On January 17, 2023 (the “Closing Date”), the Company acquired through a reverse triangular merger 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. Entrepix’s CMP technology portfolio and water cleaning equipment complements our existing substrate polishing and wet process chemical offerings. Under the terms 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”).

On the Closing Date, in contemplation of the Acquisition, the Company entered into a Loan and Security Agreement with UMB Bank, N.A. (the “Lender”), under which the Lender provided the Company with (i) a $12.0 million term loan maturing January 17, 2028 (“Term Loan”), and (ii) an $8.0 million revolving loan facility maturing January 17, 2024 (see Note 12). The proceeds of the Term Loan were used to partially fund the Acquisition.

The Acquisition is accounted for using the acquisition method of accounting for business combinations under FASB ASC Topic No. 805, Business Combinations (“ASC 805”), with Amtech representing the accounting acquirer under this guidance. The Company elected to apply pushdown accounting per ASC 805-50-50-5.

Summary of Consideration Transferred – 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 ASC 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. The recorded amounts of acquired accounts receivable and accounts payable approximate their fair value because of the short maturities of these assets and liabilities. The fair value of acquired property, plant and equipment was based on quoted market prices for similar assets in active markets. The fair value of acquired identifiable intangible assets were estimated using various valuation methodologies, including the multi-period excess earnings method, the relief from royalty method and the distributor method. 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 Consolidated Statements of Operations. The following table summarizes the provisional 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.


	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

Unaudited Pro Forma Financial Information – Entrepix is included in the Company’s consolidated results beginning January 17, 2023. Total revenues and net loss attributable to Entrepix for the period from January 17, 2023 to September 30, 2023 were $18.6 million and $(3.7) million, respectively.

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.


	Year Ended September 30,
	2023			2022
Revenues, Net	$	121,020		$	129,781
Net (Loss) Income	$	(13,099	)	$	13,946

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.