8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

(Amendment No.1)

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 27, 2013

IXYS Corporation

(Exact name of registrant as specified in its charter)

Delaware	000-26124	77-0140882
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

1590 Buckeye Drive, Milpitas, California 95035

(Address of principal executive offices) (Zip Code)

(408) 457-9000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Explanatory Note

On July 2, 2013, IXYS Corporation, or IXYS, filed a Current Report on Form 8-K reporting the completion on June 27, 2013 of its previously announced acquisition of certain assets (the “MCU Business”) pursuant to the Asset Purchase Agreement dated May 25, 2013 by and among IXYS, IXYS Intl Limited and Samsung Electronics Co. Ltd (“Samsung”). This Amendment No. 1 to the initial Form 8-K is being filed to provide the financial statements described under Item 9.01 below.

Based on information provided by Samsung, revenues generated by the MCU Business for the calendar year ended December 31, 2012 (Samsung’s fiscal year-end) were $89.1 million, or approximately 0.05% of the total revenues of Samsung ($187.8 billion for the fiscal year 2012). It was not practical to obtain full financial statements for the MCU Business. The statements of assets acquired and statements of net revenues and direct operating expenses are being presented in lieu of the full financial statements in satisfaction of Rule 3-05 of Regulation S-X.

Samsung’s fiscal year ends on December 31, while IXYS’ fiscal year ends on March 31. As such, the financial information of the MCU Business reported in this form is presented to align with the reporting periods of IXYS’ fiscal year and quarters. Information for the fiscal year ended on March 31, 2013 is comparable with the MCU Business’ fiscal year ended on December 31, 2012 and IXYS’ first quarter ended on June 30, 2013 is comparable to the MCU Business’ first quarter ended on March 31, 2013. Those periods have been reflected below for the financial information of the MCU Business and pro forma condensed combined unaudited statements of operations. No pro forma balance sheet is required to be filed in this Form 8-K/A, as the June 30, 2013 balance sheet of IXYS includes the effects of the acquisition.

Item 9.01 Financial Statements and Exhibits

(a) Financial Statements of Business Acquired

The following financial statements of the MCU Business are filed as Exhibit 99.1 and incorporated herein by reference:

i. Audited statements of assets acquired of the MCU Business, as of December 31, 2012 and 2011 and statements of net revenues and direct operating expenses of the MCU Business for the three years ended December 31, 2012, and unaudited statements of assets acquired of the MCU Business as of March 31, 2013 and statements of net revenues and direct operating expenses of the MCU Business for the three months ended March 31, 2013 and March 31, 2012.

(b) Pro Forma Financial Information

The following unaudited pro forma condensed combined consolidated financial statements of IXYS and the MCU Business are filed as Exhibit 99.2 and incorporated herein by reference:

i. Unaudited pro forma condensed combined consolidated statement of operations for the year ended March 31, 2013.

ii. Unaudited pro forma condensed combined consolidated statement of operations for the quarter ended June 30, 2013.

iii. Notes to the unaudited pro forma condensed combined consolidated financial statements.

(d) Exhibits

23.1	Consent of Independent Accountants.
99.1	Audited statements of assets acquired of the MCU Business, as of December 31, 2012 and 2011 and statements of net revenues and direct operating expenses of the MCU Business for the three years ended December 31, 2012, and unaudited statements of assets acquired of the MCU Business as of March 31, 2013 and statements of net revenues and direct operating expenses of the MCU Business for the three months ended March 31, 2013 and March 31, 2012.
99.2	IXYS Corporation and the MCU Business unaudited pro forma condensed combined consolidated statement of operations for the fiscal year ended March 31, 2013, the quarter ended June 30, 2013 and notes.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: September 10, 2013	IXYS CORPORATION
	By:	/s/ Uzi Sasson
		Name:	Uzi Sasson
		Title:	President and Chief Financial Officer

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INDEX TO EXHIBIT LIST

Exhibit
No.	Description
23.1	Consent of Independent Accountants.
99.1	Audited statements of assets acquired of the MCU Business, as of December 31, 2012 and 2011 and statements of net revenues and direct operating expenses of the MCU Business for the three years ended December 31, 2012, and unaudited statements of assets acquired of the MCU Business as of March 31, 2013 and statements of net revenues and direct operating expenses of the MCU Business for the three months ended March 31, 2013 and March 31, 2012.
99.2	IXYS Corporation and the MCU Business unaudited pro forma condensed combined consolidated statement of operations for the fiscal year ended March 31, 2013, the quarter ended June 30, 2013 and notes.

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EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-177784, 333-174797, 333-167548, 333-163975, 333-147256, 333-139502, 333-109857, 333-96081, 333-92204, 333-66289 and 333-4412) of IXYS Corporation of our report dated September 10, 2013, relating to the statements of assets acquired and statements of net revenues and direct operating expenses of the MCU Business, which appears in the Current Report on Form 8-K of IXYS Corporation dated June 27, 2013, as amended.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

September 10, 2013

EX-99.1

Exhibit 99.1

MCU Business

Statements of Assets Acquired and

Statements of Net Revenues and Direct Operating Expenses

As of March 31, 2013 (Unaudited), December 31, 2012 and 2011, for Each

Of the Three Years in the Period Ended December 31, 2012 and for the Three

Months Ended March 31, 2013 (Unaudited) and March 31, 2012 (Unaudited)

Contents

Independent Auditor’s Report	1
Financial Statements
Statements of Assets Acquired	2
Statements of Net Revenues and Direct Operating Expenses	3
Notes to Statements of Assets Acquired and Statements of Net Revenues and Direct Operating Expenses	4–7

Independent Auditor’s Report

To the Board of Directors of Samsung Electronics Co., Ltd.

We have audited the accompanying statements of assets acquired of the MCU Business (as defined in Note 1) as of December 31, 2012 and 2011 and the related statements of net revenues and direct operating expenses for each of the three years ended December 31, 2012.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the statements referred to above present fairly, in all material respects, the assets acquired of the MCU Business as of December 31, 2012 and 2011 and its net revenues and direct operating expenses for each of the three years ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.

Emphasis of Matter

The accompanying statements of assets acquired and statements of net revenues and direct operating expenses of the MCU Business were prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission for inclusion in the Current Report on Form 8-K of IXYS Corporation as described in Note 2, and are not intended to be a complete presentation of the results of operations of the MCU Business.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

September 10, 2013

1

MCU BUSINESS

STATEMENT OF ASSETS ACQUIRED

	March 31, 2013		December 31, 2012		December 31, 2011
	(Unaudited)
Assets acquired
Inventories	$	1,173,249	$	796,625	$	2,276,803
Machinery and equipment		44,769		54,676		81,213
Intangible assets		28,504		30,792		33,045
Total assets acquired	$	1,246,522	$	882,093	$	2,391,061

2

MCU BUSINESS

STATEMENTS OF NET REVENUES AND DIRECT OPERATING EXPENSES

	2012		Year Ended December 31, 2011		2010
Net revenues	$	89,071,542	$	98,490,748	$	110,526,104
Direct operating expenses
Cost of goods sold	$	59,326,884	$	54,646,327	$	56,099,849
Sales expenses		2,721,941		3,422,921		5,816,056
Product development expenses		4,028,320		2,518,709		3,284,103
Total direct operating expenses		66,077,145		60,587,957		65,200,008
Net revenues less direct operating expenses	$	22,994,397	$	37,902,791	$	45,326,096

MCU BUSINESS

STATEMENTS OF NET REVENUES AND DIRECT OPERATING EXPENSES

	Three Month Period Ended
	March 31,
	2013		2012
	(Unaudited)
Net revenues	$	23,897,985	$	21,830,450
Direct operating expenses
Cost of goods sold	$	16,881,410	$	14,803,024
Sales expenses		955,832		713,028
Product development expenses		2,402,521		979,061
Total direct operating expenses		20,239,763		16,495,113
Net revenues less direct operating expenses	$	3,658,222	$	5,335,337

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MCU Business

Notes to Statements of Assets Acquired and

Statements of Net Revenues and Direct Operating Expenses

As of March 31, 2013 (Unaudited), December 31, 2012 and 2011, for Each

Of the Three Years in the Period Ended December 31, 2012 and for the Three

Months Ended March 31, 2013 (Unaudited) and March 31, 2012 (Unaudited)

1. General information

The Microcontroller Business Unit is a division of Samsung Electronics Co., Ltd. (“the Company”) and is engaged in the development, manufacturing and sales of 4-bit, 8-bit, 16-bit and 32-bit microcontroller products for use in remote controls.

Pursuant to an asset purchase agreement (the “APA”) dated May 25, 2013 between the Company and IXYS Corporation (“the Acquirer”), the Acquirer purchased certain operating assets related to the 4-bit and 8-bit microcontroller product lines of the Company including inventories, equipment and intangible assets for approximately $50 million in cash. No liabilities were transferred as a result of the transaction. Hereinafter, the assets and the related business sold under the APA are referred to as the “MCU Business”. The Company will retain the remainder of its microcontroller product lines, comprised of 16-bit and 32-bit products.

2. Summary of Significant Accounting Policies

2.1 Basis of Presentation

The accompanying financial statements of the MCU Business were prepared for the purpose of providing the Acquirer with historical information to comply with the rules and regulations of the Securities and Exchange Commission for inclusion in the current report on Form 8-K to be filed by the Acquirer. The accompanying financial statements include assets acquired and net revenues and direct operating expenses of the MCU Business for the periods presented.

These statements are derived from the Company’s historical accounting records and do not purport to reflect the assets acquired and the net revenues and direct operating expenses that would have resulted if the MCU Business had been a separate, stand-alone company during the periods presented. The MCU Business was only a small component of the Company prior to the divestiture and accordingly, historical financial statements in accordance with generally accepted accounting principles in the U.S. (“U.S. GAAP”) have not previously been prepared, nor is it practicable to prepare separate, historical financial statements for the MCU Business. The statements of assets acquired and the statement of net revenues and direct operating expenses vary from a complete financial statement prepared in accordance with U.S. GAAP because they only include assets acquired and exclude indirect expenses, such as certain general and administrative expenses, interest expenses, depreciation and amortization, income taxes and the allocation of corporate overhead costs. Therefore, the results set forth in the statements of net revenues and direct operating expenses may not be representative of future operations.

The accompanying statements of assets acquired as of March 31, 2013 and the statements of net revenues and direct operating expenses for the three month periods ended March 31, 2013 and 2012 for the MCU Business are unaudited, but, in the opinion of management, have been prepared on the same basis as the audited statements of assets acquired of the MCU Business as of December 31, 2012 and 2011, and the related statements of net revenues and direct operating expenses for each of the three years ended December 31, 2012.

Translation into United States Dollar Amounts

The Company operates primarily in Korean Won and its official accounting records are maintained in Korean Won. The U.S. dollar amounts provided in the financial statements have been translated using the spot rates at the dates of the statements of assets acquired and the average exchange rates for the three or twelve months ended at the dates of the statements of net revenues and direct operating expenses.

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2.2 Use of Estimates

Preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

2.3 Inventories

Inventories consist solely of finished goods and are stated at the lower of cost and net realizable value. Cost is determined using the average cost method. The cost of finished goods comprises design costs, raw materials, direct labor, other direct costs and related production overheads (based on normal operating capacity). It excludes costs of idle plant and abnormal waste. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

Inventories are reduced for the estimated losses arising from excess, obsolescence, and decline in value. This reduction is determined by estimating net realizable value based on future customer demand. The losses on inventory obsolescence are recorded as a part of cost of sales.

2.4 Machinery and Equipment

Machinery and equipment are stated at cost less accumulated depreciation. Depreciation is calculated on the straight-line method over the estimated useful life of the asset. The estimated useful life is as follows:

Machinery and equipment 5 years

2.5 Intangible assets

Intangible assets consist of patents. Patents are stated at the net of cost less accumulated amortization. Amortization is calculated on the straight-line method over the estimated useful life of ten years.

2.6 Revenue Recognition

Revenue mainly comprises the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the MCU Business’s activities. Revenue is shown net of value-added tax, returns, rebates and discounts and after eliminating intercompany transactions.

Sales of products and merchandise are recognized upon delivery when the significant risks and rewards of ownership of goods have transferred to the buyer, continuing managerial involvement usually associated with ownership and effective control have ceased, the amount of revenue can be measured reliably, and it is probable that the economic benefits associated with the transaction will flow to the Company. The Company records reductions to revenue for special pricing arrangements, price protection and other volume based discounts. If product sales are subject to customer acceptance, revenue is not recognized until customer acceptance occurs.

2.7 Direct Operating Expenses

Direct operating expenses on the accompanying statements of net revenues and direct operating expenses, which include cost of goods sold, sales expenses, and product development expenses represent the total direct operating expenses recorded within the MCU Business. Direct operating expenses were extracted from the Company’s accounts based upon specifically identifiable cost centers or projects associated with the activities of the MCU Business. The MCU Business’ statements of net revenues and direct operating expenses exclude corporate overhead, including items such as human resources, legal services and settlements, compliance, finance, tax and treasury functions that are managed by the Company. Additionally, depreciation expense of assets not acquired, interest expense and income taxes have also been excluded from the financial statements.

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3. Inventories

Inventories are summarized as follows:

	March 31, 2013			December 31, 2012			December 31, 2011
	(Unaudited)
Finished goods	$	1,180,415		$	810,105		$	2,291,361
Less inventory reserve		(7,166	)		(13,480	)		(14,558	)
Net inventories	$	1,173,249		$	796,625		$	2,276,803

4. Machinery and equipment

Details of machinery and equipment are summarized as follows:

	March 31, 2013			December 31, 2012			December 31, 2011
	(Unaudited)
Machinery and equipment	$	18,257,794		$	18,956,674		$	17,605,561
Accumulated depreciation		(18,213,025	)		(18,901,998	)		(17,524,348	)
Net machinery and equipment	$	44,769		$	54,676		$	81,213

Depreciation expense for years ended December 31, 2012, 2011, and 2010 was $5.8 million, $3.7 million, and $4.6 million, respectively. Depreciation expense for the three month periods ended March 31, 2013 and 2012 was $1.8 million and $1.3 million, respectively. Depreciation expense for the periods is primarily recorded in cost of goods sold.

5. Intangible Assets

Details of Intangible Assets are as follows:

	March 31, 2013			December 31, 2012			December 31, 2011
	(Unaudited)
Patent	$	46,119		$	47,884		$	44,471
Accumulated amortization		(17,615	)		(17,092	)		(11,426	)
Net intangible assets	$	28,504		$	30,792		$	33,045

Amortization expense for years ended December 31, 2012, 2011, and 2010 was $4,557, $4,546, and $2,972, respectively. Amortization expense for the three month periods ended March 31, 2013 and 2012 was $1,180 and $1,132, respectively. Amortization expense for the periods is primarily recorded in cost of goods sold.

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6. Selected Cash Flow Information

The following selected cash flow information has been prepared from cash flows related solely to cash flows used in or provided by changes in the specific assets comprising the MCU Business.

	Three month period ended March 31,					Year ended December 31,
	2013			2012		2012		2011			2010
	(Unaudited)
Net revenues less direct operating expenses	$	3,658,222		$	5,335,337	$	22,994,397	$	37,902,791		$	45,326,096
Change in inventories		(376,624	)		88,100		1,480,178		(245,333	)		(401,473	)
Selected operating cash flows		3,281,598			5,423,437		24,474,575		37,657,458			44,924,623
Purchases of intangible assets		—			—		—		(12,871	)		(3,553	)
Selected investing cash flows		—			—		—		(12,871	)		(3,553	)
Net selected cash flows	$	3,281,598		$	5,423,437	$	24,474,575	$	37,644,587		$	44,921,070

7. Subsequent Events

Subsequent events have been evaluated for recognition and disclosure through September 10, 2013, the date the financial statements were available to be issued. There have been no subsequent events requiring disclosure other than the sale below.

Pursuant to the APA mentioned heretofore and dated as of May 25, 2013 between the Company and the Acquirer, the Acquirer purchased the MCU Business from the Company in return for approximately $50 million in cash. The APA provides for a working capital adjustment at the transaction close date such that any working capital deficiencies can be settled through additional cash consideration. Accordingly, certain assets which have been included in the above statements of assets acquired may change as of the close of the transaction.

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EX-99.2

Exhibit 99.2

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS

On June 27, 2013, IXYS Corporation, or IXYS, completed the acquisition of certain assets (the “MCU Business”) pursuant to the Asset Purchase Agreement dated May 25, 2013 by among IXYS, IXYS Intl. Limited and Samsung Electronics Co. Ltd (“Samsung”).

For the purpose of the unaudited pro forma condensed combined consolidated statements of operations, the acquisition was assumed to have occurred as of April 1, 2012. IXYS has reflected the effect of the acquisition of the MCU Business in the unaudited condensed consolidated balance sheet as of June 30, 2013 included in its Form 10-Q. As a result of filing the original Form 8-K on July 2, 2013, IXYS is not required to include a pro forma balance sheet. The unaudited pro forma condensed combined statements of operations for the twelve months ended March 31, 2013 combines the historical operating results of IXYS for the year ended March 31, 2013 and of the MCU Business the year ended December 31, 2012. The unaudited pro forma condensed combined statements of operations for the three months ended June 30, 2013 combines the historical operating results of IXYS for the quarter ended June 30, 2013 and of the MCU Business the quarter ended March 31, 2013.

The acquisition of the MCU Business has been accounted for in accordance with the authoritative guidance on business combinations. The total purchase consideration has been allocated on a preliminary basis to the tangible and intangible assets acquired based on their relative fair values. No liabilities were assumed under generally accepted accounting principles. The excess of the purchase consideration over the tangible and identifiable intangible assets is recorded as goodwill. The purchase price allocation is preliminary. IXYS is in the process of obtaining additional information and reviewing fair value calculations and assumptions prior to finalizing the purchase price allocation. Accordingly, the pro forma adjustments related to the purchase price allocation and certain other adjustments are preliminary and have been made solely for the purpose of providing unaudited pro forma condensed combined financial statements.

The unaudited pro forma condensed combined consolidated financial information is for informational purposes only and does not purport to represent what the Company’s actual results would have been if the acquisition had been completed as of the date indicated above, or that may be achieved in the future. The unaudited pro forma condensed combined consolidated statements of operations do not include the effects of any cost savings from operating efficiencies or synergies that may result from the acquisition. The historical financial information of the MCU Business presented only includes the direct revenues and expenses related to the MCU Business’ activities. IXYS intends to integrate the MCU Business into IXYS’ existing corporate infrastructure. As such, the pro forma statements of operations are not indicative of operations going forward as the financial information for the MCU Business excludes various operating expenses.

The unaudited pro forma condensed combined consolidated financial statements, including the notes thereto, should be read in conjunction with (i) the Company’s historical financial statements included in the Company’s annual report on Form 10-K for the year ended March 31, 2013, (ii) the interim unaudited condensed consolidated financial statements as of and for the three months ended June 30, 2013, (iii) the audited statements of net assets acquired of the MCU Business as of December 31, 2012 and 2011 and the audited statements of net revenues and direct operating expenses for the three years ended December 31, 2012 and (iv) the unaudited statement of net assets acquired of the MCU Business as of March 31, 2013 and the unaudited statements of net revenues and direct operating expenses for the three months ended March 31, 2013 and 2012.

IXYS CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 2013⁽¹⁾

(In thousands, except per share data)

	Historical
	IXYS			MCU Business(2)		Proforma Adjustments			Reference			Proforma Combined (3)
	Twelve Months Ended March 31, 2013			Twelve Months Ended December 31, 2012
Net revenues	$	280,014		$	89,071	$	—					$	369,085
Cost of goods sold		195,134			59,327		—						254,461
Gross profit		84,880			29,744		—						114,624
Operating expenses:
Research, development and engineering		28,022			4,028		—						32,050
Selling, general and administrative		39,287			2,722		—						42,009
Amortization of intangible assets		2,244					18,206			( a	)		20,450
Total operating expenses		69,553			6,750		18,206						94,509
Operating income		15,327			22,994		(18,206	)					20,115
Other income (expense):
Interest income		334					—						334
Interest expense		(938	)				(1,119	)		( b	)		(2,057	)
Other income (expense), net		(41	)				—						(41	)
Income (loss) before income tax		14,682			22,994		(19,325	)					18,351
Provision for income tax		(7,034	)				(334	)		( c	)		(7,368	)
Net income	$	7,648		$	22,994	$	(19,659	)				$	10,983
Net income per share:
Basic	$	0.25										$	0.35
Diluted	$	0.24										$	0.35
Cash dividends per share	$	0.06										$	0.06
Weighted average shares used in per share calculation:
Basic		31,025											31,025
Diluted		31,695											31,695

See Notes to Unaudited Pro forma Condensed Combined Financial Statements.

(1) Assumes acquisition date of April 1, 2012.

(2) As fiscal years differ by less than 93 days, SEC Rule 11-02 permits combination without recasting of periods.

(3) Not indicative of operating results going forward, as it necessarily excludes various operating expenses of the MCU Business such as corporate overhead, human resources, legal services and settlements, compliance, finance, tax and treasury functions that are managed by the Company.

IXYS CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE QUARTER ENDED JUNE 30, 2013⁽¹⁾

(In thousands, except per share data)

	Historical
	IXYS			MCU Business(2)		Proforma Adjustments			Reference			Proforma Combined(3)
	Three Months Ended June 30, 2013			Three Months Ended March 31, 2013
Net revenues	$	71,186		$	23,898	$	—					$	95,084
Cost of goods sold		50,049			16,881		—						66,930
Gross profit		21,137			7,017		—						28,154
Operating expenses:
Research, development and engineering		7,687			2,403		—						10,090
Selling, general and administrative		10,043			956		(201	)		( d	)		10,798
Amortization of intangible assets		246					2,625			( e	)		2,871
Total operating expenses		17,976			3,359		2,424						23,759
Operating income		3,161			3,658		(2,424	)					4,395
Other income (expense):
Interest income		39					—						39
Interest expense		(212	)				(280	)		( f	)		(492	)
Other income (expense), net		(83	)				—						(83	)
Income (loss) before income tax		2,905			3,658		(2,704	)					3,859
Provision for income tax		(926	)				(90	)		( g	)		(1,016	)
Net income	$	1,979		$	3,658	$	(2,794	)				$	2,843
Net income per share:
Basic	$	0.06										$	0.09
Diluted	$	0.06										$	0.09
Cash dividends per share	$	0.03										$	0.03
Weighted average shares used in per share calculation:
Basic		30,948											30,948
Diluted		31,635											31,635

See Notes to Unaudited Pro forma Condensed Combined Financial Statements.

(1) Assumes acquisition date of April 1, 2012.

(2) As fiscal periods differ by less than 93 days, SEC Rule 11-02 permits combination without recasting of periods.

(3) Not indicative of operating results going forward, as it necessarily excludes various operating expenses of the MCU Business such as corporate overhead, human resources, legal services and settlements, compliance, finance, tax and treasury functions that are managed by the Company.

NOTES TO UNAUDITED PROFORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Pro Forma Presentation

On June 27, 2013, IXYS Corporation, or IXYS, completed the acquisition of certain assets (the “MCU Business”) pursuant to the Asset Purchase Agreement dated May 25, 2013 by among IXYS, IXYS Intl. Limited and Samsung Electronics Co. Ltd (“Samsung”).

The unaudited pro forma condensed combined consolidated statements of operations have been presented for the year ended March 31, 2013. These are based on historical statements of IXYS and the MCU Business after giving effect to the acquisition adjustments. The unaudited pro forma condensed combined consolidated statements of operations are presented as if the acquisition had occurred on April 1, 2012.

2. Purchase Price Allocation

The aggregate purchase price for the acquired assets is $50.0 million. The closing payment was $20.0 million and IXYS is obligated to pay $30.0 million in two installment payments of $15.0 million each. The first installment is due on June 27, 2014 and the second installment is due on December 31, 2014. The installments bear simple interest at a variable annual rate equal to six-month LIBOR plus a 3 percentage point margin.

The allocation of the purchase price presented in these financial statements is based on the estimated fair values of the assets acquired. No liabilities were assumed in this acquisition. The purchase price allocation is preliminary and may change upon the completion of our evaluation of the fair values of the acquired assets. The final allocation of the purchase price will be based upon the fair values of the acquired assets as on the date of completing the acquisition. The impact of such changes could be material.

The preliminary allocation of the purchase price based on estimated fair values (in thousands):

Inventories	$	1,150
Property, plant and equipment		36
Identifiable intangible assets:
Developed intellectual property		14,256
Customer relationships		14,703
In process intellectual property		13,090
Contract backlog		5,250
Noncompetition agreement		1,350
Goodwill		165
Total purchase price	$	50,000

Intangible Assets

The fair value of intangible assets is comprised of the following (in thousands):

Identifiable intangible assets	Preliminary fair value		First year amortization		Amortization for the three months ended June 30, 2013		Amortization method		Estimated useful life
Developed intellectual property	$	14,256	$	2,851	$	713		Straight line		60 months
Customer relationships		14,703		7,352		1,224		Accelerated		36 months
In process intellectual property (1)		13,090		2,618		654		Straight line		60 months
Contract backlog		5,250		5,250		—		Straight line		12 months
Noncompetition agreement		1,350		135		34		Straight line		120 months
Total	$	48,649	$	18,206	$	2,625

(1) For the purpose of pro forma calculations, it is assumed that in process intellectual property will be amortized from April, 1, 2012.

The valuation of the acquired intangibles is classified as a level 3 measurement under authoritative guidance on fair value measurements, because the valuation was based on significant unobservable inputs and involved management judgment and assumptions about market participants and pricing. The following was considered in determining the fair value of the assets:

i. Stage of development – Each asset was fully developed or was expected to develop and included in products on sale to commercial customers, and

ii. Anticipated future use – IXYS and any likely marketplace participant would continue to produce the product related to each technology asset in a manner similar to that assumed by IXYS.

These assets were valued using the Income approach and the Royalty savings approach consistent with the guidance in the AICPA Practice Aid titled “Assets Acquired in a Business Combination to Be Used in Research and Development Activities” as well as authoritative accounting guidance. The analysis considers the following major factors:

Forecast – A business forecast was prepared for each technology asset and product line reflecting current and anticipated future sales, cost of goods sold and operating expenses over the expected; remaining life of the asset, including the anticipated technological obsolesce of the asset.

Operating Income – An expected operating income was computed, specific to each asset, using the associated business forecast.

Capital Charges – Capital charges based on significant tangible and intangible assets needed to realize the operating income forecast were computed. For each contributory asset, the fair value of the asset was compared to its required, risk-adjusted return. Cumulative returns were allocated to individual technologies based on revenue and deducted from the operating income to arrive at an incremental income forecast, reflecting the contribution of the technology to the overall operating income.

Risk Adjusted Discount Rate – Each incremental operating income forecast was discounted to present value using a risk adjusted discount rate specific to the assets, its business forecast and the market it addresses. The rates used were compared to the overall implied rate for the transaction (based on the overall forecast and the consideration paid) and to the weighted average rate of all the assets, including the assets to which charges were recognized. Assets for which capital charge were developed and used, included: fixed assets, working capital, and customer relationships. The discount rate used was 17%.

Present Value of Incremental Operating Income – The present value of the incremental operating income was determined using the risk-adjusted discount rate.

Section 197 Tax Benefit – A benefit was recognized for the tax deductibility of the amount invested in intangible assets per the AICPA Practice Aid. This benefit was added to the present value of incremental operating income to determine the final conclusion of fair value.

3. The unaudited pro forma condensed combined consolidated statements of operations give effect to the following adjustments:

( a )	To record the amortization of newly acquired intangible assets for the twelve months ended March 31, 2013.
( b )	To record the interest expense on the deferred payments of the purchase consideration for the twelve months ended March 31, 2013.
( c )	To record the effect of income taxes on the combined net profit for the twelve months ended March 31, 2013.
( d )	To record the effect of eliminating acquisition related expenses for the quarter ended June 30, 2013.
( e )	To record the amortization of newly acquired intangible assets for the quarter ended June 30, 2013.
( f )	To record the interest expense on the deferred payments of the purchase consideration for the quarter ended June 30, 2013.
( g )	To record the effect of income taxes on the combined net profit for the quarter ended June 30, 2013.