UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 11-K

(Mark one)

x	ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF  1934

For the fiscal year ended December 31, 2009

OR

¨	TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ___________

Commission File Number 000-00121

A. Full title of the plan and the address of the plan, if different from that of the issuer named below:

KULICKE AND SOFFA INDUSTRIES, INC. INCENTIVE SAVINGS PLAN

B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

Kulicke and Soffa Industries, Inc.

1005 Virginia Drive

Fort Washington, PA 19034

 

 

---

 

KULICKE AND SOFFA INDUSTRIES, INC. INCENTIVE SAVINGS PLAN

Financial Statements and Supplemental Schedule

For the years ended December 31, 2008 and 2009

INDEX

	PAGE
Report of Independent Registered Public Accounting Firm	3
Financial Statements:
Statements of Net Assets Available for Benefits (Modified Cash Basis)  as of December 31, 2008 and 2009	4
Statements of Changes in Net Assets Available for Benefits (Modified Cash Basis) for the years ended December 31, 2008 and 2009	5
Notes to Financial Statements (Modified Cash Basis)	6
Supplemental Schedule:
Schedule H, Line 4i – Schedule of Assets (Held at End of Year) (Modified Cash Basis) as of December 31, 2009	12
Signatures	13
Exhibits	14

 

2

---

 

Report of Independent Registered Public Accounting Firm

To the Participants and Administrator of

Kulicke and Soffa Industries, Inc. Incentive Savings Plan

We have audited the accompanying statements of net assets available for benefits (modified cash basis) of Kulicke and Soffa Industries, Inc. Incentive Savings Plan as of December 31, 2009 and 2008, and the related statements of changes in net assets available for benefits (modified cash basis) for the years then ended.  These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As described in Note 2, these financial statements and supplemental schedule were prepared on a modified cash basis of accounting, which is a comprehensive basis of accounting other than generally accepted accounting principles.

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2009 and 2008, and the changes in net assets available for benefits for the years then ended, on the basis of accounting described in Note 2.

Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole.  The supplemental schedule is presented for purposes of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974.  The supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.

/s/ Kronick Kalada Berdy & Co., P.C.
Kingston, Pennsylvania
June 29, 2010

 

3

---

 

Kulicke and Soffa Industries, Inc. Incentive Savings Plan

Statements of Net Assets Available for Benefits (Modified Cash Basis)

December 31, 2008 and 2009

		2008				2009
Assets:
Investments, at fair value:
Mutual funds		$	34,518,233			$	33,595,978
Common commingled trusts							10,634,285
Kulicke and Soffa Industries, Inc. common stock			2,684,078				6,463,791
Self directed brokerage accounts			518,297				670,106
Participant loans			257,976				668,152
Total investments			37,978,584				52,032,312
Adjustment from fair value to contract value for fully benefit-responsive investment contracts			-				305,267
Net assets available for benefits		$	37,978,584			$	52,337,579

The accompanying notes are an integral part of these financial statements.

 

4

---

 

Kulicke and Soffa Industries, Inc. Incentive Savings Plan

Statements of Changes in Net Assets Available for Benefits (Modified Cash Basis)

For the years ended December 31, 2008 and 2009

		2008				2009
ADDITIONS:
Investment income:
Interest and dividends		$	1,274,325			$	306,967
Net appreciation on fair value of investments			-				13,555,687
			1,274,325				13,862,654
Contributions:
Employer non-cash (common stock)			1,153,789				869,124
Qualified non-elective contribution			-				886
Employer cash (one timer pension rollover)			113,268				-
Employee			2,253,752				1,664,335
Rollover							52,868
			3,520,809				2,587,213
Total additions			4,795,134				16,449,867
DEDUCTIONS:
Net depreciation on fair value of investments			24,260,782				-
Benefit payments			4,264,315				14,541,015
Administrative and other fees			88,495				60,119
Total deductions			28,613,592				14,601,134
INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS, PRIOR TO TRANSFER			(23,818,458	)			1,848,733
Transfer from Orthodyne			-				12,510,262
NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS			(23,818,458	)			14,358,995
Net assets available for benefits:
Beginning of year			61,797,042				37,978,584
End of year		$	37,978,584			$	52,337,579

The accompanying notes are an integral part of these financial statements.

 

5

---

 

Kulicke and Soffa Industries, Inc. Incentive Savings Plan

Notes to Financial Statements (Modified Cash Basis)

December 31, 2008 and 2009

1.	DESCRIPTION OF THE PLAN

The following description of the Kulicke and Soffa Industries, Inc. (the “Company”) Incentive Savings Plan (the “Plan”) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.

General

The Plan is a defined contribution plan established on January 1, 1987 and has been amended with the latest amendment on December 28, 2009. Full-time employees that are at least 18 years old are eligible to participate in the Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”).

On November 9, 2009, Orthodyne Electronics Inc (“Orthodyne”), a wholly owned subsidiary of the Company, transferred the net assets of its plan into the Company’s Plan. The transfer increased the net assets available for benefits by $12,510,262.

Contributions

The Plan allowed for employee contributions and matching Company contributions in varying percentages. Participants may contribute up to 25% of their compensation, on a before-tax or after-tax basis, subject to Internal Revenue Service (“IRS”) limitations. In addition, participants who have attained the age of 50 before the end of the Plan year are eligible to make “catch-up” contributions. Participants may also contribute amounts representing distributions from other qualified plans. Participants direct the investment of their contributions into various investment options offered by the Plan. The Plan was amended on November 8, 2009 to allow participant after tax contributions of up to 85% of their compensation when combined with their before-tax contributions.

In the fourth quarter of 2009, the Plan amended the Company matching contributions. For employees with less than 15 years of service the Company will make matching contributions of 100% of the employee contribution up to 4% of eligible compensation. If the employee has 15 years or more years of vesting service, the Company will make matching contributions of 100% of the employee contribution up to 6% of eligible compensation. Additionally, grandfathered matching contributions of 75% of the employee’s salary deferral were made to active participants who have been in service since December 31, 1995. The Company’s contributions were satisfied by shares of Company common stock, valued at the market price on the date of the matching contribution. In July 2008, the Company made a one time cash contribution of $113,268 which was distributed to all active participants of the Plan as a result of terminating the Kulicke and Soffa Retirement Pension Plan (the “Retirement Plan”) in March 2008.

Participant Accounts

Each participant’s account is credited with the participant’s contribution, allocation of the Company’s contribution and Plan earnings and charged with an allocation of Plan losses and administrative and other fees. Allocations are based upon participant earnings or account balances, as defined. Participants are entitled to their vested account.

Vesting

Participants are vested immediately in their contributions plus actual earnings. Vesting in the Company’s matching contribution to the participant’s account is based upon years of service. Prior to November 9, 2009, participants became 33 1/3% vested after 2 years of service, 66 2/3% vested after 3 years of service, and 100% vested after 4 years of service. Effective November 9, 2009, the Company amended the vesting service to 50% vested after one year of service and 100% vested after 2 years of service. If a participant attains the age of 65, dies, or becomes disabled while actively working for the Company, the participant’s account becomes 100% vested.

 

6

---

 

Payment of Benefits

Upon termination of service, a participant or beneficiary will receive a lump-sum amount equal to the vested value of his or her account. Distributions are subject to the applicable provisions of the Plan agreement.

2.	SUMMARY OF ACCOUNTING POLICIES

Basis of Accounting

The accompanying financial statements are prepared on the modified cash basis of accounting, which is a comprehensive basis of accounting other than U.S. generally accepted accounting principles (“GAAP”), and is an acceptable method of reporting under Department of Labor Regulations. The modified cash basis of accounting utilizes the cash basis of accounting while carrying investments at fair value and recording investment income on the accrual basis.

Effective July 1, 2009, the Financial Accounting Standards Board (“FASB”) issued revised accounting guidance which establishes the FASB Accounting Standards Codification (“ASC”) as the authoritative source for accounting principles of non-governmental entities to conform to GAAP used in the preparation of financial statements. The ASC is not intended to change existing guidance for public companies. The new guidance is effective for interim and annual reporting periods ending after September 15, 2009.

Use of Estimates

The preparation of financial statements requires the Plan’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.

Benefits

Benefits are recorded when paid by the Plan.