On January 17, 2023 (the “Closing Date”), the Company acquired 100% of the issued and outstanding shares of capital stock of Entrepix, Inc., an Arizona corporation (“Entrepix”), which primarily manufactures chemical mechanical polishing (“CMP”) technology, through a reverse triangular merger. Entrepix’s CMP technology portfolio and wafer cleaning equipment will complement our existing substrate polishing and wet process chemical offerings. Pursuant to the terms and conditions of the Agreement and Plan of Merger dated January 17, 2023 (the “Merger Agreement”), Emerald Merger Sub, Inc., a wholly-owned subsidiary of the Company (“Merger Sub”), merged with and into Entrepix (the “Merger”), resulting in Entrepix surviving the Merger and becoming a wholly-owned subsidiary of the Company (the “Acquisition” or “Transaction”).

On the Closing Date, in connection with the Merger Agreement and in contemplation of the Transaction, the Company entered into a Loan and Security Agreement with UMB Bank, N.A., under which the Lender provided the Company with (i) a $12.0 million term loan maturing January 17, 2028, and (ii) an $8.0 million revolving loan facility maturing January 17, 2024 (see Note 2). The proceeds of the Term Loan were used to partially fund the Transaction.

The Acquisition is accounted for using the acquisition method of accounting for business combinations under FASB Accounting Standard Codification Topic No. 805, Business Combinations (“ASC 805”), with Amtech representing the accounting acquirer under this guidance.

The total consideration for the Acquisition was $39.2 million, consisting of $35.2 million cash consideration to the sellers and $4.0 million cash paid for debt and Entrepix transaction costs.

Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Such assets include synergies the Company expects to achieve, such as deeper penetration into an overlapping customer base, complementary product offerings, and cost redundancy reductions. In accordance with the measurement principles in FASB Accounting Standard Codification Topic No. 820, Fair Value Measurement, the purchase consideration for the Acquisition has been allocated under the acquisition method of accounting to the estimated fair market value of the net assets acquired, including a residual amount of goodwill, none of which is deductible for tax purposes. Amtech’s acquisition costs incurred were $2.5 million as of the year ended September 30, 2023, and were recorded as “Selling, general and administrative expenses” in the accompanying Condensed

Consolidated Statements of Operations. The following table summarizes the fair values assigned to identifiable assets acquired and liabilities assumed, in thousands:


	September 30, 2023
Fair value of total cash consideration transferred	$	39,227
Estimated fair value of identifiable assets acquired and liabilities assumed:
Cash and cash equivalents	$	4,289
Accounts receivable, net		5,884
Inventories		5,683
Other current assets		179
Property, plant, and equipment		2,040
Right-of-use assets		2,246
Intangible assets		13,600
Goodwill		16,463
Other assets		80
Total assets acquired		50,464
Accounts payable		1,574
Other accrued liabilities		1,994
Contract liabilities		1,949
Income taxes payable		985
Current portion of long-term operating lease liabilities		515
Long-term operating lease liabilities		1,730
Deferred tax liability		2,490
Total liabilities assumed		11,237
Net assets acquired	$	39,227

The establishment of the allocation to goodwill requires the extensive use of accounting estimates and management judgment. In accordance with ASC 805, the Company has up to one year from the acquisition date (referred to as the measurement period) to account for changes in the fair values of the identifiable assets acquired and the liabilities assumed in the acquired entity. As of January 17, 2024 the measurement period is closed.

The fair value associated with acquired intangible assets and their associated weighted-average amortization periods consist of the following, in thousands:


	Classification of Amortization	Amount		Weighted-Average Amortization Period
Developed technology	Cost of sales	$	6,700	5.0 years
Customer relationships	Selling, general and administrative		2,800	10.0 years
Backlog	Selling, general and administrative		2,100	1.0 year
Trade names	Selling, general and administrative		1,800	10.0 years
Noncompetition agreements	Selling, general and administrative		200	5.0 years
Total intangible assets		$	13,600	6.1 years

The following unaudited pro forma financial information presents the combined results of operations of Amtech and Entrepix, in thousands, as if the acquisition occurred on October 1, 2021. The unaudited pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place on the date indicated or of results that may occur in the future.


	Three Months Ended March 31,		Six Months Ended March 31,
	2023		2023
Revenues, Net	$	34,623	$	63,778
Net Income	$	4,285	$	1,149

The unaudited pro forma financial information presented above include the following adjustments:

The unaudited pro forma financial information includes adjustments to align accounting policies, which were materially similar to the Company’s accounting policies. Any differences in accounting policies were adjusted to reflect the accounting policies of the Company in the unaudited pro forma financial information presented.