Pericom Board Sends Letter to Shareholders Strongly Recommending They Vote "FOR" the Proposed Acquisition by Diodes

Pericom Semiconductor Corporation ("Pericom" or the "Company")

today announced that its Board of Directors sent a letter to its shareholders urging them to vote "FOR" the previously announced merger agreement (the "Diodes Agreement") with Diodes Incorporated ("Diodes")

, pursuant to which Pericom shareholders are entitled to promptly receive $17.00 per share in cash, subject only to Pericom shareholder approval. The letter, a copy of which is included below, addresses the Board's significant concerns with the clear and fundamental risks associated with the offer made by Montage Technology Group Limited ("Montage"), including risks and uncertainties regarding Montage's ability (or unwillingness) to obtain financing and regulatory approvals for an acquisition of Pericom and Montage's ability to ultimately close a transaction with Pericom in a timely fashion, if at all. The letter to shareholders also responds to and clarifies a number of misleading statements that Montage has repeatedly made in communications to Pericom shareholders in its effort to conceal the significant risks associated with Montage's offer. Pericom has mailed a white proxy card to its shareholders in connection with its Special Meeting of Shareholders (the "Special Meeting"), which is scheduled to be held on November 20, 2015. The Special Meeting is being called primarily to seek shareholder approval of the Diodes Agreement. Pericom shareholders of record as of the close of business on September 22, 2015 are entitled to vote at the Special Meeting. In connection with the Special Meeting, Pericom has filed an investor presentation with the U.S. Securities Exchange Commission ("SEC") detailing the rationale for the Board's unanimous approval of the Diodes Agreement and the Board's unanimous decision to reject the inferior offer from Montage based on the significant and unacceptable risks associated with that offer. November 5, 2015 Dear Shareholders, A Special Meeting of Shareholders of Pericom Semiconductor Corporation will be held on November 20, 2015, at which you will be asked to approve the Agreement and Plan of Merger between Diodes Incorporated and Pericom, dated September 2, 2015 (the "Diodes Agreement"). The Pericom Board of Directors unanimously recommends that Pericom shareholders vote "FOR" the acquisition of Pericom by Diodes. Your vote in support of the proposed acquisition by Diodes is essential to lock in the substantial cash premium represented by the $17.00 per share purchase price offered by Diodes, which we believe is clearly in the best interests of Pericom shareholders. THE MONTAGE OFFER IS CLEARLY NOT IN THE BEST INTERESTS OF PERICOM SHAREHOLDERS BECAUSE THE HIGHLY UNCERTAIN PREMIUM IS INSUFFICIENT TO OUTWEIGH THE SIGNIFICANT TIMING AND DEAL CERTAINTY RISKS ASSOCIATED WITH THE OFFER In summary, the key elements of the Montage Offer that the Pericom Board of Directors find most troubling are: -- Despite its claims, the one-page financing letters provided by Montage's lenders are not full commitments to finance a transaction with Pericom; -- For example, the one-page letter from the Bank of China Shanghai Pudong Branch states that any financing to be provided to Montage "needs to be evaluated by [Bank of China's] committee and will not be issued until all the conditions that [Bank of China] requires and admits are fully satisfied". However, the Bank of China Shanghai Pudong Branch's letter does not include any details regarding what those conditions may be and, despite repeated requests, Montage has not provided any further information regarding such conditions. -- Montage has removed regulatory approvals as a condition to closing although they still must be obtained for a lawful closing; -- Cannot contract away the oversight of third party regulators and to suggest such an action demonstrates a move to hide the facts -- Because Montage is a Cayman company with few assets in the United States, enforcement of any judgment against Montage will be problematic -- a risk Montage itself clearly stated in its IPO prospectus; and -- If for any reason, Montage is unable or unwilling to close the proposed transaction with Pericom, the only real recourse for Pericom shareholders may be the $43 million reverse break-up fee (vs. $400 million of market premium from Diodes). As you may know, subsequent to signing the Diodes Agreement, the Pericom Board received an unsolicited acquisition offer from Montage Technology Group Limited ("Montage") with a proposed purchase price of $18.50 per share (the "Montage Offer"). Clearly, the additional $1.50 per share premium compared to the price offered by Diodes merited serious consideration by the Pericom Board. However, the Pericom Board has a duty to obtain the highest value reasonably available to our shareholders, and in carrying out such duty, the Pericom Board must consider all factors, including the likelihood of completing a transaction. Accordingly, we devoted a significant amount of time and resources to fully evaluating the Montage Offer and conducted a thorough analysis and comparison of the Montage and Diodes offers to determine what is in the best interests of our shareholders. After careful consideration and extensive consultation with our independent financial advisor, Cowen and Company, and outside legal advisors, including Latham & Watkins and Lee & Li, and extensive discussions and negotiations with Montage and its advisors, the Pericom Board of Directors unanimously determined that the premium represented by the Montage Offer is highly uncertain, does not outweigh or adequately compensate our shareholders for the very real possibility that Montage would not be able to close an acquisition of Pericom, and is clearly not in the best interests of our shareholders. As discussed in greater detail below, the Board's unanimous decision was based, in part, on the serious doubts and concerns that the Board has with respect to Montage's ability to obtain the financing and regulatory approvals necessary to consummate an acquisition of Pericom. -- Despite numerous and repeated requests by Pericom, both prior to and following execution of the Diodes Agreement, Montage has refused to provide customary, reliable or sufficient financing commitments to consummate a transaction with Pericom. The only reasonable conclusion that can be drawn from Montage's otherwise inexplicable failure to provide such commitments despite having repeated opportunities and many months to do so is that Montage is indeed unable to actually secure such financing. -- Montage has also dismissed and failed to thoughtfully consider the implications of, or even how it plans to address, the myriad of regulatory approvals that will be required in connection with an acquisition of Pericom, including approvals from numerous governmental agencies in the People's Republic of China (PRC) and Taiwan (which will almost certainly require divestiture of Taiwanese assets by Pericom) and from the Committee on Foreign Investments in the U.S. (CFIUS). Indeed, rather than actually addressing Pericom's concerns with respect to the regulatory approvals required in a revised offer received November 4, Montage avoids the issue entirely by simply eliminating any requirement that regulatory approvals be obtained. While this might be the quickest way to "address" Pericom's concerns with respect to regulatory approvals, regulatory oversight cannot be contracted away, and an acquisition of Pericom by Montage will still be subject to regulatory filings and regulatory scrutiny. Simply stated, Pericom's concerns with respect to obtaining regulatory approvals have not been cured by Montage's hasty attempt to contractually do away with legally required approvals. We believe Montage is consistently misrepresenting the one-page financing letters as "committed financing" and challenge Montage to be transparent with investors and make available the one-page financing letters as provided by Bank of China Shanghai Pudong Branch and CEC. Despite repeated requests and many months to do so, Montage has yet to provide the Pericom Board with any level of reasonable assurance that it has secured committed financing or that it has a legitimate plan to obtain regulatory approvals. As a result, the Montage Offer asks Pericom shareholders to sacrifice a highly certain, near-term $17.00 per share offer from Diodes in the hopes of obtaining, at some point in the future, if at all, a highly uncertain premium from a buyer who has consistently failed to address the material risks associated with its offer. We believe that there is a substantial risk that pursuing a transaction with Montage would leave our shareholders holding the bag, with nothing more than a $43 million reverse breakup fee (which amounts to less than 11% of the $400 million value represented by the premium offer from Diodes) as compensation if Montage cannot (or chooses not to) close the deal.