Exhibit 10.1
AMENDMENT NUMBER THREE
TO
WAFER SUPPLY AGREEMENT

This Amendment Number Three (the "Amendment"), effective as of February 1, 2012
(the "Amendment Effective Date"), amends the Wafer Supply Agreement effective
April 1. 2005. As amended by Amendment Number One effective December 19, 2008
and Amendment Number Two effective September 13, 2010, (as amended, the
Agreement"') by and between:

(1)
POWER INTEGRATIONS INTERNATIONAL LTD., a Cayman Islands corporation having a
place of business at 4th Floor, Century Yard, Cricket Square, Elgin Avenue, P.O.
Box 32322, Grand Cayman K Y 1-1209 ("Power Integrations")

and
 
(2)
SEIKO EPSON CORPORATION, a Japanese corporation having a place of business at
281 Fujimi, Fujimi-machi, Suwa-gun, Nagano-ken, 399-0293 Japan ("Seiko Epson").

RECITALS
WHEREAS, pursuant to the terms of the Agreement, Power Integrations grants to
Seiko Epson licenses of certain of Power Integrations' intellectual property for
the sole purpose of
Power Integrations acquiring from Seiko Epson the fabrication and supply of
wafers of certain power IC products; and

WHEREAS, Power Integrations and Seiko Epson desire to amend the terms of the
Agreement; and
WHEREAS, in accordance with Section 18.10 of the Agreement, the Agreement may be
amended only by an instrument in writing duly executed by authorized
representatives of Seiko Epson and Power Integrations.
Now, Therefore, in consideration of the mutual promises contained herein and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties
hereby amend the Agreement as follows:

AGREEMENT
1
Exhibit B of the Agreement is deleted in its entirety and replaced with Exhibit
B in the form attached hereto.

2
Effective as of the Amendment Effective Date, all references in the Agreement to
the "Agreement" or "this Agreement" shall mean the Agreement as amended by this
Amendment. Except as expressly amended

1

[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

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herein, the terms of the Agreement continue unchanged and shall remain in full
force and effect. This Amendment may be executed in one or more counterparts,
each of which shall be considered an original, but all of which counterparts
together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by
their duly authorized representatives, effective as of the Amendment Effective
Date.
SEIKO EPSON CORPORATION
 
POWER INTEGRATIONS INTERNATIONAL, LTD.
 
 
 
 
 
 
 
By:
/s/ Kazuhzro Takenaka
 
 
By:
/s/ John Tomlin
 
 
 
 
 
 
 
 
Name:
Kazuhzro Takenaka
 
 
Name:
John Tomlin
 
 
 
 
 
 
 
 
Title:
Deputy COO, Microdevice
 
 
Title:
President    
 

2

[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

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Exhibit B

WAFER PRICES FOR VOLUME PRODUCTION OF [*] INCH WAFERS BY
MONTHLY ORDER VOLUME

For [*] and [*] WAFERS in both PILOT PRODUCTION and VOLUME PRODUCTION:
Monthly [*] WAFER Volume
[*] Price/[*] Price
Less than [*]
[*]
[*]
[*]
[*] and above
[*]

Pricing will be reviewed and mutually agreed to in writing on an annual basis.
For WAFERS in ENGINEERING PRODUCTION, the price for each entry of the above
table will be multiplied by [*].
The above prices are the WAFER'S BASE_ PRICE and are based on an exchange rate
of [*] ¥/$. The fluctuation in foreign exchange rate, as supplied by the Wall
Street Journal will be shared equally by each party as follows F/X_BASE = [*]¥/$

Initial F/X_RATE = [*] ¥/$

A new F/X_RATE is only established at the time of placing a PO for WAFERS if the
[*] is equal to or greater than [*]¥ from the F/X-BASE. The new F/X RATE will be
set to the [*] and will remain in effect for at least the [*] it was
established.

The actual PURCHASE_PRICE for WAFERS, by WAFER TYPE, used at the time of order
will be calculated by the following formula:

PURCHASE _PRICE =
[*]

Examples: For DS WAFERS with a BASE PRICE of [*]
1.
Nominal F/X Rate Example: F/X_RATE = in the range of [*]¥ to [*]¥:

PURCHASE_PRICE = BASE_ PRICE

2.
Higher F/X Rate Example: New F/X_RATE = [*]¥:

PURCHASE_PRICE = [*] = [*]

3.
Lower F/X Rate Example: New F/X_RA TE = [*]¥:

PURCHASE_PRICE = [*] = [*].

[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.