-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Gl6QaqQxHBY0HMnBjfvjKASxeWhX5irCkFqnPFz5NSEETQyp3TNnRZotbI8qs4pF 83mSXFWlJT7bJCgdibSElw== /in/edgar/work/0001012870-00-005036/0001012870-00-005036.txt : 20001003 0001012870-00-005036.hdr.sgml : 20001003 ACCESSION NUMBER: 0001012870-00-005036 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000929 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IXYS CORP /DE/ CENTRAL INDEX KEY: 0000945699 STANDARD INDUSTRIAL CLASSIFICATION: [3674 ] IRS NUMBER: 770140882 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 000-26124 FILM NUMBER: 731674 BUSINESS ADDRESS: STREET 1: 3540 BASSETT ST CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4089540500 MAIL ADDRESS: STREET 1: 3540 BASSETT STREET CITY: SANTA CLARA STATE: CA ZIP: 95054 FORMER COMPANY: FORMER CONFORMED NAME: PARADIGM TECHNOLOGY INC /DE/ DATE OF NAME CHANGE: 19951031 10-K405/A 1 0001.txt FORM 10K-405/A FOR PERIOD ENDING MARCH 31, 2000 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- FORM 10-K/A (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended March 31, 2000. OR [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission file number 001-14165 ---------------- IXYS CORPORATION (Exact name of registrant as specified in its charter) Delaware 770140882-5 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) identification No.)
3540 Bassett Street Santa Clara, California 95054-2704 (Address of principal executive offices and zip code) (408) 982-0700 (Registrant's telephone number, including area code) ---------------- Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered ------------------- ----------------------------------------- None
Securities registered pursuant to Section 12(g) of the Act: (Title of class) Common Stock, $.01 par value ---------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 of 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [_] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this Form 10-K. Yes [X] No [_] The aggregate market value of the voting stock held by non-affiliates of the registrant as of June 30, 2000 was approximately $159,443,614.75.* The number of shares of the Registrant's Common Stock outstanding as of June 30, 2000 is 12,178,383. - -------- * Based on a closing price of $53.375 per share of the Registrants' Common Stock on June 30, 2000 held by executive officers, directors and stockholders whose ownership exceeds 5% of the Common Stock outstanding at June 30, 2000. Exclusion of such shares should not be construed to indicate that any such person possesses the power, direct or indirect, to direct or cause the direction of the management or policies of the of the registrant or that such person is controlled by or under common control with the Registrant. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED MARCH 31, 2000 TABLE OF CONTENTS PART I ITEM 1.BUSINESS........................................................... 1 PART II ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS............................................. 2 ITEM 8.FINANCIAL STATEMENTS............................................... 5 PART III ITEM 11. EXECUTIVE COMPENSATION........................................... 7 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................... 10 PART IV ITEM 14.EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 10- K........................................................................ 11
PART I ITEM 1.BUSINESS The first sentence of the first paragraph under the heading "Other Products" is hereby amended and restated to read in its entirety: "IXYS markets its proprietary DCB (direct copper bond) substrates to a variety of customers, including those in the power semiconductor industry, and uses DCB in the manufacturing of its modules." 1 PART II ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview IXYS was founded in 1983 to design, develop and market power semiconductors used primarily in controlling energy in motor drives and power conversion. IXYS' target market includes segments of the power semiconductor market that require medium to higher power semiconductors, with a particular emphasis on higher power semiconductors, which are those capable of processing greater than 500 watts of power. IXYS has been an innovator in power MOS semiconductor products and technologies since its inception. IXYS pioneered the high voltage, high current MOSFET and IGBT technologies and was the industry's first developer and manufacturer of a 1,000 volt, 100 amp IGBT, which has proven to be superior in reliability and performance to traditional bipolar Darlington transistors. In 1989, IXYS acquired from ABB AG its semiconductor operation in Lampertheim, Germany. Now called IXYS Semiconductor GmbH, the power semiconductor operation in Lampertheim is recognized for pioneering work in DCB packaging technology. The group also developed a line of FREDs that significantly reduce energy losses in motor control and UPS applications. IXYS Semiconductor GmbH provides IXYS with a strong foothold in the European Union ("EU") and positions IXYS to take advantage of tariff and import incentives to EU-based entities. In January 1993, in answer to continuing operational losses, IXYS underwent a reorganization of its upper level management structure. Subsequent cost cutting in its US operations as well as in its Lampertheim facility allowed IXYS to operate more efficiently and achieve profitability. In 1995, IXYS reincorporated in Delaware. Also in 1995, ABB AG converted approximately $10.5 million in debt owed to it by IXYS into IXYS Series B Preferred Stock. In January 1998, IXYS completed the purchase of the Lampertheim facility previously leased from ABB AG. This facility is approximately 170,000 square feet and houses IXYS' Lampertheim offices and manufacturing operations. ABB AG leases some office space in this facility. IXYS feels that the Lampertheim facility is sufficient to serve its needs in the module and bipolar product lines at least through fiscal 2001. On September 23, 1998, IXYS Corporation merged with Paradigm, a Delaware corporation that designs and markets fast SRAM products, in a transaction accounted for as a reverse merger. In the merger, Paradigm issued 11,513,821 shares of its common stock in exchange for all outstanding shares of IXYS Corporation capital stock. At the conclusion of the merger, IXYS Corporation stockholders held approximately 96% of the combined company, and the historic accounting records of IXYS Corporation became those of the combined company. Accordingly, Paradigm formally changed its name to "IXYS Corporation." Results of Operations--Years Ended March 31, 2000 and March 31, 1999 Net Revenue. IXYS' net revenues for fiscal 2000 were $76.6 million, a 15.2% increase from revenues of $66.5 million in 1999. The increase is primarily related to approximately a 7% increase in units shipped in 2000 as compared to 1999, and approximately 8% increase in average selling prices. International net revenue represents $47.6 million for fiscal 2000 or 62% of total net revenue as compared to $42.8 million for fiscal 1999 or 65% of net revenue. Gross Margin. IXYS' gross margin was 36% in 2000 as compared to 32% in 1999. The increase was primarily due to higher average selling prices and greater revenue earned during the year. Gross margin for products sold by IXYS' German division for fiscal 2000 was 24% as compared to 22% in 1999. Gross margin for products sold by IXYS' domestic division for fiscal 2000 was 41% as compared to 34% in fiscal 1999. 2 Research, Development and Engineering ("R&D"). For fiscal 2000, R&D was $4.7 million or 6.1% of net revenues as compared to $4.2 million or 6.3% of net revenues, for fiscal 1999. The R&D expenses increase was due to higher engineering headcount in fiscal 2000 and an increase in the number of R&D projects. Selling, General, Administrative Expenses ("SG&A"). For the fiscal year 2000, SG&A was $11.5 million (14.9% of net sales) as compared to $20.3 million (30.4% of net sales) in fiscal year 1999. The decrease reflects $10.4 million, amortization and writeoff of goodwill related to the acquisition of Paradigm in fiscal 1999. Interest Expense. During fiscal 2000, interest expense was $417,000 as compared to $993,000 in fiscal 1999. The decrease in interest expense is due to lower interest rates for the year as well as repayment of loans throughout fiscal 2000. Other Income (Expense), Net. Other income (expense) fiscal in 2000 was $(199,000) as compared to $669,000 in 1999. Provision/Benefit For Income Taxes. The 2000 provision for income taxes reflects an effective tax rate of 36% in 2000, as compared to the 1999 provision for an effective income tax rate of 29% (excluding the effect of non- deductible write-off in connection with the acquisition of Paradigm). Results of Operations--Years Ended March 31, 1999 and March 31, 1998 Net Revenue. IXYS' net revenues for fiscal 1999 were $66.5 million, a 17.0% increase from revenues of $56.9 million in 1998. The increase is primarily related to approximately a 39% increase in units shipped in 1999 as compared to 1998, offset by approximately 16% decrease in average selling prices. International net revenue represents $42.8 million for fiscal 1999 or 65% of total net revenue as compared to $35.8 million for fiscal 1998 or 63% of net revenue. Gross Margin. IXYS' gross margin for 1999 was 32% in 1999 as compared to 33% in 1998. The decrease in gross margin is due to average selling prices which, in response to competition, declined at a somewhat faster rate than IXYS' ability to reduce its cost of goods sold. Gross margin for products sold by IXYS' German division for 1999 was 22% as compared to 25% in 1998. Gross margin for products sold by IXYS' domestic division for 1999 was 34% as compared to 42% in 1998. Research, Development and Engineering ("R&D"). For the fiscal year ended 1999 R&D was $4.2 million or 6.3% of net revenues as compared to $3.3 million or 5.8% of net revenues, for fiscal year 1998. R&D expenses increase was due to higher engineering headcount in 1999. Selling, General, Administrative Expenses ("SG&A"). For the fiscal year 1999, SG&A was $20.3 million (30.4% of net sales) as compared to $8.4 million (14.7% of net sales) in fiscal year 1998. The increase reflects $10.4 million, amortization and writeoff of goodwill related to the acquisition of Paradigm or 15.6% of net sales. SG&A excluding the amortization and writeoff of goodwill related to the acquisition of Paradigm was $9.9 million, or 14.8% of net sales. Interest Expense. During 1999, interest expense was $993,000 as compared to $431,000 compared to in 1998. The increase in interest expense is due to higher average borrowings in 1999 as compared to 1998. Other Income (Expense), Net. Other income (expense) in fiscal 1999 was $669,000 as compared to $3.5 million in fiscal 1998, which included $3.7 million attributable to the settlement of the patent claim made by Harris Corporation. 3 Liquidity and Capital Resources IXYS has financed its operations to date through the private sale of equity, lease financing and bank borrowings. As of March 31, 2000, the cash and cash equivalents were $9.5 million, an increase of $2.4 million from cash and cash equivalents of $7.1 million at March 31, 1999. The increase in cash and cash equivalents was primarily due to net income. There are two line of credit facilities available to IXYS. In the United States, IXYS has a line of credit with a U.S. bank that consists of a $5.0 million commitment amount which is available through December 2000. The line bears interest at the bank's prime rate (9.0% at March 31, 2000). The line is collateralized by certain assets and contains certain general and financial covenants. At March 31, 2000, we had drawn $2.1 million against such line of credit. In Germany, IXYS has two lines of credit with German banks that, as of March 31, 2000, consisted of: . DM 1.5 million ($734,574) commitment amount with an outstanding balance of DM 1.5 million ($734,574), bearing interest at 3.5% at March 31, 2000. This line of credit is secured by compensating balances. . DM 5.0 million ($2.5 million) commitment amount without any outstanding balance. This line supports a letter of credit facility. The accounts receivable at March 31, 2000 were $16.9 million, an increase of 43.7% as compared to March 31, 1999. The inventories at March 31, 2000 were $21.4 million, an increase of 6.5% as compared to March 31, 1999. Net plant and equipment at March 31, 2000 were $10.2 million, a decrease of 9.7% as compared to March 31, 1999. IXYS evaluates the acquisition of businesses, products or technologies that complement IXYS' business. Any such transactions, if consummated, may use a portion of IXYS' working capital or require the issuance of equity securities, which may result in further dilution to IXYS' stockholders. IXYS believes that cash generated from operations, if any, and banking facilities will be sufficient to meet its cash requirements through fiscal 2001. To the extent that funds generated from operations, together with bank facilities are insufficient to meet its capital requirements, IXYS will be required to raise additional funds. No assurance can be given that additional financing will be available on acceptable terms. The lack of such financing if needed, would have a material adverse effect on IXYS' business, financial condition and results of operations. New Accounting Standards In June 1998, the Financial Accounting Standards Board ("FASB") issued SFAS No. 133. "Accounting for Derivative Instruments and Hedging Activities." The Statement will require us to recognize all derivatives on the balance sheet at fair value. SFAS No. 133 requires that derivative instruments used to hedge be identified specifically as to assets, liabilities, firm commitments or anticipated transactions and measured as to effectiveness and ineffectiveness when hedging changes in fair value or cash flows. Derivative instruments that do not qualify as either a fair value or cash flow hedge will be valued at fair value with the resultant gain or loss recognized in current earnings. Changes in the effective portion of fair value hedges will be recognized in current earnings along with the change in fair value of the hedged item. Changes in the effective portion of the fair value of cash flow hedges will be recognized in other comprehensive income until realization of the cash flows of the hedged item through current earnings. Any ineffective portion of hedges will be recognized in current earnings. In June 1999, the FASB issued SFAS No. 137, "Deferral of the Effective Date of FASB Statement No. 133," to defer for one year the effective date of implementation of SFAS No. 133. SFAS No. 133, as amended by SFAS No. 137, is effective for fiscal years beginning after June 15, 2000, with earlier application 4 encouraged. We are in the process of evaluating the requirements of SFAS Nos. 133, but do not expect this pronouncement to materially impact our financial position or results of operations. In December 1999, the SEC issued Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements." SAB 101 summarizes certain of the SEC's views in applying generally accepted accounting principles to revenue recognition in financial statements. In March 2000, the SEC issued SAB No. 101A, to defer for one quarter the effective date of implementation of SAB No. 101 with earlier application encouraged. We do not expect the adoption of SAB 101 to have a material effect on our financial position or results of operations. In March 2000, The Financial Accounting Standards Board ("FAB") issued FASB interpretation No. 44 "Accounting for Certain Transactions Involving Stock Compensation an interpretation of APB Opinion No. 25." This interpretation has provisions that are effective on staggered dates, some of which began after December 15, 1998 and others that become effective after June 30, 2000. The adoption of this interpretation did not and will not have a material impact on the financial statements. Year 2000 Conversion IXYS has not experienced any known material adverse impacts on our current products, internal information systems, and non-information technology systems (equipment and systems) as a result of the Year 2000 issue. IXYS made capital expenditures and incurred related expenses of approximately $330,000 to prepare ourselves for the Year 2000 conversion. No system projects were deferred in relation to the Year 2000 issue. ITEM 8. FINANCIAL STATEMENTS IXYS CORPORATION INDEX TO FINANCIAL STATEMENTS CONTENTS
Page ---- Audited Financial Statements Consolidated Statement of Comprehensive Income........................... 6
5 IXYS CORPORATION CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (in thousands)
Year Ended March 31, ----------------------- 1998 1999 2000 ------ ------- ------ Net income............................................ $6,084 $(5,238) $6,899 Other comprehensive income, net of tax: Foreign currency translation adjustments............ (540) 405 (1,167) ------ ------- ------ Comprehensive income................................ $5,544 $(4,833) $5,732 ------ ------- ------
6 PART III ITEM 11. EXECUTIVE COMPENSATION Director And Executive Compensation Directors currently receive no cash compensation from IXYS for their services as members of the IXYS Board, but are reimbursed for certain expenses in connection with attendance at IXYS Board and Committee meetings. IXYS' 2000 Non-Employee Directors' Equity Incentive Plan (the "Directors' Plan"), effective during fiscal 2000, provides for the grant of options to non-employee directors pursuant to a discretionary grant mechanism administered by the IXYS Board. These options vest over a period of time, to be determined in each case by the IXYS Board, so long as the optionee remains a non-employee director of IXYS. The following table sets forth certain compensation awarded or paid by IXYS during the fiscal year ended March 31, 2000 to its President and Chief Executive Officer and IXYS' other executive officers who earned more than $100,000 during the fiscal year ended March 31, 2000 (collectively, the Named Executive Officers): Summary Compensation Table
Annual Compensation --------------- Securities Name and Principal Other Annual Underlying All Other Position Year Salary($) Bonus($)(1) Compensation($)(2) Options(#) Compensation($) - ------------------ ---- ---------- ----------- ------------------ ---------- --------------- Nathan Zommer........... 2000 357,420(3) 124,300 15,605 240,000 2,110(4) President and Chief 1999 200,004 257,700 16,597 31,300 11,607(5) Executive Officer 1998 200,004 267,800 18,710 -- 2,200(4) Arnold Agbayani......... 2000 189,190(3) 48,000 12,693 20,000 2,830(4) Vice President, 1999 128,004 171,600 15,238 17,400 10,229(6) Finance and 1998 128,004 171,600 12,839 -- 2,830(4) Administration, Chief Financial Officer and Secretary Richard Fassler(7)...... 2000 111,907 43,013 -- 70,000 -- Former Vice President, 1999 100,848 28,411 7,800 7,000 -- Sales and Marketing 1998 90,250 41,405 7,800 -- -- Peter Ingram............ 2000 154,578 19,294 1,752 90,000 -- Vice President, 1999 153,961 25,851 6,893 12,200 -- European Operations 1998 151,483 -- 6,373 -- -- Kevin McDonough(8)...... 2000 120,346 3,000 -- 120,000 -- Vice President, U.S. 1999 110,822 3,000 -- 4,300 -- Operations 1998 23,692 2,000 1,800 -- --
- -------- (1)Represents annual bonus earned for performance in the specified fiscal year. (2)Represents car allowance. (3)Includes retroactive payments made during fiscal year 2000 attributable to base salary increases in fiscal year 1999. (4)Represents premiums paid for group term life insurance. (5)Includes $2,110 premiums paid for group term life insurance and $9,497 tax gross-up paid by us. (6)Includes $2,830 premiums paid for group term life insurance and $7,399 tax gross-up paid by us. (7)Mr. Fassler left our company in January 2000. (8)Mr. McDonough joined us in January 1998. 7 Option Grants In Last Fiscal Year
Potential Realizable Value at Assumed Annual # of # of Total Rates of Stock Securities Options Price Appreciation Underlying Granted in Exercise for Term (3) Options Fiscal Price Per Expiration ------------------- Name Granted Year (1) Share (2) Date 5% 10% ---- ---------- ---------- --------- ---------- -------- ---------- Nathan Zommer........... 240,000 16.3% $4.675 11/18/09 $706,860 $1,783,980 President and Chief Executive Officer Arnold Agbayani......... 20,000 1.4 4.25 11/18/09 53,550 135,150 Secretary, Vice President, Finance and Administration Richard Fassler......... 70,000 4.8 4.25 11/18/00 187,425 473,025 Former Vice President, Sales and Marketing Peter H. Ingram......... 30,000 2.0 4.25 11/18/09 80,325 202,725 Vice President, 34,628 2.4 7.25 1/20/10 158,163 399,174 European Operations 25,372 1.7 7.25 1/20/10 115,886 292,475 Kevin McDonough......... 35,000 2.4 4.25 11/18/09 93,712 236,512 Vice President, U.S. 35,002 2.4 7.25 1/20/10 159,871 403,485 Operations 49,998 3.4 7.25 1/20/10 228,365 576,351
- -------- (1.) Based on an aggregate of 1,470,000 options granted to employees and consultants of IXYS in fiscal 2000 including the Named Executive Officers. (2.) Exercise prices are equal to the closing price of IXYS Common Stock on the Nasdaq Small Cap Market on the date of grant, except Mr. Zommer's option was priced 10% above such closing price. (3.) The potential realizable value is calculated based on the term of the option at its time of grant (10) years and is calculated by assuming that the stock price on the date of grant appreciates at the indicated annual rate compounded annually for the entire term of the option and that the option is exercised and sold on the last day of its term for the appreciated price. The 5% and 10% assumed rates of appreciation are derived from the rules of the Securities and Exchange Commission and do not represent our estimate or projection of the future IXYS Common Stock price. 8 Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values The following table sets forth information with respect to the number of securities underlying unexercised options held by the Named Executive Officers as of March 31, 2000 and the value of unexercised in-the-money options as of March 31, 2000:
Number of Number of Securities Value of Unexercised In-The Shares Underlying Unexercised Money Options at March 31, Acquired Options at March 31, 2000 2000 (2) On Value ------------------------- ----------------------------- Name Exercise Realized (1) Exercisable Unexercisable Exercisable Unexercisable (1) ---- --------- ------------ ----------- ------------- ----------- ----------------- Nathan Zommer........... -- -- 99,905 265,040 $675,676 $2,379,777 President and Chief Executive Officer Arnold Agbayani......... -- -- 33,759 35,511 236,995 338,654 Secretary, Vice President, Finance Richard Fassler......... 1,050 $4,856 16,622 -- 62,739 -- Former Vice President, Sales and Marketing Peter A. Ingram......... -- -- 21,642 100,512 186,424 762,604 Vice President, European Operations Kevin McDonough......... -- -- 860 88,440 8,762 897,607 Vice President, U.S. Operations
- -------- (1.) The value realized is based on the fair market value of IXYS Common Stock on the date of exercise minus the exercise price. (2.) The valuations are based on the fair market value of IXYS Common Stock on March 31, 2000 of $13.563 minus the exercise price of the options. Employment Contracts IXYS entered into an employment agreement, dated as of January 1, 1995, with Dr. Nathan Zommer, Chief Executive Officer of IXYS. The agreement provides for, among other things, salaries, bonuses and car allowances as determined by the IXYS Board. Under the terms of the agreement, IXYS agrees to maintain term life insurance in the amount of $1,000,000. In addition, the agreement provides that if IXYS terminates Dr. Zommer's employment without cause, Dr. Zommer shall be entitled to receive as severance his monthly salary, incremented one month per year of service to IXYS, to a maximum of twelve months. The agreement also provides Dr. Zommer with a paid annual physical exam and the limited services of a financial advisor. The agreement was amended on July 1, 1998 to extend its term to January 31, 2004. In the amended agreement, Dr. Zommer's annual bonus is 40% of his base salary, which was increased to $285,000. In addition, he is eligible for an incentive bonus of three times his base annual salary in the event of certain transactions significantly affecting IXYS, including a reorganization, consolidation, merger and sale of IXYS stock or assets. If his employment terminates within a year after a change of control event, Dr. Zommer is entitled to receive severance equal to three times his average annual compensation, continued benefits for 18 months and accelerated vesting of all option shares. IXYS entered into an employment agreement, dated as of January 1, 1995, with Mr. Arnold Agbayani, Chief Financial Officer of IXYS. The agreement provides for, among other things, salaries, bonuses and car 9 allowances as determined by the IXYS Board. Under the terms of the agreement, IXYS agrees to maintain term life insurance in the amount of $1,000,000. In addition, the agreement provides that if IXYS terminates Mr. Agbayani's employment without cause, Mr. Agbayani shall be entitled to receive as severance his monthly salary, incremented one month per year of service to IXYS, to a maximum of twelve months. The agreement also provides Mr. Agbayani with a paid annual physical exam and the limited services of a financial advisor. The agreement was amended on July 1, 1998 to extend its term to January 31, 2004. In the amended agreement, Mr. Agbayani's annual bonus is 30% of his base salary, which was increased to $160,000. In addition, he is eligible for an incentive bonus of three times his annual base salary in the event of certain transactions significantly affecting IXYS, including a reorganization, consolidation, merger and sale of IXYS stock or assets. If his employment terminates within a year after a change of control event, Mr. Agbayani is entitled to receive severance equal to three times his average annual compensation, continued benefits for 18 months and accelerated vesting of all option shares. Compensation Committee Interlocks and Insider Participation The Securities and Exchange Commission requires disclosure where an executive officer of a company served or serves as a director or on the compensation committee of another entity and an executive officer of such other entity served or serves as a director or on the compensation committee of IXYS. IXYS does not have any such interlocks. Decisions as to executive compensation are made by the Compensation Committee. During fiscal year 2000, the Compensation Committee was comprised entirely of non-employee directors. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Certain Transactions On September 14, 1995, the IXYS Board authorized stock grants (the "1995 Management Stock Awards"), made pursuant to certain Stock Purchase Agreements, to Dr. Zommer, Mr. Agbayani, Richard Fassler, Yoram Hirsch, Peter Ingram, and Robert Kane (each referred to as an "IXYS Executive" and collectively referred to as "IXYS Executives"). Pursuant to the terms of such agreements, if an IXYS Executive voluntarily terminates his employment with IXYS or is terminated for cause (the "Termination"), IXYS has the right to repurchase from such IXYS Executive any or all of his shares that remain unvested on the Termination Date. In connection with the 1995 Management Stock Awards, an aggregate of 3,908,094 shares of IXYS Common Stock were granted at a price of $0.23 per share to the IXYS Executives. Such shares were paid for by the IXYS Executives with recourse promissory notes and vest on a five-year schedule. As of January 1, 1998, Dr. Zommer's and Mr. Agbayani's shares had fully vested. As of December 31, 1999, Mr. Fassler's and Mr. Ingram's shares had fully vested. In connection with Mr. Hirsch's and Mr. Kane's departures from IXYS, IXYS exercised its purchase option with respect to 29,606 and 20,302 shares respectively, pursuant to the terms of the Stock Purchase Agreements. See also "Item 11. Executive Compensation." In November 1996, IXYS loaned approximately $75,000 to Dr. Zommer, in exchange for a promissory note bearing a simple interest rate of 8.25% per annum. The principal amount of the loan, plus any interest thereon, is due and payable no later than November 12, 2001. In the event of Dr. Zommer's voluntary termination or his termination for cause, the loan will be due and payable one year from the date of his termination. IXYS has entered into indemnity agreements with certain officers and directors which provide, among other things, that IXYS will indemnify such officer or director, under the circumstances and to the extent provided therein, for expenses, damages, judgments, fines and settlements he may be required to pay in actions or proceedings which he is or may be made a party by reason of his position as a director, officer or other agent of IXYS, and otherwise to the full extent permitted under Delaware law and the Amended and Restated Bylaws of IXYS. See also "Item 11. Executive Compensation-- Compensation Committee Interlocks and Insider Participation." ABB AG is a principal stockholder of IXYS. In fiscal 2000, IXYS generated revenues of $653,000 from sales of products to ABB AG and to ABB AG's affiliates for use as components in their products. 10 PART IV ITEM 14. Exhibits, Financial Statement Schedules, and Reports on Form 10-K (a) The following documents are filed as part of this Report on Form 10- K: (1) Financial Statements: Consolidated Statement of Comprehensive Income (b) Financial Statement Schedules (2) Financial Statements schedules have been omitted from this report because the information is provided in the Financial Statements or is not applicable. (3) Exhibits 11
Exhibit No. Description ----------- ----------- 2.1 Agreement and Plan of Merger and Reorganization, dated as of March 6, 1998 and amended April 10, 1998 and May 29, 1998, among Paradigm Technology, Inc., Paradigm Enterprises, Inc. and IXYS Corporation. (1) 3.1 Amended and Restated Certificate of Incorporation of the Registrant. (1) 3.2 Certificate of Amendment to Amended and Restated Certificate of Incorporation (regarding increased authorization and reverse stock split). (2) 3.3 Certificate of Amendment to Amended and Restated Certificate of Incorporation (regarding name change). (2) 4.2 Amended and Restated Bylaws of the Registrant. (3) 10.1 First Amended Executive Employment Agreement, dated as of July 1, 1998, by and between IXYS and Nathan Zommer. (1) 10.2 First Amended Executive Employment Agreement, dated as of July 1, 1998, by and between IXYS and Arnold Agbayani. (1) 10.3 Wafer Foundry Agreement, dated as of June 21, 1995, as amended on March 28, 1996 and March 13, 1998, by and between IXYS and Samsung Electronics Co. (1) 10.4 Lampertheim Contractual Purchase Deed and Conveyance, dated as of February 26, 1997. (1) 10.5 Loan Agreement, dated as of February 27, 1997, by and between IXYS and Commerzbank, Aktiengesellschaft, Mannheim Branch. (1) 10.6 Loan and Security Agreement, dated as of December 24, 1997, by and between IXYS and Bank of the West. (1) 10.7 Form of Indemnity Agreement between IXYS and its directors. (3) 10.8 The Paradigm 1994 Stock Option Plan, as amended. (3) 10.9 The IXYS 1999 Equity Incentive Plan. (4) 10.10 The IXYS 1999 Employee Stock Purchase Plan. (4) 10.11 The IXYS 1999 Non-Employee Directors' Equity Incentive Plan. (4) 10.12 Amendment of Lease by and between Mission West Properties, L.P. and IXYS Corporation, dated as of September 30, 1998. (4) 10.13 Registration and Stockholder Rights Agreement, by and between IXYS, Asea Brown Boveri AG, and Asea Brown Boveri, Inc., dated September 23, 1998. (2) 10.14* Letter of Credit Agreement by and between IXYS and Commerzbank. 23.1** Consent of PricewaterhouseCoopers LLP. 24.1 Power of Attorney. (6) 27.1** Financial Data Schedule.
(b) Financial Statement Schedules. (c) IXYS has filed no reports on Form 8-K during the last quarter of this fiscal year. - -------- *To be filed by amendment. **previously filed. (1) Filed as an Annex or Exhibit to the Joint Proxy Statement/Prospectus forming part of the Registration Statement on Form S-4 of Paradigm Technology, Inc., as amended (333-57003) and incorporated herein by reference. 12 (2) Filed as an Exhibit to the Quarterly Report on Form 10-Q for the period ended September 30, 1998 and incorporated herein by reference. (3) Filed as an Exhibit to the Quarterly Report on Form 10-Q for the period ended December 31, 1998 and incorporated herein by reference. (4) Filed on an Exhibit to the Annual Report on Form 10-K for year ended March 31, 1999 and incorporated herein by reference. (5) Filed on an Exhibit to Quarterly Report on Form 10-Q for the period ended December 31, 1999 and incorporated herein by reference. (6) Included in the signature page of this Report on Form 10-K. 13 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to a report to be signed on its behalf by the undersigned, thereunto duly authorized. IXYS Corporation /s/ Arnold P. Agbayani By: _________________________________ Arnold P. Agbayani Vice President, Finance and Chief Financial Officer and Secretary Dated: September 28, 2000 14 -----END PRIVACY-ENHANCED MESSAGE-----