merger consideration, as applicable, in the mergers. In order to receive the TriQuint merger consideration or the RFMD merger consideration, as applicable, you must hold your shares through the completion of the mergers.

 

Q: What happens if I sell my shares of TriQuint common stock or RFMD common stock after the applicable special meeting, but before the effective time of the applicable merger?

 

A: If you transfer your shares after the applicable special meeting, but before the effective time of the applicable merger, you will have transferred the right to receive the TriQuint merger consideration or the RFMD merger consideration, as applicable, in the applicable merger. In order to receive the TriQuint merger consideration or the RFMD merger consideration, as applicable, you must hold your shares of TriQuint common stock or RFMD common stock, as applicable, through the completion of the applicable merger.

About the Special Meetings

 

Q: When and where will the TriQuint and RFMD special meetings be held?

 

A: TriQuint: The TriQuint special meeting will be held at [] on [], 2014, at [], Pacific time, unless the special meeting is adjourned or postponed.

RFMD: The RFMD special meeting will be held at [] on [], 2014, at [], Eastern time, unless the special meeting is adjourned or postponed.

 

Q: What constitutes a quorum?

 

A:

TriQuint Special Meeting: The presence, in person or represented by proxy, of holders of a majority in voting power of the TriQuint common stock issued and outstanding and entitled to vote at the TriQuint

 

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  special meeting constitutes a quorum. In the absence of a quorum, the chairman of the special meeting will have power to adjourn the special meeting. As of the TriQuint record date, [] shares of TriQuint common stock will be required to achieve a quorum.

RFMD Special Meeting: The presence, in person or represented by proxy, of holders of a majority in voting power of the RFMD common stock issued and outstanding and entitled to vote at the RFMD special meeting constitutes a quorum. As of the RFMD record date, [] shares of RFMD common stock will be required to achieve a quorum.

 

Q: Who is entitled to vote at the TriQuint and RFMD special meetings?

 

A: TriQuint Special Meeting: TriQuint has fixed [], 2014 as the TriQuint record date. If you were a TriQuint stockholder at the close of business on the TriQuint record date, you are entitled to vote on matters that come before the TriQuint special meeting. A TriQuint stockholder may vote his, her or its shares, however, only if he, she or it is present in person or is represented by proxy at the TriQuint special meeting.

RFMD Special Meeting: RFMD has fixed [], 2014 as the RFMD record date. If you were an RFMD shareholder at the close of business on the RFMD record date, you are entitled to vote on matters that come before the RFMD special meeting. An RFMD shareholder may vote his, her or its shares, however, only if he, she or it is present in person or is represented by proxy at the RFMD special meeting.

 

Q: How many votes do I have?

 

A: TriQuint: TriQuint stockholders are entitled to one vote at the TriQuint special meeting for each share of TriQuint common stock held of record as of the TriQuint record date. As of the close of business on the TriQuint record date, there were [] outstanding shares of TriQuint common stock.

RFMD: RFMD shareholders are entitled to one vote at the RFMD special meeting for each share of RFMD common stock held of record as of the RFMD record date. As of the close of business on the RFMD record date, there were [] outstanding shares of RFMD common stock.

 

Q: What if I hold shares in both RFMD and TriQuint?

 

A: If you are a stockholder of both RFMD and TriQuint, you will receive two separate packages of proxy materials. A vote as a TriQuint stockholder for the proposal to adopt the merger agreement will not constitute a vote as an RFMD shareholder for the proposal to approve the merger agreement, or vice versa. Therefore, please mark, sign, date and return all proxy cards that you receive, whether from RFMD or TriQuint, or submit proxies as both an RFMD shareholder and a TriQuint stockholder over the internet or by telephone.

 

Q: May I attend the TriQuint special meeting?

 

A: Yes. You are entitled to attend the TriQuint special meeting if you were a TriQuint stockholder of record, or a beneficial owner of TriQuint common stock, as of the close of business on the TriQuint record date, or you hold a valid proxy for the TriQuint special meeting. You should be prepared to present a form of photo identification, such as a driver’s license, or your proxy card. For additional information, see “The TriQuint Special Meeting — Attending the Special Meeting” on page 62.

 

Q: May I attend the RFMD special meeting?

 

A: Yes. You are entitled to attend the RFMD special meeting if you were an RFMD shareholder of record, or a beneficial owner of RFMD common stock, as of the close of business on the RFMD record date, or you hold a valid proxy for the RFMD special meeting. You should be prepared to present a form of photo identification, such as a driver’s license, or your proxy card. For additional information, see “The RFMD Special Meeting — Attending the Special Meeting” on page 66.

 

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Q: My shares are held in “street name” by my broker. Will my broker automatically vote my shares for me?

 

A: No. If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial owner” of the shares held for you in what is known as “street name.” If this is the case, this joint proxy statement/prospectus has been forwarded to you by your brokerage firm, bank or other nominee, or its agent. As the beneficial owner, you have the right to direct your broker, bank or other nominee as to how to vote your shares. If you do not provide voting instructions to your broker on a particular proposal on which your broker does not have discretionary authority to vote, your shares will not be voted on that proposal. This is called a “broker non-vote.”

We believe that (a) under the General Corporation Law of the State of Delaware, which we refer to as the DGCL, and the North Carolina Business Corporation Act, which we refer to as the NCBCA, any broker non-votes represented at the applicable meeting will be counted for purposes of determining the presence or absence of a quorum at the TriQuint special meeting and the RFMD special meeting and (b) under the current rules of NASDAQ, brokers do not have discretionary authority to vote on any of the RFMD proposals or any of the TriQuint proposals. To the extent there are any broker non-votes, a broker non-vote will have the same effect as a vote “AGAINST” the proposals to approve and adopt the merger agreement, as applicable, but will have no effect on the other proposals.

 

Q: What do I need to do now?

 

A: Read and consider the information contained in this joint proxy statement/prospectus carefully, and then please vote your shares as soon as possible so that your shares may be represented at the applicable special meeting.

 

Q: How do I vote?

 

A: If you are a registered holder of record, you can vote in person by completing a ballot at your company’s special meeting, or you can vote by proxy before the special meeting. Even if you plan to attend your company’s special meeting, we encourage you to vote your shares by proxy as soon as possible. After carefully reading and considering the information contained in this joint proxy statement/prospectus, please submit your proxy by telephone or over the Internet in accordance with the instructions set forth on the enclosed proxy card, or mark, sign and date the proxy card and return it in the enclosed postage-paid envelope as soon as possible so that your shares may be voted at your company’s special meeting.

If you hold shares of TriQuint common stock or RFMD common stock in “street name,” you may vote by following the instructions provided by the bank, broker or other nominee holding your shares.

For detailed information, see “The RFMD Special Meeting — How to Vote” beginning on page 65 and “The TriQuint Special Meeting — How to Vote” beginning on page 60. YOUR VOTE IS VERY IMPORTANT.

 

Q: What happens if I do not indicate how to vote on my proxy card?

 

A: If you are a registered holder of record and you return your signed proxy card but do not indicate your voting preferences, the persons named in the proxy card will vote the shares represented by that proxy as recommended by the RFMD board, in the case of RFMD common stock, or the TriQuint board, in the case of TriQuint common stock.

 

Q: Can I change my vote after I have submitted a proxy by telephone or over the Internet or submitted my completed proxy card?

 

A:

Yes. If you are a registered holder of record, you can change your vote by revoking your proxy at any time before it is voted at the TriQuint special meeting or RFMD special meeting, as applicable. You can do this in one of four ways: (a) submit a proxy again by telephone or over the Internet prior to midnight on the night

 

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  before the applicable special meeting; (b) sign another proxy card with a later date and return it prior to midnight on the night before the applicable special meeting; (c) attend the applicable special meeting and complete a ballot; or (d) send a written notice of revocation to the corporate secretary of TriQuint or RFMD, as applicable, so that it is received prior to midnight on the night before the applicable special meeting.

If you have instructed a broker to vote your shares, you must follow directions received from your broker to change your vote.

 

Q: What should stockholders or shareholders do if they receive more than one set of voting materials for a special meeting?

 

A: You may receive more than one set of voting materials for a special meeting, including multiple copies of this joint proxy statement/prospectus and multiple proxy cards or voting instruction cards. Please complete, sign, date and return each proxy card and voting instruction card that you receive. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card.

 

Q: How can I find out the results of the votes?

 

A: Each of RFMD and TriQuint will publicly announce final voting results as promptly as practicable after the applicable special meeting is completed. Preliminary voting results may be announced at the special meetings.

 

Q: Who is paying for this proxy solicitation?

 

A: RFMD will bear the entire cost of soliciting proxies from RFMD shareholders and TriQuint will bear the entire cost of soliciting proxies from TriQuint stockholders, except that TriQuint and RFMD will share equally the expenses incurred in connection with the printing and mailing of this joint proxy statement/prospectus and filing all soliciting materials with the Securities and Exchange Commission, which we refer to as the SEC. In addition to this mailing, each of RFMD’s and TriQuint’s directors, officers and employees (who will not receive any additional compensation for those services) may solicit proxies. Solicitation of proxies will be undertaken through the mail, in person, by telephone, via the Internet and video conference. Each of RFMD and TriQuint may also reimburse brokerage houses and other custodians, nominees and fiduciaries for their expenses incurred in forwarding proxy and solicitation materials to the beneficial owners of TriQuint common stock and RFMD common stock, as applicable, and in obtaining voting instructions from those beneficial owners.

 

Q: Whom should I call if I have questions about the proxy materials or voting procedures?

 

A: If you have questions about the mergers, or if you need assistance in submitting your proxy or voting your shares or need additional copies of this joint proxy statement/prospectus or the enclosed proxy card, you should contact the proxy solicitation agent for the company in which you hold shares.

If you are a TriQuint stockholder, you should contact The Proxy Advisory Group, LLC®, the proxy solicitation agent for TriQuint, by mail at 18 East 41st Street, 20th Floor, New York, New York 10017, by telephone at (888) 557-7699 or (888) 55-PROXY (toll free) or (212) 616-2180.

If you are an RFMD shareholder, you should contact Innisfree M&A Incorporated, the proxy solicitation agent for RFMD, by mail at 501 Madison Avenue, 20th Floor, New York, NY 10022, by telephone at (888) 750-5834 (shareholders call toll free) or (212) 750-5833 (banks and brokers call collect).

If your shares are held in a stock brokerage account or by a bank or other nominee, you should contact your broker, bank or other nominee for additional information.

 

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SUMMARY

The following summary highlights selected information from this joint proxy statement/prospectus and may not contain all of the information that may be important to you. Accordingly, stockholders and shareholders are encouraged to carefully read this entire joint proxy statement/prospectus, its annexes and the documents referred to or incorporated by reference in this joint proxy statement/prospectus. Each item in this summary includes a page reference directing you to a more complete description of that item. Please see “Where You Can Find More Information” beginning on page 209.

Information About the Companies

RF Micro Devices, Inc.

RF Micro Devices, Inc., which we refer to as RFMD, was incorporated in North Carolina in 1991. RFMD designs and manufactures high-performance radio frequency solutions. RFMD’s products enable worldwide mobility, provide enhanced connectivity and support advanced functionality in the mobile device, wireless infrastructure, wireless local area network (WLAN or WiFi), cable television/broadband, Smart Energy/advanced metering infrastructure and aerospace and defense markets. RFMD’s principal executive offices are located at 7628 Thorndike Road, Greensboro, North Carolina 27409-9421. RFMD’s telephone number is (336) 664-1233 and its website is www.rfmd.com.

TriQuint Semiconductor, Inc.

TriQuint Semiconductor, Inc., which we refer to as TriQuint, was incorporated in California in 1981 and reincorporated in Delaware in 1997. TriQuint designs, develops and manufactures high-performance active and passive technologies, including power amplifier, switch and filter modules for the mobile device, network infrastructure and defense and aerospace markets. TriQuint has core competencies in gallium arsenide (“GaAs”), gallium nitride (“GaN”), surface acoustic wave (“SAW”) and bulk acoustic wave (“BAW”) technologies. TriQuint’s principal executive offices are located at 2300 N.E. Brookwood Parkway, Hillsboro, Oregon 97124. TriQuint’s telephone number is (503) 615-9000 and its website is www.triquint.com.

Rocky Holding, Inc.

Rocky Holding, Inc., which we refer to as Rocky Holding, was incorporated in Delaware in December 2013 as a wholly owned subsidiary of RFMD solely for the purpose of effecting the mergers and has not conducted any business activities other than in connection with the mergers. As described below in “— The Mergers” and more fully in “The Mergers” and “The Merger Agreement,” following the completion of the mergers, RFMD and TriQuint will each become wholly owned subsidiaries of Rocky Holding. We anticipate that, prior to completion of the mergers, Rocky Holding will change its name, adopt a NASDAQ symbol for its common stock, and register a new trade name and logo that reflect the key attributes of the combined company. Rocky Holding’s principal executive offices are currently located at 7628 Thorndike Road, Greensboro, North Carolina 27409-9421 and its telephone number is (336) 664-1233.

The Mergers

RFMD, Rocky Holding and TriQuint have entered into the merger agreement providing for the combination of RFMD and TriQuint under a new holding company, Rocky Holding. As a result of the transactions contemplated by the merger agreement, former RFMD shareholders and former TriQuint stockholders will own stock in Rocky Holding, which shares are expected to be listed for trading on NASDAQ. Pursuant to the merger agreement, Rocky Merger Sub will be merged with and into RFMD, and Trident Merger Sub will be merged with and into TriQuint. As a result, RFMD and TriQuint will each become wholly owned subsidiaries of Rocky Holding.

The organization of RFMD, TriQuint and Rocky Holding before and after the mergers is illustrated on the following pages:

[The remainder of this page intentionally left blank.]

 

 

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Prior to the Mergers

 

LOGO    LOGO

The Mergers

 

LOGO

 

 

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After the Mergers

 

LOGO

Merger Consideration Received by TriQuint Stockholders

Upon completion of the TriQuint merger, each outstanding share of TriQuint common stock, other than TriQuint excluded shares, will be converted into the right to receive 0.4187 of a share of validly issued, fully paid and non-assessable Rocky Holding common stock. Shares of TriQuint common stock held by TriQuint or Trident Merger Sub (which we refer to as the TriQuint excluded shares) will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration.

TriQuint stockholders will not receive any fractional shares of Rocky Holding common stock in the TriQuint merger. Instead of receiving any fractional shares, each holder of TriQuint common stock will be paid an amount in cash, without interest, rounded to the nearest cent, determined by (a) dividing that fraction by the TriQuint Exchange Ratio, and (b) multiplying the result by the average closing price of a share of TriQuint common stock on NASDAQ for the 10 most recent trading days that the TriQuint common stock has traded, ending on the trading day one day prior to the date on which the closing of the mergers takes place, which we refer to as the closing date.

Merger Consideration Received by RFMD Shareholders

Upon completion of the RFMD merger, each outstanding share of RFMD common stock, other than RFMD excluded shares, will be converted into the right to receive 0.2500 of a share of validly issued, fully paid and non-assessable Rocky Holding common stock. Shares of RFMD common stock held by RFMD or Rocky Merger Sub (which we refer to as the RFMD excluded shares) will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration.

RFMD shareholders will not receive any fractional shares of Rocky Holding common stock in the RFMD merger. Instead of receiving any fractional shares, each holder of RFMD common stock will be paid an amount in cash, without interest, rounded to the nearest cent, determined by (a) dividing that fraction by the RFMD Exchange Ratio, and (b) multiplying the result by the average closing price of a share of RFMD common stock on NASDAQ for the 10 most recent trading days that the RFMD common stock has traded, ending on the trading day one day prior to the closing date.

 

 

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Total Rocky Holding Shares to Be Issued

Based on the number of shares of TriQuint common stock outstanding as of [], 2014 and the number of shares of RFMD common stock outstanding as of [], 2014, the latest practicable date before the printing of this joint proxy statement/prospectus, and assuming no TriQuint stock options or RFMD stock options are exercised between [], 2014 and the effective times of the mergers, the total number of shares of Rocky Holding common stock to be issued immediately following the mergers will be approximately [].

Comparative Per Share Market Price and Dividend Information

Rocky Holding common stock is not traded or quoted on a stock exchange or quotation system and, therefore, its common stock does not have a historical market value. As discussed below in “— Listing of Rocky Holding Common Stock on NASDAQ,” Rocky Holding will apply to have its common stock listed on NASDAQ upon completion of the mergers.

RFMD common stock trades on NASDAQ under the symbol “RFMD,” and TriQuint common stock trades on NASDAQ under the symbol “TQNT.” The table below shows the historical and pro forma equivalent per share value of RFMD and TriQuint common stock at the close of the regular trading session on February 21, 2014, the last trading day before the public announcement of the signing of the merger agreement, on [], 2014, the record date, and on [], 2014, the last trading day before the printing of this joint proxy statement/prospectus.

 

Date

   RFMD Closing
Price
     TriQuint Closing
Price
     RFMD Pro Forma
Equivalent(1)
     TriQuint Pro
Forma Equivalent(2)
 

February 21, 2014

   $ 5.81       $ 9.23       $ 23.24       $ 22.04   

[], 2014

           

[], 2014

           

 

(1) The pro forma equivalent per share value of RFMD common stock is calculated by dividing the RFMD closing price by the RFMD Exchange Ratio of 0.2500.
(2) The pro forma equivalent per share value of TriQuint common stock is calculated by dividing the TriQuint closing price by the TriQuint Exchange Ratio of 0.4187.

Because the 0.2500 and 0.4187 exchange ratios for the RFMD merger and TriQuint merger, respectively, are fixed and will not be adjusted as a result of changes in market prices, the implied value of the merger consideration will fluctuate with the changes in the market prices of RFMD common stock and TriQuint common stock between the time of the execution of the merger agreement and the closing of the mergers. You should obtain current market quotations for the shares of both companies.

Neither RFMD nor TriQuint has paid dividends on common stock during their last two fiscal years, and neither company has any current intention of doing so.

TriQuint Special Meeting

Date, Time and Place

The TriQuint special meeting will be held at [] on [], 2014, at [], Pacific time, unless the special meeting is adjourned or postponed.

Quorum

The presence, in person or represented by proxy, of holders of a majority in voting power of the TriQuint common stock issued and outstanding and entitled to vote at the TriQuint special meeting constitutes a quorum.

 

 

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In the absence of a quorum, the chairman of the TriQuint special meeting will have power to adjourn the TriQuint special meeting. As of the TriQuint record date, [] shares of TriQuint common stock will be required to achieve a quorum.

Purpose of the TriQuint Special Meeting

At the TriQuint special meeting, TriQuint stockholders will be asked to consider and vote upon the following matters:

 

    a proposal to adopt the merger agreement;

 

    a proposal to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

 

    a proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers; and

 

    a proposal to approve the amended TriQuint 2013 Incentive Plan.

Record Date; Shares Entitled to Vote

Only holders of record of shares of TriQuint common stock at the close of business on the TriQuint record date ([], 2014) will be entitled to vote shares held at that date at the TriQuint special meeting or any adjournments or postponements of the TriQuint special meeting. Each outstanding share of TriQuint common stock entitles its holder to cast one vote.

As of the TriQuint record date, [] shares of TriQuint common stock were outstanding and entitled to vote at the TriQuint special meeting.

Vote Required

Proposal to Adopt the Merger Agreement by TriQuint Stockholders: Adopting the merger agreement requires the affirmative vote of holders of a majority of the shares of TriQuint common stock outstanding and entitled to vote. Accordingly, a TriQuint stockholder’s failure to submit a proxy card or to vote in person at the TriQuint special meeting, an abstention from voting, or the failure of a TriQuint stockholder who holds his, her or its shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

Proposal to Adjourn the TriQuint Special Meeting by TriQuint Stockholders: Approving the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement) requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote on the adjournment proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to adjourn the TriQuint special meeting, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to adjourn the TriQuint special meeting.

Proposal Regarding Certain TriQuint Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, TriQuint is providing stockholders with the opportunity to approve, by non-binding advisory vote, compensation payments for TriQuint’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “TriQuint Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for TriQuint Named Executive Officers” beginning on page 173. Approving this merger-related executive compensation, on a non-binding

 

 

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advisory basis, requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote on the merger-related compensation proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the merger-related executive compensation, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

Proposal to Approve the amended TriQuint 2013 Incentive Plan by TriQuint Stockholders: Approving the amended TriQuint 2013 Incentive Plan requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the TriQuint special meeting and entitled to vote. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the amended TriQuint 2013 Incentive Plan, while broker non-votes and shares not in attendance at the TriQuint special meeting will have no effect on the outcome of any vote to approve the amended TriQuint 2013 Incentive Plan.

Voting by TriQuint’s Directors and Executive Officers

As of the TriQuint record date, TriQuint’s directors and executive officers beneficially owned [] shares of TriQuint common stock entitled to vote at the TriQuint special meeting. This represents approximately []% in voting power of the outstanding shares of TriQuint common stock entitled to be cast at the TriQuint special meeting, which is []% less than the vote required to adopt the merger agreement. Each TriQuint director and executive officer has indicated his or her present intention to vote, or cause to be voted, the shares of TriQuint common stock owned by him or her for the proposal to adopt the merger agreement.

RFMD Special Meeting

Date, Time and Place

The RFMD special meeting will be held at [] on [], 2014, at [], Eastern time, unless the RFMD special meeting is adjourned or postponed.

Purpose of the RFMD Special Meeting

At the RFMD special meeting, RFMD shareholders will be asked to consider and vote upon the following matters:

 

    a proposal to approve the merger agreement;

 

    a proposal to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement); and

 

    a proposal to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers.

Record Date; Shares Entitled to Vote

Only holders of record of shares of RFMD common stock at the close of business on the RFMD record date ([], 2014) will be entitled to vote shares held at that date at the RFMD special meeting or any adjournments or postponements of the RFMD special meeting. Each outstanding share of RFMD common stock entitles its holder to cast one vote.

As of the RFMD record date, [] shares of RFMD common stock were outstanding and entitled to vote at the RFMD special meeting.

 

 

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Vote Required

Proposal to Approve the Merger Agreement by RFMD Shareholders: Approving the merger agreement requires the affirmative vote of holders of a majority of the shares of RFMD common stock outstanding and entitled to vote. Accordingly, an RFMD shareholder’s failure to submit a proxy card or to vote in person at the RFMD special meeting, an abstention from voting, or the failure of an RFMD shareholder who holds his or her shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

Proposal to Adjourn the RFMD Special Meeting by RFMD Shareholders: Approving the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement) requires that the votes “FOR” the proposal to adjourn the RFMD special meeting exceed the votes “AGAINST” such proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to adjourn the RFMD special meeting.

Proposal Regarding Certain RFMD Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, RFMD is providing shareholders with the opportunity to approve, by non-binding advisory vote, compensation payments for RFMD’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “RFMD Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for RFMD Named Executive Officers” beginning on page 169. Approving this merger-related executive compensation, on a non-binding advisory basis, requires that the votes “FOR” the merger-related compensation proposal exceed the votes “AGAINST” the merger-related compensation proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

Voting by RFMD’s Directors and Executive Officers

As of the RFMD record date, RFMD’s directors and executive officers beneficially owned [] shares of RFMD common stock entitled to vote at the RFMD special meeting. This represents approximately []% in voting power of the outstanding shares of RFMD common stock entitled to be cast at the RFMD special meeting, which is []% less than the vote required to approve the merger agreement. Each RFMD director and executive officer has indicated his or her present intention to vote, or cause to be voted, the shares of RFMD common stock owned by him or her for the proposal to approve the merger agreement.

Recommendation of the TriQuint Board

The TriQuint board has unanimously (a) approved the merger agreement and the TriQuint merger and the transactions contemplated by the merger agreement upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the mergers are fair to, advisable and in the best interests of TriQuint and its stockholders, (c) authorized management to submit the merger agreement to the TriQuint stockholders for adoption at the TriQuint special meeting, and (d) recommended that TriQuint’s stockholders adopt the merger agreement.

The TriQuint board unanimously recommends that TriQuint stockholders vote:

 

    “FOR” the proposal to adopt the merger agreement;

 

    “FOR” the proposal to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

 

 

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    “FOR” the proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers; and

 

    “FOR” the proposal to approve the amended TriQuint 2013 Incentive Plan.

We refer to the recommendation that TriQuint stockholders vote “FOR” the proposal to adopt the merger agreement as the TriQuint Recommendation. See “The Mergers — Recommendation of the TriQuint Board; TriQuint’s Reasons for the Merger” beginning on page 79.

Recommendation of the RFMD Board

The RFMD board has unanimously (a) adopted the merger agreement and approved the completion of the RFMD merger upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the terms of the merger agreement, the RFMD merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, RFMD and its shareholders, (c) directed that the merger agreement be submitted to RFMD shareholders for approval at the RFMD special meeting, (d) recommended that RFMD’s shareholders approve the merger agreement, and (e) declared that the merger agreement is advisable.

The RFMD board unanimously recommends that RFMD shareholders vote:

 

    “FOR” the proposal to approve the merger agreement;

 

    “FOR” the proposal to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement); and

 

    “FOR” the proposal to approve, by non-binding advisory vote, the compensation arrangements for RMFD’s named executive officers in connection with the mergers.

We refer to the recommendation that RFMD shareholders vote “FOR” the proposal to approve the merger agreement as the RFMD Recommendation. See “The Mergers — Recommendation of the RFMD Board; RFMD’s Reasons for the Merger” beginning on page 94.

Opinion of Financial Advisor to TriQuint

Goldman, Sachs & Co. (which we refer to as Goldman Sachs) delivered its opinion to the TriQuint board that, as of February 22, 2014 and based upon and subject to the factors and assumptions set forth therein and taking into account the RFMD merger, the TriQuint Exchange Ratio pursuant to the merger agreement was fair from a financial point of view to the holders (other than RFMD and its affiliates) of shares of TriQuint common stock.

The full text of the written opinion of Goldman Sachs, dated February 22, 2014, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B. Goldman Sachs provided its opinion for the information and assistance of the TriQuint board in connection with its consideration of the mergers. The Goldman Sachs opinion is not a recommendation as to how any holder of TriQuint common stock should vote with respect to the mergers or any other matter. Pursuant to an engagement letter between TriQuint and Goldman Sachs, TriQuint has agreed to pay Goldman Sachs a transaction fee of approximately $23 million plus an additional amount in TriQuint’s sole discretion of up to approximately $3 million, all of which is payable upon completion of the mergers.

Opinion of Financial Advisor to RFMD

In connection with the RFMD merger and the TriQuint merger, which we refer to in this section as the “Transaction,” Merrill Lynch, Pierce, Fenner & Smith Incorporated (which we refer to as BofA Merrill Lynch), RFMD’s financial advisor, delivered to the RFMD board a written opinion, dated February 22, 2014, as to,

 

 

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taking into account the Transaction, the fairness, from a financial point of view and as of the date of the opinion, of the RFMD Exchange Ratio provided for in the merger agreement to the holders of RFMD common stock (excluding RFMD, TriQuint and their respective affiliates). The full text of the written opinion, dated February 22, 2014, of BofA Merrill Lynch, which describes, among other things, the assumptions made, procedures followed, factors considered and limitations on the review undertaken, is attached as Annex C to this document and is incorporated by reference herein in its entirety. BofA Merrill Lynch provided its opinion to the RFMD board (in its capacity as such) for the benefit and use of the RFMD board in connection with and for purposes of its evaluation, taking into account the Transaction, of the RFMD Exchange Ratio from a financial point of view. BofA Merrill Lynch’s opinion does not address any other aspect of the Transaction and no opinion or view was expressed as to the relative fairness of the RFMD Exchange Ratio as compared with the TriQuint Exchange Ratio or the relative merits of the Transaction in comparison to other strategies or transactions that might be available to RFMD or in which RFMD might engage or as to the underlying business decision of RFMD to proceed with or effect the Transaction. BofA Merrill Lynch’s opinion does not address any other aspect of the Transaction and does not constitute a recommendation to any shareholder as to how to vote or act in connection with the Transaction or any related matter.

Interests of Officers and Directors in the Mergers

Certain of RFMD’s and TriQuint’s executive officers and directors have financial interests in the mergers that are different from, or in addition to, the interests of RFMD’s shareholders and TriQuint’s stockholders, respectively. The members of the RFMD board and the TriQuint board were aware of and considered these interests, among other matters, in evaluating and negotiating the merger agreement and the mergers and in recommending to RFMD shareholders and TriQuint stockholders that the merger agreement be approved or adopted, as applicable. These interests are described in more detail in “The Mergers — Interests of Officers and Directors in the Mergers” beginning on page 110.

Governmental and Regulatory Approvals

RFMD and TriQuint are not required to complete the mergers unless a number of regulatory conditions are satisfied or waived. These conditions include: (a) absence of any temporary restraining order, preliminary or permanent injunction or other order that would prevent the completion of the mergers, (b) absence of any legal requirement that makes the completion of the mergers illegal, (c) any waiting period applicable to the completion of the mergers under any applicable antitrust law, including the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (which we refer to as the HSR Act), having expired or been terminated, and (d) any governmental authorization or other consent required to be obtained with respect to the mergers under any applicable antitrust law or other legal requirement having been obtained and remaining in full force and effect (other than any governmental authorization or consent under legal requirements other than antitrust laws, the failure to obtain which would not reasonably be expected to have a material adverse effect with respect to either RFMD or TriQuint), and no such governmental authorization or other consent so obtained requiring, containing or contemplating any term, limitation, condition or restriction that has or would reasonably be expected to have or result in a material adverse effect with respect to either RFMD or TriQuint. See “The Mergers — Governmental and Regulatory Approvals” beginning on page 122 for more information about these conditions, filings and each party’s obligations related to governmental and regulatory approvals.

No Solicitation

Subject to specified exceptions, each of TriQuint and RFMD has agreed not to solicit, initiate, knowingly encourage or knowingly facilitate the making of any acquisition proposal (as defined in the section entitled “The Merger Agreement — Covenants of the Parties — No Solicitation” beginning on page 142) or acquisition inquiry

 

 

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(as defined in the section entitled “The Merger Agreement — Covenants of the Parties — No Solicitation” beginning on page 142), furnish information to any person in connection with or in response to an acquisition proposal or acquisition inquiry or engage in discussions or negotiations regarding any acquisition proposal or acquisition inquiry. Notwithstanding these restrictions, prior to the approval or adoption of the merger agreement by a party’s shareholders or stockholders, the party may furnish information to, or enter into discussions and negotiations with, any person in response to an acquisition proposal that the party’s board of directors concludes in good faith, after consulting with its outside legal counsel and financial advisors, is reasonably expected to result in a superior offer (as defined in the merger agreement), among other things, if the party’s board of directors, concludes in good faith, after having consulted with its outside legal counsel, that failure to take such action would be a breach of the fiduciary duties of the board of directors to its shareholders or stockholders under applicable legal requirements.

Restrictions on Recommendation Withdrawal

The merger agreement generally restricts the ability of each of TriQuint and RFMD from withdrawing its recommendation that its stockholders or shareholders, as applicable, adopt or approve the merger agreement, as applicable. However, each of the TriQuint board and the RFMD board may change its recommendation (a) in response to a superior offer, if, among other things, such board of directors concludes that a failure to change its recommendation would be a breach of its fiduciary duties to its stockholders or shareholders, as applicable, under applicable laws and, if requested by the other party, its representatives shall have negotiated in good faith with the other party for five business days regarding any amendment to the merger agreement that would cause the superior offer to no longer constitute a superior offer; or (b) if an unknown or unforeseeable material development or change in circumstances not involving or relating to an acquisition proposal occurs or arises, if, among other things, such board concludes in good faith, after consultation with its outside legal counsel, that the failure to take such an action would be a breach of its fiduciary duties to its stockholders or shareholders, as applicable, under applicable laws.

Conditions to Completion of the Mergers

The obligations of each party to cause the mergers to be effected and otherwise cause the transactions contemplated by the merger agreement to be completed are subject to the satisfaction or waiver of the following conditions:

 

    the merger agreement has been approved by the RFMD shareholders and adopted by the TriQuint stockholders;

 

    the shares of Rocky Holding common stock issuable pursuant to the merger agreement have been approved for listing on NASDAQ subject to official notice of issuance;

 

    the absence of any order preventing the completion of the mergers, and no legal requirement has been enacted or deemed applicable to the mergers that makes completion of the mergers illegal;

 

    the effectiveness of the registration statement for the Rocky Holding common stock being issued in the mergers and the absence of any stop order suspending such effectiveness;

 

    any waiting period applicable to the completion of the mergers under any applicable antitrust law (including the HSR Act) has expired or been terminated;

 

    any governmental authorization or other consent required to be obtained with respect to the mergers has been obtained and remains in full force and effect (other than any governmental authorization or consent under legal requirements other than antitrust laws, the failure of which to obtain would not reasonably be expected to have a material adverse effect with respect to either RFMD or TriQuint), and no such governmental authorization or other consent so obtained requires, contains or contemplates any term, limitation, condition or restriction that has or would reasonably be expected to have or result in a material adverse effect with respect to either RFMD or TriQuint;

 

 

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    the representations and warranties of the other party set forth in the merger agreement are accurate, subject to various materiality or “material adverse effect” qualifications described in the merger agreement;

 

    the party has received a certificate executed by an executive officer of the other party confirming that specified conditions have been satisfied;

 

    the other party has complied with or performed in all material respects all of its covenants and obligations under the merger agreement required to be complied with or performed at or prior to the closing;

 

    the party has received a legal opinion to the effect that the mergers will constitute a reorganization within the meaning of Section 368(a) of the Internal Revenue Code;

 

    since the date of the merger agreement, a material adverse effect with respect to the other party has not occurred and not been cured, and no other event exists that, in combination with any other events or circumstances, is reasonably expected to have or result in a material adverse effect with respect to the other party;

 

    the absence of any pending legal proceeding brought by, or overtly threatened by, a governmental body (a) challenging or seeking to restrain, prohibit, rescind or unwind any of the transactions contemplated by the merger agreement; (b) seeking to prohibit or limit in any material respect Rocky Holding’s ability to vote, transfer, receive dividends or otherwise exercise ownership rights with respect to the stock of either surviving corporation; (c) relating to the transactions contemplated by the merger agreement and that would reasonably be expected to materially and adversely affect the right or ability of TriQuint, RFMD or any of their respective subsidiaries to own any material asset or materially limit the operation of their respective businesses; (d) seeking to compel RFMD, TriQuint or any of their respective subsidiaries to dispose of or hold separate any material asset or business as a result of the mergers or any of the other transactions contemplated by the merger agreement; or (e) relating to the mergers or the other transactions contemplated by the merger agreement and seeking to impose (or that would reasonably be expected to result in the imposition of) any criminal sanctions or criminal liability on Rocky Holding, RFMD, TriQuint or any of their respective subsidiaries; and

 

    the other party has filed all statements, reports, schedules, forms and other documents required to be filed with the SEC since the date of the merger agreement.

Closing

The closing of the mergers will occur on a date to be designated jointly by RFMD and TriQuint, which will be as soon as practicable (and, in any event, within five business days) after the satisfaction or, to the extent permitted under the merger agreement, waiver of the last to be satisfied or waived of all conditions to the mergers, other than conditions that by their nature are to be satisfied at the closing and will in fact be satisfied or waived at the closing, unless another time or date is agreed to in writing by RFMD and TriQuint.

Termination

The merger agreement may be terminated prior to the effective time of the mergers, whether before or after approval or adoption of the merger agreement by RFMD’s shareholders or TriQuint’s stockholders, under specified circumstances. See “The Merger Agreement — Termination” beginning on page 151 for more information about the circumstances in which either RFMD or TriQuint could terminate the merger agreement.

Termination Fees; Expenses

All fees and expenses incurred by the parties are to be paid by the party that has incurred the fees and expenses except that the parties have agreed to share equally the fees and expenses associated with (a) the filing,

 

 

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printing and mailing of this joint proxy statement/prospectus and any amendments or supplements to this document, and (b) the filing of any notice or other document under any applicable antitrust law.

The merger agreement provides that RFMD or TriQuint, as applicable, will pay the other a cash termination fee in specified circumstances. For more information about the circumstances in which one or both of RFMD or TriQuint must pay a termination fee and the amount of the potential fees, see “The Merger Agreement — Termination Fees; Expenses” beginning on page 153.

Material U.S. Federal Income Tax Consequences

We anticipate that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Code. TriQuint’s obligation to complete the TriQuint merger is conditioned on TriQuint receiving a written opinion of its counsel, Perkins Coie, to the effect that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Code. RFMD’s obligation to complete the RFMD merger is conditioned on RFMD receiving an opinion of its counsel, Weil Gotshal, to the effect that each of the TriQuint merger and the RFMD merger will constitute a reorganization within the meaning of Section 368(a) of the Code. If each of the TriQuint merger and the RFMD merger constitutes a reorganization within the meaning of Section 368(a), then U.S. holders (as defined in the section entitled “The Mergers — Material U.S. Federal Income Tax Consequences” beginning on page 124) of TriQuint common stock and RFMD common stock generally will not recognize gain or loss for U.S. federal income tax purposes as a result of the exchange of TriQuint common stock and RFMD common stock, respectively, for Rocky Holding’s common stock except for any cash received in lieu of a fractional share of Rocky Holding common stock.

You are strongly urged to consult with a tax advisor to determine the particular U.S. federal, state or local or foreign income or other tax consequences of the mergers to you. See “The Mergers — Material U.S. Federal Income Tax Consequences” on page 124.

Appraisal Rights

Under North Carolina corporate law, holders of RFMD common stock are not entitled to an appraisal in connection with the RFMD merger. Under Delaware corporate law, holders of TriQuint common stock are not entitled to an appraisal in connection with the TriQuint merger. See “The Mergers — Appraisal Rights” on page 127.

Listing of Rocky Holding Common Stock on NASDAQ

Rocky Holding common stock received by RFMD shareholders in the RFMD merger and TriQuint stockholders in the TriQuint merger is expected to be listed on NASDAQ under the symbol []. After completion of the mergers, RFMD common stock and TriQuint common stock will no longer be listed or traded on NASDAQ and will no longer be registered under the Exchange Act.

Comparison of Stockholder Rights

The rights of RFMD shareholders are governed by the NCBCA, RFMD’s restated articles of incorporation, as amended, and RFMD’s amended and restated bylaws. The rights of TriQuint stockholders are governed by the DGCL, TriQuint’s amended and restated certificate of incorporation, and TriQuint’s second amended and restated bylaws. Because TriQuint stockholders and RFMD shareholders will receive shares of Rocky Holding common stock in the mergers, the rights of both RFMD shareholders and TriQuint stockholders will be governed by the DGCL, Rocky Holding’s certificate of incorporation and Rocky Holding’s bylaws upon completion of the mergers. Rocky Holding’s certificate of incorporation and bylaws are attached as Annex D and Annex E, respectively, to this joint proxy statement/prospectus. We anticipate that Rocky Holding will amend and restate its certificate of

 

 

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incorporation and bylaws in connection with the mergers, each of which will reflect the terms of the transaction and the intent of the parties. For a description of how the rights of a Rocky Holding stockholder will be different than the rights of either an RFMD shareholder or a TriQuint stockholder, see “Comparison of Stockholder Rights” on page 181.

Litigation Relating to the Mergers

Five putative stockholder class action lawsuits have been filed against TriQuint, its directors, RFMD, and other defendants in connection with TriQuint and RFMD entering into the merger agreement. Each lawsuit was filed on behalf of a putative class of TriQuint stockholders against TriQuint, the individual members of TriQuint’s board of directors, and RFMD; some also name Rocky Holding and/or the Merger Subs as defendants. See “The Mergers — Litigation Relating to the Mergers” beginning on page 127 for more information.

 

 

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SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF RFMD

The tables below present summary selected historical consolidated financial data of RFMD prepared in accordance with accounting principles generally accepted in the United States of America, which we refer to as GAAP. You should read the following tables in conjunction with RFMD’s consolidated financial statements and related notes, and management’s discussion and analysis of consolidated financial condition, results of operations, and other financial information in RFMD’s Annual Report on Form 10-K for the fiscal year ended March 30, 2013 as filed with the SEC on May 24, 2013, and Quarterly Report on Form 10-Q for the nine months ended December 28, 2013, as filed with the SEC on January 30, 2014, which are incorporated by reference into this joint proxy statement/prospectus.

The selected consolidated statements of operations data set forth below for each of the years in the five-year period ended March 30, 2013 and the five-year selected consolidated balance sheet data as of March 30, 2013 are derived from, and qualified by reference to, the audited financial statements of RFMD and the related notes thereto, including the consolidated balance sheets as of March 30, 2013 and March 31, 2012 and the related consolidated statements of operations, comprehensive (loss) income, shareholders’ equity, and cash flows for each of the three years in the period ended March 30, 2013 that are incorporated by reference into this joint proxy statement/prospectus.

The selected consolidated statements of operations data for the nine months ended December 28, 2013 and December 29, 2012 and the selected consolidated balance sheet data as of December 28, 2013 are unaudited but include, in the opinion of management of RFMD, all adjustments, including normal recurring adjustments, necessary for a fair statement of such information. Results for the nine months ended December 28, 2013 and December 29, 2012, are not necessarily indicative of the results that may be expected for any other interim periods or for the year as a whole.

 

    Nine Months Ended     Fiscal Year Ended  
    December 28,
2013
    December 29,
2012
    2013     2012     2011     2010     2009  
(In thousands, except per share data)   (unaudited)     (unaudited)                                

Revenue

  $ 892,232      $ 683,544      $ 964,147      $ 871,352      $ 1,051,756      $ 978,393      $ 886,506   

Operating costs and expenses:

             

Cost of goods sold

    586,584        465,945        658,332        582,586        662,085        623,224        669,163   

Research and development

    147,907        130,053        178,793        151,697        141,097        138,960        170,778   

Marketing and selling

    56,381        50,022        68,674        63,217        59,470        56,592        64,946   

General and administrative

    61,320        47,734        64,242        50,107        48,003        48,316        50,352   

Other operating expense (income)

    11,957 (6)      7,127        9,786        (898     1,582        4,895        800,563 (1) 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating costs and expenses

    864,149        700,881        979,827        846,709        912,237        871,987        1,755,802   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from operations

    28,083        (17,337     (15,680     24,643        139,519        106,406        (869,296

Interest expense

    (4,381     (5,086     (6,532     (10,997     (17,140     (23,997     (25,893

Interest income

    128        195        249        468        787        1,291        5,337   

Other income (expense), net

    1,198        (2,734     (3,936     1,514        339        1,134        9,844 (2) 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

    25,028        (24,962     (25,899     15,628        123,505        84,834        (880,008

Income tax (expense) benefit

    (11,340     (12,076     (27,100 )(5)      (14,771 )(3)      1,053 (4)      (13,815     (7,896 )(3) 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ 13,688      $ (37,038   $ (52,999   $ 857      $ 124,558      $ 71,019      $ (887,904
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per share:

             

Basic

  $ 0.05      $ (0.13   $ (0.19   $ 0.00      $ 0.46      $ 0.27      $ (3.38
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

  $ 0.05      $ (0.13   $ (0.19   $ 0.00      $ 0.44      $ 0.25      $ (3.38
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Shares used in per share calculation:

             

Basic

    281,749        277,562        278,602        276,289        272,575        267,349        262,493   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

    287,553        277,562        278,602        282,576        280,394        289,429        262,493   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

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    As of     As of Fiscal Year Ended  
    December 28,
2013
    December 29,
2012
    2013     2012     2011     2010     2009  
(In thousands)   (unaudited)     (unaudited)                                

Cash and cash equivalents

    117,482        113,665        101,662        135,524        131,760        104,778        172,989   

Short-term investments

    88,059        75,976        77,987        164,863        159,881        134,882        93,527   

Working capital

    274,872        338,917        330,523        421,182        465,222        396,091        418,090   

Total assets

    933,994        946,425        931,999        964,584        1,025,393        1,014,008        1,088,642 (1) 

Long-term debt and capital lease obligations, less current portion

    36        80,873        82,123        119,102        177,557        289,837        505,162 (2) 

Shareholders’ equity

    660,062        646,987        639,014        672,331        676,355        530,084        431,962 (1) 

 

(1) During fiscal 2009, RFMD recorded an impairment charge of $686.5 million to goodwill and intangibles, and restructuring expenses of approximately $67.1 million due to the adverse macroeconomic business environment. RFMD also recorded restructuring expenses of approximately $47.1 million as a result of the restructuring initiated in the first half of fiscal 2009 to reduce investments in wireless systems.
(2) Other income (expense) for fiscal 2009 included a gain of approximately $14.4 million as a result of the purchase and retirement of $55.3 million aggregate principal amount of convertible subordinated notes due 2010 and 2014.
(3) Income tax expense for fiscal years 2012 and 2009 included the effects of an increase of a valuation reserve against foreign and domestic deferred tax assets.
(4) Income tax benefit for fiscal 2011 included the effects of a reduction of a valuation reserve against deferred tax assets.
(5) Income tax expense for fiscal 2013 included the effects of an increase of a valuation reserve against the U.K. net deferred tax asset as a result of the decision to phase out manufacturing at the U.K. facility.
(6) Other operating expense included expenses related to the phase out of manufacturing and sale of RFMD’s Newton Aycliffe, U.K.-based GaAs facility, restructuring expenses associated with achieving manufacturing efficiencies, and $2.9 million of expenses related to the proposed mergers.

 

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SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF TRIQUINT

The following statements of operations data and balance sheet data for the five years ended December 31, 2013 were derived from TriQuint’s audited consolidated financial statements which were prepared in accordance with GAAP. You should read the following data in conjunction with TriQuint’s consolidated financial statements and related notes, and management’s discussion and analysis of consolidated financial condition, results of operations and other financial information in TriQuint’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013 as filed with the SEC on February 21, 2014, which are incorporated by reference into the joint proxy statement-prospectus.

The following statements of operations data and balance sheet data for the five years ended December 31, 2013 were derived from, and are qualified by reference to, the audited consolidated financial statements of TriQuint and the related notes thereto, including the consolidated balance sheets as of December 31, 2013 and December 31, 2012 and the related consolidated statements of operations and comprehensive (loss) income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2013 that are incorporated by reference into this joint proxy statement/prospectus.

 

(in thousands, except per share data)    Year Ended December 31,  
   2013(1)     2012     2011     2010     2009  

Statements of Operations Data:

          

Revenue

   $ 892,879      $ 829,174      $ 896,083      $ 878,703      $ 654,301   

Cost of goods sold

     635,194        591,578        574,152        527,865        445,721   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     257,685        237,596        321,931        350,838        208,580   

Research, development and engineering

     189,967        160,483        146,902        129,248        109,445   

Selling, general and administrative

     108,410        106,642        96,779        96,090        78,399   

Litigation expense(5)

     —          7,547        19,224        9,360        1,159   

Settlement of lawsuit(4)

     —          —          —          —          2,950   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) income from operations

   $ (40,692   $ (37,076   $ 59,026      $ 116,140      $ 16,627   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Interest expense, net

     (4,369     (1,871     (1,274     (739     (176

Recovery (impairment) of investments in other companies(3)

     421        6,957        1,363        1,340        (116

Other, net

     (426     116        (143     (212     315   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) income before income tax

     (45,066     (31,874     58,972        116,529        16,650   

Income tax (benefit) expense(2)

     (7,058     (5,705     10,822        (74,308     405   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss) income

   $ (38,008   $ (26,169   $ 48,150      $ 190,837      $ 16,245   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) earnings per common share data:

          

Basic —

          

Net (loss) income

   $ (0.24   $ (0.16   $ 0.29      $ 1.22      $ 0.11   

Diluted —

          

Net (loss) income

   $ (0.24   $ (0.16   $ 0.28      $ 1.17      $ 0.11   

Common equivalent shares:

          

Basic

     159,349        164,366        164,256        155,870        149,759   

Diluted

     159,349        164,366        172,510        163,486        152,326   

 

     As of December 31,  
(in thousands)    2013      2012      2011      2010      2009  

Balance Sheet Data:

              

Cash, cash equivalents and marketable securities

   $ 79,026       $ 138,958       $ 162,311       $ 223,656       $ 153,935   

Accounts receivable, net

   $ 177,114       $ 132,729       $ 129,103       $ 138,989       $ 88,090   

Inventories

   $ 159,488       $ 138,246       $ 151,577       $ 101,457       $ 89,964   

Total assets

   $ 1,033,257       $ 1,053,678       $ 1,055,268       $ 978,102       $ 680,041   

Working capital

   $ 373,884       $ 366,009       $ 391,423       $ 419,224       $ 275,463   

Long-term liabilities(6)

   $ 30,596       $ 31,505       $ 11,748       $ 16,836       $ 20,156   

Total stockholders’ equity

   $ 894,553       $ 908,399       $ 937,288       $ 834,019       $ 577,162   

 

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(1) During the fourth quarter of 2013, TriQuint incurred restructuring, impairment and other charges related to the disposal of assets, totaling $27,120, in relation to actions taken to reduce GaAs capacity and associated costs.
(2) During the third quarter of 2010, TriQuint recorded a tax benefit of $73,367 due to the release of the valuation allowance. Also, during the fourth quarter of 2010, TriQuint recorded a tax benefit of $4,436 primarily due to the recognition of a deferred tax asset related to research and development credits resulting from a change in tax legislation that was passed at the end of 2010.
(3) During 2013, 2012, 2011 and 2010, TriQuint received $421, $6,957, $1,363 and $1,340 for the recovery of previously impaired investments.
(4) During the second quarter of 2009, TriQuint incurred $2,950 in costs associated with the settlement of a derivative lawsuit.
(5) Litigation expense incurred in relation to the litigation with Avago Technologies Ltd., which was settled on May 15, 2012 when TriQuint and Avago entered into a confidential agreement to end all outstanding legal disputes related to the pending litigation between the two parties.
(6) During the second quarter of 2012, TriQuint entered into a cross-licensing agreement and recorded a liability with an ending fair value of $14,752 and $15,818 at December 31, 2013 and 2012, respectively.

 

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SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following selected unaudited pro forma condensed combined financial data was prepared using the acquisition method of accounting with RFMD considered the accounting acquirer of TriQuint. The selected unaudited pro forma condensed combined financial data are based on the respective historical consolidated financial statements and the accompanying notes of RFMD and TriQuint, which have different fiscal year periods. RFMD reports its financial results using a 52- or 53-week fiscal year, with each of its fiscal quarters ending on the Saturday closest to the last day of the calendar quarter and its fiscal year ending on the Saturday closest to March 31 of each year. TriQuint reports its financial results on a fiscal year basis, with each of its fiscal quarters ending on the Saturday closest to the last day of the calendar quarter and its fiscal year ending on December 31 of each year. The selected unaudited pro forma condensed combined balance sheet data are based on historical consolidated balance sheets of RFMD and TriQuint and have been prepared to reflect the mergers as if they were completed on December 28, 2013. The selected unaudited pro forma condensed combined statements of operations data assume that the mergers were completed as of the beginning of RFMD’s fiscal year 2013 (April 1, 2012). RFMD’s unaudited condensed consolidated statement of operations for the nine months ended December 28, 2013 has been combined with TriQuint’s unaudited condensed consolidated statement of operations for the nine months ended September 28, 2013. RFMD’s audited consolidated statement of operations for the fiscal year ended March 30, 2013 has been combined with TriQuint’s audited consolidated statement of operations for the year ended December 31, 2012.

The information presented below should be read in conjunction with those historical consolidated financial statements and related notes of RFMD and TriQuint filed by each company with the SEC, and incorporated by reference in this document, and with the unaudited pro forma condensed combined financial statements of RFMD and TriQuint, including the related notes. See “RFMD and TriQuint Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 40 and “Where You Can Find More Information” beginning on page 209. The unaudited pro forma condensed combined financial statements are presented for illustrative purposes only and are not necessarily indicative of results that actually would have occurred or that may occur in the future had the mergers been completed on the dates indicated, or the future operating results or financial position of the combined company following the mergers. Future results may vary significantly from the results reflected because of various factors, including those discussed under the heading “Risk Factors” beginning on page 32.

 

Unaudited Pro Forma Condensed Combined Balance Sheet Data:    As of
December 28, 2013
 
(in thousands)       

Cash and cash equivalents

   $ 196,508   

Short-term investments

     88,059   

Working capital

     635,971   

Total assets

     3,477,110   

Long-term obligations, less current portion

     66,932   

Shareholders’ equity

     3,007,914   

 

Unaudited Pro Forma Condensed Combined Statements of Operations Data:    Nine Months
Ended
December 28, 2013
   
Fiscal Year
Ended
March 30, 2013
 
(in thousands, except per share data)             

Revenue

   $ 1,514,505      $ 1,790,469   

Loss from operations

     (90,154     (171,661

Loss before income taxes

     (96,458     (176,678

Net loss

     (98,512     (193,851

Net loss per share: basic and diluted

   $ (0.70   $ (1.38

Weighted average number of shares used in computing earnings per share:

    

Basic and diluted

     141,029        140,242   

 

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COMPARATIVE PER SHARE DATA

Presented below are RFMD’s and TriQuint’s historical per share data and unaudited pro forma combined per share data. You should read this information together with the consolidated financial statements and related notes of RFMD and TriQuint that are incorporated by reference in this joint proxy statement/prospectus and with the unaudited pro forma combined financial data included under “Selected Unaudited Pro Forma Combined Financial Information.” The pro forma information is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the mergers had been completed as of the beginning of the periods presented, nor is it necessarily indicative of the future operating results or financial position of the combined company. The pro forma earnings per share of the combined company are computed by dividing the pro forma net income by the pro forma weighted-average number of shares outstanding. The pro forma book values per share of the combined company are computed by dividing total pro forma stockholders’ equity by the pro forma number of shares of common stock outstanding at the end of the period.

 

     Nine Months Ended
December 28, 2013
     Year Ended
March 30, 2013
 

RFMD historical data

     

Earnings per share:

     

Basic

   $ 0.05       $ (0.19

Diluted

     0.05         (0.19

Book value per share

     2.34         2.28   

 

     Nine Months Ended
September 28, 2013
    Year Ended
December 31, 2012
 

TriQuint historical data

    

Earnings per share:

    

Basic

   $ (0.18   $ (0.16

Diluted

     (0.18     (0.16

Book value per share

     5.54        5.66   

 

     Nine Months Ended
December 28, 2013
    Year Ended
March 30, 2013
 

Unaudited Pro Forma Combined

    

Earnings per share:

    

Basic

   $ (0.70   $ (1.38

Diluted

     (0.70     (1.38

Book value per share

     21.30        N/A   

 

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COMPARATIVE PER SHARE MARKET PRICE DATA AND DIVIDEND INFORMATION

RFMD common stock is traded on NASDAQ under the symbol “RFMD.” TriQuint common stock is traded on NASDAQ under the symbol “TQNT.” The following table sets forth, for the calendar quarters indicated, the high and low sales prices per share of RFMD common stock and TriQuint common stock on NASDAQ.

 

     RFMD
Common Stock
     TriQuint
 
        Common Stock  
For the calendar quarter ended:    High      Low      High      Low  

2014

           

June 30, 2014 (through April 9, 2014)

   $ 8.23       $ 7.41       $ 13.96       $ 12.54   

March 31, 2014

     7.96         4.50         13.62         7.96   

2013

           

December 31, 2013

     6.20         4.80         8.98         6.80   

September 30, 2013

     5.90         4.71         8.49         6.72   

June 30, 2013

     5.75         4.88         7.29         4.72   

March 31, 2013

     5.43         4.30         5.54         4.31   

2012

           

December 31, 2012

     4.89         3.50         5.50         4.30   

September 30, 2012

     4.44         3.47         6.10         4.80   

June 30, 2012

     4.96         3.45         6.92         4.56   

March 31, 2012

     5.69         4.41         7.26         4.75   

2011

           

December 31, 2011

     7.89         4.97         7.76         3.97   

September 30, 2011

     7.41         4.95         10.84         4.98   

June 30, 2011

     6.73         5.14         14.13         9.90   

March 31, 2011

     8.48         6.01         15.20         11.50   

Neither RFMD nor TriQuint has paid dividends on common stock during its last two fiscal years, and neither company has any current intention to do so.

 

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RISK FACTORS

In addition to the other information included in, or incorporated by reference in, and found in the annexes attached to, this joint proxy statement/prospectus, including the matters addressed in “Cautionary Note Concerning Forward-Looking Statements” beginning on page 56, you should carefully consider the risks described below before deciding how to vote. You should also read and consider the risk factors associated with each of the businesses of RFMD and TriQuint because these risk factors may affect the operations and financial results of the combined company. These risk factors may be found under Part I, Item 1A of RFMD’s Annual Report on Form 10-K for the year ended March 30, 2013, and Part I, Item 1A of TriQuint’s Annual Report on Form 10-K for the year ended December 31, 2013, each of which is on file with the SEC and all of which are incorporated by reference into this joint proxy statement/prospectus. Furthermore, you should read and consider the other information in this joint proxy statement/prospectus and the other documents incorporated by reference herein. See “Where You Can Find More Information” beginning on page 209 for the location of information incorporated by reference into this joint proxy statement/prospectus. Additional risks and uncertainties not presently known to RFMD or TriQuint or that are not now believed to be important also may adversely affect the mergers and Rocky Holding following the mergers.

Risk Factors Relating to the Mergers

The market value of the shares of Rocky Holding common stock to be issued to RFMD shareholders and TriQuint stockholders is uncertain, and may be lower than the market value of the shares of RFMD common stock and/or TriQuint common stock to be surrendered in the mergers by RFMD shareholders and/or TriQuint stockholders, respectively.

RFMD shareholders and TriQuint stockholders will receive a fixed number of shares of Rocky Holding common stock in the mergers rather than a number of shares with a particular fixed market value. The market values of RFMD common stock and TriQuint common stock at the time of the mergers may vary significantly from their prices on the date the merger agreement was executed, the date of this joint proxy statement/prospectus or the date[s] on which RFMD shareholders and TriQuint stockholders vote on the mergers. Because neither the RFMD Exchange Ratio nor the TriQuint Exchange Ratio will be adjusted to reflect any changes in the market prices of RFMD common stock or TriQuint common stock, respectively, the market value of the shares of Rocky Holding common stock issued in the mergers may be higher or lower than the value attributed to them on earlier dates. For the same reason, the respective market values of the shares of RFMD common stock and TriQuint common stock to be surrendered in the mergers may be higher or lower than the values of these shares on earlier dates.

Changes in the market prices of RFMD common stock and TriQuint common stock may result from a variety of factors that are beyond the control of RFMD or TriQuint, including changes in their respective businesses, operations and prospects, regulatory considerations, governmental actions, and legal proceedings and developments. Market assessments of the benefits of the mergers, the likelihood that the mergers will be completed, and general and industry-specific market and economic conditions may also have an effect on the market price of RFMD common stock and TriQuint common stock. Changes in market prices of RFMD common stock and TriQuint common stock may also be caused by fluctuations and developments affecting domestic and global securities markets.

Obtaining required regulatory approvals may prevent or delay completion of the mergers or reduce the anticipated benefits of the mergers or may require changes to the structure or terms of the mergers.

Completion of the mergers is conditioned upon, among other things, the expiration or termination of the waiting period (and any extensions thereof) applicable to the mergers under the HSR Act, the approval for listing of Rocky Holding common stock on NASDAQ, and receipt of all required clearances or approvals applicable to the completion of the mergers under the antitrust laws of the People’s Republic of China by the Ministry of Commerce of the People’s Republic of China (which we refer to as MOFCOM). The time it takes to obtain these approvals may delay the completion of the mergers. Further, regulatory authorities may place certain conditions

 

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on their approval of the mergers. Satisfying these conditions may also delay the completion of the mergers and/or may reduce the anticipated benefits of the mergers, which could have a material adverse effect on Rocky Holding’s business and cash flows, financial condition and results of operations. Additionally, at any time before or after the mergers are completed, the DOJ, the FTC or U.S. state attorneys general could take action under the antitrust laws in opposition to the mergers, including seeking to enjoin completion of the mergers, condition completion of the mergers upon the divestiture of assets of RFMD or TriQuint or their respective subsidiaries or impose restrictions on Rocky Holding’s post-merger operations. These could negatively affect the results of operations and financial condition of Rocky Holding following completion of the mergers. Any of these requirements or restrictions may prevent or delay completion of the mergers or may reduce the anticipated benefits of the mergers, which could also have a material adverse effect on Rocky Holding’s business and cash flows, financial condition and results of operations.

Rocky Holding may never realize the anticipated benefits from the mergers.

The mergers involve the integration of two companies that will have operated independently until the time the mergers are completed and that are geographically remote from each other. Although the parties believe that the combination of RFMD and TriQuint has the potential to result in substantial financial and operating benefits, including increased revenues, cost savings and other benefits, it is speculative when, whether and to what extent Rocky Holding will be able to realize increased revenues, cost savings or other benefits, if at all. In this regard, see also the additional risk factors set forth under “— Risk Factors Relating to Rocky Holding After Completion of the Mergers” beginning on page 36.

RFMD and TriQuint will be subject to business uncertainties and contractual restrictions while the mergers are pending.

Uncertainty about the effect of the mergers on employees and customers may have an adverse effect on RFMD or TriQuint and consequently on Rocky Holding. These uncertainties may impair the ability of RFMD and TriQuint to retain and motivate key personnel and could cause customers and others that deal with the companies to defer entering into contracts with either of them or making other decisions concerning either of them or seek to change existing business relationships with them. RFMD and TriQuint both have agreements with their respective customers containing provisions that may allow those customers to terminate their agreements with RFMD or TriQuint, as applicable, if the mergers are completed. If key employees of RFMD or TriQuint depart because of uncertainty about their future roles and the potential complexities of the mergers, RFMD’s and TriQuint’s businesses could be harmed. In addition, the merger agreement restricts RFMD and TriQuint from making various acquisitions and taking other specified actions until the mergers occur without the consent of the other party. These restrictions may prevent RFMD and/or TriQuint from pursuing attractive business opportunities that may arise prior to the completion of the mergers. See “The Merger Agreement — Covenants of the Parties” beginning on page 136 for a description of the restrictive covenants applicable to RFMD and TriQuint.

The merger agreement limits RFMD’s and TriQuint’s ability to pursue alternatives to the mergers.

Each of RFMD and TriQuint has agreed that it will not solicit, initiate, knowingly encourage or knowingly facilitate inquiries or proposals, or engage in discussions or negotiations, regarding transactions in which a party other than RFMD or TriQuint could obtain ownership of more than 15% of the voting securities of RFMD or TriQuint, subject to limited exceptions. We discuss these exceptions below in “The Merger Agreement — Covenants of the Parties” beginning on page 136. Each party has also agreed that its board of directors will not change its recommendation to its shareholders or stockholders, as the case may be, or approve or enter into any alternative agreement, subject to limited exceptions, which we also discuss below in the section titled “The Merger Agreement — Covenants of the Parties” beginning on page 136. The merger agreement also requires each party to call, give notice of and hold a meeting of its shareholders or stockholders, as the case may be, for the purpose of obtaining the approval of their respective shareholders or stockholders, as applicable. This special meeting requirement does not apply to a party if the merger agreement is terminated in accordance with its terms.

 

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See “The Merger Agreement — Covenants of the Parties — Shareholder Meetings” beginning on page 144. In addition, under specified circumstances, RFMD or TriQuint may be required to pay a termination fee to the other of either $17.1 million or $66.7 million (depending on the specific circumstances) if the mergers are not completed. See “The Merger Agreement — Termination Fees; Expenses” beginning on page 153 for a description of the circumstances under which termination fees are payable. These provisions might discourage a potential acquirer that might be interested in acquiring all or a significant part of RFMD or TriQuint from considering or proposing an acquisition, even if it were prepared to pay consideration with greater value than that proposed in the merger agreement, or these provisions might result in a potential competing acquirer proposing to pay less to acquire RFMD or TriQuint than it might otherwise have been willing to pay.

Certain directors and executive officers of RFMD and TriQuint may have interests in the mergers that are different from, in addition to, or in conflict with your interests.

Executive officers of RFMD and TriQuint negotiated the terms of the merger agreement and the boards of RFMD and TriQuint approved the merger agreement and unanimously recommend that you vote in favor of the proposals to approve and adopt the merger agreement, as applicable. These directors and executive officers may have interests in the mergers that are different from, in addition to, or in conflict with your interests. These interests include the continued employment of various executive officers of RFMD and TriQuint by Rocky Holding, the continued positions of specified directors of RFMD and TriQuint as directors of Rocky Holding, and the indemnification of former RFMD directors and TriQuint directors by the surviving corporations. With respect to directors and executive officers of both RFMD and TriQuint, these interests also include the treatment in the respective mergers of employment agreements, change of control severance agreements, cash compensation arrangements, equity compensation arrangements, including restricted stock units, deferred stock units, stock options and other rights held by these directors and executive officers. You should be aware of these interests when you consider your board of directors’ recommendation that you vote in favor of the applicable merger. For a discussion of the interests of executive officers and directors in the mergers, see “The Mergers — Interests of Officers and Directors in the Mergers” beginning on page 110.

Both RFMD shareholders and TriQuint stockholders will have a reduced ownership and voting interest after the mergers and will exercise less influence over management.

After the completion of the mergers, the RFMD shareholders and TriQuint stockholders will own a smaller percentage of Rocky Holding than they now own of RFMD and TriQuint, respectively. Immediately upon completion of the mergers, we anticipate that RFMD shareholders and TriQuint stockholders will each hold approximately 50% of the shares of Rocky Holding common stock then issued and outstanding. Consequently, RFMD shareholders, as a group, and TriQuint stockholders, as a group, will each have reduced ownership and voting power in the combined company compared to their ownership and voting power in RFMD and TriQuint, respectively.

The mergers may not be completed, which could negatively affect the ongoing businesses of RFMD and TriQuint in several ways.

If the mergers are not completed, the ongoing businesses of RFMD and TriQuint may be adversely affected and RFMD and TriQuint will be subject to several risks and consequences, including the following:

 

    TriQuint may be required, in specified circumstances, to pay RFMD a termination fee of either $66.7 million or $17.1 million (depending on the specific circumstances); likewise, RFMD may be required, in specified circumstances, to pay TriQuint a termination fee of either $66.7 million or $17.1 million (depending on the specific circumstances);

 

    RFMD and TriQuint will be required to pay various costs relating to the mergers, whether or not the mergers are completed, such as significant fees and expenses relating to legal, accounting, financial advisor and printing services;

 

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    under the merger agreement, each of RFMD and TriQuint is subject to specified restrictions on the conduct of its business prior to completing the mergers that may adversely affect its ability to execute its business strategies; and

 

    matters relating to the mergers may require substantial commitments of time and resources by RFMD and TriQuint management, which could otherwise have been devoted to other opportunities that, had they been pursued, might have been beneficial to RFMD and TriQuint as independent companies.

In addition, if the mergers are not completed, RFMD and TriQuint may experience negative reactions from the financial markets and from their respective customers, suppliers and employees. RFMD and TriQuint also could be subject to litigation related to a failure to complete the mergers or to enforce their respective obligations under the merger agreement. These risks could materially affect the business, financial results and stock prices of the respective companies, even if the mergers are not completed.

RFMD, TriQuint and Rocky Holding will incur significant transaction and merger-related transition costs in connection with the mergers.

RFMD and TriQuint expect that they and Rocky Holding will incur significant costs in connection with completing the mergers and integrating the operations of the two companies. RFMD and TriQuint may incur additional costs to maintain employee morale and to retain key employees. RFMD and TriQuint will also incur significant legal, accounting and other transaction fees and other costs associated with the mergers. Some of these costs are payable regardless of whether the mergers are completed. Moreover, in specified circumstances, RFMD or TriQuint may be required to pay a termination fee of either $66.7 million or $17.1 million (depending on the specific circumstances) if the mergers are not completed. See “The Merger Agreement — Termination Fees; Expenses” beginning on page 153.

The unaudited pro forma financial data included in this joint proxy statement/prospectus may not be indicative of what Rocky Holding’s actual financial position or results of operations would have been.

The unaudited pro forma financial data included in this joint proxy statement/prospectus are presented solely for illustrative purposes and are not necessarily indicative of what Rocky Holding’s actual financial position or results of operations would have been had the mergers been completed on the dates indicated. The pro forma financial data reflect adjustments that were developed using preliminary estimates based on available information and various assumptions and that may be revised as additional information becomes available. Accordingly, the final acquisition accounting adjustments may differ materially from the pro forma adjustments reflected in this joint proxy statement/prospectus. In addition, the pro forma financial data have not been adjusted to give effect to either the various expected financial benefits of the mergers or the anticipated costs to achieve these benefits. The various expected financial benefits of the mergers include, among others, operational cost savings, and annual savings of approximately $[] million in compensation and benefits costs. The anticipated costs to achieve the financial benefits of the mergers include, among others, charges against earnings or increases in tax expense resulting from integration or restructuring activities after the mergers close. Additionally, the final application of purchase accounting may cause Rocky Holding’s financial position or results of operations to differ from the financial position or results of operations, as applicable, reflected in the pro forma financial data. Neither the pro forma financial data nor any interim period financial data included in this joint proxy statement/prospectus upon which the pro forma financial data are based have been audited.

Several lawsuits have been filed against TriQuint, its board members, RFMD, Rocky Holding and the Merger Subs challenging the mergers, and an adverse ruling in any of these lawsuits may prevent the mergers from becoming effective or delay their completion.

TriQuint, its board members, RFMD, Rocky Holding and the Merger Subs have been named as defendants in lawsuits brought by and on behalf of TriQuint stockholders challenging the mergers, and seeking, among other things, to enjoin the defendants from completing the mergers on the agreed-upon terms or to rescind the mergers

 

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if they are completed. See “The Mergers — Litigation Relating to the Mergers” for more information about these lawsuits. Other similar lawsuits challenging the mergers may be filed against TriQuint, RFMD, their respective boards of directors, Rocky Holding, Trident Merger Sub or Rocky Merger Sub.

One of the conditions to the closing of the mergers is that no order preventing the completion of the mergers has been issued by a court of competent jurisdiction. If the plaintiffs in these lawsuits are successful in obtaining an injunction from a court of competent jurisdiction prohibiting the defendants from completing the mergers on the agreed-upon terms, then the mergers may not be completed within the expected timeframe, or at all.

RFMD and TriQuint must continue to retain, motivate and recruit executives and other key employees, which may be difficult in light of uncertainty regarding the mergers, and failure to do so could negatively affect Rocky Holding.

For the mergers to be successful, during the period before the mergers are completed both RFMD and TriQuint must continue to retain, motivate and recruit executives and other key employees. Moreover, Rocky Holding must be successful at retaining and motivating key employees following the completion of the mergers. Experienced employees in the industries in which RFMD and TriQuint operate are in high demand, and competition for their talents can be intense. Employees of both RFMD and TriQuint may experience uncertainty about their future role with Rocky Holding until, or even after, strategies with regard to Rocky Holding are announced or executed. The potential distractions of the mergers may adversely affect the ability of RFMD, TriQuint or, following completion of the mergers, Rocky Holding to retain, motivate and recruit executives and other key employees and keep them focused on applicable strategies and goals. A failure by RFMD, TriQuint or, following the completion of the mergers, Rocky Holding to attract, retain and motivate executives and other key employees during the period prior to or after the completion of the mergers could have a negative effect on the business of RFMD, TriQuint or Rocky Holding.

Risk Factors Relating to Rocky Holding After Completion of the Mergers

Unless the context requires otherwise, references to “Rocky Holding” in this section are to Rocky Holding, Inc. as directly or indirectly affected by, acting through, or having the attributes of, one or more of RFMD, TriQuint and their respective direct and indirect subsidiaries, in each case, by virtue of Rocky Holding’s direct or indirect ownership thereof following completion of the mergers.

The loss of key employees or the inability to recruit and retain qualified employees could adversely affect Rocky Holding’s profitability, results of operations and ability to compete.

Rocky Holding’s success will depend on its ability to attract, retain and motivate qualified personnel generally, including key management and employees. Losing or being unable to recruit and retain employees who possess substantial experience or expertise could materially and adversely affect Rocky Holding’s ability to compete in the semiconductor industry, thereby materially and adversely affecting Rocky Holding’s results of operations and prospects. In addition, the mergers could result in current and prospective employees experiencing uncertainty about their future with Rocky Holding following the mergers. These uncertainties may impair the ability of Rocky Holding to retain, recruit or motivate key personnel.

Current customers of RFMD and TriQuint may cease doing business with RFMD or TriQuint, which could adversely affect Rocky Holding’s profitability and results of operations.

Current customers of RFMD and TriQuint, who are expected to become customers of Rocky Holding, may cease doing business with RFMD or TriQuint prior to the effective time of the mergers for various reasons, including as a result of the announcement of the mergers or because of perceived conflicts resulting from the combination of the two companies. If a sufficient number of customers reduce the quantities of, or terminate, their purchase or use of RFMD or TriQuint’s products prior to the effective time of the mergers, these events

 

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could adversely affect Rocky Holding’s profitability and results of operations. Likewise, the failure of Rocky Holding to retain the customers of RFMD and TriQuint following the mergers could adversely affect Rocky Holding’s profitability and results of operations.

Demand for Rocky Holding’s services and products could decrease for various reasons, including a general economic downturn or a decline in a customer’s or an industry’s financial condition or prospects.

Rocky Holding gives no assurance that the demand for its products or services will grow or that Rocky Holding will compete successfully with existing or new competitors. The demand of Rocky Holding’s customers for its products or services may change based on their own needs and financial conditions. In addition, Rocky Holding’s results of operations will be affected directly by the level of business activity of Rocky Holding’s customers, as well as end market customers. Further, economic slowdowns in some markets, particularly in the United States and China, may cause reduction in discretionary spending or otherwise reduce demand for Rocky Holding’s products, increased price competition and negatively affect Rocky Holding’s growth and profit margins.

Rocky Holding will be subject to risks of doing business internationally.

A sizeable portion of Rocky Holding’s business and operations will be located outside of the United States. As a result, Rocky Holding’s business operations will be subject to foreign financial, tax and business risks, which could arise in the event of:

 

    currency exchange fluctuations;

 

    unexpected increases in taxes or changes in U.S. or foreign tax laws;

 

    compliance with a variety of international laws, such as data privacy, employment, trade barriers and restrictions on the import and export of technologies, as well as U.S. laws affecting the activities of U.S. companies abroad, including the Foreign Corrupt Practices Act of 1977 and sanctions programs administered by the U.S. Department of Treasury’s Office of Foreign Assets Control;

 

    absence in some jurisdictions of effective laws to protect Rocky Holding’s intellectual property rights;

 

    new regulatory requirements or changes in policies and local laws that directly affect Rocky Holding’s foreign operations;

 

    local economic and political conditions, including unusual, severe or protracted recessions in foreign economies;

 

    unusual and unexpected monetary exchange controls; or

 

    civil disturbance or other catastrophic events that reduce business activity in other parts of the world.

These factors may lead to decreased sales or profits and therefore have a material adverse effect on Rocky Holding’s business, financial condition and operating results.

The market price for shares of Rocky Holding common stock may be affected by factors different from those affecting the market price for shares of RFMD common stock and TriQuint common stock.

Upon completion of the mergers, holders of RFMD common stock and TriQuint common stock will become holders of Rocky Holding common stock. Although as a combined company operating in the semiconductor industry Rocky Holding will generally be subject to the same risks that each of RFMD and TriQuint currently face, those risks may affect the results of operations of Rocky Holding differently than they could affect the results of operations of each of RFMD and TriQuint as separate companies. Additionally, the results of operations of Rocky Holding may be affected by additional or different factors than those that currently affect the results of operations of RFMD and TriQuint. For a discussion of the businesses of RFMD and TriQuint and of various factors to consider in connection with those businesses, see the documents incorporated by reference in this joint proxy statement/prospectus and referred to under the section entitled “Where You Can Find More Information” beginning on page 209.

 

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There has been no prior public market for Rocky Holding common stock, and an active public market may not develop after the completion of the mergers.

No public market currently exists for Rocky Holding common stock. Rocky Holding plans to apply to list its common stock on NASDAQ. Neither RFMD, TriQuint or Rocky Holding can predict the extent to which an active trading market for Rocky Holding common stock will develop or how liquid that market might become.

The market price of Rocky Holding common stock may decline if it does not achieve the anticipated benefits of the mergers.

The market price of Rocky Holding common stock may decline if, among other factors, the integration of RFMD and TriQuint is unsuccessful, the operational cost savings estimates are not realized or the transaction costs related to the mergers are greater than expected. The market price of Rocky Holding common stock also may decline if it does not achieve the perceived benefits of the mergers as rapidly as or to the extent anticipated by financial or industry analysts or if the effect of the mergers on Rocky Holding’s financial results is not consistent with the expectations of financial or industry analysts.

The price of Rocky Holding common stock may be volatile.

The price of Rocky Holding common stock may be volatile and subject to wide fluctuations. In addition, the trading volume of Rocky Holding common stock may fluctuate and cause significant price variations to occur. Some of the factors that could cause fluctuations in the stock price or trading volume of Rocky Holding’s common stock include:

 

    general market and economic conditions, including market conditions in the radio frequency engineering, integrated circuit design, and technical marketing and support industries;

 

    actual or expected variations in quarterly operating results;

 

    differences between actual operating results and those expected by investors and analysts;

 

    changes in recommendations by securities analysts;

 

    operations and stock performance of competitors;

 

    accounting charges, including charges relating to the impairment of goodwill;

 

    significant acquisitions or strategic alliances by Rocky Holding or by its competitors;

 

    sales of Rocky Holding common stock, including sales by Rocky Holding’s directors and officers or significant investors;

 

    recruitment or departure of key personnel; and

 

    loss of key customers.

Rocky Holding does not assure you that the price of Rocky Holding common stock will not fluctuate or decline significantly in the future. In addition, the stock market in general can experience considerable price and volume fluctuations that may be unrelated to Rocky Holding’s performance.

Rocky Holding has not yet determined its dividend policy and may not pay dividends.

Rocky Holding has not yet determined its dividend policy. Any determination to pay dividends in the future will be at the discretion of the Rocky Holding board and will depend upon Rocky Holding’s results of operations, financial condition, contractual restrictions, restrictions imposed by applicable law, rule or regulation, business and investment strategy, and other factors that the Rocky Holding board deems relevant. The Rocky Holding board may determine not to pay periodic or other dividends to holders of Rocky Holding common stock. If Rocky Holding does not pay dividends, then the return on an investment in its common stock will depend entirely upon any future appreciation in its stock price. There is no guarantee that Rocky Holding’s common stock will appreciate in value or maintain its value.

 

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Rocky Holding may engage in future acquisitions that dilute its stockholders’ ownership and cause it to incur debt and assume contingent liabilities.

As part of its business strategy, Rocky Holding expects to continue to review potential acquisitions that could complement its current product offerings, augment its market coverage or enhance its technical capabilities, or that may otherwise offer growth, accretion or margin improvement opportunities. While Rocky Holding has no definitive agreements providing for any acquisitions (other than the mergers contemplated by this joint proxy statement/prospectus), it may acquire businesses, products or technologies in the future. In the event of future acquisitions, Rocky Holding could issue equity securities that would dilute its then-existing stockholders’ ownership, incur substantial debt or other financial obligations or assume contingent liabilities. Any of these actions by Rocky Holding could seriously harm its results of operations or the price of its common stock. Acquisitions also entail numerous other risks that could adversely affect Rocky Holding’s business, results of operations and financial condition, including:

 

    unanticipated costs, capital expenditures or working capital requirements associated with the acquisition;

 

    acquisition-related charges and amortization of acquired technology and other intangibles;

 

    diversion of management’s attention from its business;

 

    injury to existing business relationships with suppliers and customers;

 

    failure to successfully integrate acquired businesses, operations, products, technologies and personnel; and

 

    unrealized expected synergies.

Provisions in Rocky Holding’s governing documents could discourage takeovers and prevent stockholders from realizing an investment premium.

Certain provisions of Rocky Holding’s certificate of incorporation and bylaws, which will be amended and restated in connection with the mergers, could have the effect of making it more difficult for a third party to acquire, or discouraging a third party from attempting to acquire, control of Rocky Holding. These provisions include []. These provisions could limit the price that certain investors might be willing to pay in the future for shares of Rocky Holding common stock.

 

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RFMD AND TRIQUINT UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

The following unaudited pro forma condensed combined financial statements are based on the respective historical consolidated financial statements and the accompanying notes of RFMD and TriQuint and are adjusted given the effect of the mergers. The unaudited pro forma condensed combined financial statements were prepared using the acquisition method of accounting with RFMD considered the accounting acquirer of TriQuint. RFMD reports its financial results using a 52- or 53-week fiscal year, with each of its fiscal quarters ending on the Saturday closest to the last day of the calendar quarter and its fiscal year ending on the Saturday closest to March 31 of each year. TriQuint reports its financial results on a fiscal year basis, with each of its fiscal quarters ending on the Saturday closest to the last day of the calendar quarter and its fiscal year ending on December 31 of each year. The unaudited pro forma condensed combined balance sheet is based on historical balance sheets of RFMD, as of December 28, 2013, and TriQuint, as of December 31, 2013, and has been prepared to reflect the mergers as if they were completed on December 28, 2013. The unaudited pro forma condensed combined statements of operations assume that the mergers were completed as of the beginning of RFMD’s fiscal year 2013 (April 1, 2012). The unaudited pro forma condensed combined statements of operations are based on (a) RFMD’s audited consolidated statement of operations for the fiscal year ended March 30, 2013 and TriQuint’s audited consolidated statement of operations for the fiscal year ended December 31, 2012 and (b) RFMD’s unaudited condensed consolidated statement of operations for the nine months ended December 28, 2013 and TriQuint’s unaudited condensed consolidated statement of operations for the nine months ended September 28, 2013.

The pro forma adjustments are preliminary and have been made solely for purposes of developing the pro forma financial information for illustrative purposes necessary to comply with the requirements of the SEC. The actual results reported by the combined company in periods following the mergers may differ significantly from those reflected in these unaudited pro forma condensed combined financial statements for a number of reasons, including cost saving synergies from operating efficiencies and the effect of the incremental costs incurred in integrating the two companies. As a result, the pro forma financial information is not necessarily indicative of what the combined company’s financial condition or results of operations would have been had the mergers been completed on the applicable dates of this pro forma financial information. In addition, the pro forma financial information does not purport to project the future financial condition and results of operations of the combined company.

The unaudited pro forma condensed combined financial statements are based on various assumptions, including assumptions related to the purchase price, and the preliminary allocation of the purchase price to the assets acquired and the liabilities assumed from TriQuint based on preliminary estimates of fair value. The pro forma assumptions and adjustments are described in the accompanying notes presented on the following pages, which should be read in conjunction with the unaudited pro forma condensed combined financial statements. Pro forma adjustments are those that are directly attributable to the transaction, are factually supported and, with respect to the unaudited pro forma condensed combined statements of operations, are expected to have a continuing effect on consolidated results of operations of the combined company.

The pro forma adjustments for the mergers are based on preliminary purchase price allocations and management’s estimates. Actual allocations will be based on final valuations, appraisals and other analyses of the fair value of the acquired assets and liabilities. The allocations will be finalized after the data necessary to complete the valuations, appraisals and other analyses of the fair values of the acquired assets and assumed liabilities are obtained and evaluated. Differences between the preliminary and final allocations could have a material effect on the unaudited pro forma condensed combined financial statements. The actual amounts recorded as of the completion of the mergers may differ materially from the information presented in these unaudited pro forma condensed combined financial statements as a result of several factors, including the timing of completion of the mergers and changes in net assets that may occur prior to completion of the mergers.

 

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS — (Continued)

The unaudited pro forma condensed combined financial statements, although helpful in illustrating the financial characteristics of the combined company under one set of assumptions, do not reflect the benefits of any expected cost savings (or associated costs to achieve such savings), opportunities to earn additional revenue, or other factors that may result from the mergers and, accordingly, do not attempt to predict or suggest future results. Specifically, the unaudited pro forma condensed combined statements of operations exclude projected operating efficiencies and synergies expected to be achieved as a result of the mergers. The unaudited pro forma condensed combined financial statements also exclude the effects of costs associated with any restructuring or integration activities or asset dispositions resulting from the mergers, as they are currently not known, and to the extent they occur, are expected to be non-recurring and will not have been incurred at the closing date of the mergers. However, such costs could affect the combined company following the mergers in the period the costs are incurred or recorded. Further, the unaudited pro forma condensed combined financial statements do not reflect the effect of any regulatory actions that may impact the results of the combined company following the mergers.

The unaudited pro forma condensed combined financial statements are based on and should be read in conjunction with:

 

    the accompanying notes to the unaudited pro forma condensed combined financial statements;

 

    the historical audited consolidated statement of operations of RFMD for the year ended March 30, 2013, included in RFMD’s Annual Report on Form 10-K and incorporated by reference in this joint proxy statement/prospectus;

 

    the historical audited consolidated statement of operations of TriQuint for the year ended December 31, 2012, included in TriQuint’s Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated by reference in this joint proxy statement/prospectus;

 

    the historical unaudited condensed consolidated financial statements of RFMD as of and for the nine months ended December 28, 2013 included in RFMD’s Quarterly Report on Form 10-Q and incorporated by reference in this joint proxy statement/prospectus;

 

    the historical audited consolidated balance sheet of TriQuint as of December 31, 2013, included in TriQuint’s Form 10-K for the year ended December 31, 2013 and incorporated by reference in this joint proxy statement/prospectus, and the unaudited condensed consolidated statement of operations of TriQuint for the nine months ended September 28, 2013, included in TriQuint’s Quarterly Report on Form 10-Q; and

 

    other information relating to RFMD and TriQuint contained in or incorporated by reference into this joint proxy statement/prospectus.

See “Where You Can Find More Information” beginning on page 209, “Selected Consolidated Historical Financial Data of RFMD” beginning on page 25, and “Selected Consolidated Historical Financial Data of TriQuint” beginning on page 27.

 

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UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

(In thousands)

 

    RFMD
as of
December 28, 2013
    TriQuint
as of
December 31, 2013 (*)
    Pro Forma
Adjustments
        Pro Forma
Combined
 

ASSETS

         

Current Assets:

         

Cash and cash equivalents

  $ 117,482      $ 79,026      $ —          $ 196,508   

Short-term investments

    88,059        —          —            88,059   

Accounts receivable, net

    143,684        177,114        (93 )    (1)     320,705   

Inventories

    136,300        159,488        38,512      (2)     334,300   

Prepaid expenses

    11,604        13,617        —            25,221   

Other receivables

    26,559        20,765        —            47,324   

Other current assets

    2,713        31,982        (8,577 )    (5)     26,118   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total current assets

    526,401        481,992        29,842          1,038,235   

Property and equipment, net

    200,671        420,363        —        (3)     621,034   

Goodwill

    103,901        13,519        934,409      (4)     1,051,829   

Intangible assets, net

    73,324        23,510        610,490      (4)     707,324   

Long-term investments

    4,509        —         —            4,509   

Other non-current assets

    25,188        93,873        (64,882 )    (5)     54,179   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total assets

  $ 933,994      $ 1,033,257      $ 1,509,859        $ 3,477,110   
 

 

 

   

 

 

   

 

 

     

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

         

Current liabilities:

         

Accounts payable

  $ 102,869      $ 52,472      $ (93 )    (6)   $ 155,248   

Accrued liabilities

    61,659        55,636        41,420      (7)     158,715   

Current portion of long-term debt, net of unamortized discount

    85,902        —          —            85,902   

Other current liabilities

    1,099        —          1,300      (8)     2,399   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total current liabilities

    251,529        108,108        42,627          402,264   

Other long-term liabilities

    22,403        30,596        13,933      (9)     66,932   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total liabilities

    273,932        138,704        56,560          469,196   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total shareholders’ equity

    660,062        894,553        1,453,299     (10)     3,007,914   
 

 

 

   

 

 

   

 

 

     

 

 

 

Total liabilities and shareholders’ equity

  $ 933,994      $ 1,033,257      $ 1,509,859        $ 3,477,110   
 

 

 

   

 

 

   

 

 

     

 

 

 

 

* See Note 5 for an explanation of the reclassification adjustments to TriQuint’s Balance Sheet as of December 31, 2013.

See accompanying notes to the unaudited pro forma condensed combined financial statements

 

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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

(In thousands, except per share data)

 

     RFMD
Nine Months Ended
December 28, 2013
    TriQuint
Nine Months Ended
September 28, 2013 (**)
    Pro Forma
Adjustments
        Pro Forma
Combined
     

Revenue

   $ 892,232     $ 625,148     $ (2,875 )    (a)   $ 1,514,505     

Cost of goods sold

     586,584        437,440        38,637      (a), (b)     1,062,661     
  

 

 

   

 

 

   

 

 

     

 

 

   

Gross profit

     305,648       187,708       (41,512       451,844     

Operating expenses:

            

Research and development

     147,907       140,201       (331 )    (b)     287,777     

Marketing and selling

     56,381       44,991       47,983      (b)     149,355     

General and administrative

     61,320       38,030       (187 )    (b)     99,163     

Other operating expense (income)

     11,957       (3,371     (2,883 )    (c)     5,703     
  

 

 

   

 

 

   

 

 

     

 

 

   

Total operating expenses

     277,565       219,851       44,582          541,998     
  

 

 

   

 

 

   

 

 

     

 

 

   

Income (loss) from operations

     28,083        (32,143     (86,094       (90,154  

Interest expense

     (4,381     (3,429     —            (7,810  

Interest income

     128       83       —            211     

Other income

     1,198        97       —            1,295     
  

 

 

   

 

 

   

 

 

     

 

 

   

Income (loss) before income taxes

     25,028        (35,392     (86,094       (96,458  

Income tax (expense) benefit

     (11,340     6,119        3,167      (d)     (2,054  
  

 

 

   

 

 

   

 

 

     

 

 

   

Net income (loss)

   $ 13,688      $ (29,273   $ (82,927     $ (98,512  
  

 

 

   

 

 

   

 

 

     

 

 

   

Net income (loss) per share:

            

Basic

   $ 0.05      $ (0.18       $ (0.70  
  

 

 

   

 

 

       

 

 

   

Diluted

   $ 0.05      $ (0.18       $ (0.70  
  

 

 

   

 

 

       

 

 

   

Shares used in per share calculations:

            

Basic

     281,749        159,057            141,029      (e)
  

 

 

   

 

 

       

 

 

   

Diluted

     287,553        159,057            141,029      (e)
  

 

 

   

 

 

       

 

 

   

 

** See Note 5 for an explanation of the reclassification adjustments to TriQuint’s Statement of Operations for the nine months ended September 28, 2013.

See accompanying notes to the unaudited pro forma condensed combined financial statements

 

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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

(In thousands, except per share data)

 

     RFMD
Year Ended
March 30, 2013
    TriQuint
Year Ended
December 31, 2012 (***)
    Pro Forma
Adjustments
        Pro Forma
Combined
     

Revenue

   $ 964,147     $ 829,174     $ (2,852 )    (a)   $ 1,790,469     

Cost of goods sold

     658,332        591,578        52,357      (a), (b)     1,302,267     
  

 

 

   

 

 

   

 

 

     

 

 

   

Gross profit

     305,815        237,596        (55,209       488,202     

Operating expenses:

            

Research and development

     178,793       160,483       (165 )    (b)     339,111     

Marketing and selling

     68,674       56,985       64,110      (b)     189,769     

General and administrative

     64,242       57,204       (249 )    (b)     121,197     

Other operating expense

     9,786       —         —            9,786     
  

 

 

   

 

 

   

 

 

     

 

 

   

Total operating expenses

     321,495       274,672       63,696          659,863     
  

 

 

   

 

 

   

 

 

     

 

 

   

Loss from operations

     (15,680     (37,076     (118,905       (171,661  

Interest expense

     (6,532     (2,112     —            (8,644  

Interest income

     249       241       —            490     

Loss on retirement of convertible subordinated notes

     (2,756     —         —            (2,756  

Other (expense) income

     (1,180     7,073       —            5,893     
  

 

 

   

 

 

   

 

 

     

 

 

   

Loss before income taxes

     (25,899     (31,874     (118,905       (176,678  

Income tax (expense) benefit

     (27,100     5,705        4,222      (d)     (17,173  
  

 

 

   

 

 

   

 

 

     

 

 

   

Net loss

   $ (52,999   $ (26,169   $ (114,683     $ (193,851  
  

 

 

   

 

 

   

 

 

     

 

 

   

Net loss per share:

            

Basic

   $ (0.19   $ (0.16       $ (1.38  
  

 

 

   

 

 

       

 

 

   

Diluted

   $ (0.19   $ (0.16       $ (1.38  
  

 

 

   

 

 

       

 

 

   

Shares used in per share calculations:

            

Basic and diluted

     278,602        164,366            140,242      (e)
  

 

 

   

 

 

       

 

 

   

 

*** See Note 5 for an explanation of the reclassification adjustments to TriQuint’s Statement of Operations for the year ended December 31, 2012.

See accompanying notes to the unaudited pro forma condensed combined financial statements

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS

 

NOTE 1. DESCRIPTION OF TRANSACTION

On February 22, 2014, RFMD and TriQuint entered into the merger agreement providing for the business combination of RFMD and TriQuint. A new Delaware holding company named Rocky Holding, Inc. has been formed. Rocky Holding will form two direct subsidiaries prior to the closing (Trident Merger Sub and Rocky Merger Sub). Pursuant to the merger agreement, Trident Merger Sub will merge with and into TriQuint, and Rocky Merger Sub will merge with and into RFMD. As a result of the mergers, TriQuint and RFMD will each become a wholly owned subsidiary of Rocky Holding.

Upon completion of the RFMD merger, each share of RFMD common stock, other than RFMD excluded shares, will be converted into the right to receive 0.2500 of a share of Rocky Holding common stock. Shares of RFMD common stock held by RFMD or Rocky Merger Sub, which we refer to as RFMD excluded shares, will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration. Generally, each RFMD stock option that is outstanding (whether or not vested or exercisable) and each RFMD restricted stock unit or performance stock unit for which shares of RFMD common stock remain unvested or unissued, in each case as of the effective time of the RFMD merger, will be converted automatically into a substantially similar option or award for Rocky Holding common stock and will remain subject to the same terms, conditions and restrictions as the original option or award, subject to specified adjustments to reflect the effect of the RFMD Exchange Ratio.

Upon completion of the TriQuint merger, each outstanding share of TriQuint common stock, other than TriQuint excluded shares, will be converted into the right to receive 0.4187 of a share of Rocky Holding common stock. Shares of TriQuint common stock held by TriQuint or Trident Merger Sub, which we refer to as TriQuint excluded shares, will be canceled and will not be converted into any shares of Rocky Holding common stock or other consideration. Generally, each TriQuint stock option that is outstanding (whether or not vested or exercisable) and each TriQuint restricted stock unit or market-based restricted unit for which shares of TriQuint common stock remain unvested or unissued, in each case as of the effective time of the TriQuint merger, will be converted automatically into a substantially similar option or award for Rocky Holding common stock and will remain subject to the same terms, conditions and restrictions as the original option or award, subject to specified adjustments to reflect the effect of the TriQuint Exchange Ratio.

 

NOTE 2. BASIS OF PRO FORMA PRESENTATION

The unaudited pro forma condensed combined balance sheet is based on historical balance sheets of RFMD and TriQuint and has been prepared to reflect the mergers as if they were completed on December 28, 2013. The unaudited pro forma condensed combined statements of operations assume that the mergers were completed as of the beginning of RFMD’s fiscal year 2013 (April 1, 2012). The unaudited pro forma condensed combined statements of operations are based on (a) RFMD’s unaudited condensed consolidated statement of operations for the nine months ended December 28, 2013 and TriQuint’s unaudited condensed consolidated statement of operations for the nine months ended September 28, 2013, and (b) RFMD’s audited consolidated statement of operations for the fiscal year ended March 30, 2013 and TriQuint’s audited consolidated statement of operations for the fiscal year ended December 31, 2012. As a result of the different fiscal periods combined, TriQuint’s unaudited condensed consolidated statement of operations for the three months ended December 31, 2013 was excluded. TriQuint’s revenues and net loss for the three months ended December 31, 2013 totaled $267.7 million and $8.7 million, respectively. To the extent identified, certain reclassifications have been reflected in the historical financial statements of TriQuint to conform to RFMD’s presentation, as described in Note 5 below.

The unaudited pro forma condensed combined financial statements were prepared using the acquisition method of accounting in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 805 “Business Combinations” (“ASC 805”). Although the business combination of RFMD and TriQuint is a “merger of equals,” generally accepted accounting principles require that one of the two companies in the mergers be designated as the acquirer for accounting purposes based on the available evidence. RFMD and TriQuint have evaluated the provisions of ASC 805 and concluded that RFMD

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

should be the acquirer for accounting purposes. In reaching such conclusion, the companies considered, among other things, the relative outstanding share ownership, the composition of the governing body of Rocky Holding and the designation of certain senior management positions of Rocky Holding.

Under the acquisition method of accounting, the assets and liabilities of TriQuint, as of the effective date of the mergers, will be recorded by RFMD at their respective fair values and the excess of the merger consideration over the fair value of TriQuint’s net assets will be allocated to goodwill.

The pro forma adjustments described below have been developed based on management’s assumptions and estimates, including assumptions relating to the consideration to be paid and the allocation thereof to the assets acquired and liabilities assumed from TriQuint based on preliminary estimates of fair value. The final purchase price and the allocation of the purchase price will differ from that reflected in the pro forma financial statements after final valuation procedures are performed and amounts are finalized following the completion of the mergers.

The unaudited pro forma condensed combined financial statements are provided for illustrative purposes only and do not purport to represent what the actual consolidated results of operations or the consolidated financial position of the combined company would have been had the mergers occurred on the dates assumed, nor are they necessarily indicative of future consolidated results of operations or financial position.

The unaudited pro forma condensed combined financial statements do not reflect any integration activities or cost savings from operating efficiencies, synergies, asset dispositions or other restructurings that could result from the mergers. Additionally, no adjustments were made to reflect employee termination costs to be incurred in connection with the mergers, since those costs are not yet factually supportable.

RFMD performed a preliminary review of TriQuint’s accounting policies, based primarily on publicly available information, to determine whether any adjustments were necessary to ensure comparability in the pro forma condensed combined financial statements. At this time, RFMD is not aware of any differences that would have a material effect on the unaudited pro forma condensed combined financial statements; therefore, the unaudited pro forma condensed combined financial statements do not reflect any differences in accounting policies. Upon completion of the mergers, or as more information becomes available, RFMD will perform a more detailed review of TriQuint’s accounting policies. As a result of that review, differences may be identified between the accounting policies of the two companies that, when conformed, could have a material effect on the unaudited pro forma condensed combined financial statements.

 

NOTE 3. PRELIMINARY ESTIMATED PURCHASE PRICE

Preliminary Estimated Purchase Price

The total preliminary estimated purchase price for the transaction is approximately $2,385,062, as follows (in thousands):

 

Value of shares of Rocky Holding common stock to be issued to TriQuint stockholders

  (1)    $ 2,267,541   

Value of Rocky Holding restricted stock units to be issued to holders of TriQuint restricted stock units and market based restricted stock units

  (2),(3)      1,649   

Value of Rocky Holding options to be issued to holders of TriQuint stock options

  (2),(4)      115,872   
    

 

 

 

Total consideration to be transferred

     $ 2,385,062   
    

 

 

 

 

(1) Equals TriQuint outstanding shares as of April 1, 2014 multiplied by the exchange ratio (before giving effect to the one-for-four reverse stock split) of 1.6749, multiplied by the RFMD closing share price on April 1, 2014 of $8.03.

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

(2) In accordance with applicable accounting guidance, the fair value of replacement awards attributable to precombination service is recorded as part of the consideration transferred in the mergers, while the fair value of replacement awards attributable to postcombination service is recorded separately from the business combination and recognized as compensation cost over the remaining postcombination service period. The portion of TriQuint equity awards attributable to precombination and postcombination service is estimated based on the ratio of the service period rendered as of April 1, 2014 to the total service period. The fair value of awards attributed to precombination service was recognized as a component of the purchase price. Various estimates were used in this calculation, which could differ significantly from actual amounts calculated at the date of the mergers, and such differences could have a material impact on the total purchase price.
(3) The fair value of Rocky Holding equivalent restricted stock units and market based restricted stock units was estimated based on the closing price of TriQuint common stock on April 1, 2014. The equivalent number of market based restricted stock units was estimated based upon TriQuint’s total shareholder return relative to the performance of companies in the S&P Semiconductor Index for the applicable measurement period. These estimates are subject to change with market conditions and other circumstances, and these changes may have a material impact on the fair value of restricted stock units and market based restricted stock units used to calculate the total purchase price.
(4) The fair value of the Rocky Holding equivalent stock options was estimated as of April 1, 2014 using the Black-Scholes valuation model utilizing various assumptions. The expected volatility of the Rocky Holding common stock price is based on the average implied volatility over the expected term based on daily closing stock prices of RFMD and TriQuint common stock. The expected term of the option is based on TriQuint historical employee stock option exercise behavior as well as the remaining contractual exercise term. The stock price volatility and expected term are based on RFMD’s best estimates at this time, both of which impact the fair value of the option calculated under the Black-Scholes methodology and, ultimately, the total consideration that will be recorded at the effective time of the mergers. These estimates are subject to change with market conditions and other circumstances, and these changes may have a material impact on the fair value of stock options used to calculate the total purchase price.

RFMD believes that the fair value of the Rocky Holding stock options that will be issued to the holders of TriQuint stock options approximates the fair value of TriQuint stock options outstanding immediately prior to the TriQuint merger. Accordingly, the fair value of the converted stock options attributable to precombination service was recognized as a component of the purchase price and no additional amounts have been reflected as compensation expense. RFMD will recalculate the fair values of the TriQuint stock options and the converted options as of the closing date to determine the excess fair value amounts, if any, to be recorded as compensation expense by Rocky Holding.

TriQuint’s outstanding equity awards, and certain of RFMD’s outstanding equity awards, include a provision for acceleration of vesting in certain circumstances involving termination in connection with a change in control. No adjustments have been made to the unaudited pro forma condensed combined financial statements as a result of this provision, as RFMD cannot currently predict the nature and extent of terminations to be made in connection with the mergers.

The portion of the purchase price to be paid in shares of Rocky Holding common stock will be valued on the number of TriQuint shares outstanding immediately prior to the TriQuint merger multiplied by the exchange ratio (before giving effect to the one-for-four reverse stock split) of 1.6749 and the RFMD share price on that date estimated based on shares outstanding on April 1, 2014. A 10% change in RFMD’s stock price would change the purchase price by approximately $226,754, with a corresponding change to goodwill. The actual purchase price will fluctuate with the price of RFMD’s common stock until the effective date of the mergers, and the final valuation could differ significantly from the current estimate.

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

NOTE 4. PRELIMINARY ESTIMATED PURCHASE PRICE ALLOCATION

Under the acquisition method of accounting, the total purchase price is allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the date of the mergers. The pro forma purchase price allocation below has been developed based on preliminary estimates of fair value using the historical financial statements of TriQuint as of December 31, 2013. As of the date of this joint proxy statement/prospectus, RFMD has not completed the detailed valuation studies necessary to arrive at the required estimates of the fair value of TriQuint’s assets to be acquired and the liabilities to be assumed and the related allocations of purchase price. Therefore, the allocation of the purchase price to acquired intangible assets is based on preliminary fair value estimates and subject to final management analysis, with the assistance of third party valuation advisors, following the completion of the mergers. The estimated intangible asset values and their useful lives could be affected by a variety of factors that may become known to RFMD only upon access to additional information and/or changes in these factors that may occur prior to the effective time of the mergers.

The preliminary estimated intangible assets consist of customer relationships, developed technology, purchase order backlog, trade name and in-process research and development. The estimated useful lives range between one year and six years and are detailed in the schedule below. The estimated fair values of the intangibles were based primarily on current estimates of TriQuint’s expected future cash flows and may change as estimates and assumptions are refined. Additional intangible asset classes may be identified as the valuation process continues.

The excess of the purchase price over the tangible and identifiable intangible assets acquired and liabilities assumed has been allocated to goodwill.

The preliminary allocation of the purchase price as of December 28, 2013 is estimated as follows (in thousands):

 

Total preliminary purchase price

     $ 2,385,062   

Estimated fair value of net tangible assets acquired and liabilities assumed

    

Cash and cash equivalents

   $ 79,026     

Accounts receivable

     177,114     

Inventories

     198,000     

Prepaid expenses and other current assets

     57,787     

Property and equipment

     420,363     

Other non-current assets, net

     28,991     

Accounts payable, accrued liabilities and other current liabilities

     (112,318  

Current deferred tax liabilities, net

     (1,300  

Long-term deferred tax liabilities, net

     (18,143  

Other long-term liabilities

     (26,386  
  

 

 

   
       803,134   

Estimated fair value of identifiable intangible assets acquired:

    

Customer relationships

     304,000     

Developed technology

     190,000     

Purchase order backlog

     26,000     

Trade name

     14,000     

In-process research and development

     100,000     
       634,000   
    

 

 

 

Estimated goodwill

     $ 947,928   
    

 

 

 

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

Tangible assets acquired and liabilities assumed

RFMD has estimated the fair value of tangible assets acquired and liabilities assumed. These estimates are based on a preliminary valuation performed as of December 31, 2013, and are subject to further review by management. See Note 6 below for a further explanation of the assumptions related to certain of the assets assumed.

Identifiable intangible assets

The preliminary fair value of the acquired developed technology was determined based on an income approach using the “excess earnings method.” The preliminary fair value of the acquired customer relationships was determined based on an income approach using the “with and without method.” The preliminary fair value of the acquired trade name was determined based on an income approach using the “relief from royalty method”. These estimates are based on a preliminary valuation and are subject to further review by management. The following table sets forth the components of these intangible assets and their estimated useful lives (dollars in thousands):

 

     Fair Value      Estimated Useful Life  

Customer relationships

   $ 304,000         5 years   

Developed technology

     190,000         5-6 years   

Purchase order backlog

     26,000         1 year   

Trade name

     14,000         3 years   

In-process research and development

     100,000         Indefinite   

Acquired in-process research and development (“IPRD”) is an intangible asset classified as an indefinite-lived asset until the completion or abandonment of the associated research and development effort. IPRD will be amortized over an estimated useful life to be determined at the date the associated research and development effort is completed, or expensed immediately when, and if, the project is abandoned. Acquired IPRD is not amortized during the period that it is considered indefinite-lived, but rather is subject to annual testing for impairment or when there are indicators of impairment.

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

NOTE 5. RECLASSIFICATION ADJUSTMENTS

The following reclassification adjustments have been made to the December 31, 2013 historical balance sheet of TriQuint to conform to RFMD’s presentation (in thousands):

 

     As of
December 31, 2013
 

Deferred tax assets, net, as reported by TriQuint

   $ 12,787   

Reclassify to Other current assets

     (12,787
  

 

 

 

Adjusted TriQuint Deferred tax assets, net, to conform to RFMD

   $ —     
  

 

 

 

Other receivables, as reported by TriQuint

   $ —     

Reclassified from Other current assets

     20,765   
  

 

 

 

Adjusted TriQuint Other receivables to conform to RFMD

   $ 20,765   
  

 

 

 

Other current assets, as reported by TriQuint

   $ 39,960   

Reclassified from Deferred tax assets, net

     12,787   

Reclassify to Other receivables

     (20,765
  

 

 

 

Adjusted TriQuint Other current assets to conform to RFMD

   $ 31,982   
  

 

 

 

Deferred tax assets — non-current, net, as reported by TriQuint

   $ 61,554   

Reclassify to Other non-current assets

     (61,554
  

 

 

 

Adjusted TriQuint Deferred tax assets — non-current, net, to conform to RFMD

   $ —     
  

 

 

 

Other non-current assets, net, as reported by TriQuint

   $ 32,319   

Reclassified from Deferred tax assets — non-current, net

     61,554   
  

 

 

 

Adjusted Other non-current assets, net, to conform to RFMD

   $ 93,873   
  

 

 

 

Accrued payroll, as reported by TriQuint

   $ 39,743   

Reclassify to Accrued liabilities

     (39,743
  

 

 

 

Adjusted TriQuint Accrued payroll to conform to RFMD

   $ —     
  

 

 

 

Other accrued liabilities, as reported by TriQuint

   $ 15,893   

Reclassify to Accrued liabilities

     (15,893
  

 

 

 

Adjusted TriQuint Other accrued liabilities to conform to RFMD

   $ —     
  

 

 

 

Accrued liabilities, as reported by TriQuint

   $ —     

Reclassified from Accrued payroll

     39,743   

Reclassified from Other accrued liabilities

     15,893   
  

 

 

 

Adjusted TriQuint Accrued liabilities to conform to RFMD

   $ 55,636   
  

 

 

 

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

The following reclassification adjustments have been made to the historical statements of operations of TriQuint to conform to RFMD’s presentation (in thousands):

 

    Nine Months
Ended September 28,
2013
    Twelve Months
Ended December 31,
2012
 

Selling, general and administrative, as reported by TriQuint

  $ 79,650      $ 106,642   

Reclassify to General and administrative

    (38,030     (49,657

Reclassify to Marketing and selling

    (44,991     (56,985

Reclassify to Other operating expense (income)

    3,371        —     
 

 

 

   

 

 

 

Adjusted TriQuint Selling, general and administrative to conform to RFMD

  $ —        $ —     
 

 

 

   

 

 

 

Marketing and selling, as reported by TriQuint

  $ —        $ —     

Reclassified from Selling, general and administrative

    44,991        56,985   
 

 

 

   

 

 

 

Adjusted TriQuint Marketing and selling to conform to RFMD

  $ 44,991      $ 56,985   
 

 

 

   

 

 

 

General and administrative, as reported by TriQuint

  $ —        $ —     

Reclassified from Selling, general and administrative

    38,030        49,657   

Reclassified from Litigation expense

    —          7,547   
 

 

 

   

 

 

 

Adjusted TriQuint General and administrative to conform to RFMD

  $ 38,030      $ 57,204   
 

 

 

   

 

 

 

Litigation expense, as reported by TriQuint

  $ —        $ 7,547   

Reclassify to General and administrative

    —          (7,547
 

 

 

   

 

 

 

Adjusted TriQuint Litigation expense to conform to RFMD

  $ —        $ —     
 

 

 

   

 

 

 

Other operating expense (income), as reported by TriQuint

  $ —        $ —     

Reclassified from Selling, general and administrative

    (3,371     —     
 

 

 

   

 

 

 

Adjusted TriQuint Other operating expense (income) to conform to RFMD

  $ (3,371   $ —     
 

 

 

   

 

 

 

Recovery of investments in other companies, as reported by TriQuint

  $ 421      $ 6,957   

Reclassify to Other (expense) income

    (421     (6,957
 

 

 

   

 

 

 

Adjusted TriQuint Recovery of investments in other companies to conform to RFMD

  $ —        $ —     
 

 

 

   

 

 

 

Other, net, as reported by TriQuint

  $ (324   $ 116   

Reclassified from Recovery of investments in other companies

    421        6,957   
 

 

 

   

 

 

 

Adjusted TriQuint Other (expense) income to conform to RFMD

  $ 97      $ 7,073   
 

 

 

   

 

 

 

 

NOTE 6. UNAUDITED PRO FORMA ADJUSTMENTS (in thousands)

The following is a description of the unaudited pro forma adjustments reflected in the unaudited pro forma condensed combined financial statements:

Balance Sheet

 

  1. Accounts Receivable

During the twelve months ended March 30, 2013, as well as the nine months ended December 28, 2013, RFMD purchased various products from TriQuint. The pro forma adjustment of $93 relates to the elimination of the RFMD accounts receivable balance on TriQuint’s December 31, 2013 balance sheet.

 

  2. Inventories

Raw material inventory is measured at fair value (current replacement cost), which is estimated to be the current carrying value. Work-in-process inventory is estimated at the fair market value, which is the estimated

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

selling price less the sum of (a) costs to complete the manufacturing process, (b) costs of selling effort, and (c) a reasonable profit margin for the completion of the manufacturing process and selling effort. Finished goods inventory is estimated at the fair market value, which is the estimated selling price less the sum of (a) costs of selling effort, and (b) a reasonable profit margin for the selling effort.

The pro forma adjustment of $38,512 reflects the step-up in value of the acquired work-in-process and finished goods inventory. The increased valuation of the inventory will increase cost of revenue as the acquired inventory is sold after the closing date of the mergers. There is no continuing effect of the acquired inventory adjustment on the combined operating results and, as such, this adjustment is not addressed in the unaudited pro forma condensed combined statements of operations.

 

3. Property and Equipment

The carrying value of TriQuint’s property and equipment was used in the preliminary purchase price allocation, and no adjustments were made to the unaudited pro forma condensed combined balance sheet. Adjustments may be required when additional information is obtained and a more detailed review is performed over the fair value of property and equipment. The actual amounts recorded when the mergers are completed may differ materially from the current book value of property and equipment.

 

4. Goodwill and Other Intangible Assets

The net pro forma adjustment to goodwill includes the elimination of TriQuint’s pre-merger goodwill balance and is calculated as follows (in thousands):

 

Purchase price allocation to goodwill (Note 4)

   $ 947,928   

Elimination of pre-merger TriQuint goodwill

     (13,519
  

 

 

 

Total pro forma adjustment to goodwill

   $ 934,409   
  

 

 

 

The net pro forma adjustment to intangible assets, net, includes the elimination of TriQuint pre-merger intangible assets and is calculated as follows (in thousands):

 

Value assigned to intangible assets acquired (Note 4)

   $ 634,000   

Elimination of pre-merger TriQuint intangible assets

     (23,510
  

 

 

 

Total pro forma adjustment to intangible assets

   $ 610,490   
  

 

 

 

See Note 4 for the estimated purchase price allocation. The final valuation could differ significantly from the current estimate. The pro forma purchase price allocation is preliminary as the mergers have not yet been completed. The pro forma presentation assumes that the historical values of TriQuint’s tangible assets and liabilities approximate fair value. Additionally, the allocation of the purchase price to acquired intangible assets is preliminary and subject to the final outcome of management’s analysis.

 

5. Other Current Assets and Other Non-Current Assets

TriQuint has a long-term asset related to a non-qualified deferred compensation plan that requires a lump-sum payout upon change in control at the election of the eligible employees and members of the TriQuint board. The pro forma adjustment of $4,210 relates to the portion of deferred compensation assets which is required to be reclassified as a current asset as a result of the mergers.

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

TriQuint’s historical current and non-current deferred tax assets have been reduced in the amounts of $12,787 and $60,672, respectively. The pro forma adjustments reflect an increase in deferred tax liabilities related to step-up in value of intangible assets allocated to the U.S. and an increase of TriQuint’s valuation reserve against net U.S. deferred tax assets based on a preliminary estimate of realizability of the deferred tax assets subsequent to completion of the mergers, which result in a nil remaining deferred tax asset position in the U.S. The incremental valuation allowance is not reflected as a pro forma adjustment to the statement of operations as the application of the valuation allowance will not have a continuing impact in the statement of operations of the combined entity.

On a combined basis, based upon the weight of available evidence as of this filing, it is expected that the new combined company will record a full valuation allowance for its net U.S. deferred tax assets.

 

6. Accounts Payable

During the twelve months ended March 30, 2013, as well as the nine months ended December 28, 2013, RFMD purchased various products from TriQuint. The pro forma adjustment of $93 relates to the elimination of the TriQuint accounts payable balance on RFMD’s December 28, 2013 balance sheet.

 

7. Accrued Liabilities

The total pro forma adjustment of $37,210 reflects the estimated unpaid non-recurring merger-related costs (that are not reflected in the historical financial statements of either RFMD or TriQuint) such as investment banking fees, legal fees, accounting fees, valuation fees and other expenses associated with the mergers, which RFMD and TriQuint either have incurred or expect to incur (estimated). While presented in the unaudited pro forma condensed combined balance sheet, these costs have been excluded from the unaudited pro forma condensed combined statements of operations as there is no continuing effect of such costs.

TriQuint has a non-qualified deferred compensation plan that requires a lump-sum payout upon change in control at the election of the eligible employees and members of the TriQuint board. The pro forma adjustment of $4,210 relates to the portion of deferred compensation obligation that is being reclassified from other long-term liabilities as a result of the mergers.

 

8. Other Current Liabilities

The pro forma adjustment of $1,300 reflects the deferred tax liabilities associated with the estimated fair market value of the intangible assets in Singapore at a 5% tax rate. Singapore has granted a 10 year tax holiday to TriQuint through 2021 for a reduction in the statutory rate of 17% to 5%.

 

9. Other Long-Term Liabilities

TriQuint has a non-qualified deferred compensation plan that requires a lump-sum payout upon change in control at the election of the eligible employees and members of the TriQuint board. The pro forma adjustment of $4,210 relates to the portion of deferred compensation obligation that is being reclassified to accrued liabilities as a result of the mergers.

The pro forma adjustment of $18,143 reflects the deferred tax liabilities associated with the estimated fair market value of the intangible assets in Singapore at a 5% tax rate. Singapore has granted a 10 year tax holiday to TriQuint through 2021 for a reduction in the statutory rate of 17% to 5%.

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

10. Stockholders’ Equity

The historical stockholders’ equity of TriQuint will be eliminated upon the completion of the mergers. The total stockholders’ equity of the combined company will be increased over the pre-merger RFMD shareholders’ equity by the value of the common stock issued in connection with the mergers. Rocky Holding will be issuing approximately $2,267,541 of common stock as part of the purchase price consideration, and estimates the number of replacement stock options, restricted stock units and other equity-based awards to be $117,521. The number of shares issued is dependent on the number of TriQuint shares, stock options, restricted stock units and other equity-based awards outstanding on the date of the mergers. Refer to Note 3 for a discussion of the determination of the estimated preliminary purchase price which includes how the common stock to be issued and stock based awards outstanding at the date of the mergers were valued.

The calculation of the pro forma adjustments to total stockholders’ equity is as follows (in thousands):

 

Elimination of pre-merger TriQuint equity balances

   $ (894,553

Impact of shares to be issued to TriQuint stockholders

     2,385,062   

Estimated transaction costs

     (37,210
  

 

 

 

Total pro forma adjustment

   $ 1,453,299   
  

 

 

 

Statements of Operations

 

a. Intercompany Transactions

During the nine months ended December 28, 2013 and the twelve months ended March 30, 2013, RFMD purchased various products from TriQuint. The following amounts have been eliminated in the pro forma statements of operations (in thousands):

 

     Nine months ended
December 28, 2013
    Twelve months
ended
March 30, 2013
 

TriQuint Sales to RFMD

   $ 2,875      $ 2,852   

Decrease to Cost of goods sold for items sold to third parties

     (2,236     (2,238

 

b. Cost of Goods Sold, Research and Development, Marketing and Selling, and General and Administrative

The adjustments reflect the amortization for customer relationships, developed technology, purchase order backlog, and trade name, which will be recognized in the statements of operations using a straight-line method over an estimated term of five years, five to six years, one year, and three years, respectively.

The pro forma adjustments related to amortization expense are as follows (in thousands):

 

Nine months ended December 28, 2013:

   Cost of
Goods Sold
    Research and
Development
    Marketing
and Selling
    General and
Administrative
 

Elimination of TriQuint historical amortization expense

   $ (3,627   $ (331   $ (1,117   $ (187

Amortization of intangible assets acquired

     44,500        —          49,100        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Pro forma adjustment

   $ 40,873      $ (331   $ 47,983      $ (187
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Twelve months ended March 30, 2013:

   Cost of
Goods Sold
    Research and
Development
    Marketing
and Selling
    General and
Administrative
 

Elimination of TriQuint historical amortization expense

   $ (4,738   $ (165   $ (1,357   $ (249

Amortization of intangible assets acquired

     59,333        —          65,467        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Pro forma adjustment

   $ 54,595      $ (165   $ 64,110      $ (249
  

 

 

   

 

 

   

 

 

   

 

 

 

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL

STATEMENTS — (Continued)

 

c. Transaction Costs

The adjustment represents the elimination of merger-related transaction costs that were recognized in RFMD’s income statement for the nine months ended December 28, 2013, as they have no continuing impact on the combined results of operations. There were no merger-related transaction costs included in TriQuint’s statement of operations for the nine months ended September 28, 2013.

 

d. Income Taxes

The pro forma adjustments to tax expense relate to the recognition of deferred tax benefit in Singapore at a 5% tax rate. Singapore has granted a 10-year tax holiday to TriQuint through 2021 for a reduction in the statutory rate of 17% to 5%. There is no adjustment to income tax expense in the U.S. as a result of the pro forma adjustments, as the U.S. is expected to have a full valuation allowance against its net deferred tax asset.

The pro forma combined provision for income taxes does not reflect the amounts that would have resulted had RFMD and TriQuint filed consolidated income tax returns during the periods presented.

 

e. Basic and Diluted Shares

 

(shares in thousands)

   RFMD
Nine months ended
December 28, 2013
     TriQuint
Nine months ended
September 28, 2013
    Combined  

Historical basic weighted average shares outstanding

     281,749         168,597  

Exchange ratio

     0.25         0.4187     

Adjusted basic and diluted weighted average shares outstanding

     70,437         70,592 **      141,029   

(shares in thousands)

   RFMD
Twelve months ended
March 30, 2013
     TriQuint
Twelve months ended
December 31, 2012
    Combined  

Historical basic weighted average shares outstanding

     278,602         168,597  

Exchange ratio

     0.25         0.4187     

Adjusted basic and diluted weighted average shares outstanding

     69,650         70,592 **      140,242   

 

* Represents outstanding shares of TriQuint stockholders as of April 1, 2014.
** Represents shares of Rocky Holding common stock to be issued to TriQuint stockholders estimated as of April 1, 2014.

 

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CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

This material may include forward-looking statements, both with respect to us and our industry, that reflect our current views with respect to future events and financial performance. Statements that include the words “expect,” “intend,” “plan,” “believe,” “project,” “anticipate,” “will,” “may,” “would” and similar statements of a future or forward-looking nature may be used to identify forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. For example, forward-looking statements include projections of earnings, revenues, synergies, accretion or other financial items; any statements of the plans, strategies and objectives of management for future operations, including the execution of integration and restructuring plans and the anticipated timing of filings and approvals related to the mergers or the closing of the mergers; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. All forward-looking statements address matters that involve risks and uncertainties, many of which are beyond our control. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in those statements, and therefore, you should not place undue reliance on any of those statements. In particular, you should consider the risks and uncertainties described under “Risk Factors” beginning on page 32. The following factors, among others, could also cause actual results to differ from those set forth in the forward-looking statements:

STANDARD OPERATING FACTORS

 

    Fluctuations in our operating results, which may be influenced by, among other things, changes in semiconductor industry conditions;

 

    Our inability to accurately predict market needs, our failure to achieve design wins with our customers, or the market’s failure to accept our new products and technologies and the products of our customers;

 

    Our inability to achieve, maintain or improve manufacturing yields and margins or to increase utilization levels of our manufacturing capacity;

 

    Customer concentration risks, including the gain or loss of significant customers;

 

    Risks associated with our reliance on certain suppliers;

 

    Continued downward pressure on average selling prices of our products;

 

    Results in pending and future litigation or other proceedings that would subject us to significant monetary damages or penalties and/or require us to change our business practices, or the costs incurred in connection with those proceedings;

 

    Our inability to effectively execute on strategic transactions, or to integrate or achieve anticipated benefits from any acquired businesses; and

 

    Our failure to attract and retain talented employees or to manage succession and retention for our Chief Executive Officer or other key executives.

TRANSACTION-RELATED FACTORS

 

    Uncertainty as to whether TriQuint and RFMD will be able to complete the mergers on the terms set forth in the merger agreement;

 

    The ability to obtain governmental approvals of the mergers;

 

    Failure to realize the anticipated benefits of the mergers, including as a result of a delay in completing the mergers or a delay or difficulty in integrating the businesses of RFMD and TriQuint;

 

    Uncertainty as to the long-term value of Rocky Holding common stock;

 

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    The expected amount and timing of cost savings and operating synergies; and

 

    Failure to receive the approval of TriQuint stockholders or RFMD shareholders for the mergers.

The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors set forth in this joint proxy statement/prospectus and the risk factors included in TriQuint’s most recent report on Form 10-K and the risk factors included in RFMD’s most recent reports on Form 10-K and Form 10-Q and other documents of TriQuint, RFMD and Rocky Holding on file with the SEC. Any forward-looking statements made in this material are qualified in their entirety by the cautionary statements contained or referred to in this section, and there is no assurance that the actual results or developments anticipated by us will be realized or that, even if substantially realized, they will have the expected consequences to, or effects on, us or our business or operations. Except to the extent required by applicable law, we undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

INFORMATION ABOUT THE COMPANIES

RF Micro Devices, Inc.

RF Micro Devices, Inc., which we refer to as RFMD, was incorporated in North Carolina in 1991. RFMD designs and manufactures high-performance radio frequency solutions. RFMD’s products enable worldwide mobility, provide enhanced connectivity and support advanced functionality in the mobile device, wireless infrastructure, wireless local area network (WLAN or WiFi), cable television/broadband, Smart Energy/advanced metering infrastructure and aerospace and defense markets. RFMD’s principal executive offices are located at 7628 Thorndike Road, Greensboro, North Carolina 27409-9421. RFMD’s telephone number is (336) 664-1233, and its website is www.rfmd.com.

TriQuint Semiconductor, Inc.

TriQuint Semiconductor, Inc., which we refer to as TriQuint, was incorporated in California in 1981 and reincorporated in Delaware in 1997. TriQuint designs, develops and manufactures high-performance active and passive technologies, including power amplifier, switch and filter modules for the mobile device, network infrastructure and defense and aerospace markets. TriQuint has core competencies in gallium arsenide (“GaAs”), gallium nitride (“GaN”), surface acoustic wave (“SAW”) and bulk acoustic wave (“BAW”) technologies. TriQuint’s principal executive offices are located at 2300 N.E. Brookwood Parkway, Hillsboro, Oregon 97124. TriQuint’s telephone number is (503)  615-9000, and its website is www.triquint.com.

Rocky Holding, Inc.

Rocky Holding, Inc., which we refer to as Rocky Holding, was incorporated in Delaware in December 2013 as a wholly owned subsidiary of RFMD solely for the purpose of effecting the mergers and has not conducted any business activities other than in connection with the mergers. As described in “The Mergers” and “The Merger Agreement,” following the completion of the mergers, RFMD and TriQuint will each become wholly owned subsidiaries of Rocky Holding. We anticipate that, prior to completion of the mergers, Rocky Holding will change its name, adopt a NASDAQ symbol for its common stock, and register a new trade name and logo that reflect the key attributes of the combined company. Rocky Holding’s principal executive offices are currently located at 7628 Thorndike Road, Greensboro, North Carolina 27409-9421, and its telephone number is (336) 664-1233.

 

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THE TRIQUINT SPECIAL MEETING

This section contains information about the special meeting of TriQuint stockholders that has been called to consider and adopt the merger agreement, to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement), to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers, and to approve the amended TriQuint 2013 Incentive Plan.

This joint proxy statement/prospectus is being furnished to the stockholders of TriQuint in connection with the solicitation of proxies by the TriQuint board for use at the TriQuint special meeting. TriQuint is first mailing this joint proxy statement/prospectus and accompanying proxy card to its stockholders on or about [], 2014.

Date, Time and Place

A special meeting of the stockholders of TriQuint will be held at [] on [], 2014, at [], Pacific time, unless the special meeting is adjourned or postponed.

Purpose

At the special meeting, TriQuint stockholders will be asked to consider and vote upon the following matters:

 

    a proposal to adopt the merger agreement;

 

    a proposal to approve the adjournment of the TriQuint special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

 

    a proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers contemplated by the merger agreement; and

 

    a proposal to approve the amended TriQuint 2013 Incentive Plan.

Recommendation of the TriQuint Board

The TriQuint board has unanimously (a) approved the merger agreement and the TriQuint merger and the transactions contemplated by the merger agreement upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the mergers are fair to, advisable and in the best interests of TriQuint and its stockholders, (c) authorized management to submit the merger agreement to the TriQuint stockholders for adoption at the TriQuint special meeting, and (d) recommended that TriQuint’s stockholders adopt the merger agreement.

The TriQuint board unanimously recommends that TriQuint stockholders vote:

“FOR” the proposal to adopt the merger agreement;

“FOR” the proposal to approve the adjournment of the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement);

“FOR” the proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers contemplated by the merger agreement; and

“FOR” the proposal to approve the amended TriQuint 2013 Incentive Plan.

See “The Mergers — Recommendation of the TriQuint Board; TriQuint’s Reasons for the Mergers” beginning on page 79.

 

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TriQuint stockholders should carefully read this joint proxy statement/prospectus in its entirety for more detailed information concerning the merger agreement, the proposed transactions and certain compensation arrangements for TriQuint’s named executive officers in connection with the mergers. In addition, TriQuint stockholders are directed to the merger agreement, which is attached as Annex A to this joint proxy statement/prospectus.

Record Date; Shares Entitled to Vote

Only holders of record of shares of TriQuint common stock at the close of business on the TriQuint record date ([], 2014) will be entitled to vote shares held at that date at the TriQuint special meeting or any adjournments or postponements of the TriQuint special meeting. Each outstanding share of TriQuint common stock entitles its holder to cast one vote.

As of the TriQuint record date, [] shares of TriQuint common stock, par value $0.001 per share, were outstanding and entitled to vote at the TriQuint special meeting.

Quorum; Broker Non-Votes

The presence, in person or represented by proxy, of holders of a majority in voting power of the TriQuint common stock issued and outstanding and entitled to vote at the TriQuint special meeting constitutes a quorum. In the absence of a quorum, the chairman of the special meeting will have power to adjourn the special meeting. As of the TriQuint record date, [] shares of TriQuint common stock will be required to achieve a quorum.

Holders of shares of TriQuint common stock present in person at the TriQuint special meeting but not voting, and shares of TriQuint common stock for which TriQuint has received proxies indicating that their holders have abstained, will be counted as present at the TriQuint special meeting for purposes of determining whether a quorum is established. Broker non-votes, if any, will be counted for purposes of determining whether a quorum exists at the special meeting.

Under the rules that govern brokers who have record ownership of shares that are held in “street name” for their clients, the beneficial owners of the shares, brokers have discretion to vote these shares on routine matters but not on non-routine matters. The adoption of the merger agreement is not considered a routine matter, nor are any of the other matters being proposed at the TriQuint special meeting. Accordingly, brokers will not have discretionary voting authority to vote your shares on any matter at the TriQuint special meeting. A broker non-vote occurs when brokers do not have discretionary voting authority and have not received instructions from the beneficial owners of the shares on a particular non-routine matter. A broker will not be permitted to vote on the proposal to adopt the merger agreement, or any other proposal being presented, without instruction from the beneficial owner of the shares of TriQuint common stock held by that broker. As a result, shares of TriQuint common stock beneficially owned that have been designated on proxy cards by the broker, bank or nominee as not voted on the proposal to adopt the merger agreement (broker non-vote) will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement. Broker non-votes will have no effect, however, on the proposal to adjourn the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement), the proposal to approve, by non-binding advisory vote, the compensation arrangements for TriQuint’s named executive officers in connection with the mergers, or the proposal to approve the amended TriQuint 2013 Incentive Plan. If you hold shares of TriQuint stock through a broker, bank or other organization with custody of your shares, follow the voting instructions you receive from that organization.

Vote Required

Proposal to Adopt the Merger Agreement by TriQuint Stockholders: Adopting the merger agreement requires the affirmative vote of holders of a majority of the shares of TriQuint common stock outstanding and entitled to vote. Accordingly, a TriQuint stockholder’s failure to submit a proxy card or to vote in person at

 

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the special meeting, an abstention from voting, or the failure of a TriQuint stockholder who holds his, her or its shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

Proposal to Adjourn the TriQuint Special Meeting by TriQuint Stockholders: Approving the adjournment of the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement) requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the special meeting and entitled to vote on the adjournment proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to adjourn the special meeting, while broker non-votes and shares not in attendance at the special meeting will have no effect on the outcome of any vote to adjourn the special meeting.

Proposal Regarding Certain TriQuint Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, TriQuint is providing stockholders with the opportunity to approve, by non-binding advisory vote, compensation payments for TriQuint’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “TriQuint Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for TriQuint Named Executive Officers” beginning on page 173. Approving this merger-related executive compensation, on a non-binding advisory basis, requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the special meeting and entitled to vote on the merger-related compensation proposal. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the merger-related executive compensation, while broker non-votes and shares not in attendance at the special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

Proposal to Approve the Amended TriQuint 2013 Incentive Plan by TriQuint Stockholders: Approving the amended TriQuint 2013 Incentive Plan requires the affirmative vote of holders of a majority of the shares of TriQuint common stock present, in person or represented by proxy, at the special meeting and entitled to vote. Accordingly, abstentions will have the same effect as a vote “AGAINST” the proposal to approve the amended TriQuint 2013 Incentive Plan, while broker non-votes and shares not in attendance at the special meeting will have no effect on the outcome of any vote to approve the amended TriQuint 2013 Incentive Plan.

Voting by TriQuint’s Directors and Executive Officers

As of the TriQuint record date, TriQuint’s directors and executive officers beneficially owned [] shares of TriQuint common stock entitled to vote at the TriQuint special meeting. This represents approximately []% in voting power of the outstanding shares of TriQuint common stock entitled to be cast at the TriQuint special meeting, which is []% less than the vote required to adopt the merger agreement. Each TriQuint director and executive officer has indicated his or her present intention to vote, or cause to be voted, the shares of TriQuint common stock owned by him or her for the proposal to adopt the merger agreement.

How to Vote

Stockholders may vote using any of the following methods:

By telephone or on the Internet

You can vote by calling the toll-free telephone number on your proxy card. Please have your proxy card handy when you call. Easy-to-follow voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded.

 

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The website for Internet voting is []. Please have your proxy card handy when you go online. As with telephone voting, you can confirm that your instructions have been properly recorded. If you vote on the Internet, you also can request electronic delivery of future proxy materials.

Telephone and Internet voting facilities for stockholders of record will be available 24 hours a day beginning on or about [], 2014, and will close at [] Eastern time on [], 2014. The availability of telephone and Internet voting for beneficial owners will depend on the voting processes of your broker, bank or other holder of record. Therefore, TriQuint recommends that you follow the voting instructions in the materials you receive.

If you vote by telephone or on the Internet, you do not need to return your proxy card.

By mail

If you received your special meeting materials by mail, you may complete, sign and date the proxy card or voting instruction card and return it in the prepaid envelope. If you are a stockholder of record and you return your signed proxy card but do not indicate your voting preferences, the persons named in the proxy card will vote the shares represented by that proxy as recommended by the TriQuint board.

In person at the special meeting

All TriQuint stockholders as of the TriQuint record date may vote in person at the special meeting. You may also be represented by another person at the TriQuint special meeting by executing a proper proxy designating that person. If you are a beneficial owner of TriQuint shares, but not the stockholder of record, you must obtain a legal proxy from your broker, bank or other stockholder of record and present it to the inspectors of election with your ballot to be able to vote at the TriQuint special meeting.

By granting a proxy or submitting voting instructions

You may vote by granting a proxy or, for shares held in street name, by submitting voting instructions to your bank, broker or other holder of record.

Voting of Proxies

If you vote by Internet, by telephone or by completing, signing, dating and mailing your proxy card or voting instruction card, your shares will be voted in accordance with your instructions. If you are a stockholder of record and you sign, date and return your proxy card but do not indicate how you want to vote or do not indicate that you wish to abstain, your shares will be voted “FOR” the proposal to adopt the merger agreement, “FOR” the proposal to adjourn the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to adopt the merger agreement), “FOR” the proposal to approve, by non-binding advisory vote, certain compensation arrangements for TriQuint’s named executive officers in connection with the mergers, “FOR” the proposal to approve the amended TriQuint 2013 Incentive Plan and in the discretion of the proxyholders on any other matter that may properly come before the meeting at the discretion of the TriQuint board.

Revoking Your Proxy

If you are a stockholder of record, you may revoke your proxy at any time before it is voted at the TriQuint special meeting. To do this, you must:

 

    enter a new vote by telephone, over the Internet, or by signing and returning another proxy card at a later date;

 

    provide written notice of the revocation to our Corporate Secretary or deliver another duly executed proxy or voter instruction form dated subsequent to the date thereof to the addressee named in the proxy or voter instruction form; or

 

    attend the TriQuint special meeting and vote in person.

If your shares are held in “street name,” you must contact your broker or nominee to revoke and vote your proxy.

 

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Attending the Special Meeting

Only TriQuint stockholders of record, or beneficial owners of TriQuint common stock, as of the record date, may attend the special meeting in person. If you plan to attend the TriQuint special meeting, please vote your proxy in advance as described above so that your vote will be counted if you later decide not to attend the special meeting.

If your shares are held beneficially in the name of a broker, bank or other stockholder of record and you plan to attend the TriQuint special meeting in person and would like to vote there, you will need to bring a legal proxy from your broker, bank or other stockholder of record, as explained above.

Stockholders should be prepared to present a form of photo identification, such as a driver’s license, or their proxy card.

Confidential Voting

Proxy instructions, ballots and voting tabulations that identify individual TriQuint stockholders are handled in a manner that protects your voting privacy. Your vote will not be disclosed either within TriQuint or to third parties, except (a) as necessary to meet applicable legal requirements, (b) to allow for the tabulation of votes and certification of the vote, and (c) to facilitate a successful proxy solicitation.

Stockholders Sharing an Address; Householding

TriQuint has adopted a procedure approved by the SEC called “householding.” Under this procedure, beneficial stockholders who have the same address and last name and who do not participate in electronic delivery or Internet access of proxy materials will receive only one copy of stockholder documents unless one or more of these stockholders notifies TriQuint that they wish to continue receiving individual copies. This procedure is designed to reduce duplicate mailings and save significant printing and processing costs, as well as natural resources. Each stockholder who participates in householding will continue to receive a separate proxy card. Your consent to householding is perpetual unless you withhold or revoke it. You may revoke your consent at any time by contacting Broadridge Financial Solutions, Inc., either by calling toll-free at (800) 542-1061, or by writing to Broadridge Financial Solutions, Inc. Householding Department, 51 Mercedes Way, Edgewood, New York 11717. You will be removed from the householding program within 30 days of receipt of your response, after which you will receive an individual copy of the stockholder documents.

Solicitation of Proxies

TriQuint is soliciting proxies for the TriQuint special meeting from TriQuint stockholders. TriQuint has also engaged The Proxy Advisory Group, LLC®, to assist in the solicitation of proxies and provide related advice and informational support, for a services fee and the reimbursement of customary disbursements that are not expected to exceed $35,000 in the aggregate. TriQuint will bear the entire cost of soliciting proxies from TriQuint stockholders, except that TriQuint and RFMD will share equally the expenses incurred in connection with the printing and mailing of this joint proxy statement/prospectus and filing all soliciting materials with the SEC. In addition to this mailing, TriQuint’s directors, officers and employees may solicit proxies, but they will not receive any additional compensation for those services. Solicitation of proxies will be undertaken through the mail, in person, by telephone, and via the Internet and video conference.

TriQuint may also reimburse brokerage houses and other custodians, nominees and fiduciaries for their expenses for forwarding proxy and solicitation materials to the beneficial owners of TriQuint common stock and in obtaining voting instructions from the beneficial owners.

Other Business

There are no other matters that the TriQuint board intends to present, or has reason to believe others will present, at the TriQuint special meeting. If you have returned your signed and completed proxy card and other

 

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matters are properly presented for voting at the special meeting, the proxy committee appointed by the TriQuint board (the persons named in your proxy card if you are a stockholder of record) will have the discretion to vote on those matters for you. For additional information on how business can be brought before a meeting, see Section 2.5 of TriQuint’s Second Amended and Restated Bylaws.

Assistance

If you need assistance in completing your proxy card or have questions regarding the TriQuint special meeting, please contact The Proxy Advisory Group, LLC®, the proxy solicitation agent for TriQuint, by mail at 18 East 41st Street, 20th Floor, New York, New York 10017, by telephone at (888) 557-7699 or (888) 55-PROXY (toll free) or (212) 616-2180.

THE RFMD SPECIAL MEETING

This section contains information about the special meeting of RFMD shareholders that has been called to consider and approve the merger agreement, to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement), and to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers.

This joint proxy statement/prospectus is being furnished to the shareholders of RFMD in connection with the solicitation of proxies by the RFMD board for use at the RFMD special meeting. RFMD is first mailing this joint proxy statement/prospectus and accompanying proxy card to its shareholders on or about [], 2014.

Date, Time and Place

A special meeting of the shareholders of RFMD will be held at [] on [], 2014, at [], Eastern time, unless the special meeting is adjourned or postponed.

Purpose

At the special meeting, RFMD shareholders will be asked to consider and vote upon the following matters:

 

    a proposal to approve the merger agreement;

 

    a proposal to approve the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement); and

 

    a proposal to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers contemplated by the merger agreement.

Recommendation of the RFMD Board

The RFMD board has unanimously (a) adopted the merger agreement and approved the completion of the RFMD merger upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the terms of the merger agreement, the RFMD merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, RFMD and its shareholders, (c) directed that the merger agreement be submitted to RFMD shareholders for approval at the RFMD special meeting, (d) recommended that RFMD’s shareholders approve the merger agreement, and (e) declared that the merger agreement is advisable.

The RFMD board unanimously recommends that RFMD shareholders vote:

“FOR” the proposal to approve the merger agreement;

“FOR” the proposal to approve any adjournment of the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement); and

 

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“FOR” the proposal to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers contemplated by the merger agreement.

See “The Mergers — Recommendation of the RFMD Board; RFMD’s Reasons for the Mergers” beginning on page 94.

RFMD shareholders should carefully read this joint proxy statement/prospectus in its entirety for more detailed information concerning the merger agreement, the proposed transactions and certain compensation arrangements for RFMD’s named executive officers in connection with the mergers. In addition, RFMD shareholders are directed to the merger agreement, which is attached as Annex A to this joint proxy statement/prospectus.

Record Date; Shares Entitled to Vote

Only holders of record of shares of RFMD common stock at the close of business on the RFMD record date ([], 2014) will be entitled to vote shares held at that date at the RFMD special meeting or any adjournments or postponements of the RFMD special meeting. Each outstanding share of RFMD common stock entitles its holder to cast one vote.

As of the RFMD record date, [] shares of RFMD common stock were outstanding and entitled to vote at the RFMD special meeting.

Quorum; Broker Non-Votes

The presence, in person or represented by proxy, of holders of a majority in voting power of the RFMD common stock issued and outstanding and entitled to vote at the RFMD special meeting constitutes a quorum. As of the RFMD record date, [] shares of RFMD common stock will be required to achieve a quorum.

Holders of shares of RFMD common stock present in person at the RFMD special meeting but not voting, and shares of RFMD common stock for which RFMD has received proxies indicating that their holders have abstained, will be counted as present at the RFMD special meeting for purposes of determining whether a quorum is established. Broker non-votes, if any, will be counted for purposes of determining whether a quorum exists at the special meeting.

Under the rules that govern brokers who have record ownership of shares that are held in “street name” for their clients, the beneficial owners of the shares, brokers have discretion to vote these shares on routine matters but not on non-routine matters. The approval of the merger agreement is not considered a routine matter, nor are any of the other matters being proposed at the RFMD special meeting. Accordingly, brokers will not have discretionary voting authority to vote your shares on any matter at the RFMD special meeting. A broker non-vote occurs when brokers do not have discretionary voting authority and have not received instructions from the beneficial owners of the shares on a particular non-routine matter. A broker will not be permitted to vote on the proposal to approve the merger agreement, or any other proposal being presented, without instruction from the beneficial owner of the shares of RFMD common stock held by that broker. As a result, shares of RFMD common stock beneficially owned that have been designated on proxy cards by the broker, bank or nominee as not voted on the proposal to approve the merger agreement (broker non-vote) will have the same effect as a vote “AGAINST” the proposal to approve the merger agreement. Broker non-votes will have no effect, however, on the proposal to adjourn the special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement), or the proposal to approve, by non-binding advisory vote, the compensation arrangements for RFMD’s named executive officers in connection with the mergers. If you hold shares of RFMD stock through a broker, bank or other organization with custody of your shares, follow the voting instructions you receive from that organization.

 

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Vote Required

Proposal to Approve the Merger Agreement by RFMD Shareholders: Approving the merger agreement requires the affirmative vote of holders of a majority of the shares of RFMD common stock outstanding and entitled to vote. Accordingly, an RFMD shareholder’s failure to submit a proxy card or to vote in person at the RFMD special meeting, an abstention from voting, or the failure of an RFMD shareholder who holds his, her or its shares in “street name” through a broker or other nominee to give voting instructions to the broker or other nominee, will have the same effect as a vote “AGAINST” the proposal to approve the merger agreement.

Proposal to Adjourn the RFMD Special Meeting by RFMD Shareholders: Approving the adjournment of the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement) requires that the votes “FOR” the proposal to adjourn the RFMD special meeting exceed the votes “AGAINST” such proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to adjourn the RFMD special meeting.

Proposal Regarding Certain RFMD Merger-Related Executive Compensation Arrangements: In accordance with Section 14A of the Exchange Act, RFMD is providing shareholders with the opportunity to approve, by non-binding advisory vote, compensation payments for RFMD’s named executive officers in connection with the mergers, as reported in the section of this joint proxy statement/prospectus entitled “RFMD Proposal No. 3: Advisory Vote to Approve Merger-Related Compensation for RFMD Named Executive Officers” beginning on page 169. Approving this merger-related executive compensation, on a non-binding advisory basis, requires that the votes “FOR” the merger-related compensation proposal exceed the votes “AGAINST” the merger-related compensation proposal. Accordingly, abstentions, broker non-votes and shares not in attendance at the RFMD special meeting will have no effect on the outcome of any vote to approve, on a non-binding advisory basis, the merger-related executive compensation proposal.

Voting by RFMD’s Directors and Executive Officers

As of the RFMD record date, RFMD’s directors and executive officers beneficially owned [] shares of RFMD common stock entitled to vote at the RFMD special meeting. This represents approximately []% in voting power of the outstanding shares of RFMD common stock entitled to be cast at the RFMD special meeting, which is []% less than the vote required to approve the merger agreement. Each RFMD director and executive officer has indicated his or her present intention to vote, or cause to be voted, the shares of RFMD common stock owned by him or her for the proposal to approve the merger agreement.

How to Vote

Registered holders who have shares registered in the owner’s name through our transfer agent may vote only by returning a completed proxy card in the enclosed postage-paid envelope. If your shares are held in “street name,” that is, shares held in the name of a brokerage firm, bank or other nominee, you may receive a voting instruction form from that institution in lieu of a proxy card. In order to lower costs, we have instructed these nominees to send a notice of Internet availability of proxy materials to certain beneficial owners. These beneficial owners will have electronic access to our proxy materials but will not receive paper proxy materials unless they request them as provided for in the notice. The notice or voting instruction form will provide information, if applicable, regarding the process for beneficial owners to vote over the Internet, by telephone or by mail. A large number of banks and brokerage firms provide eligible beneficial owners the opportunity to vote over the Internet or by telephone. The Internet and telephone voting facilities will close at [] [p.m.] Eastern time on [], 2014. The Internet and telephone voting procedures are designed to authenticate the shareholder’s identity and to allow shareholders to vote their shares and confirm that their instructions have been properly recorded. If a voting instruction form does not reference Internet or telephone information, or if you prefer to vote by mail, you may complete and return the paper voting instruction form in the self-addressed, postage-paid envelope provided.

 

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Shareholders who elected to access the proxy statement electronically over the Internet through an arrangement with their brokerage firm, bank or other nominee should receive an email with information on how to access the shareholder information and voting instructions. Shareholders who vote over the Internet or by telephone need not return a proxy card or voting instruction form by mail, but a shareholder may incur costs, such as usage charges, from telephone companies or Internet service providers, for which the shareholder is responsible.

RFMD shareholders of record may also vote their shares in person at the RFMD special meeting. In order to vote shares held in street name in person at the meeting, a proxy issued in the owner’s name must be obtained from the record shareholder (typically the bank, broker or other nominee) and presented at the RFMD special meeting.

Voting of Proxies

If you vote by Internet, by telephone or by completing, signing, dating and mailing your proxy card or voting instruction card, your shares will be voted in accordance with your instructions. If you are a shareholder of record and you sign, date and return your proxy card but do not indicate how you want to vote or do not indicate that you wish to abstain, your shares will be voted “FOR” the proposal to approve the merger agreement, “FOR” the proposal to adjourn the RFMD special meeting (if necessary or appropriate to solicit additional proxies if there are not sufficient votes to approve the merger agreement) and “FOR” the proposal to approve, by non-binding advisory vote, certain compensation arrangements for RFMD’s named executive officers in connection with the mergers, and in the discretion of the proxyholders on any other matter that may properly come before the RFMD special meeting at the discretion of the RFMD board.

Revoking Your Proxy

You may revoke your proxy at any time before it is exercised by filing with our corporate secretary an instrument revoking it, filing a duly executed proxy bearing a later date (including a proxy given over the Internet or by telephone) or by attending the RFMD special meeting and electing to vote in person.

Attending the Special Meeting

Only RFMD shareholders of record, or beneficial owners of RFMD common stock, as of the RFMD record date, may attend the RFMD special meeting in person.

If you decide to attend the RFMD special meeting in person, upon your arrival you will need to register as a visitor with the security desk at []. Please be sure to have picture identification with you at the time of registration. After a determination that you are a registered shareholder of RFMD common stock as of the RFMD record date, you will receive a security pass that will allow you to access the offices of [] and attend the RFMD special meeting. If you are not a registered holder, please be sure that you bring a proxy issued to you in your name by your brokerage firm, bank or other nominee, as well as your picture identification, to present to the security desk at the time of registration.

Householding of Shareholder Materials

Some banks, brokers or other nominee record holders may be participating in the practice of “householding” shareholder documents. This means that only one copy of this joint proxy statement/prospectus may have been sent to multiple shareholders in the same household. RFMD will promptly deliver a separate copy of this joint proxy statement/prospectus to any shareholder upon request submitted in writing to RFMD at the following address: RF Micro Devices, Inc., 7628 Thorndike Road, Greensboro, North Carolina 27409-9421, Attention: Investor Relations Department, or by calling (336) 664-1233. Any shareholder who wants to receive separate copies of RFMD shareholder documents, including annual reports, proxy statements or notice of Internet availability of proxy materials in the future, or who is currently receiving multiple copies and would like to receive only one copy for his or her household, should contact his or her bank, broker or other nominee record holder, or contact RFMD at the above address and telephone number.

 

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Solicitation of Proxies

RFMD is soliciting proxies for the RFMD special meeting from RFMD shareholders. This solicitation is being made by mail and may also be made in person or by fax, telephone or Internet by our officers or employees. We will pay all expenses incurred in this solicitation except that RFMD and TriQuint will share equally the expenses incurred in connection with the printing and mailing of this joint proxy statement/prospectus and filing all solicitation materials with the SEC. RFMD will request banks, brokerage houses and other institutions, nominees and fiduciaries to forward the soliciting material to beneficial owners and to obtain authorization for the execution of proxies. RFMD will, upon request, reimburse these parties for their reasonable expenses in forwarding proxy materials to beneficial owners. We have retained the services of Innisfree M&A Incorporated for a fee of $[] plus out-of-pocket expenses to aid in the distribution of the proxy materials as well as to solicit proxies from institutional investors via telephone on behalf of RFMD.

Other Business

The RFMD board is not aware of any other matters that will be presented for action at the RFMD special meeting. If other matters are properly presented at the RFMD special meeting for consideration, the agents named on the proxy card will have the discretion to vote on those matters for you.

Assistance

If you need assistance in completing your proxy card or have questions regarding the RFMD special meeting, please contact Innisfree M&A Incorporated, the proxy solicitation agent for RFMD, by mail at 501 Madison Avenue, 20th Floor, New York, NY 10022, by telephone at (888) 750-5834 (toll free) or (212) 750-5833 (collect).

 

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THE MERGERS

General

On February 22, 2014, the RFMD board and the TriQuint board each approved the merger agreement, attached hereto as Annex A, which provides for two separate mergers involving RFMD and TriQuint, respectively. First, the merger agreement provides for Trident Merger Sub, Inc., a to-be-formed, wholly owned subsidiary of Rocky Holding, to merge with and into TriQuint, with TriQuint surviving the merger as a wholly owned subsidiary of Rocky Holding. Second, immediately following the completion of the TriQuint merger, the merger agreement provides for the merger of Rocky Merger Sub, Inc., another to-be-formed, wholly owned subsidiary of Rocky Holding, with and into RFMD, with RFMD surviving the merger as a wholly owned subsidiary of Rocky Holding. As a result of the mergers, both of the surviving entities of the TriQuint merger and the RFMD merger will become wholly owned subsidiaries of Rocky Holding, which will be a publicly traded corporation. You are encouraged to read the merger agreement in its entirety, a copy of which is attached as Annex A to this joint proxy statement/prospectus.

At the effective time of the TriQuint merger, which we refer to as the initial effective time, all shares of TriQuint common stock that are held by TriQuint or Trident Merger Sub immediately prior to the initial effective time will be cancelled and cease to exist and no consideration will be paid or payable for those shares. Subject to various restrictions, each share of TriQuint common stock that is outstanding immediately prior to the initial effective time, other than TriQuint excluded shares, will be converted into the right to receive 0.4187 of a share of Rocky Holding common stock. Each share of Trident Merger Sub common stock issued and outstanding immediately prior to the initial effective time will be converted into one share of common stock of the TriQuint surviving corporation.

At the effective time of the RFMD merger, which we refer to as the effective time, all shares of RFMD common stock that are held by RFMD or Rocky Merger Sub immediately prior to the effective time will be cancelled and cease to exist and no consideration will be paid or payable for those shares. Subject to various restrictions, each share of RFMD common stock that is outstanding immediately prior to the effective time, other than RFMD excluded shares, will be converted into the right to receive 0.2500 of a share of Rocky Holding common stock. Each share of Rocky Merger Sub common stock issued and outstanding immediately prior to the effective time will be converted into one share of common stock of the RFMD surviving corporation.

Background of the Mergers

The management and boards of directors of RFMD and TriQuint have regularly reviewed their respective companies’ results of operations and competitive positions in the markets in which they operate as well as their respective strategic options in light of company-specific and industry conditions, among other things, including whether the continued execution of their respective strategies as stand-alone companies or the possible combination with a third party offers the best avenue to enhance stockholder value.

RFMD and TriQuint were familiar with each other both as participants in the RF market and through a series of foundry services arrangements dating back to the early 1990s and continuing today under which TriQuint has provided RFMD with GaAs MESFET and pHEMT products for various RFMD-designed products. More recently, the two companies have preliminarily explored the possibility of TriQuint supplying various filter products to RFMD. Over the years of the two companies’ association, executives from the companies periodically discussed the RF market generally.

Between spring 2009 and early 2013, representatives of TriQuint and RFMD, primarily Bob Bruggeworth, President and Chief Executive Officer of RFMD, and Ralph Quinsey, Chief Executive Officer of TriQuint, communicated by telephone and met informally on approximately eight occasions. Their meetings included informal breakfast, lunch or dinner meetings in various cities at which they discussed their respective views on trends in the RF market and potential opportunities for a strategic business combination between the two companies. They also exchanged overviews of each company’s businesses, including manufacturing facilities and capabilities, and they discussed possible cost saving synergies that might be realized from a business combination.

 

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On February 25, 2013, Mr. Quinsey and Mr. Bruggeworth met at the Mobile World Congress in Barcelona, Spain and decided to reopen some of their earlier discussions and meet again to discuss a potential strategic transaction. Mr. Quinsey broached the concept of a transaction that would create two separate companies, one focused on the mobile market and one focused on the infrastructure and defense markets.

During the same week, also at Mobile World Congress, Mr. Quinsey met with the CEO of a third party, referred to as Company B, and mentioned a similar transaction concept. At that time, Mr. Quinsey and the CEO of Company B had a preexisting general business relationship and had participated in several informal conversations over the years.

On March 18, 2013, Mr. Bruggeworth and Mr. Quinsey met in Los Angeles, California for approximately one hour. Following their discussion, each confirmed a continued interest in a potential transaction, but also that points of disagreement prevented any serious discussion of a potential transaction at this time.

At its regularly scheduled board of directors meeting on March 20-21, 2013, Mr. Bruggeworth briefed the RFMD board on his recent meetings with Mr. Quinsey, the strategic advantages to completing a business combination of the two companies and the current impediments to reaching an agreement on the structure and terms of a transaction to complete such a business combination. Based on this briefing, the RFMD board authorized Mr. Bruggeworth to deliver a private letter to the TriQuint board outlining RFMD’s interest in a strategic transaction and the financial case for a business combination of the two companies.

On April 3, 2013, RFMD delivered a letter from Mr. Bruggeworth to Mr. Quinsey formally communicating RFMD’s interest in pursuing a strategic transaction with TriQuint and outlining the potential structure and terms of a proposed transaction. In this letter, RFMD proposed an all stock acquisition of TriQuint via merger at an exchange ratio of 0.9226 shares of RFMD stock for each share of TriQuint common stock, which reflected the then market price of TriQuint common stock relative to RFMD common stock without any discount or premium, and proposed the creation of two market-focused companies. The letter requested a meeting with Mr. Quinsey and Mr. Bruggeworth and Walter Wilkinson, Jr., RFMD’s Chairman of the Board, and also requested a response by April 17, 2013.

Mr. Quinsey provided a copy of the RFMD letter to the TriQuint board via email on April 6, 2013. On April 12, 2013, at a telephonic special meeting of the TriQuint board, the TriQuint board discussed the proposal set forth in RFMD’s letter. Following a presentation by Steven Buhaly, TriQuint’s Chief Financial Officer, the TriQuint board discussed TriQuint’s current market valuation, factors likely to affect valuation, market dynamics and TriQuint’s position relative to its major competitors. The TriQuint board also discussed a response to RFMD’s letter and determined that the proposal did not appropriately reflect TriQuint’s relative value and, in particular, did not ascribe appropriate value to TriQuint’s infrastructure and defense business.

On April 16, 2013, Mr. Quinsey called and informed Mr. Bruggeworth that the TriQuint board had considered the proposal outlined in the April 3 letter and declined to move forward for the reasons identified by the TriQuint board.

On May 14, 2013, at a regular meeting of the TriQuint board, representatives of Goldman Sachs, who were present at the meeting at the invitation of TriQuint management, and pursuant to the terms of an indemnification letter agreement between Goldman Sachs and TriQuint, presented a general overview, and participated in a discussion with the TriQuint board, TriQuint management and Perkins Coie LLP, who we refer to as Perkins Coie, regarding TriQuint’s historical financial performance, valuation, potential strategic alternatives and stockholder activism issues. A representative of Perkins Coie provided legal advice regarding potential strategic alternatives and advised the TriQuint board of its fiduciary duties.

At the regularly scheduled RFMD board meeting on May 15-16, 2013, Mr. Bruggeworth briefed the RFMD board on TriQuint’s response to the April 3 letter and his conversations with Mr. Quinsey regarding the same. Mr. Bruggeworth reported he had an upcoming dinner with Mr. Quinsey at which he planned to discuss the response in more detail.

 

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On May 28, 2013, Mr. Quinsey and Mr. Bruggeworth met for dinner in New York and reviewed the points of disagreement between the parties. The meeting concluded with an understanding that the parties would renew contact after each company had announced its June quarterly earnings results in July.

On June 5, 2013, the CEO of Company B delivered an unsolicited letter to Mr. Quinsey and the TriQuint board, setting forth Company B’s offer to acquire TriQuint in an all-cash transaction at a per share price of $8.25 per share of TriQuint common stock, reflecting an 18% premium to TriQuint’s then-current market price. Mr. Quinsey provided the letter to the TriQuint board via email on June 6, 2013.

At a telephonic special meeting of the TriQuint board held on June 11, 2013, Mr. Quinsey presented Company B’s proposal to the TriQuint board. The TriQuint board discussed Company B’s proposal and the proposed valuation relative to ranges of potential value for TriQuint, and also discussed the prior proposal from RFMD as well as TriQuint’s strategic plan on a stand-alone basis. A representative of Perkins Coie provided legal advice regarding the TriQuint board’s fiduciary duties with respect to the proposal. Following its discussion, the TriQuint board determined not to pursue a sale at that time. Following the meeting, Mr. Quinsey called Company B’s CEO and informed him of the TriQuint board’s decision.

On June 19, 2013, while attending a semiconductor industry conference sponsored by McKinsey & Co. at the CordeValle Resort in California, Mr. Bruggeworth had an unscheduled discussion with Wally Rhines, a TriQuint director, regarding their respective views concerning the RF industry trends and the potential strategic merits of a business combination between the two companies.

On July 26, 2013, Mr. Quinsey and Mr. Bruggeworth spoke briefly by telephone and agreed to set up a meeting in order to reopen discussions regarding a potential strategic transaction between RFMD and TriQuint.

On August 7, 2013, at a regular meeting of the TriQuint board, the TriQuint board discussed, with management and representatives of Perkins Coie, potential strategic alternatives available to TriQuint as well as various considerations with respect to these alternatives, and Mr. Rhines briefed the TriQuint board regarding his discussion with Mr. Bruggeworth. A representative of Perkins Coie advised the TriQuint board of its fiduciary duties with respect to potential strategic alternatives. Following these discussions, the TriQuint board authorized management to take additional steps to assess the viability and possible advantages of potential transactions.

At its regularly scheduled board of directors meeting on August 14-15, 2013, Mr. Bruggeworth briefed the RFMD board on his recent conversations with Mr. Quinsey and Mr. Rhines, and Dean Priddy, RFMD’s Chief Financial Officer, briefed the RFMD board on certain financial aspects of a potential transaction with TriQuint. Mr. Bruggeworth reported that he had an upcoming meeting with Mr. Quinsey in order to continue discussions, which the RFMD board encouraged.

On August 22, 2013, Mr. Quinsey and Mr. Bruggeworth met for dinner in Portland and continued their discussions regarding a potential business combination of RFMD and TriQuint, and, based on progress regarding relative valuation, agreed to schedule a more formal meeting involving several members of the boards of directors of each company to discuss a potential transaction during that dinner. Mr. Quinsey and Mr. Bruggeworth also discussed a potential “merger of equals” structure in which each company’s stockholders would own approximately 50% of a combined company. They had subsequent phone conversations regarding the agenda, ground rules and format for this meeting and agreed to execute a mutual nondisclosure agreement to facilitate the free exchange of information at this meeting, which was signed on September 9, 2013.

On September 9, 2013, Mr. Quinsey, Mr. Buhaly, Steven Sharp, TriQuint’s Chairman of the Board, and Scott Gibson, another member of the TriQuint board, met in San Francisco with Mr. Bruggeworth, Mr. Priddy , Mr. Wilkinson, RFMD’s Chairman of the Board, and Jack Harding, another member of the RFMD board, over a social introductory dinner. The following day, the same parties met for approximately three hours, during which time each group gave presentations regarding its company and the parties then discussed the merits of a potential

 

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combination of the two companies. The parties agreed to continue their discussions, and TriQuint indicated it would be engaging Goldman Sachs to assist it as its financial advisor. The parties also agreed to authorize their financial advisors to begin a dialogue regarding the overall framework for a potential business combination of the two companies.

At its regularly scheduled board of directors meeting on September 19, 2013, Messrs. Bruggeworth, Wilkinson and Harding briefed RFMD’s other board members regarding the San Francisco meeting.

On October 10, 2013, at the direction of the boards of directors of RFMD and TriQuint, respectively, representatives of BofA Merrill Lynch, RFMD’s financial advisor, and Goldman Sachs, TriQuint’s financial advisor, held an introductory call and developed a framework for next steps. The representatives agreed to schedule an in-person meeting in San Francisco between the parties and their financial advisors to coincide with RFMD’s upcoming November board meeting in Palo Alto, California.

On October 16, 2013, at the direction of the boards of directors of RFMD and TriQuint, respectively, representatives of BofA Merrill Lynch and Goldman Sachs began discussing key terms of a potential transaction, including the concept of structuring the transaction as a “merger of equals” in which the shareholders of each party would own approximately 50% of the combined company. It was further understood that any transaction should be structured to permit the potential future spin-off of either the mobile or infrastructure and defense products businesses of the combined company, but such a spin-off would not be a condition to completing a combination transaction.

On October 18, 2013, Messrs. Bruggeworth, Priddy, Quinsey and Buhaly participated in a conference call in which they developed an agenda for the upcoming meeting to be held in San Francisco, and on October 23, 2013, the financial advisors to TriQuint and RFMD discussed by telephone the agreed agenda for the meeting.

On October 25 and November 1, 2013, Messrs. Quinsey, Buhaly, Bruggeworth and Priddy met by telephone to discuss preparation for the upcoming meeting in San Francisco.

On October 28, 2013, RFMD signed an engagement letter with BofA Merrill Lynch covering financial advisory services for the potential business combination with TriQuint.

Following the delivery of the publicly released letter from Starboard Value LP, which we refer to as Starboard, to TriQuint on October 29, 2013, Mr. Quinsey called Mr. Bruggeworth the same day to inform him of the letter, and representatives of BofA Merrill Lynch and Goldman Sachs, at the direction of the boards of directors of RFMD and TriQuint, respectively, participated in a conference call on October 31, 2013 to discuss the potential ramifications of the letter on a possible transaction between RFMD and TriQuint.

At a special telephonic meeting of the RFMD board held on November 6, 2013, the RFMD board ratified the execution of the engagement letter with BofA Merrill Lynch and Mr. Bruggeworth briefed the RFMD board on his recent contacts with Mr. Quinsey and the ongoing conversations between Messrs. Bruggeworth, Priddy, Quinsey and Buhaly regarding the upcoming San Francisco meeting. The RFMD board reviewed the potential structure of the potential business combination and discussed the status of the resolution of various management issues related to such a transaction.

At a regularly scheduled meeting of the TriQuint board held on November 6-7, 2013, representatives of Goldman Sachs discussed strategic alternatives available to TriQuint and the potential factors likely to affect those alternatives over the near-to-intermediate term, as well as the potential structure and value of a potential transaction with RFMD compared to TriQuint’s stand-alone value. Goldman Sachs representatives also addressed the potential interest of other parties in an acquisition of TriQuint. A representative of Perkins Coie reviewed the TriQuint board’s fiduciary duties under various scenarios, including a potential combination with RFMD. The TriQuint board discussed the potential benefits to TriQuint’s stockholders that could be achieved in a combination with RFMD, as well as potential alternatives for enhancing stockholder value.

 

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On November 11, 2013, Mr. Bruggeworth and Mr. Quinsey met in San Francisco to discuss the proposed structure and terms of the potential business combination. Mr. Bruggeworth and Mr. Quinsey discussed several key points of the transaction including relative value, key management positions and board composition of the combined entity.

On November 12, 2013, Messrs. Bruggeworth, Priddy, Quinsey and Buhaly, together with representatives of Goldman Sachs and BofA Merrill Lynch, had a conference call on which they discussed the results of the November 11 meeting and preparations for the San Francisco meeting scheduled for November 15, 2013.

On November 12, 2013, at a telephonic special meeting of the TriQuint board, Mr. Quinsey reported on his recent conversations with Mr. Bruggeworth and the parties’ general concurrence on specified fundamental terms of the potential combination, including relative ownership of each company’s stockholders and likely board and management structure. The TriQuint board discussed with representatives of Goldman Sachs and Perkins Coie a potential process pursuant to which TriQuint would contact Company B to determine its potential interest in a transaction with TriQuint. The TriQuint board discussed TriQuint’s prior history with Company B and the proposed process, timing, advantages and risks of contacting additional parties or broadening the market check. The TriQuint board agreed to authorize representatives of Goldman Sachs to contact Company B, but determined that the risks to a potential RFMD transaction, and risks to TriQuint within the commercial marketplace, of broader communication to parties other than Company B outweighed the potential advantages of such a broader communication plan. A representative of Perkins Coie discussed the TriQuint board’s fiduciary duties in the context of the potential transaction with RFMD and alternative transactions.

At RFMD’s regularly scheduled board of directors meeting in Palo Alto, California on November 13, 2013, Mr. Bruggeworth briefed the RFMD board on his most recent conversations with Mr. Quinsey, including the results of his meeting with Mr. Quinsey on November 11, 2013 and the discussion between the parties on the structure and terms of the potential business combination. During the second day of the RFMD board meeting on November 14, 2013, representatives of BofA Merrill Lynch reviewed certain financial aspects of the potential transaction. At the conclusion of its two-day board meeting and these presentations, the RFMD board determined to move forward with the process towards agreeing on the terms of a potential transaction.

On the evening of November 14, 2013, Messrs. Bruggeworth, Priddy, Wilkinson and Harding representing RFMD and Messrs. Quinsey, Buhaly, Sharp and Gibson representing TriQuint met for dinner in San Francisco in preparation for a joint meeting the following day.

On November 15, 2013, the same individuals, together with representatives of their respective financial advisors, met in San Francisco to discuss the rationale for the potential transaction, an analysis of potential synergies developed by the respective management teams and other benefits and related preliminary financial analysis of the combination. At this meeting, Mr. Quinsey informed Messrs. Bruggeworth and Wilkinson that the TriQuint board determined to inquire about a third party’s (Company B) potential interest in a transaction in light of its prior interest.

On November 17, 2013, RFMD delivered a proposed term sheet to TriQuint prepared by its legal counsel, Weil Gotshal, outlining the proposed terms of a business combination and requesting an exclusive right to negotiate the transaction for a period of 30 days.

Also on November 17, 2013, Mr. Quinsey had a telephone conversation with the CEO of Company B regarding Company B’s potential interest in re-engaging in acquisition discussions, with another brief follow-up telephone call between the two on November 18, 2013.

On November 18, 2013, representatives of RFMD and TriQuint and their respective financial and legal advisors participated in an organizational conference call regarding the potential transaction, including a discussion regarding the proposed timeline for the overall transaction and the due diligence process to be followed by the parties, including areas of focus.

 

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On November 19, 2013, Mr. Quinsey and Mr. Bruggeworth had a brief telephone conversation regarding the proposed term sheet and potential issues from TriQuint’s perspective regarding granting exclusive negotiation rights to RFMD.

Also on November 19, 2013, Mr. Quinsey received a letter dated November 18, 2013 from Company B, which included a non-binding indication of interest to acquire TriQuint for a purchase price of $10.00 per share of TriQuint common stock, comprised of a mix of 50% cash and 50% stock, which price represented a 33% premium to TriQuint’s then-current market price. Mr. Quinsey provided the letter to the TriQuint board via email on the same day.

At a special telephonic meeting of the RFMD board held on November 19, 2013, Mr. Bruggeworth briefed the RFMD board on the results of the meeting held on November 15, 2013 between representatives of RFMD and TriQuint and their financial advisors and summarized his follow-up conversations with Mr. Quinsey over the weekend of November 15-17, the results of the organizational call between the two companies, the proposed due diligence process and the proposed timeline for the transaction.

Also on November 19, at a telephonic special meeting of the TriQuint board, Mr. Quinsey described his recent conversation with Company B’s CEO and the resulting proposal from Company B. He also described the organizational call with RFMD and the parties’ financial advisors and the proposed due diligence process and timeline. Representatives of Goldman Sachs discussed various financial analyses with respect to the potential transaction with RFMD and Company B’s most recent proposal. The TriQuint board discussed various scenarios that could develop with RFMD and Company B, and representatives of Goldman Sachs and Perkins Coie responded to the board’s questions. A representative of Perkins Coie also advised the TriQuint board of its fiduciary duties in the context of the potential transactions. The TriQuint board also discussed RFMD’s request for exclusivity and determined it was not appropriate to grant exclusivity at that time.

On November 20, 2013, Mr. Quinsey reported to Mr. Bruggeworth that TriQuint was unwilling to grant exclusivity to RFMD.

Also on November 20, 2013, Mr. Quinsey and the CEO of Company B had a telephone conversation during which Mr. Quinsey answered follow up questions about TriQuint from the previous call and asked for more specific information regarding some areas of Company B’s proposal. On November 21, 2013, TriQuint signed a non-disclosure agreement with Company B containing standstill restrictions that would terminate upon the occurrence of specified events, including TriQuint’s entry into an agreement that would result in the acquisition of 50% or more of its voting securities by any third party, and received an updated non-binding indication of interest from Company B. The updated letter re-affirmed the prior offer of $10.00 per share of TriQuint common stock, comprised of a mix of 50% cash and 50% stock, and included additional proposed terms, including specified closing conditions and a proposed timeline. The offer letter also requested a 30-day exclusivity period.

Commencing on November 21, 2013, TriQuint and RFMD began posting due diligence materials into separate virtual data rooms, and on November 26 the parties provided access to each other’s data room and began conducting due diligence investigations of each other. The due diligence review, which included numerous calls and meetings between representatives of the two companies and their respective financial advisors and legal advisors, continued until the potential transaction was initially abandoned on December 13, 2013. On December 4 and December 5, 2013, representatives of TriQuint and RFMD, together with their respective financial advisors, attended due diligence meetings in Dallas, Texas.

On November 22, 2013, Mr. Quinsey and Mr. Buhaly met by telephone with the CEO and CFO of Company B regarding an overview of TriQuint’s business and operations, with a follow-up telephone conversation between Mr. Quinsey and Company B’s CEO on November 23, 2013. Representatives of Goldman Sachs had a telephone conference with Company B’s financial advisor on November 23, 2013 to discuss process and next steps for a potential transaction with Company B.

On November 24-26, 2013, Company B’s financial advisor provided representatives of Goldman Sachs with a summary of key due diligence points, Company B’s legal counsel provided Perkins Coie with an initial due diligence request, and Company B was provided initial access to another TriQuint virtual data site. Additional due diligence materials were disclosed by TriQuint to Company B during the week of December 2, 2013.

 

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On November 24, 2013, representatives of Goldman Sachs provided Company B’s financial advisor with an initial draft of the definitive agreement for a potential transaction between TriQuint and Company B, as prepared by Perkins Coie.

At a telephonic special meeting of the TriQuint board held on November 26, 2013, representatives of Goldman Sachs reviewed the status of discussions with RFMD and the terms of the proposal from Company B, and a discussion ensued regarding a framework to assist in evaluating the two potential transactions. A representative of Perkins Coie reviewed the TriQuint board’s fiduciary duties with respect to the exclusivity requests. The TriQuint board discussed the exclusivity request from RFMD and the proposed consideration mix of Company B’s offer. Mr. Quinsey also presented information to the TriQuint board regarding analyses of potential synergies under both transactions.

At a special telephonic meeting of the RFMD board held on November 26, 2013, representatives of Weil Gotshal and Womble Carlyle Sandridge & Rice, LLP, which we refer to as Womble Carlyle, gave a presentation to the RFMD board on its fiduciary duties in the context of the potential transaction with TriQuint. Mr. Bruggeworth briefed the board on his recent conversations with Mr. Quinsey, including board composition and personnel-related matters. Mr. Bruggeworth also briefed the board on the status of ongoing due diligence. A representative of Weil Gotshal gave an overview of the terms of the proposed definitive merger agreement with TriQuint and representatives of Weil Gotshal and Womble Carlyle briefed the board on intellectual property due diligence matters.

On November 27, 2013, representatives of Weil Gotshal distributed to representatives of Perkins Coie a draft definitive agreement for the potential transaction with RFMD.

On December 2, 2013, Company B’s financial advisor provided representatives of Goldman Sachs with a high-level summary of key issues regarding the proposed transaction between Company B and TriQuint. On the same day representatives of Goldman Sachs and Company B’s financial advisor had a telephone conference regarding a transaction timeline and process.

At a special telephonic meeting of the RFMD board held on December 3, 2013, Mr. Bruggeworth provided an update on the status of the proposed definitive merger agreement and ongoing due diligence efforts and representatives of Weil Gotshal and Womble Carlyle led a discussion of the key due diligence matters.

On December 3, 2013, at a telephonic special meeting of the TriQuint board, representatives of Goldman Sachs, Perkins Coie and management and the TriQuint board engaged in a discussion regarding the two potential transactions, including valuation, potential synergies identified by TriQuint management, potential future upside to stockholders, deal certainty, regulatory issues, financing, and closing timelines. The TriQuint board also reviewed TriQuint’s stand-alone financial plan, and authorized management to formally engage Goldman Sachs pursuant to an engagement letter, which was executed that day. A representative of Perkins Coie also advised the TriQuint board of its fiduciary duties in the context of the potential transactions.

On December 4, 2013, Company B’s financial advisors provided representatives of Goldman Sachs with a supplemental due diligence request, and on December 6, 2013, representatives of TriQuint and Company B and their respective financial advisors met in San Francisco for a day of in-person due diligence meetings.

At a telephonic special meeting of the TriQuint board held on December 7, 2013, representatives of Goldman Sachs, Perkins Coie and management and the TriQuint board engaged in a discussion regarding the two potential transactions, including the results of the most recent due diligence meetings with RFMD and Company B, the potential synergies identified by TriQuint management (including both the magnitude and the timing of realization), and the general impressions of and potential fit with each company. The TriQuint board also discussed, with input from representatives of Goldman Sachs and management, and with legal advice from representatives of Perkins Coie, the advantages and risks of inquiries to other potentially interested parties.

 

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Between December 9 and December 12, 2013, representatives of Perkins Coie, Weil Gotshal and Womble Carlyle participated in negotiation conversations via telephone and exchanged several drafts of the proposed definitive agreement between TriQuint and RFMD.

At a special telephonic meeting of the RFMD board held on December 10, 2013, Mr. Bruggeworth briefed the board on the results to date of RFMD’s due diligence investigation of TriQuint, the proposed timing for completion and announcement of the transaction and potential issues that could interfere with completion of the transaction. At this meeting, a representative of Weil Gotshal summarized the status of negotiations of the definitive merger agreement, including the terms of the proposed deal protection provisions and how those provisions would operate under hypothetical scenarios.

Between December 8 and December 10, 2013, representatives of Goldman Sachs discussed timing and process with Company B’s financial advisor by telephone, Company B’s legal counsel provided representatives of Perkins Coie with a markup of the proposed definitive agreement between TriQuint and Company B, and representatives of Perkins Coie returned a further revised definitive agreement draft to Company B’s legal counsel. Representatives of Perkins Coie also participated in negotiation discussions with Company B’s legal counsel via telephone during the same time period.

At a telephonic special meeting of the TriQuint board held on December 10, 2013, Mr. Quinsey presented TriQuint’s long-range financial forecast and also briefed the TriQuint board on the recent meetings with representatives of both RFMD and Company B. Mr. Quinsey shared TriQuint management’s view that the potential synergies to be obtained from a transaction with RFMD likely would be higher than previously believed. Representatives of Goldman Sachs discussed financial analyses with respect to TriQuint on a stand-alone basis, the pro forma combined results of TriQuint and RFMD, and the potential transaction with Company B. The TriQuint board also discussed with management and representatives of Goldman Sachs other potentially interested parties, business considerations likely to affect those parties’ level of interest, and the risks and benefits of contacting one or more of those parties. The TriQuint board also discussed the potential alternative of not pursuing a current transaction with any party and instead waiting until the market had greater visibility into TriQuint’s anticipated performance in 2014. Representatives of Perkins Coie provided legal advice to the TriQuint board on related matters.

On December 11-12, 2013, representatives of TriQuint, Company B and their respective advisors met in Palo Alto regarding supplemental due diligence, and Perkins Coie provided an initial disclosure schedule to Company B’s legal counsel. On December 13, 2013, Company B provided Mr. Quinsey with an updated letter, which re-affirmed the prior non-binding indication of interest of $10.00 per share of TriQuint common stock, comprised of a mix of 50% cash and 50% stock. The letter also requested a 10-day exclusivity period.

At a telephonic special meeting of the TriQuint board held on December 13, 2013, Mr. Quinsey reviewed the background of, and rationale for, a potential transaction with RFMD, including the then currently proposed terms of the transaction, and reasons for having made the inquiry to Company B, as well as the status of, and opportunities presented by, both transactions. Representatives of Goldman Sachs discussed the financial analyses of the potential transactions, and representatives of Perkins Coie discussed the terms of both proposed definitive agreements and the relative risks and potential issues of the transactions from an antitrust regulatory perspective. The TriQuint board discussed these analyses along with numerous other considerations, including the potential of revisiting a transaction with RFMD at a future time. The TriQuint board concluded that it was unwilling to approve the proposed transaction with RFMD based, in part, on concerns regarding the potential market reaction to the transaction in light of both RFMD’s and TriQuint’s expected near-term financial results. The TriQuint board also directed Mr. Quinsey to request Company B to improve its existing offer.

At a special telephonic meeting of the RFMD board held in the evening of December 13, 2013, the RFMD board met to discuss approval of the proposed transaction. Members of RFMD management and representatives of RFMD’s legal advisors and financial advisors participated at the meeting. Representatives of Weil Gotshal updated the RFMD board on the terms of the proposed definitive merger agreement, including changes since

 

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December 10. At that meeting, BofA Merrill Lynch reviewed certain financial analyses regarding the proposed transaction and rendered its oral opinion to the RFMD board to the effect that as of December 13, 2013 and based on and subject to various assumptions and limitations described in its draft opinion, taking into account the RFMD merger and the TriQuint merger provided for in the proposed merger agreement, the RFMD exchange ratio provided for in the proposed merger agreement was fair, from a financial point of view, to the holders of RFMD common stock (excluding RFMD, TriQuint and their respective affiliates). After discussion, the RFMD board, acting unanimously, determined that the proposed business combination with TriQuint, including the RFMD merger, was advisable and fair to, and in the best interests of, RFMD and its shareholders, approved the merger agreement, the RFMD merger and other contemplated transactions and resolved to recommend that RFMD shareholders vote in favor of the merger.

Following the RFMD board meeting, later on the evening of December 13, 2013, Mr. Quinsey contacted Mr. Bruggeworth and reported the decision of the TriQuint board, which had been meeting that day and evening to consider the proposed business combination. Following this communication, the parties abandoned all discussions and work on the transaction and closed the due diligence data sites.

Following the TriQuint board meeting on December 13, 2013, Mr. Quinsey placed a telephone call to the CEO of Company B, indicating that Company B must increase its offer in order for the TriQuint board to consider moving forward with its proposal.

On December 14, 2013, at a telephonic special meeting of the TriQuint board, Mr. Quinsey discussed the recent communications with each of RFMD and Company B following the prior TriQuint board meeting. The TriQuint board discussed, with input from Mr. Quinsey and representatives of Goldman Sachs, potential changes to the structure of a transaction with Company B and an increase in the proposed price, in each case that might represent a more attractive value to TriQuint’s stockholders. The TriQuint board continued to discuss the proposed transaction with Company B compared with continued implementation of TriQuint’s strategic plan, including potentially pursuing a different transaction in the future.

On December 15, 2013, Company B’s financial advisor verbally indicated to representatives of Goldman Sachs that Company B would be willing to increase its offer to $10.10 per share of TriQuint common stock, with all other aspects of the offer remaining the same. Later on December 15, the TriQuint board held a telephonic special meeting to discuss the revised offer from Company B. The TriQuint board discussed at length, with input from representatives of Goldman Sachs, different valuation outcomes based on current market expectations for TriQuint and RFMD as well as information from management regarding the anticipated results of both companies. During this special meeting, the TriQuint board discussed TriQuint’s ability to pursue a transaction with RFMD sometime in the first half of 2014.

The TriQuint board held a telephonic special meeting on December 17, 2013, to continue its discussions regarding revisiting the potential transaction with RFMD, the last offer received from Company B, and TriQuint’s current prospects and business. A representative of Perkins Coie provided legal advice to the TriQuint board on related matters. The TriQuint board determined to continue to review TriQuint’s strategic alternatives, but not to proceed with either the RFMD or Company B transactions at that time.

At a special telephonic meeting of the RFMD board held on December 17, 2013, Mr. Bruggeworth reviewed additional feedback from RFMD’s legal and financial advisors regarding the decision by TriQuint not to proceed with a business combination.

Between December 17, 2013 and late January 2014, Company B’s financial advisor contacted representatives of Goldman Sachs twice to inquire whether the TriQuint board’s views had changed, and during this period the TriQuint board continued generally to discuss strategic alternatives available to TriQuint.

On January 28, 2014, representatives of Goldman Sachs received an unsolicited inquiry from a third party, expressing interest in acquiring a portion of TriQuint’s current business. Representatives of Goldman Sachs received a subsequent unsolicited inquiry from a different third party, Company C, on January 31, 2014, expressing preliminary interest in an acquisition of TriQuint in its entirety.

 

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On January 31, 2014, at the request of Starboard, representatives of Starboard met with Mr. Priddy and Mr. Bruggeworth at RFMD’s facilities in Greensboro, North Carolina. Following a tour of RFMD’s wafer fabrication facilities, representatives of Starboard gave a presentation to Mr. Bruggeworth and Mr. Priddy endorsing the strategic rationale for a merger of RFMD and TriQuint. In this presentation, Starboard outlined three potential transaction structures and the benefits of each structure. Because RFMD was subject to a written nondisclosure agreement with TriQuint, Mr. Bruggeworth and Mr. Priddy did not disclose to Starboard any information regarding RFMD’s previous negotiations with TriQuint regarding the transaction that was abandoned in December 2013.

On February 3, 2014, Mr. Bruggeworth called Mr. Quinsey to inform him of the meeting with Starboard on January 31, 2014.

On February 4, 2014, Mr. Quinsey called the CEO of Company B to schedule a general business update for the following week, and on February 5, 2014, a representative of Company C contacted Mr. Quinsey to set up an introductory meeting.

On February 7, 2014, at the direction of the boards of directors of TriQuint and RFMD, respectively, representatives of Goldman Sachs spoke with RFMD’s financial advisor by telephone regarding readiness to re-engage in transaction discussions and also spoke with Company B’s financial advisor regarding the re-engagement process and the status of due diligence.

On February 11, 2014, Mr. Quinsey and Mr. Buhaly participated in a telephone call with representatives of Company C to discuss TriQuint’s business and a potential transaction process, and Mr. Quinsey also requested that Company C submit any offer no later than February 18, 2014. Also on February 11, 2014, a media report indicated that TriQuint was rumored to have hired Goldman Sachs as a financial advisor.

At a regular meeting of the TriQuint board held on February 12, 2014, representatives of Goldman Sachs updated the TriQuint board on conversations with potential strategic counterparties, including separate discussions with the financial advisors of both RFMD and Company B and a due diligence telephone conference with Company C. The Goldman Sachs representatives also discussed updated financial analyses with respect to a potential transaction with RFMD and reviewed with the TriQuint board the informal inquiries received from Company C and the other strategic party. A representative of Perkins Coie advised the TriQuint board regarding its fiduciary duties.

Between February 12 and February 18, 2014, representatives of Goldman Sachs received several additional inquiries regarding TriQuint, each of which was either preliminary in nature or related to the potential acquisition of one or more portions of TriQuint’s current business.

On February 12, 2014, Mr. Quinsey contacted Mr. Bruggeworth and indicated an interest in resuming discussions regarding a potential business combination of the two companies on the same terms as previously pursued. On February 14, 2014, following consultation with RFMD’s legal advisors and financial advisors, Mr. Bruggeworth contacted Mr. Quinsey and reported that RFMD was unwilling to move forward with negotiating a transaction absent a mutual agreement by the parties to negotiate with each other on an exclusive basis until February 28, 2014. On the same day, at the direction of the RFMD board, BofA Merrill Lynch delivered to representatives of Goldman Sachs a proposed mutual non-solicitation agreement embodying this concept.

On February 13, 2014, representatives of TriQuint and Company B attended a telephone conference to refresh each company’s prior due diligence.

On February 14, 2014, TriQuint and Company C signed a non-disclosure agreement containing standstill restrictions that would terminate upon the occurrence of specified events, including TriQuint’s entry into an agreement that would result in the acquisition of 50% or more of its voting securities by any third party, and on the following day, Mr. Quinsey and representatives of Goldman Sachs called a representative of Company C and emphasized that any offer made by Company C should be detailed and specific in light of TriQuint’s involvement in another negotiation. On February 18, 2014, Company C delivered a letter to TriQuint that did not contain an offer and only indicated an interest in completing at least 30 days of due diligence.

 

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At a special telephonic meeting of the RFMD board held on February 15, 2014, Mr. Bruggeworth briefed the board on his recent conversations with Mr. Quinsey regarding potentially restarting negotiations. A representative of Weil Gotshal discussed the terms of a potential exclusivity agreement with TriQuint and the RFMD board considered whether any intervening circumstances since December 2013 should cause RFMD to reconsider moving forward with the transaction as a whole or seek additional or different terms. Based on the discussion, the RFMD board supported moving forward on the previously discussed terms, subject to obtaining exclusive negotiating rights.

On February 18, 2014, Company B’s financial advisor informed representatives of Goldman Sachs that it would not re-affirm its last offer from December 15, 2013 and had determined to withdraw from the process.

At a telephonic special meeting of the TriQuint board held on February 18, 2014, representatives of Goldman Sachs reviewed the results of recent discussions with representatives of RFMD and recent developments with Company B and Company C, as well as the inquiries received from other parties, all of which were of a tentative and preliminary nature. The TriQuint board discussed, with input from representatives of Goldman Sachs and management, and legal advice from representatives of Perkins Coie, the potential risks and benefits of continued discussions with Company C, the anticipated regulatory risks associated with a potential transaction with Company C, the risks of losing the ability to pursue a transaction with RFMD, and potential additional synergies between RFMD and TriQuint. Representatives of Goldman Sachs and Perkins Coie reviewed with the TriQuint board the open issues in negotiations with RFMD, and the TriQuint board determined to pursue a business combination with RFMD.

At RFMD’s regularly scheduled board of directors meeting on February 19, 2014, representatives of BofA Merrill Lynch reported on their discussions with representatives of Goldman Sachs from earlier that day, in which the Goldman Sachs representatives indicated TriQuint was willing to move forward with completing a transaction on the previously agreed terms, but would not grant RFMD exclusive negotiation rights and would require a right to terminate the merger agreement if it received a superior offer. Later that day, following additional conversations between the parties’ financial advisors, at the direction of the respective boards of directors of RFMD and TriQuint, the RFMD board reconvened with its financial advisors and legal advisors and discussed a response to TriQuint’s new conditions. Following discussion with its advisors, the RFMD board accepted TriQuint’s proposed terms, subject to negotiation of a termination fee that would fairly compensate RFMD for the increased risk that a transaction would not close.

Beginning February 20, 2014, the parties began active work to complete the transaction. The parties reopened the due diligence data sites and posted updated materials, conducted a joint due diligence call on February 20, 2014 and exchanged final disclosure schedules on February 22, 2014. Following a telephone conversation among representatives of Perkins Coie and Weil Gotshal to discuss open issues, a revised merger agreement was distributed on February 20, 2014 by Perkins Coie and responsive comments were delivered later that day by Weil Gotshal. Representatives of Weil Gotshal provided a further revised draft on February 21, 2014. Because the merger agreement was nearly complete in December, the parties were able to complete negotiation of the remaining open issues in several days.

At a telephonic special meeting of the TriQuint board held on February 21, 2014, management and representatives of Goldman Sachs briefed the TriQuint board on the status of financial due diligence, negotiations, and synergy opportunities related to the potential transaction with RFMD. A representative of Perkins Coie advised the TriQuint board regarding its fiduciary duties. Representatives of Goldman Sachs also updated the TriQuint board on the lack of additional communication from Company C and from other parties that had previously expressed preliminary interest. Representatives of Goldman Sachs also discussed certain financial analyses, including management’s stand-alone projections for TriQuint.

At a telephonic special meeting of the TriQuint board held on the morning of February 22, 2014, representatives of Perkins Coie reviewed the terms of the merger agreement and responded to the TriQuint board’s inquiries regarding specific terms. Representatives of Goldman Sachs made a presentation to the

 

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TriQuint board and rendered its oral opinion to the TriQuint board, subsequently confirmed in writing by delivery of a written opinion dated February 22, 2014, that, as of that date and based upon and subject to the factors and assumptions set forth therein and taking into account the RFMD merger, the TriQuint Exchange Ratio pursuant to the Merger Agreement was fair from a financial point of view to the holders (other than RFMD and its affiliates) of TriQuint’s shares. Following a discussion by the TriQuint board, in which it considered the factors discussed further in “— Recommendation of the TriQuint Board; TriQuint’s Reasons for the Merger,” the TriQuint board unanimously approved the merger agreement, the TriQuint merger, and the transactions contemplated by the merger agreement on the terms and subject to the conditions set forth in the merger agreement. The TriQuint board also determined that the mergers were fair to, advisable and in the best interests of TriQuint and its stockholders, authorized management to submit the merger agreement to the TriQuint stockholders for adoption at the TriQuint special meeting, and recommended that TriQuint’s stockholders adopt the merger agreement.

At a special telephonic meeting of the RFMD board held on the evening of February 22, 2014, and following notification from Mr. Quinsey that the TriQuint board had met earlier that day and unanimously approved the merger agreement and the transactions contemplated thereby, the RFMD board met to discuss approval of the proposed transaction. Members of RFMD management and representatives of RFMD’s legal advisors and financial advisors participated at the meeting. Representatives of Weil Gotshal updated the RFMD board on the final terms of the merger agreement, including resolution of the remaining open issues. At that meeting, BofA Merrill Lynch reviewed with RFMD’s board its financial analysis of the RFMD Exchange Ratio and delivered to RFMD’s board an oral opinion, which was confirmed by delivery of a written opinion dated February 22, 2014, to the effect that, as of such date and based on and subject to various assumptions and limitations described in its opinion, taking into account the RFMD merger and the TriQuint merger, the RFMD Exchange Ratio was fair, from a financial point of view, to the holders of RFMD common stock (excluding RFMD, TriQuint and their respective affiliates). After discussion in which the RFMD board considered the factors discussed further in “— Recommendation of the RFMD Board; RFMD’s Reasons for the Merger,” the RFMD board, acting unanimously, determined that the proposed business combination with TriQuint, including the RFMD Merger, was advisable and fair to, and in the best interests of, RFMD and its shareholders, approved the merger agreement, the RFMD Merger and other transactions contemplated by the merger agreement and resolved to recommend that RFMD shareholders vote in favor of the mergers and to approve the merger agreement.

On February 22, 2014, RFMD and TriQuint executed the merger agreement. RFMD and TriQuint issued a joint press release announcing the execution of the merger agreement before the opening of trading on February  24, 2014.

Recommendation of the TriQuint Board; TriQuint’s Reasons for the Mergers

Following a review and discussion of all relevant information regarding the mergers, at a meeting held on February 22, 2014, the TriQuint board unanimously (a) approved the merger agreement and the TriQuint merger and the transactions contemplated by the merger agreement upon the terms and subject to the conditions set forth in the merger agreement, (b) determined that the mergers are fair to, advisable and in the best interests of TriQuint and its stockholders, (c) authorized management to submit the merger agreement to the TriQuint stockholders for adoption at the TriQuint special meeting, and (d) recommended that TriQuint’s stockholders adopt the merger agreement.

ACCORDINGLY, THE TRIQUINT BOARD UNANIMOUSLY RECOMMENDS THAT TRIQUINT STOCKHOLDERS VOTE “FOR” THE PROPOSAL TO ADOPT THE MERGER AGREEMENT, “FOR” THE PROPOSAL TO APPROVE THE ADJOURNMENT OF THE TRIQUINT SPECIAL MEETING (IF NECESSARY OR APPROPRIATE TO SOLICIT ADDITIONAL PROXIES IF THERE ARE NOT SUFFICIENT VOTES TO ADOPT THE MERGER AGREEMENT) AND “FOR” THE PROPOSAL TO APPROVE, BY NON-BINDING ADVISORY VOTE, THE COMPENSATION ARRANGEMENTS FOR TRIQUINT’S NAMED EXECUTIVE OFFICERS IN CONNECTION WITH THE MERGERS CONTEMPLATED BY THE MERGER AGREEMENT.

 

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The TriQuint board believes that the mergers present a strategic opportunity to expand value through a combination with the complementary business of RFMD. In reaching its decision to approve the merger agreement and recommend the adoption of the merger agreement to its stockholders, the TriQuint board consulted with management, as well as its legal advisors and financial advisors, and considered a number of factors, including, among others, the following:

 

    The TriQuint board’s knowledge of TriQuint’s business, operations, financial condition, earnings and stock performance, and its understanding of RFMD’s business, operations, financial condition and prospects. In reviewing these factors, including the information obtained through due diligence, the TriQuint board considered that RFMD’s business and operations complement those of TriQuint, and that RFMD’s earnings, and the synergies potentially available in the mergers, create the opportunity for the combined company to have superior future earnings and prospects compared to TriQuint’s future earnings and prospects on a stand-alone basis. In particular, the TriQuint board considered the following:

 

    current financial market conditions and historical market prices, volatility and trading information with respect to TriQuint’s common stock and RFMD’s common stock;

 

    the value of the consideration to be received by TriQuint stockholders and RFMD shareholders as a result of the transaction and the relationship between the current and historical market values of TriQuint common stock and RFMD common stock;

 

    the fact that the exchange ratios used for the purpose of determining the respective ownership interest of TriQuint’s and RFMD’s securityholders implied a premium to the trading price of TriQuint common stock at the time the merger agreement was signed;

 

    the expectation that the mergers represent a unique strategic opportunity to create a new leader in high-performance radio frequency solutions, well positioned for sustained growth and profitability across its geographies and business segments, and in turn create value for its stockholders, customers, suppliers and employees;

 

    the expectation that the mergers would result in at least $150 million in cost synergies by the end of the second year following the closing;

 

    the expectation that the mergers would be accretive to non-GAAP earnings per share in the first full fiscal year following the closing;

 

    the potential that the value of Rocky Holding common stock would increase after the completion of the mergers and that TriQuint stockholders would share in any increase in that value; and

 

    current industry, economic and market conditions and the various alternatives to the mergers, including TriQuint continuing to operate as an independent enterprise, and the risks associated with those alternatives, including TriQuint’s size, financial resources and business operations compared to the size, financial resources and business operations of its competitors.

 

    Its conclusion after its analysis that the businesses of TriQuint and RFMD are a complementary fit and that the mergers will provide expanded product offerings, greater opportunities for innovation, cost savings opportunities, scale advantages, and enhanced opportunities for growth, including in the mobile devices, network infrastructure and aerospace/defense global markets.

 

    The structure of the transaction as a “merger of equals” in which TriQuint stockholders would have substantial participation in the value of cost synergies and long-term strategic opportunities and the TriQuint board and management would provide support for the combined company, including, among other things:

 

    that TriQuint stockholders will own approximately 50% of the combined company following the closing;

 

    that the board of directors of the combined company will consist of an equal number of directors selected by TriQuint and by RFMD;

 

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    that TriQuint’s President and Chief Executive Officer, Ralph G. Quinsey, will serve as the non-executive Chairman of the Board of Directors of the combined company; and

 

    the significant participation of other TriQuint officers in senior management of the combined company.

 

    The perceived similarity in corporate cultures, which would facilitate integration and implementation of the mergers.

 

    The ability and likelihood of TriQuint and RFMD to complete the mergers, including their ability to obtain necessary regulatory approvals and the obligations to attempt to obtain those approvals, and measures taken by TriQuint and RFMD to provide reasonable assurance to each other that the mergers will occur, including the provisions of the merger agreement that require TriQuint or RFMD to compensate the other in some circumstances if the mergers do not occur.

 

    The fact that the mergers are not subject to any financing condition.

 

    The expectation that the transaction will be treated as a tax-free reorganization for U.S. federal income tax purposes.

 

    The fact that TriQuint stockholders who receive Rocky Holding common stock will receive registered shares of Rocky Holding common stock pursuant to the TriQuint merger.

 

    Its review and discussions with TriQuint management concerning the due diligence examination of RFMD’s business, operations, financial condition and prospects.

 

    The opinion of Goldman Sachs, rendered to the TriQuint board to the effect that, as of February 22, 2014 and based upon and subject to the factors and assumptions set forth therein and taking into account the RFMD merger, the TriQuint Exchange Ratio was fair from a financial point of view to the holders (other than RFMD and its affiliates) of TriQuint shares (see “— Opinion of Financial Advisor to TriQuint”).

 

    The terms and conditions of the merger agreement and the course of negotiations of the merger agreement, including, among other things:

 

    the ability of the TriQuint board, under specified circumstances, to withdraw or modify its recommendation to TriQuint stockholders concerning the transactions contemplated by the merger agreement, as described under “The Merger Agreement — Covenants of the Parties —Shareholder Meetings” beginning on page 144; and

 

    the ability of the TriQuint board to terminate the merger agreement to enter into a contract for a superior offer, subject to specified conditions (including various rights of RFMD to have an opportunity to match the superior offer) and the payment of a termination fee, as described under “The Merger Agreement — Covenants of the Parties — No Solicitation” beginning on page 142 and “The Merger Agreement — Termination Fees; Expenses” beginning on page 153.

 

    Other terms of the merger agreement, including the representations, warranties and covenants, and the conditions to each party’s obligations to complete the mergers.

The TriQuint board also weighed the factors described above against certain factors and potential risks associated with entering into the merger agreement, including, among others, the following:

 

    the difficulty inherent in integrating the businesses, assets and workforces of two large companies and the risk that the cost savings, synergies and other benefits expected to be obtained in the transactions contemplated by the merger agreement might not be fully realized, if at all;

 

    the possibility of customer, supplier, management and employee disruption associated with the mergers and integrating the operations of the companies;

 

    the risk of diverting management focus and resources from other strategic opportunities and from operational matters while working to implement the mergers;

 

    the risk that the cultures of the two companies may not be as compatible as anticipated;

 

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    the fact that the TriQuint Exchange Ratio is fixed and will not be adjusted at closing based on the relative market values of TriQuint or RFMD common stock;

 

    the restrictions on the conduct of TriQuint’s business prior to the completion of the proposed mergers, which may delay or prevent TriQuint from undertaking business opportunities that may arise or other actions it would otherwise take or refrain from taking with respect to the operations of TriQuint pending completion of the proposed mergers;

 

    the fact that the termination fee to be paid to RFMD under the circumstances specified in the merger agreement may discourage other parties that might otherwise have an interest in a business combination with, or an acquisition of, TriQuint (see “The Merger Agreement — Termination Fees; Expenses” beginning on page 153);

 

    the terms of the merger agreement placing limitations on TriQuint’s ability to solicit alternative business combination transactions and to provide confidential due diligence information to, or engage in discussions with, a third party interested in pursuing an alternative business combination transaction (see “The Merger Agreement — Covenants of the Parties — No Solicitation” beginning on page 142);

 

    the ability of the RFMD board, under specified circumstances, to withdraw or modify its recommendation to RFMD’s shareholders concerning the transactions contemplated by the merger agreement (see “The Merger Agreement — Covenants of the Parties — Shareholder Meetings” beginning on page 144);

 

    the ability of the RFMD board to terminate the merger agreement to enter into a contract for a superior offer, subject to specified conditions (which mirror those related to TriQuint’s similar ability) (see “The Merger Agreement — Covenants of the Parties — Shareholder Meetings” beginning on page 144);

 

    the amount of time it could take to complete the mergers, including the fact that completion of the mergers depends on factors outside TriQuint’s control;

 

    the risk that either RFMD shareholders may fail to approve or TriQuint stockholders may fail to adopt the merger agreement;

 

    the possibility of significant costs and delays resulting from seeking regulatory approvals necessary to complete the transactions contemplated by the merger agreement, the possibility that the transactions may not be completed if such approvals are not obtained, and the potential negative impacts on TriQuint, its business and its stock price if such approvals are not obtained;

 

    the fact that if the proposed mergers are not completed, TriQuint will have expended significant human and financial resources on a failed transaction, and may also be required to pay a termination fee in various circumstances, as described under “The Merger Agreement — Termination Fees; Expenses” beginning on page 144; and

 

    the risks described in the section entitled “Cautionary Note Concerning Forward-Looking Information” beginning on page 56.

In considering the recommendation of the TriQuint board with respect to the proposal to adopt the merger agreement, you should be aware that some of TriQuint’s directors and executive officers may have interests in the merger that are different from, or in addition to, yours. The TriQuint board was aware of and considered these interests, among other matters, in evaluating the merger agreement and the transactions contemplated by the merger agreement, and in recommending that the merger agreement be adopted by TriQuint stockholders. See “— Interests of Officers and Directors in the Mergers” beginning on page 110.

The foregoing discussion of the information and factors considered by the TriQuint board in reaching its conclusions and recommendations is not intended to be exhaustive, but includes the material factors considered by the TriQuint board. In view of the wide variety of factors considered in connection with its evaluation of the merger agreement and the transactions contemplated by the merger agreement, and the complexity of these matters, the TriQuint board did not find it practicable to, and did not attempt to, quantify, rank or assign any relative or specific

 

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weights to the various factors considered in reaching its determination and making its recommendation. In addition, individual directors may have given different weights to different factors. The TriQuint board considered all of the foregoing factors as a whole and based its recommendation on the totality of the information presented.

The foregoing discussion also contains forward-looking statements with respect to future events that may have an effect on TriQuint’s financial performance or the future financial performance of the combined company. See the sections entitled “Cautionary Note Concerning Forward-Looking Statements” beginning on page 56 and “Risk Factors” beginning on page 32.

Financial Projections Reviewed by the TriQuint Board and TriQuint’s Financial Advisor

Nature of Financial Projections Reviewed by the TriQuint Board and TriQuint’s Financial Advisor

Although TriQuint has publicly issued limited short-term guidance concerning various aspects of its expected financial performance, TriQuint does not make public disclosure of detailed forecasts or projections of its expected financial performance for extended periods because of, among other things, the inherent difficulty of accurately predicting future periods and the likelihood that the underlying assumptions and estimates may prove incorrect. In connection with its evaluation of the mergers, however, TriQuint management prepared and provided to the TriQuint board and Goldman Sachs some non-public internal financial projections regarding TriQuint’s anticipated future operations and estimated synergies arising in connection with the mergers. In addition, TriQuint management prepared and provided to the TriQuint board and Goldman Sachs some non-public internal financial projections for RFMD, which were derived from forecasts for RFMD that RFMD prepared and provided to TriQuint management in connection with TriQuint’s evaluation of the mergers, as adjusted by TriQuint management. A summary of these financial projections and estimated synergies is included below to provide TriQuint stockholders and RFMD shareholders access to specific non-public information that was considered by the TriQuint board for purposes of evaluating the mergers and provided to Goldman Sachs.

The financial projections and estimated synergies summarized below were not prepared for purposes of public disclosure, nor were they prepared on a basis designed to comply with published guidelines of the SEC, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of projections, or U.S. GAAP. TriQuint’s independent auditor, which is listed as an expert in the section entitled “Experts” beginning on page 208 did not compile, examine or perform any procedures with respect to the projections or estimated synergies summarized below, and has not expressed any opinion or any other form of assurance on this information or its achievability, and assumes no responsibility for, and disclaims any association with, these projections and estimated synergies. The independent auditor’s reports incorporated by reference in this document relate to historical financial statements. They do not extend to any prospective financial information and should not be seen to do so.

Although presented with numerical specificity, the projections and estimated synergies were prepared in the context of numerous variables, estimates and assumptions that are inherently uncertain and may be beyond the control of TriQuint, and which may prove not to have been, or to no longer be, accurate. The projections and the estimated synergies are subject to many risks and uncertainties. Important factors that may affect actual results and cause actual results to differ materially from these projections and synergies include risks and uncertainties relating to TriQuint’s and RFMD’s businesses (including their ability to achieve strategic goals, objectives and targets over the applicable periods), industry performance, the regulatory environment, general business and economic conditions, market and financial conditions, various risks set forth in TriQuint’s reports filed with the SEC, and other factors described or referenced under “Cautionary Note Concerning Forward-Looking Statements” beginning on page 56 of this joint proxy statement/prospectus. The projections and estimated synergies also reflect assumptions that are subject to change and are susceptible to multiple interpretations and periodic revisions based on actual results, revised prospects for TriQuint’s and RFMD’s businesses, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the projections and estimated synergies were prepared. In addition, other

 

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than with respect to the estimated synergies discussed below, the projections do not take into account any of the transactions contemplated by the merger agreement, including the mergers and associated expenses, or TriQuint’s and RFMD’s compliance with their respective covenants under the merger agreement. Moreover, the projections and estimated synergies do not take into account any circumstances, transactions or events occurring after the date the projections and estimated synergies were prepared. Accordingly, actual results will likely differ, and may differ materially, from those contained in the projections and estimated synergies. We do not assure you that these projections and estimated synergies will be realized or that future financial results of Rocky Holding, TriQuint or RFMD will not materially vary from these projections and estimated synergies.

The inclusion of a summary of the projections and estimated synergies in this joint proxy statement/prospectus should not be regarded as an indication that any of TriQuint, RFMD or their respective affiliates, officers, directors or other representatives consider the projections or estimated synergies to be necessarily predictive of actual future events, and neither the projections nor the estimated synergies should be relied upon as such. None of TriQuint, RFMD or their respective affiliates, officers, directors or other representatives gives any stockholder of TriQuint, shareholder of RFMD or other person any assurance that actual results will not differ materially from the projections and estimated synergies, and, except as otherwise required by law, none of them undertakes any obligation to update or otherwise revise or reconcile the projections or estimated synergies to reflect circumstances existing after the date the projections and estimated synergies were generated or to reflect the occurrence of future events, even in the event that any or all of the assumptions and estimates underlying the projections or estimated synergies are shown to be in error.

No one has made or makes any representation to any stockholder or anyone else regarding, nor assumes any responsibility for the validity, reasonableness, accuracy or completeness of, the information included in the projections and estimated synergies set forth below. Readers of this joint proxy statement/prospectus are cautioned not to rely on the projections and estimated synergies. TriQuint has not updated and, except as otherwise required by law, does not intend to update or otherwise revise the projections or estimated synergies, even in the short term, to reflect circumstances existing after the date when made or to reflect the occurrence of future events, including the mergers. Moreover, the projections and estimated synergies do not take into account the effect of any failure of the mergers to occur and should not be viewed as accurate or continuing in that context.

A summary of these financial projections and estimated synergies is included solely to give TriQuint stockholders and RFMD shareholders access to the information that was made available to the TriQuint board and Goldman Sachs, as described below, and is not included in this document in order to influence your decision whether to vote for or against the proposal to adopt the merger agreement. The inclusion of this information should not be regarded as an indication that the TriQuint board, its advisors or any other person considered, or now considers, it to be material or to be a reliable prediction of actual future results. TriQuint management’s internal financial projections upon which the TriQuint Projections (as defined below) and the TriQuint-Prepared RFMD Projections (as defined below) were based, as well as the estimated synergies that may result from the mergers, are subjective in many respects. We do not assure you that these projections or estimated synergies will be realized or that actual results will not be significantly higher or lower than forecasted. The projections included below cover multiple years, and this information by its nature becomes subject to greater uncertainty with each successive year. The financial projections and summary information should be evaluated, if at all, in conjunction with the historical financial statements and other information contained in TriQuint’s and RFMD’s respective public filings with the SEC.

Summary of Financial Projections Reviewed by the TriQuint Board and TriQuint’s Financial Advisor

As part of its evaluation of the mergers, TriQuint’s management prepared the unaudited financial projections regarding TriQuint’s future operations for TriQuint’s fiscal years ending December 31, 2014 through 2018 that are summarized below (which projections are referred to in this document as the “TriQuint Projections”). In addition, RFMD’s management provided various unaudited financial projections to TriQuint’s management (which are summarized under “The Mergers—Financial Projections Reviewed by the RFMD Board and RFMD’s Financial Advisor” beginning on page 97 of this joint proxy statement/prospectus and referred to in this section as the “RFMD-Prepared RFMD Projections”). As part of its evaluation of the mergers, TriQuint’s

 

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management prepared its own financial projections, based on the RFMD-Prepared RFMD Projections, regarding RFMD’s future operations for the fiscal years ending March 31, 2014 through 2018 (which projections are referred to in this section as the “TriQuint-Prepared RFMD Projections”). Both the TriQuint Projections and the TriQuint-Prepared RFMD Projections, which are collectively referred to as the “Forecasts” under “The Mergers — Opinion of Financial Advisor to TriQuint” beginning on page 86 of this document, were provided to the TriQuint board for use in its evaluation of the mergers and, in connection therewith, also provided to Goldman Sachs. TriQuint’s management also provided the TriQuint Projections to RFMD’s management.

The following tables present a summary of the TriQuint Projections and the TriQuint-Prepared RFMD Projections:

Summary of the TriQuint Projections

 

     Projected Fiscal Year Ending December 31,  
     2014     2015     2016     2017     2018  
     (in millions of U.S. dollars, except per share data)  

Revenue

   $ 929      $ 1,040      $ 1,165      $ 1,305      $ 1,462   

Cost of Goods Sold

   $ (574   $ (610   $ (680   $ (757   $ (848

Gross Profit

   $ 355      $ 431      $ 486      $ 548      $ 614   

Operating Expenses

   $ (263   $ (260   $ (272   $ (274   $ (278

Non-GAAP EBIT(1)(2)

   $ 92      $ 171      $ 214      $ 274      $ 336   

Non-GAAP EBITDA(1)(3))

   $ 196      $ 274      $ 317      $ 355      $ 417   

Non-GAAP Net Income(1)(4)

   $ 89      $ 164      $ 195      $ 236      $ 290   

Non-GAAP EPS(1)

   $ 0.52      $ 0.92      $ 1.06      $ 1.25      $ 1.48   

 

(1) TriQuint’s non-GAAP adjusted projections exclude the effects of the following, where applicable: stock-based compensation charges, non-cash tax (benefit) expense, certain charges associated with acquisitions, restructuring and impairment charges and other specifically identified non-routine transactions. These non-GAAP measures are not in accordance with GAAP and may differ from non-GAAP methods of accounting and reporting used by other companies.
(2) “Non-GAAP EBIT” is defined as estimated earnings before interest and income taxes excluding the pre-tax non-GAAP adjustments described in Note 1 above.
(3) “Non-GAAP EBITDA” is defined as estimated earnings before interest, taxes, depreciation and amortization expense excluding the pre-tax non-GAAP adjustments described in Note 1 above.
(4) “Non-GAAP Net Income” is defined as net income excluding the after-tax non-GAAP adjustments described in Note 1 above.

Summary of the TriQuint-Prepared RFMD Projections

 

     Projected Fiscal Year Ending March 31,  
     2014     2015     2016     2017     2018  
     (in millions of U.S. dollars, except per share data)  

Revenue

   $ 1,188      $ 1,354      $ 1,464      $ 1,596      $ 1,739   

Cost of Goods Sold

   $ (700   $ (788   $ (840   $ (896   $ (971

Gross Profit

   $ 488      $ 566      $ 624      $ 700      $ 769   

Operating Expenses

   $ (290   $ (298   $ (313   $ (361   $ (399

Non-GAAP EBIT(1)

   $ 198      $ 268      $ 311      $ 339      $ 370   

Non-GAAP EBITDA(1)

   $ 249      $ 318      $ 368      $ 407      $ 445   

Non-GAAP Net Income(1)

   $ 168      $ 220      $ 251      $ 274      $ 300   

Non-GAAP EPS(1)

   $ 0.58      $ 0.76      $ 0.87      $ 0.95      $ 1.03   

 

(1) Represent non-GAAP adjusted projections and exclude stock-based compensation charges, non-cash tax (benefit) expense, restructuring and impairment charges, and certain charges associated with acquisitions and other specifically identified non-routine transactions, including the mergers.

 

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In addition to the TriQuint Projections and the TriQuint-Prepared RFMD Projections, TriQuint’s management also prepared projections of the unlevered free cash flow for each of TriQuint and RFMD and provided these projections to the TriQuint board and to Goldman Sachs for use in its financial analyses. The following table represents a summary of these projections:

Unlevered Free Cash Flow(1)

 

     Projected Fiscal Year Ending December 31,  
         2014              2015              2016              2017              2018      
     (in millions of U.S. dollars)  

TriQuint

   $ 185       $ 133       $ 180       $ 164       $ 214   
     Projected Fiscal Year Ending [March 31],  
     2014      2015      2016      2017      2018  
     (in millions of U.S. dollars)  

RFMD

   $ 65       $ 202       $ 190       $ 222       $ 250   

 

(1) Unlevered Free Cash Flow is defined as: EBIT; minus taxes, capital expenditures, and changes in working capital; plus depreciation and amortization. EBIT estimates include the effect of stock-based compensation expenses.

TriQuint’s management also prepared estimates of synergies and dis-synergies that Rocky Holding would realize in each of the five years following completion of the mergers and provided these estimates to the TriQuint board and to Goldman Sachs for use in its financial analyses. These estimates are referred to as the “Synergies” under “The Mergers — Opinion of Financial Advisor to TriQuint” beginning on page 86 of this joint proxy statement/prospectus and are summarized in the following table. TriQuint’s management estimated that Rocky Holding would realize approximately $75 million in annualized run-rate cost synergies by the end of Rocky Holding’s first full year after closing and an additional approximately $75 million in run-rate cost synergies exiting Rocky Holding’s second full year after closing (which were used by Goldman Sachs and are referred to under “The Mergers — Opinion of Financial Advisor to TriQuint” beginning on page 86).

 

     Projected Fiscal Year Ending December 31,  
         2014             2015             2016             2017             2018      
     (in millions of U.S. dollars)  

EBIT Effect of Operating Synergies(1)

   $ 1      $ 53      $ 137      $ 150      $ 150   

Free Cash Flow Effect of Synergies

   $ (44   $ 46      $ 109      $ 115      $ 115   

EBIT Effect of Dis-synergies

   $ (8   $ (23   $ (28   $ (30   $ (33

Free Cash Flow Effect of Dis-synergies

   $ (7   $ (20   $ (23   $ (25   $ (27

 

(1) Includes the effect of projected cost synergies.

See “Risk Factors — Rocky Holding may never realize the anticipated benefits from the mergers.” beginning on page 33 of this joint proxy statement/prospectus for further information regarding the uncertainties associated with realizing synergies in connection with the mergers.

Opinion of Financial Advisor to TriQuint

Goldman Sachs rendered its opinion to the TriQuint board that, as of February 22, 2014, based upon and subject to the factors and assumptions set forth therein and taking into account the RFMD merger, the TriQuint Exchange Ratio pursuant to the merger agreement was fair from a financial point of view to the holders (other than RFMD and its affiliates) of shares of TriQuint common stock.

 

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The full text of the written opinion of Goldman Sachs, dated February 22, 2014, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B. Goldman Sachs provided its opinion for the information and assistance of the TriQuint board in connection with its consideration of the merger agreement. The Goldman Sachs opinion is not a recommendation as to how any holder of TriQuint common stock should vote with respect to the merger agreement or any other matter.

In connection with rendering the opinion described above and performing its related analyses, Goldman Sachs reviewed, among other things:

 

    the merger agreement;

 

    annual reports to stockholders and Annual Reports on Form 10-K of TriQuint for the five fiscal years ended December 31, 2013;

 

    annual reports to shareholders and Annual Reports on Form 10-K of RFMD for the five fiscal years ended March 30, 2013;

 

    certain interim reports to stockholders and Quarterly Reports on Form 10-Q of TriQuint and RFMD;

 

    certain other communications from TriQuint and RFMD to their respective stockholders;

 

    certain publicly available research analyst reports for TriQuint and RFMD;

 

    certain internal financial analyses and forecasts for RFMD prepared by its management; and

 

    certain internal financial analyses and forecasts for TriQuint and certain financial analyses and forecasts for RFMD, in each case as prepared by the management of TriQuint and approved for Goldman Sachs’ use by TriQuint (the “Forecasts”), and certain cost savings and operating synergies projected by the management of TriQuint to result from the transaction contemplated by the merger agreement (for purposes of this section, the “Transaction”), as approved for Goldman Sachs’ use by TriQuint (the “Synergies”).

Goldman Sachs also held discussions with members of the senior managements of TriQuint and RFMD regarding their assessment of the strategic rationale for, and the potential benefits of, the Transaction and the past and current business operations, financial condition and future prospects of TriQuint and RFMD; reviewed the reported price and trading activity for shares of TriQuint common stock and shares of RFMD common stock; compared certain financial and stock market information for TriQuint and RFMD with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the semiconductor industry and in other industries; and performed such other studies and analyses, and considered such other factors, as Goldman Sachs deemed appropriate.

For purposes of rendering the opinion described above, Goldman Sachs, with TriQuint’s consent, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by, Goldman Sachs, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with TriQuint’s consent that the Forecasts and the Synergies had been reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of TriQuint. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of TriQuint, RFMD or Rocky Holding or any of their respective subsidiaries and it was not furnished with any such evaluation or appraisal. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the completion of the Transaction will be obtained without any adverse effect on TriQuint, RFMD or Rocky Holding or on the expected benefits of the Transaction in any way meaningful to its analysis. Goldman Sachs has also assumed that the Transaction will be completed on the terms set forth in the merger agreement, without the waiver or modification of any term or condition the effect of which would be in any way meaningful to its analysis.

 

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Goldman Sachs’ opinion does not address the underlying business decision of TriQuint to engage in the Transaction, or the relative merits of the Transaction as compared to any strategic alternatives that may be available to TriQuint; nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs’ opinion addresses only the fairness from a financial point of view to the holders (other than RFMD and its affiliates) of shares of TriQuint common stock, as of the date thereof and taking into account the RFMD merger, of the TriQuint Exchange Ratio pursuant to the merger agreement. Goldman Sachs’ opinion does not express any view on, and does not address, any other term or aspect of the merger agreement or Transaction or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection with the Transaction, including, the fairness of the Transaction to, or any consideration received in connection therewith by, the holders of any other class of securities, creditors, or other constituencies of TriQuint; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of TriQuint or RFMD, or class of such persons, in connection with the Transaction, whether relative to the TriQuint Exchange Ratio pursuant to the merger agreement or otherwise. Goldman Sachs is not expressing any opinion as to the prices at which shares of Rocky Holding common stock will trade at any time or as to the impact of the Transaction on the solvency or viability of TriQuint, RFMD or Rocky Holding or the ability of TriQuint, RFMD or Rocky Holding to pay their respective obligations when they come due. Goldman Sachs’ opinion is necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date of its opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming this opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs’ opinion was approved by a fairness committee of Goldman, Sachs & Co.

The following is a summary of the material financial analyses delivered by Goldman Sachs to the TriQuint board in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs’ financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before February 21, 2014, the last trading day before the public announcement of the merger agreement, and is not necessarily indicative of current market conditions.

 

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Historical Exchange Ratio Analysis

Goldman Sachs reviewed the reported prices for TriQuint common stock and RFMD common stock over the three year period ended February 21, 2014. Goldman Sachs noted that based on the closing price of TriQuint common stock of $9.23 per share on February 21, 2014, and the closing price of RFMD common stock of $5.81 per share, the TriQuint Exchange Ratio of 1.6749 pursuant to the merger agreement (prior to the 1:4 share split contemplated in the transaction) represented a premium of 5.4% to the implied at market exchange ratio of 1.589 shares of RFMD common stock to a share of TriQuint common stock. Goldman Sachs calculated historical average exchange ratios over various periods by first dividing the closing price per share of TriQuint common stock on each trading day during the period by the closing price per share of RFMD common stock on the same trading day, and subsequently taking the average of these daily historical exchange ratios over such periods, which is referred to as the average exchange ratio for such period. Goldman Sachs then calculated the premiums implied by the TriQuint Exchange Ratio to the historical average exchange ratios over various periods. Additionally, Goldman Sachs compared the 50.0% TriQuint stockholders’ ownership in the combined company implied by the TriQuint Exchange Ratio to the ownership implied by the historical average exchange ratios over such periods. The following table presents the results of this analysis:

 

Historical Date or

Period

   Exchange Ratio
Pre-1:4 Share Split
     Premium of
TriQuint Exchange Ratio
To Historical Average
Exchange Ratio
    Implied TriQuint
Stockholder
Ownership
 

TriQuint Exchange Ratio

     1.675x           50.0

February 21, 2014

     1.589x         5.4     48.6

30 calendar days ended February 21, 2014

     1.620x         3.4     49.3

60 calendar days ended February 21, 2014

     1.654x         1.3     49.2

90 calendar days ended February 21, 2014

     1.621x         3.4     48.4

Six-month period ended February 21, 2014

     1.538x         8.9     47.1

One-year period ended February 21, 2014

     1.365x         22.7     43.8

Three-year period ended February 21, 2014

     1.343x         24.7     43.9

Selected Companies Analysis

Goldman Sachs reviewed and compared certain financial information, ratios and public market multiples for TriQuint and RFMD to corresponding financial information, ratios and public market multiples for the following publicly traded corporations in the semiconductor industry:

Mobile Peers

 

    TriQuint

 

    RFMD

 

    Avago Technologies

 

    muRata Manufacturing Co., Ltd.

 

    Peregrine Semiconductor Corporation

 

    RDA Microelectronics, Inc.

 

    Skyworks Solutions

 

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IDP Peers

 

    Avago Technologies

 

    Hittite Microwave Corporation

 

    M/A-COM Technology Solutions

 

    Microsemi Corporation

Although none of the selected companies is directly comparable to RFMD or TriQuint, the companies included were chosen because they are publicly traded companies with operations that for purposes of analysis may be considered similar to certain operations of RFMD and TriQuint.

Goldman Sachs also calculated and compared various financial multiples and ratios based on information it obtained from publicly available historical data and Institutional Brokers’ Estimate System, or “IBES,” estimates. The multiples and ratios were calculated using the applicable closing market prices as of February 21, 2014. The multiples and ratios of TriQuint and RFMD were based on IBES estimates. The multiples and ratios for each of the selected companies were based on IBES estimates. With respect to the selected companies and TriQuint and RFMD, Goldman Sachs calculated:

 

    enterprise value as a multiple of projected 2014 revenue, and

 

    enterprise value as a multiple of projected 2014 EBITDA.

The following table presents the results of this analysis:

 

Enterprise value as a multiple of:

   Mobile Peers      IDP Peers                
     Range      Median      Range      Median      TriQuint      RFMD  

CY2014E Revenue

     0.9x-4.8x         1.6x         2.2x-4.8x         3.4x         1.6x         1.3x   

CY2014E EBITDA

     6.8x-12.7x         8.4x         9.0x-12.7x         10.2x         8.1x         6.8x   

Goldman Sachs calculated the selected companies’ estimated calendar year 2014 price/earnings ratio using the applicable closing market prices as of February 21, 2014, and compared them to the same ratios for RFMD and TriQuint based on IBES estimates. In addition, Goldman Sachs calculated the selected companies’ estimated calendar year 2014 cash adjusted price/earnings ratio, which is calculated by dividing fully diluted market capitalization excluding cash by earnings excluding interest on cash (assuming 0.5% interest earned on cash). The following table presents the results of these analyses:

 

     Mobile Peers      IDP Peers      TriQuint      RFMD  
     Range      Median      Range      Median                

CY2014E P/E Ratio

     10.3x-20.0x         14.8x         9.9x-24.7x         15.0x         18.8x         10.6x   

CY2014E Cash Adjusted P/E Ratio

     8.5x-16.7x         13.7x         9.0x-18.4x         14.0x         18.0x         9.3x   

Goldman Sachs also considered calendar year 2014 to calendar year 2015 revenue growth, EBIT growth, EBITDA growth, and EPS growth and calendar year 2014 gross margin, EBIT margin, and gross margin based on IBES estimates for the selected companies and IBES estimates and the Forecasts for TriQuint and RFMD.

 

    Mobile Peers     IDP Peers     TriQuint     RFMD  
    Range     Median     Range     Median     IBES     Mgmt     IBES     Mgmt  

CY2014-15 Revenue Growth

    4.9% - 24.0%        9.6%        6.9% - 10.9%        9.7%        9.6%        11.9%        7.7%        14.0%   

CY2014-15 EBIT Growth

    11.7% - 39.4%        20.7%        13.1% - 19.2%        16.1%        31.0%        85.8%        26.6%        35.3%   

CY2014-15 EBITDA Growth

    8.3% - 50.9%        14.6%        10.9% - 32.5%        16.9%        22.6%        39.9%        17.4%        27.3%   

CY2014-15 EPS Growth

    10.0% - 54.1%        17.9%        13.0% - 26.1%        16.1%        24.5%        78.2%        22.1%        30.9%   

CY2014E Gross Margin

    33.2% - 50.7%        38.9%        50.7% - 69.3%        53.4%        37.9%        38.2%        39.6%        41.1%   

CY2014E EBIT Margin

    (12.5%) - 30.8%        15.2%        20.7% - 37.9%        26.8%        8.9%        9.9%        15.2%        16.7%   

CY2014E EBITDA Margin

    (5.1%) - 38.0%        20.3%        23.1% - 40.9%        32.3%        20.3%        21.1%        19.0%        21.0%   

 

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Illustrative Financial Contribution Analysis

Goldman Sachs first analyzed the Transaction, which implied that TriQuint’s stockholders would own 50.0% of the outstanding equity of the combined company. Goldman Sachs then compared this to the implied equity contribution based on specific historical and estimated future financial metrics, namely revenue, EBITDA, EBIT, and net income for TriQuint and RFMD before taking into account any of the possible net financial benefits or detriments, such as the Synergies (which term, when referenced in this summary, includes synergies and dis-synergies except where otherwise indicated), that may be realized following completion of the merger, for actual 2013 and estimated years 2014 through 2016, based on the Forecasts.

To calculate the implied equity contribution for TriQuint and RFMD, Goldman Sachs first calculated a weighted average valuation multiple for each respective financial metric in each applicable year and then applied the weighted average valuation multiple to each company’s respective financial metric in such year to obtain, for each of TriQuint and RFMD, an implied standalone enterprise value, for revenue, EBITDA and EBIT-based multiples, and an implied standalone equity market capitalization for net income-based multiples. Goldman Sachs then adjusted each implied standalone enterprise value by each company’s respective net debt position to arrive at each company’s implied standalone equity market capitalization, which it then used to calculate the implied equity contribution based on each particular operating metric in a given year. This analysis resulted in the following illustrative ranges of the implied equity contribution of TriQuint and RFMD, respectively, to the combined entity, in each case for each particular financial metric and for calendar years 2013 through 2016:

 

     TriQuint Implied Equity
Contribution
   RFMD Implied Equity
Contribution

Revenue

   42.5% - 44.0%    56.0% - 57.5%

EBITDA

   40.2% - 45.9%    54.1% - 59.8%

EBIT

   14.4% - 40.7%    59.3% - 85.6%

Net Income

   11.1% - 43.7%    56.3% - 88.9%

Illustrative Discounted Cash Flow Analysis

Goldman Sachs performed an illustrative discounted cash flow analysis on the Synergies and on Rocky Holding and TriQuint, to calculate the uplift per share of TriQuint common stock in the Transaction, defined as the illustrative value indication for that number of shares of Rocky Holding common stock equal to the TriQuint Exchange Ratio taking into account the Synergies less the illustrative per share value indication for TriQuint standalone. These analyses were based on the Forecasts, the Synergies and assumed a December 31, 2013 base date.

Synergies

Goldman Sachs calculated indications of net present value of free cash flows for the Synergies for calendar years 2014 through 2018 and illustrative terminal values based on perpetuity growth rates ranging from 0.0% to 4.0%, using illustrative discount rates ranging from 13.6% to 15.6%. This analysis resulted in illustrative value indications of the Synergies per share of TriQuint common stock of $1.22 to $1.95.

Value Uplift

Goldman Sachs also performed an illustrative discounted cash flow analysis for Rocky Holding to calculate indications of the implied value to be received by holders of TriQuint common stock taking into account the Synergies and subtracted from such implied value the implied value per share of TriQuint common stock (based on an illustrative discounted cash flow analysis for TriQuint) to calculate uplift per share of TriQuint common stock in the Transaction. Goldman Sachs calculated indications of net present value of free cash flows, including the Synergies, for Rocky Holding and for TriQuint standalone, in each case for calendar years 2014 through 2018

 

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using illustrative discount rates ranging from 13.6% to 15.6%, reflecting estimates of the weighted average cost of capital of each of Rocky Holding and TriQuint. Goldman Sachs calculated implied prices per share of Rocky Holding common stock and for TriQuint common stock using illustrative terminal values based on perpetuity growth rates ranging from 2.0% to 4.0%. These terminal values were then discounted to calculate implied indications of present value using illustrative discount rates ranging from 13.6% to 15.6%. This analysis resulted in a range of implied present values of the uplift per share of TriQuint common stock of $1.68 to $2.61.

DCF-Based Relative Equity Contribution