Exhibit 10.1

 

BARCLAYS

745 Seventh Avenue

New York, New York 10019

  

DEUTSCHE BANK SECURITIES INC.

DEUTSCHE BANK AG NEW YORK BRANCH

60 Wall Street

New York, New York 10005

PERSONAL AND CONFIDENTIAL

February 22, 2016

MKS Instruments, Inc.

2 Tech Drive, Suite 20

Andover, Massachusetts 01810

Attention: Seth H. Bagshaw, Vice President,

    Chief Financial Officer & Treasurer

Commitment Letter

Ladies and Gentlemen:

You have advised Barclays Bank PLC (“Barclays”), Deutsche Bank Securities Inc.
(“DBSI”), Deutsche Bank AG New York Branch (“DBNY” and, together with DBSI,
“DB”; Barclays, DBSI and DBNY, the “Commitment Parties,” “we” or “us”), that MKS
Instruments, Inc. (the “Borrower” or “you”), intends to acquire (the
“Acquisition”) 100% of the equity interests of a company previously identified
to Barclays and code-named “Photon” (the “Company”), pursuant to the Acquisition
Agreement and to consummate Transactions (each as defined in Exhibit A) and
other transactions as otherwise contemplated by this Commitment Letter and the
Fee Letter (each as defined below), in each case on the terms and subject to the
conditions set forth in this Commitment Letter and the Term Sheets
(collectively, the “Commitment Letter”).

You have also advised us that the Transaction Costs (as defined in Exhibit A)
will be financed in part from the following sources:

 

  •   $800 million of borrowings under a senior secured term loan facility (the
“Term Loan Facility”) having the terms set forth in Exhibit A; and

 

  •   $50 million under a senior secured asset-based revolving credit facility
(the “ABL Facility” and, together with the Term Loan Facility, the “Facilities”)
having the terms set forth in Exhibit B.

 

1. Commitments and Agency Roles

You hereby appoint (i) Barclays to act, and Barclays hereby agrees to act, as
sole and exclusive administrative agent (in such capacity, the “Term
Administrative Agent”) and collateral agent (in such capacity, the “Term
Collateral Agent”) for the Term Loan Facility and (ii) DBNY to act, and DBNY
hereby agrees to act, as sole and exclusive administrative agent (in such
capacity, the “ABL Administrative Agent” and, together with the Term
Administrative Agent, the “Administrative Agents”) and collateral agent (in such
capacity, the “ABL Collateral Agent” and, together with the Term Collateral
Agent, the “Collateral Agents”) for the ABL Facility. You hereby appoint (i)
DBSI to act, and DBSI hereby agrees to act, as syndication agent for the Term
Loan Facility and (ii) Barclays to act, and Barclays hereby agrees to act, as
syndication agent for the ABL Facility. You hereby (i) appoint Barclays and

 

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DBSI to act, and Barclays and DBSI hereby agree to act, as joint lead arrangers
and joint bookrunners (in such capacities, the “Term Arrangers”) for the Term
Loan Facility and (ii) DBSI and Barclays to act, and DBSI and Barclays hereby
agree to act, as joint lead arrangers and joint bookrunners (in such capacities,
the “ABL Arrangers” and, together with the Term Arrangers, the “Arrangers”) for
the ABL Facility. Each of the Arrangers, the Administrative Agents and the
Collateral Agents will have the rights and authority customarily given to
financial institutions in such roles. Barclays is pleased to advise you of its
several (and not joint) commitment to provide to the Borrower 50% of the
aggregate principal amount of each of the Facilities, and DBNY is pleased to
advise you of its several (and not joint) commitment to provide to the Borrower
50% of the aggregate principal amount of each of the Facilities, in each case on
the terms set forth in the Term Sheets and subject solely to the satisfaction or
waiver of the conditions set forth in Exhibit C. Barclays and DBNY are the
“Initial Lenders”.

Our fees for services related to the Facilities are set forth in a separate fee
letter (the “Fee Letter”) between you and us entered into on the date hereof. As
consideration for the execution and delivery of this Commitment Letter by us,
you agree to pay the fees and expenses set forth herein and in Exhibits A and B
and in the Fee Letter as and when payable in accordance with the terms hereof
and thereof.

You have the right (the “Designation Right”), on or prior to the date that is 10
business days after the date of this Commitment Letter, to appoint up to 2
additional agents, co-agents, lead arrangers, bookrunners, managers or arrangers
or to confer other titles in respect of Facilities (each such agent, co-agent,
lead arranger, bookrunner, manager, arranger or holder of another title,
together with each additional Arranger, an “Additional Committing Lender”) in a
manner and with economics determined by you pursuant to joinder documentation or
an amendment to the Commitment Letter and the Fee Letter that adds such
Additional Committing Lender as a Commitment Party. Thereafter, each such
financial institution shall constitute a “Commitment Party” under the Commitment
Letter and the Fee Letter. In connection with your exercise of Designation
Rights (i) fees will be allocated to each Additional Committing Lender on a pro
rata basis in respect of the commitment it is assuming with respect to each of
the Facilities (and the commitment of such Additional Committing Lender shall be
pro rata among the Facilities), (ii) the commitments of each Initial Lender with
respect to each of the Facilities immediately prior to the joinder or amendment
for such Additional Committing Lender shall be reduced proportionately by the
commitments assumed by each Additional Committing Lender, (iii) the commitments
of the several Commitment Parties will be several and not joint and (iv) in no
event will Barclays and DB be entitled to less than 70% of the economics of each
of the Facilities.

It is further agreed that (i) Barclays will appear on the top left of the cover
page of all marketing materials for the Term Loan Facility and will hold the
roles and responsibilities conventionally understood to be associated with such
name placement and (ii) DB will appear immediately to the right of Barclays on
the cover page of all marketing materials for the Term Loan Facility and will
hold the roles and responsibilities conventionally understood to be associated
with such name placement. It is further agreed that (i) DB will appear on the
top left of the cover page of all marketing materials for the ABL Facility and
will hold the roles and responsibilities conventionally understood to be
associated with such name placement and (ii) Barclays will appear immediately to
the right of DB on the cover page of all marketing materials for the ABL
Facility and will hold the roles and responsibilities conventionally understood
to be associated with such name placement. Except as set forth above, no other
agents, co-agents, lead arrangers, co-arrangers, bookrunners, managers or
co-managers will be appointed, no other titles will be awarded and no
compensation (other than compensation expressly contemplated by the Commitment
Letter and the Fee Letter) will be paid in connection with the Facilities unless
you and we shall so agree.

 

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2. Conditions Precedent

Our commitments hereunder to make effective and fund the Facilities on the
Closing Date and our agreements to perform the services described herein are
subject solely to the satisfaction of the conditions set forth in Exhibit C.

Notwithstanding anything in this Commitment Letter (including each of the
exhibits attached hereto), the Fee Letter, the Facilities Documentation (as
defined in Exhibit A; Exhibits A, B and C are the “Term Sheets”) or any other
letter agreement or other undertaking between you and us concerning the
financing of the Transactions to the contrary, (a) the only representations and
warranties the accuracy of which shall be a condition to the availability and
effectiveness of the Facilities on the Closing Date shall be (i) such of the
representations and warranties made by the Company with respect to the Company
and its subsidiaries in the Acquisition Agreement as are material to the
interests of the Lenders (as such term is defined in Exhibit A), but only to the
extent that you (or any of your affiliates) have the right (taking into account
any applicable cure provisions) to terminate your (or its) obligations under the
Acquisition Agreement or decline to consummate the Acquisition (in each case, in
accordance with the terms of the Acquisition Agreement) as a result of a breach
of such representations and warranties in the Acquisition Agreement (the
“Specified Acquisition Agreement Representations”) and (ii) the Specified
Representations (as defined below) and (b) the terms of the Facilities
Documentation shall be in a form such that they do not impair availability or
effectiveness of the Facilities on the Closing Date if all conditions set forth
in Exhibit C are satisfied or waived by the Arrangers (it being understood that
to the extent any Collateral or any security interests therein (including the
creation or perfection of any security interest) is not or cannot be provided or
perfected on the Closing Date (other than (i) to the extent that a lien on such
Collateral may be perfected by the filing of a financing statement under the
Uniform Commercial Code or (ii) by the delivery of stock or other certificates
of “Merger Sub” (as defined in the Acquisition Agreement)) after your use of
commercially reasonable efforts to do so, or without undue burden or expense,
the delivery of such Collateral (and creation or perfection of security
interests therein), as applicable, shall not constitute a condition precedent to
the availability or effectiveness of the Facilities on the Closing Date but
shall instead be required to be delivered or provided within 90 days after the
Closing Date (or such later date as may be reasonably agreed by the Borrower and
the applicable Administrative Agent), and in the case of perfection of security
interests in real property, within 120 days after the Closing Date (or such
later date as may be reasonably agreed by the Borrower and the applicable
Administrative Agent), in each case, pursuant to arrangements to be mutually
agreed by the Borrower and the applicable Administrative Agent). For purposes
hereof, “Specified Representations” means the representations and warranties
made by the Loan Parties (as defined in Exhibit A) set forth in the Facilities
Documentation relating to: organizational existence of the Loan Parties;
organizational power and authority of the Loan Parties, and due authorization,
execution and delivery by the Loan Parties, in each case, as they relate to
their entry into and performance of the Facilities Documentation; enforceability
of the Facilities Documentation against the Loan Parties; no conflicts with or
consent under charter documents of the Loan Parties as it relates to their entry
into and performance of the Facilities Documentation; solvency of the Borrower
and its restricted subsidiaries on a consolidated basis on the Closing Date
after giving effect to the Transactions (with solvency being determined in a
manner consistent with Annex I to this Commitment Letter); subject to the
immediately preceding sentence and the limitations set forth in the Term Sheets,
creation and perfection of security interests in the Collateral; Federal Reserve
margin regulations; the PATRIOT Act; not using proceeds in violation of OFAC or
FCPA; and the Investment Company Act. The provisions of this paragraph are
referred to as the “Certain Funds Provision”.

 

3. Syndication

Each Arranger intends and reserves the right to syndicate the Facilities to the
Lenders; provided that, unless otherwise agreed by you, no assignment prior to
the Closing Date will reduce or release any Commitment Party’s obligation to
fund its commitment in the event any assignee shall fail to do so on the Closing
Date. The Arrangers will lead the syndication, including determining, in
consultation with you,

 

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the timing of all offers to prospective Lenders, any title of agent or similar
designations or roles awarded to any Lender and the acceptance of commitments,
the amounts offered and the compensation provided to each Lender from the
amounts to be paid to the Arrangers pursuant to the terms of this Commitment
Letter and the Fee Letter and will in consultation with you determine the final
commitment allocations. You agree to use commercially reasonable efforts to
ensure that the Arrangers’ syndication efforts benefit from the existing lending
and investment banking relationships of the Borrower, the Company and their
respective subsidiaries. To facilitate an orderly and successful syndication of
the Facilities, you agree that, until the earliest of (a) the termination by the
Arrangers of syndication of the Facilities, (b) 60 days following the Closing
Date and (c) the “Successful Syndication” of the Facilities (as defined in the
Fee Letter), you will ensure (or with respect to the Company or its
subsidiaries, using your commercially reasonable efforts to ensure) there will
be no competing issues, offerings, placements or arrangements of any debt
facility or any debt security of the Company or the Borrower or any of their
respective subsidiaries, including any renewal or refinancing of any existing
debt facility or debt security, being issued, offered, placed or arranged
without the consent of the Arrangers, if such issuance, offering, placement or
arrangement would materially impair the primary syndication of the Facilities
(it being understood that (x) as to the Company and its subsidiaries, (i)
indebtedness incurred under its existing domestic revolving credit facility
prior to the Refinancing and incurred under its foreign revolving credit
facility, and (ii) indebtedness permitted to remain outstanding on and after the
Closing Date under the Acquisition Agreement and (y) as to the Borrower and its
subsidiaries, deferred purchase price obligations, ordinary course working
capital facilities for foreign subsidiaries, ordinary course capital lease,
purchase money and equipment financings and debt securities issued in accordance
with the terms of the Fee Letter will not be deemed to materially impair the
primary syndication of the Facilities).

You agree to, and agree to use commercially reasonable efforts to obtain
contractual undertakings from the Company to, cooperate with, and provide
customary information reasonably required by, the Arrangers in connection with
all syndication efforts, including: (i) your assistance in preparing as soon as
practicable after the date of this Commitment Letter, a customary information
memorandum and other customary presentation materials (collectively,
“Confidential Information Memoranda”) regarding the business, operations and
financial projections of the Borrower and the Company (which shall be, with
respect to the Company, limited to the financial information and projections
described in Exhibit C) including without limitation the delivery of all
information relating to the Transactions prepared by or on behalf of the
Borrower or the Company; (ii) using commercially reasonable efforts to obtain
from Moody’s Investor Service, Inc. (“Moody’s”) and Standard & Poor’s Ratings
Services, a Standard & Poor’s Financial Services LLC business (“S&P”), prior to
the launch of the general syndication, a corporate family rating, a corporate
credit rating and a credit rating for the Term Loan Facility; (iii) arranging
for direct communications with prospective Lenders in connection with the
syndication of the Facilities (including without limitation direct contact
between appropriate senior management, representatives and advisors of the
Borrower (and using commercially reasonable efforts to cause direct contact with
appropriate senior management, representatives and advisors of the Company) and
participation of such persons in such meetings); (iv) hosting (including any
preparations with respect thereto) with the Arrangers at places and times
reasonably requested by the Arrangers, one or more meetings with prospective
Lenders; and (v) your ensuring the ABL Administrative Agent and its designees
shall have sufficient access to the Borrower and its subsidiaries, and your
using commercially reasonable efforts to ensure that the ABL Administrative
Agent and its designees shall have sufficient access to the Company and its
subsidiaries, to complete a field examination as soon as practicable after the
date hereof. You will be solely responsible for the contents of the Confidential
Information Memoranda and all other information, documentation or other
materials delivered to us in connection therewith and you acknowledge that we
will be using and relying upon such information without independent verification
thereof as provided in Section 4 below. Subject to your consent, not to be
unreasonably withheld or delayed, and compliance with applicable laws, you agree
that each Arranger has the right to place advertisements in financial and other
newspapers at its own expense describing its

 

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services to you and the Borrower. We agree that the only financial statements
that shall be required to be provided to the Commitment Parties in connection
with the syndication of the Facilities shall be those required to be delivered
pursuant to paragraphs 3 and 4 of Exhibit C. Notwithstanding anything to the
contrary contained in this Commitment Letter or the Fee Letter or any other
letter agreement or undertaking concerning the financing of the Transactions to
the contrary, your obligations to assist in syndication efforts as provided
herein (including compliance with any of the provisions set forth in this
paragraph), shall not constitute a condition to the commitments hereunder or the
funding of the Facilities on the Closing Date.

You understand that certain prospective Lenders (such Lenders, “Public Lenders”)
may have personnel that do not wish to receive MNPI (as defined below). At an
Arranger’s request, you agree to assist in the preparation of an additional
version of the Confidential Information Memoranda that does not contain material
non-public information (as reasonably determined by you) concerning you, the
Company or your or its respective subsidiaries or affiliates or your or its
respective securities (collectively, “MNPI”) which is suitable to make available
to Public Lenders. You acknowledge and agree that the following documents may be
distributed to Public Lenders (unless you or your counsel promptly notify us
(including by email) otherwise and provided that you and your counsel have been
given a reasonable opportunity to review such documents and comply with
applicable securities law disclosure obligations): (a) drafts and final versions
of the Facilities Documentation; (b) administrative materials prepared by any
Arranger for prospective Lenders (including without limitation a lender meeting
invitation, allocations and funding and closing memoranda); and (c) summaries of
terms and notification of changes in the terms and conditions of the
Facilities. Before distribution of any Confidential Information Memoranda in
connection with the syndication of the Facilities (i) to prospective Lenders
that are not Public Lenders, you will provide us with a customary letter
authorizing the dissemination of such materials and (ii) to prospective Public
Lenders, you will provide us with a customary letter authorizing the
dissemination of information that does not contain MNPI (the “Public Information
Materials”) to Public Lenders and confirming the absence of MNPI therein. The
Confidential Information Memoranda provided to Lenders and prospective Lenders
will be accompanied by a disclaimer by such recipients exculpating us with
respect to any use thereof and of any related materials by the recipients
thereof. In addition, at an Arranger’s request, you will identify Public
Information Materials by marking the same as “PUBLIC” and by doing so you shall
be deemed to have authorized the Commitment Parties and the proposed Lenders to
treat such Public Information Materials as not containing any MNPI.

It is agreed that the completion of the successful syndication of, or receipt of
commitments in respect of, the Facilities will not be a condition to the
Commitment Parties’ commitments hereunder.

 

4. Information

You represent and warrant covenant that (and with respect to information and
projections relating to the Company and its subsidiaries to the best of your
knowledge that) (i) all written information (other than projections, forward
looking information and information of a general economic or industry specific
nature) that has been or will be made available to any Arranger, any Commitment
Party, the Lenders or any of their respective affiliates by or on behalf of the
Company or the Borrower in connection with the Transactions is and will be, when
furnished and taken as a whole, complete and correct in all material respects
and does not and will not, when furnished and taken as a whole, contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements contained therein not materially misleading in light of
the circumstances under which such statements are made (after giving effect to
all supplements thereto) and (ii) the projections and other forward looking
information that have been or will be made available to any Arranger, any
Commitment Party, the Lenders or any of their respective affiliates by or on
behalf of the Company or the Borrower have been and will be prepared in good
faith, and that information with respect to you will be based upon accounting
principles consistent

 

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with your historical audited financial statements most recently provided as of
the date hereof and upon assumptions that are believed by the preparer thereof
to be reasonable when made and when made available to such Arranger, such
Commitment Party, the Lenders and their respective affiliates; it being
understood that such projections and forward-looking statements are as to future
events and are not to be viewed as facts, such projections and forward-looking
statements are subject to significant uncertainties and contingencies and that
actual results during the period or periods covered by any such information may
differ significantly from the projected results, and that no assurance can be
given that the projected results will be realized. You agree that if at any time
prior to the later of (x) the Closing Date and (y) the earlier of (i) 60 days
following the Closing Date and (ii) the “Successful Syndication” of the
Facilities (as defined in the Fee Letter) you become aware that any of the
representations in the preceding sentence would be (to the best of your
knowledge with respect to the Company) incorrect in any material respect if made
at such time, then you will (and with respect to information and projections
with respect to the Company you will use commercially reasonable efforts to
cause the Company to) promptly supplement, or cause to be supplemented, the
information and projections so that (and with respect to information and
projections relating to the Company to the best of your knowledge) such
representations will be correct in all material respects in light of the
circumstances in which statements are made. You understand that in providing our
services pursuant to this Commitment Letter we may use and rely on the
information and projections without independent verification thereof.

 

5. Expense and Indemnification

To induce us to enter into this Commitment Letter and the Fee Letter and to
proceed with the documentation of the Facilities, you hereby agree to indemnify
and hold harmless each Administrative Agent, each Collateral Agent, each
Arranger and each other agent or co-agent (if any) designated by any Arranger
with respect to the Facilities, each Lender (including in any event each
Commitment Party) and their respective affiliates and each partner, trustee,
shareholder, director, officer, employee, advisor, representative, agent,
attorney and controlling person thereof (each of the above, an “Indemnified
Person”) from and against any and all actions, suits, proceedings (including any
investigations or inquiries), claims, losses, damages, liabilities or expenses
(including legal expenses), joint or several, of any kind or nature whatsoever
that may be brought or threatened by the Company, the Borrower, the Guarantors
(as defined in Exhibit A), any of their respective affiliates or any other
person or entity or which may be incurred by or asserted against or involve any
Indemnified Person (whether or not any Indemnified Person is a party to such
action, suit, proceeding or claim) as a result of or arising out of or in any
way related to or resulting from the Acquisition, this Commitment Letter, the
Fee Letter, the Facilities, the Transactions or any related transaction
contemplated hereby or thereby or any use or intended use of the proceeds of the
Facilities; provided that you will not have to indemnify an Indemnified Person
against (A) any claim, loss, damage, liability or expense to the extent found by
a final, non-appealable judgment of a court of competent jurisdiction to have
resulted from (i) the gross negligence or willful misconduct of such Indemnified
Person, (ii) a material breach of obligations under the Commitment Letter or the
Facilities Documentation by such Indemnified Person or (iii) any dispute solely
among the Indemnified Persons (not arising as a result of any act or omission by
the Borrower or any of its subsidiaries or affiliates) other than any claim,
action, suit, inquiry, litigation, investigation or other proceeding brought by
or against any such Indemnified Person in its capacity as agent or arranger, or
(B) any settlement entered into by such Indemnified Person without your written
consent (such consent not to be unreasonably withheld, conditioned or delayed),
but if settled with your written consent or if there is a final, non-appealable
judgment by a court of competent jurisdiction in any such action, suit,
proceeding or claim, you agree to indemnify and hold harmless each Indemnified
Person from and against any and all losses, claims, losses, damages, liabilities
or expenses by reason of such settlement or judgment in accordance with the
other provisions of this Section 5. You shall not, without the prior written
consent of an Indemnified Person (which consent shall not be unreasonably
conditioned, withheld or delayed), effect any settlement or consent to the entry
of any judgment of any pending or threatened

 

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action, suit, proceeding or claim in respect of which indemnity could have been
sought hereunder by such Indemnified Person unless (i) such settlement includes
an unconditional release of such Indemnified Person in form and substance
reasonably satisfactory to such Indemnified Person from all liability on claims
that are the subject matter of such action, suit, proceeding or claim, (ii) does
not include any statement as to or any admission of fault, culpability,
wrongdoing or a failure to act by or on behalf of any Indemnified Person and
(iii) contains customary confidentiality and non-disparagement
provisions. Notwithstanding any other provision of this Commitment Letter, no
Indemnified Person will be responsible or liable to you or any other person or
entity for damages arising from the use by others of any information or other
materials obtained through internet, electronic, telecommunications or other
information transmission systems, unless such use is found by a final,
non-appealable judgment of a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct on the party of such Indemnified
Person.

You also agree to periodically reimburse us for our reasonable and documented or
invoiced out-of-pocket costs and expenses in connection with any matter referred
to in this Commitment Letter or the Fee Letter, including expenses associated
with our due diligence efforts and field examinations and the reasonable and
documented fees, disbursements and other charges of one primary counsel, one
local counsel in each relevant jurisdiction and counsel otherwise retained with
the Borrower’s consent, whether or not the Acquisition is consummated, the
Closing Date occurs or any Facilities Documentation is executed and delivered or
any extensions of credit are made under any of the Facilities.

Your indemnity and reimbursement obligations under this Section 5 will be
binding upon and inure to the benefit of the successors, assigns, heirs and
personal representatives of you and the Indemnified Persons and shall be
superseded in each case by the applicable provisions to the extent covered in
the definitive financing documentation upon execution thereof and thereafter
shall have no further force and effect.

Neither you nor we nor any other Indemnified Person will be responsible or
liable to us or you or any other person or entity for any indirect, special,
punitive or consequential damages which may be alleged as a result of the
Acquisition, this Commitment Letter, the Fee Letter, the Facilities, the
Transactions or any related transaction contemplated hereby or thereby or any
use or intended use of the proceeds of the Facilities; provided that the
indemnity and reimbursement obligations under this Section 5 shall not be
limited by this sentence.

 

6. Assignments

This Commitment Letter may not be assigned by you without the prior written
consent of the Commitment Parties (and any purported assignment without such
consent will be null and void), is intended to be solely for the benefit of the
parties hereto and is not intended to confer any benefits upon, or create any
rights in favor of, any person (including your equity holders, employees or
creditors) other than the parties hereto (and any Indemnified Person). This
Commitment Letter may not be assigned by any Commitment Party without your
consent (and any purported assignment without such consent shall be null and
void) provided that the Commitment Parties may (i) assign commitments in
accordance with Section 1 to an Additional Committing Party and (ii) assign
commitments in accordance with Section 3 above. This Commitment Letter may not
be amended or any term or provision hereof waived or modified except by an
instrument in writing signed by each of the parties hereto.

 

7. USA PATRIOT Act Notification

Each Commitment Party notifies you, the Company and the Guarantors that,
pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (as amended, supplemented or modified from
time to time, the “Patriot Act”) it and each Lender may be required to

 

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obtain, verify and record information that identifies you, the Company and the
Guarantors, including the name and address of each such Person and other
information that will allow such Commitment Party and each Lender to identify
you, the Company and the Guarantors in accordance with the Patriot Act and other
applicable “know your customer” and anti-money laundering rules and regulations.
This notice is given in accordance with the requirements of the Patriot Act and
is effective for each Commitment Party and each Lender.

 

8. Sharing Information; Affiliate Activities; Absence of Fiduciary Relationship

Please note that this Commitment Letter, the Fee Letter and any written or oral
communications provided by any Commitment Party, any Arranger or any of their
affiliates in connection with the Transactions are exclusively for the
information of your Board of Directors and senior management and may not be
disclosed to any other person or entity or circulated or referred to publicly
without our prior written consent except, after providing written notice to the
Commitment Parties (but only as and to the extent the provision of such notice
is reasonably practicable), pursuant to applicable law or compulsory legal
process; provided that we hereby consent to your disclosure of (i) this
Commitment Letter and the Fee Letter and such communications to the Borrower’s
officers, directors, agents and advisors who are directly involved in the
consideration of the Facilities to the extent you notify such persons of their
obligation to keep this Commitment Letter, the Fee Letter and such
communications confidential and such persons agree to hold the same in
confidence, (ii) this Commitment Letter or the information contained herein (but
not the Fee Letter (except in redacted form satisfactory to the Commitment
Parties) or the information contained therein) to the Company and its officers,
directors, agents and advisors who are directly involved in the consideration of
the Facilities to the extent you notify such persons of their obligation to keep
this Commitment Letter and the information contained herein confidential and
such persons agree to hold the same in confidence, (iii) the Term Sheets to any
ratings agencies on a confidential basis in connection with the Transactions,
(iv) this Commitment Letter or the information contained herein and the Term
Sheets (but not the Fee Letter or the information contained therein) in any
syndication or other marketing materials, prospectus or other offering
memorandum, in each case relating to the Facilities, (v) the Term Sheets (but
not this Commitment Letter or the Fee Letter) to potential debt providers in
coordination with us obtaining commitments to the Facilities from such potential
debt providers, (vi) this Commitment Letter or the information contained herein
and the Term Sheets (but not the Fee Letter or the information contained
therein) to the extent customary or required in any public or regulatory filing
relating to the Transactions, and (vii) you may disclose the aggregate amounts
contained in the Fee Letter as part of the projections, pro forma information or
a generic disclosure of aggregate sources and uses related to fee amounts
related to the Transactions to the extent customary or required in offering and
marketing materials for the Facilities or to the extent customary or required in
any public or regulatory filing relating to the Transactions; provided, further,
that the foregoing restrictions shall cease to apply (except in respect of the
Fee Letter and the contents thereof) two years after the date of this Commitment
Letter.

We shall use all nonpublic information received by us and our affiliates from or
on behalf of you in connection with this Commitment Letter and the transactions
contemplated hereby solely for the purposes of negotiating, evaluating and
consulting on the transactions contemplated hereby and providing the services
that are the subject of this Commitment Letter and shall treat confidentially,
together with the terms and substance of this Commitment Letter and the Fee
Letter, all such information; provided, however, that nothing herein shall
prevent us from disclosing any such information (a) to rating agencies on a
confidential basis in connection with our mandate hereunder, (b) to any Lenders
or participants or prospective Lenders or participants or contractual
counterparty to any swap or derivative transaction relating to the Borrower, the
Company or any of their subsidiaries, in each case who have agreed to be bound
by confidentiality and use restrictions in accordance with the proviso to this
sentence, (c) in any legal, judicial or administrative proceeding or other
compulsory process or otherwise as required by

 

8

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applicable law or regulations (in which case we shall promptly notify you, in
advance, to the extent reasonably practicable and permitted by law), (d) upon
the request or demand of any regulatory authority having jurisdiction over us or
our affiliates (in which case we shall, except with respect to any audit or
examination conducted by bank accountants or any regulatory authority exercising
examination or regulatory authority, promptly notify you, in advance, to the
extent reasonably practical and permitted by law), (e) to our officers,
directors, employees, legal counsel, independent auditors, professionals and
other experts or agents (collectively, “Representatives”) who are informed of
the confidential nature of such information and who are subject to customary
confidentiality obligations of professional practice or who agree to be bound by
the terms of this paragraph (or language substantially similar to this
paragraph) (with each such Commitment Party, to the extent within its control,
responsible for such Representatives’ compliance with this paragraph), (f) to
any of our affiliates and their Representatives (provided that any such
affiliate or Representative is advised of its obligation to retain such
information as confidential, and we shall be responsible for such affiliates’
compliance with this paragraph) to be utilized solely in connection with
rendering services to you in connection with the Transactions, (g) to the extent
any such information becomes publicly available other than by reason of
disclosure by us, our affiliates or any of our respective Representatives in
breach of this Commitment Letter (h) to the extent that such information is
received by us from a third party that is not, to our knowledge, subject to
confidentiality obligations owing to you or any of your affiliates or related
parties, (i) to the extent that such information is independently developed by
us, or (j) for purposes of enforcing the rights of the Commitment Parties under
this Commitment Letter; provided that the disclosure of any such information to
any Lenders or prospective Lenders or participants or prospective participants
shall be made subject to the acknowledgment and acceptance by such Lender or
prospective Lender or participant or prospective participant that such
information is being disseminated on a confidential basis (on substantially the
terms set forth in this paragraph or as is otherwise reasonably acceptable to
you and us, including, without limitation, as agreed in any confidential
information memorandum or other marketing materials) in accordance with our
standard syndication processes or customary market standards for dissemination
of such type of information. The provisions of this paragraph shall
automatically be superseded by the confidentiality provisions to the extent
covered in the definitive documentation for the Facilities upon the Closing Date
and shall in any event automatically terminate two years following the date of
this Commitment Letter. You acknowledge that each Commitment Party and its
affiliates are full service securities firms and as such may from time to time
effect transactions, for their own account or the account of customers, and may
hold positions in securities or indebtedness, or options thereon, of the
Borrower, the Company and other companies that may be the subject of the
Transactions. Each Commitment Party and its affiliates will have economic
interests that are different from or conflict with those of the Borrower
regarding the transactions contemplated hereby, and you acknowledge and agree
that no Commitment Party has any obligation to disclose such interests to you.
You further acknowledge and agree that nothing in this Commitment Letter, the
Fee Letter or the nature of our services or in any prior relationship will be
deemed to create an advisory, fiduciary or agency relationship between us, on
the one hand, and you, your equity holders or your affiliates, on the other
hand, and you waive, to the fullest extent permitted by law, any claims you may
have against any Commitment Party for breach of fiduciary duty or alleged breach
of fiduciary duty and agree that no Commitment Party will have any liability
(whether direct or indirect) to you in respect of such a fiduciary duty claim or
to any person asserting a fiduciary duty claim on your behalf, including your
equity holders, employees or creditors. You acknowledge that the Transactions
(including the exercise of rights and remedies hereunder and under the Fee
Letter) are arms’ length commercial transactions and that we are acting as
principal and in our own best interests. You are relying on your own experts and
advisors to determine whether the Transactions are in your best interests and
are capable of evaluating and understanding, and you understand and accept, the
terms, risks and conditions of the transactions contemplated hereby. In
addition, you acknowledge that we may employ the services of our affiliates in
providing certain services hereunder and may exchange with such affiliates
information concerning you, the Company and other companies that may be the
subject of the Transactions and such affiliates will be entitled to the benefits
afforded to us hereunder.

 

9

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Consistent with our policies to hold in confidence the affairs of our customers,
we will not use or disclose confidential information obtained from you by virtue
of the Transactions in connection with our performance of services for any of
our other customers (other than as permitted to be disclosed under this Section
8). Furthermore, you acknowledge that neither we nor any of our affiliates have
an obligation to use in connection with the Transactions, or to furnish to you,
confidential information obtained or that may be obtained by us from any other
person.

Please note that each Commitment Party and its affiliates do not provide tax,
accounting or legal advice.

 

9. Waiver of Jury Trial; Governing Law; Submission to Jurisdiction; Surviving
Provisions

ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY ACTION, SUIT, PROCEEDING OR CLAIM
ARISING IN CONNECTION WITH OR AS A RESULT OF ANY MATTER REFERRED TO IN THIS
COMMITMENT LETTER OR THE FEE LETTER IS HEREBY IRREVOCABLY WAIVED BY THE PARTIES
HERETO. THIS COMMITMENT LETTER WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK; PROVIDED, HOWEVER, THAT THE LAWS OF THE
STATE OF DELAWARE SHALL GOVERN IN DETERMINING (A) THE INTERPRETATION OF A
COMPANY MATERIAL ADVERSE EFFECT (AS DEFINED IN EXHIBIT C) AND WHETHER A COMPANY
MATERIAL ADVERSE EFFECT HAS OCCURRED AND (B) THE ACCURACY OF ANY SPECIFIED
ACQUISITION AGREEMENT REPRESENTATION AND WHETHER AS A RESULT OF ANY INACCURACY
THEREOF YOU OR YOUR SUBSIDIARIES (OTHER THAN THE COMPANY AND ITS SUBSIDIARIES)
HAVE THE RIGHT (WITHOUT REGARD TO ANY NOTICE REQUIREMENT) TO TERMINATE YOUR OR
THEIR RESPECTIVE OBLIGATIONS (OR TO REFUSE TO CONSUMMATE THE ACQUISITION) UNDER
THE ACQUISITION AGREEMENT (IN EACH CASE, WITHOUT REGARD TO CONFLICT OF LAW
PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE LAW OF
THE STATE OF DELAWARE). Each of the parties hereto hereby irrevocably (i)
submits, for itself and its property, to the exclusive jurisdiction of (a) the
Supreme Court of the State of New York, New York County and (b) the United
States District Court for the Southern District of New York, located in the
Borough of Manhattan, and any appellate court from any such court, in any
action, suit, proceeding or claim arising out of or relating to this Commitment
Letter, the Fee Letter or the Transactions or the performance of services
contemplated hereunder or under the Fee Letter, or for recognition or
enforcement of any judgment, and agrees that all claims in respect of any such
action, suit, proceeding or claim shall be heard and determined in such New York
State court or such Federal court, (ii) waives, to the fullest extent permitted
by law, any objection that it may now or hereafter have to the laying of venue
of any action, suit, proceeding or claim arising out of or relating to this
Commitment Letter, the Fee Letter, the Transactions or the performance of
services contemplated hereunder or under the Fee Letter in any such New York
State or Federal court and (iii) waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of any such action,
suit, proceeding or claim in any such court and (iv) agrees that a final,
non-appealable judgment in any such action, suit or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Each of the parties hereto agrees to
commence any such action, suit, proceeding or claim either in the United States
District Court for the Southern District of New York or in the Supreme Court of
the State of New York, New York County located in the Borough of Manhattan.

 

10

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Each of the parties hereto agrees that (i) this Commitment Letter is a binding
and enforceable agreement with respect to the subject matter contained herein,
including an agreement of each party to negotiate in good faith the Facilities
Documentation by the parties hereto in a manner consistent with this Commitment
Letter, it being acknowledged and agreed that the commitments provided hereunder
are subject only to conditions precedent as expressly provided or referred to in
Exhibit C of this Commitment Letter, and (ii) the Fee Letter is a legally valid
and binding agreement of the parties thereto with respect to the subject matter
set forth therein.

This Commitment Letter is issued for your benefit only and no other person or
entity (other than the Indemnified Persons) may rely hereon.

The provisions of Sections 3, 5, 8 and this Section 9 of this Commitment Letter
will survive any termination or completion of the arrangements contemplated by
this Commitment Letter or the Fee Letter, including without limitation whether
or not the Facilities Documentation are executed and delivered and whether or
not the Facilities are made available or any loans under the Facilities are
disbursed. You may terminate in whole (not in part) this Commitment Letter and
the commitments with respect to the Facilities hereunder at any time subject to
the provisions of the preceding sentence and the Fee Letter; provided in the
event of a reduction in the purchase price for the Acquisition or if a lesser
amount of indebtedness is required to fund the Transactions for any other
reason, you may, in your sole discretion, reduce the commitments with respect to
the Term Loan Facility.

 

10. Termination; Acceptance

Our commitments hereunder and our agreements to provide the services described
herein will terminate upon the first to occur of (i) the consummation of the
Acquisition (for the avoidance of doubt, either (x) with the funding of the
Facilities to the extent required hereunder or (y) without the funding of the
Facilities if not required hereunder), (ii) the termination of the Acquisition
Agreement in accordance with its terms or your written notice of the abandonment
of the Acquisition and (iii) 5:00 p.m. on August 22, 2016, unless the closing of
the Facilities has been consummated on or before such date on the terms and
subject to the conditions set forth herein.

This Commitment Letter may be executed in any number of counterparts, each of
which when executed will be an original and all of which, when taken together,
will constitute one agreement. Delivery of an executed counterpart of a
signature page of this Commitment Letter by facsimile or other electronic
transmission will be as effective as delivery of a manually executed counterpart
hereof.

Please confirm that the foregoing is in accordance with your understanding by
signing and returning to Barclays the enclosed copy of this Commitment Letter,
together, if not previously executed and delivered, with the Fee Letter on or
before the close of business on February 26, 2016, whereupon this Commitment
Letter and the Fee Letter will become binding agreements between us. If not
signed and returned as described in the preceding sentence by such date, this
offer will terminate on such date.

[The remainder of this page is intentionally left blank.]

 

11

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We look forward to working with you on this assignment.

 

Very truly yours, BARCLAYS BANK PLC By:  

/s/ Robert Chen

Name:   Robert Chen Title:   Managing Director

[Commitment Letter]

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DEUTSCHE BANK SECURITIES INC. By:  

/s/ Ian Dorrington

Name:   Ian Dorrington Title:   Managing Director By:  

/s/ Frank Fazio

Name:   Frank Fazio Title:   Managing Director DEUTSCHE BANK AG NEW YORK BRANCH
By:  

/s/ Ian Dorrington

Name:   Ian Dorrington Title:   Managing Director By:  

/s/ Philip Saliba

Name:   Philip Saliba Title:   Director

[Commitment Letter]

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ACCEPTED AND AGREED TO AS OF THE DATE FIRST WRITTEN ABOVE:

MKS INSTRUMENTS, INC.

 

By:  

/s/ Seth H. Bagshaw

Name:   Seth H. Bagshaw Title:   Vice President and Chief Financial Officer

[Commitment Letter]

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EXHIBIT A

MKS Instruments, Inc.

$800.0 million Term Loan Facility

Summary of Terms and Conditions

Set forth below is a summary of the proposed principal terms and conditions for
the Term Loan Facility (as defined below). Capitalized terms used in this
Exhibit A shall have the meanings set forth in the Commitment Letter to which
this Exhibit A is attached and the other Exhibits to the Commitment Letter.

 

1. PARTIES

 

Borrower:    MKS Instruments, Inc., a Massachusetts corporation (the
“Borrower”). Guarantors:    Each of the Borrower’s direct and indirect, existing
and future wholly-owned restricted subsidiaries (the “Guarantors”; together with
the Borrower, the “Loan Parties”); provided that Excluded Tax Subsidiaries (as
defined below) and Excluded Subsidiaries (as defined below) shall not be
required to guarantee the obligations of the Borrower.    “Excluded Tax
Subsidiary” means (a) Foreign Subsidiaries (as defined below) and (b) any
subsidiary that is organized in the United States that holds no material assets
other than equity interests of one or more Foreign Subsidiaries.    “Excluded
Subsidiary” means (a) unrestricted subsidiaries, (b) immaterial subsidiaries,
(c) any subsidiary that is prohibited by any law or by any contractual
obligation existing on the Closing Date from providing a guaranty, or any
subsidiary that would require governmental (including regulatory) consent,
approval, license or authorization to provide a guarantee unless such consent,
approval, license or authorization has been received, (d) not-for-profit
subsidiaries, if any, (e) any captive insurance company and (f) subject to the
limitations on acquisitions of non-Guarantors contained in the definition of
Permitted Acquisition (as defined below), any restricted subsidiary acquired
pursuant to a Permitted Acquisition to the extent that (x) such subsidiary is an
obligor in respect of secured indebtedness permitted to be incurred pursuant to
the Term Documentation (as defined below) as assumed indebtedness and (y) such
secured indebtedness was not incurred by such subsidiary in contemplation of
such Permitted Acquisition to the extent the terms of such secured indebtedness
prohibit such subsidiary from becoming a Guarantor.    “Foreign Subsidiary”
means a direct or indirect subsidiary of the Borrower (i) that is a controlled
foreign corporation within the meaning of Section 957 of the Internal Revenue
Code of 1986, or (ii) that is not created under the laws of the United States or
any state thereof.

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Lead Arrangers and Bookrunners:    Barclays Bank PLC (“Barclays”) and Deutsche
Bank Securities Inc. (“DBSI”) (in such capacity, the “Arrangers”).
Administrative Agent:    Barclays (in such capacity, the “Administrative
Agent”). Syndication Agent:    DBSI. Lenders:    A syndicate of banks, financial
institutions and other entities arranged by the Arrangers and reasonably
acceptable to the Borrower (collectively, the “Term Lenders” and, together with
the ABL Lenders (as defined in Exhibit B), the “Lenders”). Transactions:    The
Borrower intends to acquire (the “Acquisition”) 100% of the equity interests of
an entity previously identified to the Arrangers and code-named “Photon” (the
“Company”), and its subsidiaries (collectively, the “Acquired Business”),
pursuant to that certain Agreement and Plan of Merger dated as of February 22,
2016 (including the exhibits and schedules thereto, and as amended, modified or
supplemented from time to time in accordance with the terms of Exhibit C, the
“Acquisition Agreement”), among the Borrower and the various parties thereto. In
connection therewith, the Borrower has requested that the Lenders provide the
Facilities (i) to pay in part the consideration for the Acquisition, (ii) to
repay all existing material third party indebtedness of the Borrower and its
subsidiaries and the Acquired Business and terminate all commitments in
connection therewith, including, without limitation, the credit agreement dated
as of July 18, 2013 among the Company, JPMorgan Chase Bank, N.A., as
administrative agent and the other parties thereto, but excluding (x) as to the
Acquired Business, indebtedness permitted to remain outstanding on and after the
Closing Date under the Acquisition Agreement (as in effect on the date hereof)
and (y) as to the Borrower and its other subsidiaries, deferred purchase price
obligations, ordinary course working capital facilities for foreign subsidiaries
and ordinary course capital lease, purchase money and equipment financings (the
“Refinancing”), (iii) to provide ongoing working capital requirements of the
Borrower and its subsidiaries and (iv) to pay transaction costs associated with
each of the foregoing (the uses set forth in clauses (i) through (iv),
collectively referred to hereinafter as the “Transaction Costs”) and for other
general corporate purposes of the Borrower and its subsidiaries. The
transactions described in this paragraph are collectively the “Transactions”.
Closing Date:    “Closing Date” means the date of the initial funding of the
Term Loan Facility.

 

Exhibit A - 2

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2. TYPES AND AMOUNTS OF FACILITIES

 

A. Term Loan Facility:

 

Type and Amount:    A senior secured term loan facility in the aggregate
principal amount of $800.0 million plus, at the Borrower’s election, an amount
sufficient to fund any original issue discount or upfront fee required to be
funded as a result of the exercise of the “Market Flex” provisions in the Fee
Letter (the “Term Loan Facility” and the loans made thereunder, the “Term
Loans”). The Term Loan Facility shall be funded in U.S. Dollars. Maturity and
Amortization:    The Term Loans will mature on the seventh anniversary of the
Closing Date (the “Term Maturity Date”).    The Term Loans shall be repayable in
equal quarterly installments in an aggregate annual amount equal to 1.00% of the
original principal amount of the Term Loan Facility payable on the last day of
each calendar quarter commencing with the first full calendar quarter after the
Closing Date. The balance of the Term Loans will be payable on the Term Maturity
Date. Availability:    The Term Loans were made in a single drawing on the
Closing Date. Repayments and prepayments of the Term Loans may not be
reborrowed. Use of Proceeds:    The proceeds of the Term Loans shall be used to
finance the Transaction Costs, and, to the extent any proceeds remain after such
application, for general corporate purposes permitted by the Term Documentation.

B.     Incremental Facilities:

      The Term Documentation shall permit the Borrower to add one or more
incremental term loan facilities to the Term Loan Facility (each, an
“Incremental Facility”) in an aggregate principal amount of (a) an amount equal
to 50% of pro forma Consolidated EBITDA (to be defined) as of the Closing Date,
plus (b) voluntary prepayments of Term Loans, plus (c) unlimited additional
amounts so long as on a pro forma basis after giving effect to the incurrence of
any such Incremental Facility (assuming that such facility is senior
indebtedness secured by the Collateral on a pari passu basis with the
Incremental Facilities) and after giving effect to any acquisition or
dispositions or prepayment of indebtedness consummated in connection therewith
and all other appropriate pro forma adjustments (including adjustments for
cost-savings and synergies subject to parameters to be agreed), the Secured
Leverage Ratio does not exceed the pro forma Secured Leverage Ratio as of the
Closing Date (provided, that the Borrower may

 

Exhibit A - 3

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elect whether such Incremental Facility has been incurred (in whole or part)
under clauses (a), (b) and/or (c) above in its sole discretion); provided that
(i) no Term Lender will be required to participate in any such Incremental
Facility, (ii) no event of default exists or would exist after giving effect
thereto (provided, however, that in the case of any Incremental Facility to fund
(a) any Permitted Acquisition (as defined below) or other permitted acquisition
whose consummation is not conditioned on the availability of, or on obtaining,
third party financing and (b) any redemption, repurchase, defeasance,
satisfaction and discharge or repayment of indebtedness requiring irrevocable
notice in advance of such redemption, repurchase, defeasance, satisfaction and
discharge or repayment (each, a “Limited Condition Transaction”), the foregoing
requirement shall be replaced by the requirement that no event of default shall
have occurred and be continuing immediately prior to signing of the applicable
purchase or acquisition agreement, and immediately after giving effect to such
signing, (iii) the representations and warranties in the Term Documentation
shall be true and correct in all material respects (and in all respects if
qualified by materiality) immediately prior to, and after giving effect to, the
incurrence of such Incremental Facility (provided that any bring-down of
representations and warranties shall be limited in the case of any Permitted
Acquisition to customary “specified representations”), (iv) the maturity date
and weighted average life to maturity of any such Incremental Facility shall be
no earlier than the maturity date and weighted average life to maturity,
respectively, of the Term Loan Facility, (v) no Incremental Facility shall be
secured by assets other than Collateral or guaranteed by persons other than the
Guarantors with respect to the corresponding Term Loans and (vi) the interest
rates and amortization schedule applicable to any Incremental Facility shall be
determined by the Borrower and the lenders thereunder on terms and pursuant to
documentation to be mutually agreed; provided, further, that if the Applicable
Margins (or similar measure of interest margin) applicable to any Incremental
Facility is more than 0.50% per annum greater than the Applicable Margins for
the Term Loans, then the Applicable Margins for the Term Loans shall be
increased to the extent necessary so that the Applicable Margins (or similar
measure of interest margin) for the Incremental Facility are equal to the
Applicable Margins for the Term Loans, plus 0.50% per annum; provided, further,
that, in determining the interest rate margins applicable to the Incremental
Facility and the Term Loans, (x) arrangement, commitment or structuring fees and
other similar fees not paid or payable generally to lenders but are payable to
any lead arranger of such Incremental Facility, and any similar fees not paid or
payable generally to lenders but are payable to the Arrangers (or their
affiliates) in connection with the Term Loans shall be excluded, (y) OID and

 

Exhibit A - 4

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   upfront fees paid to the lenders thereunder shall be included (with OID and
upfront fees being equated to interest based on assumed four-year life to
maturity or, if shorter, the actual weighted average life to maturity), and (z)
if the applicable Incremental Facility includes an interest rate floor greater
than the applicable interest rate floor under the existing Term Loan Facility,
such differential between interest rate floors shall be equated to an increase
in the applicable interest rate margin with respect to such Incremental Facility
for purposes of determining whether an increase to the interest rate margin
under the existing Term Loan Facility shall be required, but only to the extent
an increase in the interest rate floor in the existing Term Loan Facility would
cause an increase in the interest rate then in effect thereunder, and in such
case the interest rate floor (but not the interest rate margin) applicable to
the existing Term Loan Facility shall be increased to the extent of such
differential between interest rate floors; provided, further, that, with respect
to any Incremental Facility, to the extent such terms are not consistent with
the Term Loan Facility (except to the extent permitted by clauses (v) and (vii)
of this paragraph), they shall be reasonably satisfactory to the Administrative
Agent and any Incremental Facility shall, for purposes of prepayments, be
treated in any event no more favorably than the Term Loan Facility and shall
share ratably or less than ratably in any mandatory prepayments of the Term Loan
Facility.    “Secured Leverage Ratio” means the ratio of (a) Consolidated
Secured Debt (i.e., consolidated total debt of the Borrower and its restricted
subsidiaries that is secured by a lien on any assets of the Borrower or any of
its restricted subsidiaries) as of such date to (b) Consolidated EBITDA (to be
defined) for the period of four consecutive fiscal quarters of the Borrower last
ended for which financial statements have been delivered or were required to
have been delivered (the “Test Period”).

C.     Refinancing Term Facilities:

      The Term Documentation shall permit the Borrower to refinance the then
outstanding Term Loans from time to time, in whole or in part, with (x) one or
more new term facilities (each, a “Refinancing Term Facility”), under the Term
Documentation with the consent of the Borrower, the Administrative Agent and the
institutions providing such Refinancing Term Facility or (y) with one or more
additional series of senior unsecured notes or loans, or senior secured notes
that will be secured by the Collateral on a pari passu or junior basis with the
Term Loan Facility, senior subordinated (including unsecured) notes or loans, or
subordinated (including unsecured) notes or loans (any such notes or loans, the
“Refinancing Notes”, and, together with

 

Exhibit A - 5

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   the Refinancing Term Facility, the “Refinancing Indebtedness”); provided that
with respect to any such refinancing in part (i) any such Refinancing Term
Facility or Refinancing Notes do not mature prior to the maturity date of, or
have a shorter weighted average life than, the Term Loan Facility or Incremental
Facility, in either case, that are being refinanced, (ii) the amount of any such
Refinancing Indebtedness does not exceed the amount of indebtedness being
refinanced (plus any premium, accrued interest or fees and expenses in respect
of the refinancing thereof), plus additional amounts to the extent the Borrower
has available debt capacity under other baskets or carve-outs, (iii) any such
Refinancing Indebtedness is not guaranteed by any persons other than the
Guarantors under the Term Loan Facility, (iv) if secured, any such Refinancing
Indebtedness shall only be secured by the Collateral securing the Term Loan
Facility on a pari passu or junior basis with the Term Loan Facility pursuant to
the Term Documentation and shall not be secured by any assets not securing the
obligations under such Term Loan Facility, (v) customary subordination or
intercreditor agreements reasonably acceptable to the Administrative Agent are
entered into for any such secured, subordinated or senior subordinated
Refinancing Notes and (vi) either (x) the covenants and events of default and
the other terms and conditions of such Refinancing Term Facility or Refinancing
Notes (excluding pricing and optional prepayment or redemption terms) are, taken
as a whole, not more favorable to the investors providing such Refinancing Term
Facility or Refinancing Notes, as applicable, than, those applicable to the Term
Loan Facility (except for covenants or other provisions applicable only to
periods after the latest final maturity date of any then outstanding Term Loan
Facility existing at the time of such refinancing) or (y) the Term Lenders are
afforded the benefits of substantially similar provisions.

3.      CERTAIN PAYMENT PROVISIONS

   Interest Rate Options:    The Borrower may elect that the Term Loan Facility
comprising each borrowing bear interest at a rate per annum equal to (a) the ABR
plus the Applicable Margin or (b) the Eurodollar Rate, plus the Applicable
Margin.    As used herein:    “ABR” means the highest of (i) the rate of
interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S.
or, if The Wall Street Journal ceases to quote such rate, the highest per annum
interest rate published by the Federal Reserve Board in Federal Reserve
Statistical Release H.15 (519) (Selected Interest Rate) as the “bank prime loan”
rate or, if such rate is no longer quoted therein, any similar rate quote
therein (as determined by the Administrative Agent) or similar release by the
Federal Reserve Board (as determined by

 

Exhibit A - 6

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     the Administrative Agent) (the “Prime Rate”), (ii) the federal funds
effective rate from
time to time (which rate, if negative, shall be deemed to be 0.00%) plus 0.50%
and (iii)
the Eurodollar Rate applicable for an interest period of one month plus 1.00%;
provided, however, that notwithstanding the rate calculated in accordance with
the
foregoing, at no time shall the ABR for the Term Loan Facility be deemed to be
less
than 1.75% per annum.    “ABR Loans” means Loans bearing interest based upon the
ABR.    “Applicable Margin” means (i) 3.50%, in the case of ABR Loans and (ii)
4.50%, in the case of Eurodollar Loans.    “Eurodollar Loans” means Loans
bearing interest based upon the Eurodollar Rate (as defined below).   
“Eurodollar Rate” means the rate (adjusted for statutory reserve requirements
for eurocurrency liabilities) for eurodollar deposits for a period equal to one,
two, three or six months or any longer period agreed to by all relevant lenders
(as selected by the Borrower) appearing on the page of the Reuters Screen which
displays an average ICE Benchmark Administration Interest Settlement Rate or any
successor substitute page (such page currently being LIBOR01 page) (which rate,
if negative, shall be deemed to be 0.00%); provided, however, that
notwithstanding the rate calculated in accordance with the foregoing, at no time
shall the Eurodollar Rate for the Term Loan Facility be deemed to be less than
0.75% per annum. Interest Payment Dates:    In the case of ABR Loans, quarterly
in arrears.    In the case of Eurodollar Loans, on the last day of each relevant
interest period and, in the case of any interest period longer than three
months, on each successive date three months after the first day of such
interest period. Default Rate:    At any time when any Loan Party is in default
in the payment of any amount under the Term Loan Facility, after giving effect
to any applicable grace period, such overdue amounts shall bear interest at
2.00% per annum above the rate otherwise applicable thereto, and with respect to
any overdue amount (including overdue interest) for which there is no applicable
rate, 2.00% per annum in excess of the rate otherwise applicable to Term Loans
maintained as ABR Loans from time to time.

 

Exhibit A - 7

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Rate and Fee Basis:   All per annum rates shall be calculated on the basis of a
year of 360 days (or 365/366 days, in the case of ABR Loans) for actual days
elapsed. Optional Prepayments and Commitment Reductions:  

 

The Term Loans may be prepaid, in whole or in part without premium or penalty
(other than as set forth under “Soft-Call Premium” below), in minimum amounts
set forth in the Term Documentation, at the option of the Borrower at any time
upon one business day’s (or, in the case of a prepayment of Eurodollar Loans,
three business days’) prior notice, subject to reimbursement of the Term
Lenders’ redeployment costs in the case of a prepayment of Eurodollar Loans
prior to the last day of the relevant interest period. Optional prepayments of
the Term Loans, together with accrued interest, if any, shall be applied as
directed by the Borrower (and absent such direction, in direct order of maturity
thereof).

Soft-Call Premium:   In the event that all or any portion of the Term Loan
Facility is repriced downward, effectively refinanced through any amendment of
the Term Loan Facility or refinanced with the proceeds of other syndicated bank
debt financing, in each case resulting in a lower yield on such amended Term
Loan Facility or refinancing indebtedness, as applicable, than that existing on
the Term Loan Facility prior to such amendment or refinancing, for any reason on
or prior to the date that is six months after the Closing Date, such repricings,
effective refinancings or refinancings will be made with the payment of a 1.00%
premium on the amount repriced, effectively refinanced or refinanced (including
with respect to the loans and commitments of any lenders replaced in connection
with any amendment related thereto); provided that the foregoing payment shall
not apply in the case of any prepayment or refinancing in connection with a
change of control or an acquisition that is not a Permitted Acquisition. All
voluntary prepayments under the Term Loan Facility shall be applied to the
remaining amortization payments thereunder as directed by the Borrower and as
between the Term Loan Facility and any Incremental Facility, as directed by the
Borrower. Mandatory Prepayments:   Mandatory repayments of the Term Loans shall
be required from:   (a)   with respect to any non-ordinary course asset sale or
other disposition of assets with net proceeds of $5 million or more in any
transaction or series of related transactions, 100% of the net cash proceeds
(which shall be defined to exclude, among other things, the amount of any
required tax payments that the Loan Parties shall be

 

Exhibit A - 8

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    required to make as a result of such sale or disposition) from any
non-ordinary course sale or other disposition of assets (including as a result
of casualty or condemnation) by the Loan Parties and their restricted
subsidiaries, excluding up to $200 million in the aggregate for all such sales
and other dispositions that are consummated within 18 months after the Closing
Date and subject to the right of the Loan Parties to reinvest such proceeds if
such proceeds are reinvested (or committed to be reinvested) within 12 months
and, if so committed to reinvestment, reinvested within 18 months thereafter,
and other exceptions as set forth in the Term Documentation, it being understood
and agreed that any such repayments pursuant to this clause (a) shall only be
required when the aggregate amount of excess net cash proceeds from such
non-ordinary course asset sales or other disposition of assets, after giving
effect to any applicable reinvestment rights, exceeds $5 million (the “Excess
Proceeds Threshold”);   (b)   100% of the net cash proceeds from issuances or
incurrences of debt by the Borrower and its restricted subsidiaries (other than
indebtedness permitted by the Term Documentation (other than Refinancing
Indebtedness)); and   (c)   50% (with step-downs to 25% and 0%, each based upon
achievement of Total Leverage Ratios (i.e., the ratio of (a) Consolidated Total
Indebtedness (i.e., all indebtedness of the Borrower and its restricted
subsidiaries) to (b) Consolidated EBITDA for such Test Period (to be defined),
of annual Excess Cash Flow (to be defined) (commencing with Excess Cash Flow for
the fiscal year ending December 31, 2016, provided that solely for the fiscal
year ending December 31, 2016, Excess Cash Flow shall equal the annual Excess
Cash Flow for such year multiplied by the number of days from the Closing Date
to December 31, 2016 divided by 360); provided that any voluntary prepayments of
Term Loans and ABL Loans to the extent commitments under the ABL Facility are
permanently reduced by the amount of such prepayments, other than payments or
reductions funded with the proceeds of equity or long-term indebtedness, during
such fiscal year shall be credited against Excess Cash Flow prepayment
obligations on a dollar-for-dollar basis for such fiscal year.   Mandatory
prepayments shall be applied, without premium or penalty (other than any
Soft-Call Premium payable in connection

 

Exhibit A - 9

--------------------------------------------------------------------------------

   with any Refinancing Indebtedness in the case of clause (b) above), subject
to reimbursement of the Term Lenders’ redeployment costs in the case of a
prepayment of Eurodollar borrowings other than on the last day of the relevant
interest period, first to the next eight succeeding scheduled installments
thereof in direct order of maturity and second ratably to the remaining
respective installments thereof.    Prepayments from foreign subsidiaries’
Excess Cash Flow and asset sale proceeds (to the extent otherwise required)
shall be limited under the definitive documentation to the extent (x) the
repatriation of funds to fund such prepayments is prohibited, restricted or
delayed by applicable laws or (y) repatriation of funds to fund such prepayment
would result in material adverse tax consequences, as reasonably determined by
the Borrower.    All mandatory prepayments under clauses (a) and (c) above are
subject to permissibility under (a) local law (e.g., financial assistance,
corporate benefit, restrictions on upstreaming of cash intra-group and the
fiduciary and statutory duties of the directors of the relevant subsidiaries)
and (b) organizational document restrictions (including as a result of minority
ownership). The non-application of any such mandatory prepayment amounts as a
result of the foregoing provisions will not constitute a default or an event of
default and such amounts shall be available for working capital purposes of the
Borrower and its restricted subsidiaries. The Borrower will use commercially
reasonable efforts for to overcome or eliminate any such restriction and/or
minimize any such costs of prepayment.    Any Term Lender may elect not to
accept its pro rata portion of any mandatory prepayment (each a “Declining
Lender”). Any prepayment amount declined by a Declining Lender (“Rejected
Amounts”) may be retained by the Borrower and used by the Borrower in any manner
not prohibited by the Term Documentation and any such retained amounts will not
thereafter be counted as excess cash flow or net cash proceeds (as described
above) in any subsequent measurement period.

4.      COLLATERAL

   Collateral:    Subject to exclusions and limitations as set forth in the Term
Documentation and subject to the Certain Funds Provision, the obligations of the
Borrower and each Guarantor in respect of the Term Loan Facility and any swap
agreements and cash management arrangements provided by any Term Lender or
Arranger (or any affiliate of a Term Lender or Arranger) shall be secured by (a)
a perfected first-priority security interest (subject to permitted liens) in all
or substantially all of the Loan Parties’

 

Exhibit A - 10

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  tangible and intangible personal property assets other than ABL Priority
Collateral, including, without limitation, registered intellectual property,
intercompany notes and all of the capital stock of the Borrower and each of its
direct and indirect restricted subsidiaries (limited to (i) the assets of each
Guarantor and (ii) 65% of the voting capital stock, and 100% of the non-voting
capital stock, of any first-tier Excluded Tax Subsidiary) (the “Term Priority
Collateral”) and (b) a perfected second-priority security interest in all or
substantially all of the Loan Parties’ existing and future cash, cash
equivalents, bank accounts (with exceptions to be agreed), accounts receivable,
other receivables, chattel paper, inventory, and contract rights, documents,
general intangibles (excluding, for the avoidance of doubt, except as needed to
liquidate the collateral, trademarks, trade names and other intellectual
property) and insurance, instruments and books and records relating thereto and
all proceeds of the foregoing (the “ABL Priority Collateral” and, together with
the Term Priority Collateral, the “Collateral”).   Notwithstanding anything to
the contrary, the Collateral shall exclude (or not require actions with respect
thereto as described below) the following: (i) (a) leasehold interests and
(b) real property (1) located outside of the United States or (2) with a value
(as determined in good faith by the Borrower) of less than an amount to be
agreed, (ii) any assets located outside of the United States or with a value (as
determined in good faith by the Borrower) of less than an amount to be agreed,
(iii) vehicles and other assets subject to certificates of title, (iv) letter of
credit rights and commercial tort claims with a value, in each case, less than
an amount as set forth in the Term Documentation, (v) any lease, license or
other agreement or any property subject to a purchase money security interest or
similar arrangement or where the granting of a security interest in any assets
would be prohibited by contract, applicable law or regulation or the
organizational documents of any non-wholly owned restricted subsidiary (in each
case only to the extent that such contractual provisions are not rendered
ineffective by applicable law or otherwise unenforceable), in each case, to the
extent that a grant of a security interest therein would violate or invalidate
such lease, license or agreement, purchase money financing, capital lease or a
similar arrangement or create a right of termination in favor of any other party
thereto (other than the Borrower or a Guarantor) after giving effect to the
applicable anti-assignment provisions of the Uniform Commercial Code, other than
proceeds and receivables thereof, the assignment of which is expressly deemed
effective under the Uniform Commercial Code notwithstanding such prohibition,
(vi) governmental licenses or state and local franchises, charters, and
authorizations and any other property and assets to the extent the
Administrative Agent

 

Exhibit A - 11

--------------------------------------------------------------------------------

   may not validly possess a security interest therein under applicable laws
(including without limitation, rules and regulations of any governmental
authority or agency) or the pledge or creation of a security interest therein
would require governmental consent, approval, license or authorization, other
than to the extent such prohibition or limitation is rendered ineffective under
the Uniform Commercial Code or other applicable law notwithstanding such
prohibition, (vii) any intent to use trademark application prior to the filing
of a “Statement of Use” or “Amendment to Allege Use” with respect thereto, to
the extent, if any, that, and solely during the period, if any, in which the
grant of a security interest therein would impair the validity or enforceability
of such intent to use trademark application under applicable federal law, (viii)
zero balance accounts, payroll accounts, withholding and trust accounts, tax
accounts, escrow or other fiduciary accounts; (ix) those assets as to which the
Administrative Agent and the Borrower agree in writing shall be excluded where
the costs and burdens of obtaining a security interest therein or perfection
thereof outweigh the benefit to the Term Lenders of the security to be afforded
thereby; and (x) other exceptions as set forth in the Term Documentation. The
foregoing described in clauses (i) through (x) are, collectively, the “Excluded
Assets”.    None of the Collateral shall be subject to any other pledges,
security interests or mortgages, except junior liens on pledged equity interests
and instruments and other liens in each case as permitted under the lien
covenant. Notwithstanding the foregoing, no foreign law governed documents,
perfection actions or foreign law opinions shall be required in connection with
the Facilities. Intercreditor Agreement:    The relative rights and priorities
in the Collateral among the ABL Lenders, on the one hand, and the Term Lenders,
on the other hand, will be set forth in a customary intercreditor agreement that
is reasonably acceptable to the Administrative Agent under each Facility and the
Loan Parties (the “Intercreditor Agreement”).

5.      CONDITIONS

   Conditions to Initial Borrowing:    The extension of credit under the Term
Loan Facility on the Closing Date will be subject only to the conditions
precedent set forth in Exhibit C to the Commitment Letter.

6.      DOCUMENTATION

   Term Documentation:    The definitive documentation for the Term Loan
Facility (the “Term Documentation” and, together with the ABL Facility
Documentation (as defined in Exhibit B), the “Facilities

 

Exhibit A - 12

--------------------------------------------------------------------------------

   Documentation”) will contain the terms set forth in this Exhibit A and, to
the extent any other terms are not expressly set forth in this Exhibit A will
(i) be negotiated in good faith within a reasonable time period to be determined
based on the expected Closing Date and taking into account the timing of the
syndication of the Term Facility and the pre-closing requirements of the
Acquisition Agreement, (ii) contain such other terms as the Borrower and the
Arrangers shall reasonably agree, (iii) give due regard to the leverage profile
and projected free cash flow generation of the Borrower and its restricted
subsidiaries after giving effect to the Transactions, (iv) reflect the
operational and strategic requirements of the Borrower and its restricted
subsidiaries, (v) take into account the proposed business plan and financial
model of the Borrower and (vi) be in a form such that they do not impair the
availability of the Term Facility on the Closing Date if the conditions to
funding set forth or referred to in Exhibit C are satisfied (collectively, the
“Term Documentation Principles”). Financial Covenant:    None. Unrestricted
Subsidiaries:    The Term Documentation contains provisions pursuant to which,
subject to limitations on investments, loans, advances and guarantees and other
customary conditions and provisions as set forth in the Term Documentation, the
Borrower is permitted to designate any existing or subsequently acquired or
organized subsidiary as an “unrestricted subsidiary” and subsequently
re-designate any such unrestricted subsidiary as a restricted subsidiary;
provided that (i) after giving effect to any such designation or re-designation,
on a pro forma basis the Total Leverage Ratio does not exceed a level to be
agreed and no default or event of default shall exist (including after the
reclassification of investments in, debt of, and liens on the assets of, the
applicable subsidiary), (ii) if a restricted subsidiary is being designated as
an unrestricted subsidiary, such restricted subsidiary, together with all other
unrestricted subsidiaries as of such date of designation, must not have
contributed greater than 10% of the Borrower’s consolidated EBITDA (calculated
inclusive of all unrestricted subsidiaries), as of the most recently ended
fiscal quarter of the Borrower and (iii) each subsidiary designated as an
“unrestricted subsidiary” under the ABL Facility shall be designated as an
unrestricted subsidiary under the Term Loan Facility, and each subsidiary
designated as a “restricted subsidiary” under the ABL Facility shall be
designated as a restricted subsidiary under the Term Loan Facility. Unrestricted
subsidiaries will not be subject to the representations and warranties, the
affirmative or negative covenant or event of default provisions of Term
Documentation, and the results of operations and indebtedness of unrestricted

 

Exhibit A - 13

--------------------------------------------------------------------------------

   subsidiaries will not be taken into account for purposes of determining
compliance (to the extent applicable) with the negative covenants and financial
ratios contained in the Term Documentation. Representations and Warranties:   
Limited to the following and applicable to the Borrower and its restricted
subsidiaries: financial statements (including pro forma financial statements)
and projections; no material adverse change; corporate existence; compliance
with law; corporate power and authority; enforceability of Term Documentation;
with respect to the Term Documentation, no conflict with law, organizational
documents and material agreements; no material adverse litigation; ownership of
property; intellectual property; taxes; Federal Reserve regulations; labor
matters; ERISA; Investment Company Act; subsidiaries; use of proceeds;
environmental and regulatory matters; disclosures; creation, perfection and
priority of security interests; solvency (on a consolidated basis); status of
the Term Loan Facility as senior debt; PATRIOT Act; FCPA and OFAC/anti-terrorism
laws; insurance; and delivery of certain documents, subject, in the case of each
of the foregoing representations and warranties, to customary qualifications and
to limitations for materiality as set forth in the Term Documentation.
Affirmative Covenants:    Limited to the following and applicable to the
Borrower and its restricted subsidiaries: delivery of annual financial
statements (accompanied by an audit opinion from a nationally recognized
accounting firm) within ninety days (90) after the end of each fiscal year,
delivery of quarterly financial statements within forty-five (45) days after the
end of each of the first three fiscal quarters of each fiscal year; and delivery
of annual budgets and projections (within sixty-five (65) days after the end of
each fiscal year, and only to Lenders that have elected to receive material
non-public information); officers’ certificates and other information; payment
of taxes; maintenance of existence and material rights and privileges;
compliance with laws; maintenance of property (subject to casualty, condemnation
and normal wear and tear) and customary insurance; maintenance of books and
records; right of the Term Administrative Agent to inspect property and books
and records; notices of defaults, litigation and other material events;
compliance with environmental laws; ERISA; commercially reasonable efforts to
maintain ratings (but not to maintain a specific rating); use of proceeds;
designation of unrestricted subsidiaries; and further assurances (including,
without limitation, with respect to security interests in after-acquired
property), subject, in the case of each of the foregoing covenants, to customary
exceptions and qualifications as set forth in the Term Documentation.

 

Exhibit A - 14

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   Notwithstanding anything to the contrary, there is no minimum hedging
requirement for interest rate or foreign exchange hedging. Negative Covenants:
   Limited to the following with certain customary exceptions (and applicable to
the Borrower and its restricted subsidiaries):   

(a) the incurrence of debt (which shall permit, among other things, an amount to
be agreed for letters of credit and foreign lines of credit);

 

(b) liens (which shall permit, among other things, an amount to be agreed for
secured letters of credit and secured foreign lines of credit);

 

(c) mergers, consolidations and fundamental changes;

 

(d) asset sales (which shall permit, among other things, ordinary course asset
sales and dispositions, and other exceptions to be agreed, including sales of
restricted subsidiaries and sale leasebacks, with a basket of $200 million in
the aggregate for all asset sales consummated within 18 months of the Closing
Date subject to no event of default and at least 75% of the consideration
received is in cash or cash equivalents);

 

(e) investments (which shall permit, among other things, investments in
restricted subsidiaries (including Foreign Subsidiaries) subject to a limit to
be agreed on investments by Loan Parties in entities that are not Loan Parties,
and Permitted Acquisitions (as defined below));

 

(f) dividends or distributions on, or redemptions of, the Borrower’s equity
(which shall permit, among other things, (i) intercompany dividends and
distributions including pro-rata distributions from non-wholly owned
subsidiaries with respect to their equity interests, (ii) a general basket of
$50 million, subject to the absence of any event of default, (iii) unlimited
amounts subject to (x) the absence of any event of default and (y) a pro forma
Total Leverage Ratio not greater than 2.50:1.00), (iv) a basket of $15 million
for the purchase or redemption of stock appreciation rights, restricted stock
units and performance share units of the Company, in each case, in connection
with the Acquisition and (v) so long as no event of default has occurred and is
continuing or would result therefrom, dividends, distributions and equity
redemptions in an aggregate amount per fiscal year not to exceed 4.0% of Market
Capitalization (defined as an amount equal to (i) the total number of issued and
outstanding shares of common (or common equivalent) equity interests of the
Borrower on the date of declaration of the relevant restricted payment
multiplied by (ii) the arithmetic mean

 

Exhibit A - 15

--------------------------------------------------------------------------------

   of the closing prices per share of such common (or common equivalent) equity
interests for the 30 consecutive trading days immediately preceding the date of
declaration of such restricted payment) for all dates of declaration of such
restricted payments during such fiscal year;   

(g) prepayments or redemptions of junior debt, or amendments of junior debt
documents or organizational documents in a manner materially adverse to the Term
Lenders;

 

(h) negative pledge clauses and other restrictive agreements;

 

(i) transactions with affiliates above an agreed upon threshold (with customary
exceptions as set forth in the Term Documentation);

 

(j) anti-corruption laws and sanctions; FCPA and OFAC/anti-terrorism laws;

 

(k) sale/leaseback transactions; and

 

(l) change in business.

 

The Term Documentation shall provide for an available basket amount (the
“Available Amount Basket”) built by, among things, (i) $50 million,
(ii) retained Excess Cash Flow, (iii) customary capital contributions and
conversions and sales of certain equity interests, (iv) any unused Rejected
Amounts, and (v) proceeds of sales of investments and cash returns on
investments funded with the Available Amount Basket, which Available Amount
Basket may be used, subject to (a) the absence of any event of default and (b) a
pro forma Total Leverage Ratio not greater than 4.00:1.00, for restricted
payments, investments and the prepayment or redemption of any junior debt.

   The Borrower or any restricted subsidiary shall be permitted to make
acquisitions of property and assets or businesses of any person or of assets
constituting a business unit, a division or line of business of a person, or
equity interests in a person that, upon the consummation thereof, will be a
restricted subsidiary of Borrower or will be owned by Borrower or any restricted
subsidiary of Borrower (including, in each case, as a result of merger or
consolidation) (each, a “Permitted Acquisition”), so long as (a) there is no
event of default after giving pro forma effect to such acquisition and the
incurrence of indebtedness in connection therewith (at the time of such
acquisition or, in the case of a Limited Condition Transaction, at the time of
signing), (b) to the extent required under “Guarantees” and “Collateral” above,
the acquired company and its subsidiaries will become Guarantors and pledge
their Collateral to the Administrative

 

Exhibit A - 16

--------------------------------------------------------------------------------

   Agent; provided that, if any security interest in any Collateral (including
the creation or perfection of any security interest) is not or cannot reasonably
be created and/or perfected on the closing date of such Permitted Acquisition
after the Borrower’s use of commercially reasonable efforts to do so, or without
undue burden expense, then the creation and/or perfection of any such Collateral
shall not constitute a requirement to close such Permitted Acquisition, but
instead shall be created and/or perfected within 90 days after the closing date
of such Permitted Acquisition or such later date as the Administrative Agent may
reasonably agree, pursuant to reasonably satisfactory arrangements as set forth
in the Term Documentation and (c) the aggregate amount of consideration paid
directly or indirectly by the Loan Parties for acquisitions of or investments in
entities that are not required to become Loan Parties after the consummation of
such acquisition or investment shall be subject to a cap as set forth in the
Term Documentation. Events of Default:    Limited to the following and
applicable to the Borrower and its restricted subsidiaries only, and with
materiality, grace periods and other qualifications as set forth in the Term
Documentation: nonpayment of principal when due; nonpayment of interest, fees or
other amounts after a three business day grace period; material inaccuracy of a
representation or warranty when made or deemed made; violation of covenants
(subject, in the case of certain of such affirmative covenants, to a thirty day
grace period); cross-default and cross acceleration to material indebtedness
(provided that the Borrower’s failure to perform or observe the Financial
Covenant(s) (as defined in Exhibit B) with respect to the ABL Facility shall not
constitute an Event of Default for purposes of the Term Loan Facility unless and
until the ABL Lenders have actually declared all such obligations under the ABL
Facility to be immediately due and payable and such declaration has not been
rescinded); bankruptcy events of the Borrower or any restricted subsidiary that
is not an immaterial subsidiary (with a customary grace period for involuntary
events); certain ERISA events; material unsatisfied judgments; actual or
asserted invalidity of any material provision in a guarantee, security document
or material subordination provisions or non-perfection of a security interest
covering a material portion of the collateral; and a change of control.

Voting, Assignments and

Participations, Yield Protection:

  

 

After the Closing Date, the Term Lenders shall be permitted to assign (except to
disqualified lenders, if the list of disqualified lenders has been provided to
all Term Lenders) the Term Loans with the consent of the Borrower (not to be
unreasonably withheld or delayed) (the Borrower’s consent shall be deemed given
if it fails to respond within ten business days); provided

 

Exhibit A - 17

--------------------------------------------------------------------------------

   that no consent of the Borrower shall be required (i) after the occurrence
and during the continuance of a payment or bankruptcy event of default or (ii)
for assignments of loans to any existing Term Lender or an affiliate or related
fund of an existing Term Lender. All assignments will require the consent of the
Administrative Agent (not to be unreasonably withheld or delayed) unless such
assignment is an assignment of the Term Loans to another Term Lender, an
affiliate of a Term Lender or an approved fund. Each assignment will be in an
amount of an integral multiple as set forth in the Term Documentation or, in
each case, if less, all of such Term Lender’s remaining loans and commitments of
the applicable class. Natural persons and the Borrower, its subsidiaries and
affiliates may not be assignees.   

Notwithstanding the foregoing, the Administrative Agent shall not be responsible
for monitoring assignments or participations for compliance with the list of
disqualified institutions, if any.

 

The Term Lenders are permitted to sell participations in Term Loans and
commitments without restriction (except to disqualified lenders, if the list of
disqualified lenders has been provided to all Term Lenders), other than as set
forth in the next sentence, and in accordance with applicable law. Voting rights
of participants shall be limited to matters in respect of (a) increases in
commitments participated to such participants, (b) reductions of principal,
interest or fees, (c) extensions of final maturity and (d) releases of all or
substantially all of the value of the Guarantees or all or substantially all of
the Collateral.

 

The Borrower may repurchase Term Loans on a non-pro rata basis through a Dutch
auction process (or other procedures as set forth in the Term Documentation by
the Borrower and the Administrative Agent) offered to all Term Lenders on
customary terms; provided that (i) any Term Loans so repurchased shall be
immediately cancelled upon repurchase, and (ii) no event of default shall have
occurred and be continuing.

 

Notwithstanding the foregoing, the Administrative Agent is not obligated to act
as agent for any Loan repurchases by the Borrower, and the Borrower may engage a
separate firm to act in such capacity.

 

Amendments and waivers with respect to the Term Documentation shall require the
approval of Term Lenders holding more than 50% of the aggregate amount Loans and
commitments under the Term Loan Facility (the “Required Lenders”), except that
(a) in addition to the consent of the Required Lenders, the consent of each Term
Lender directly affected thereby shall be required with respect to
(i) reductions in

 

Exhibit A - 18

--------------------------------------------------------------------------------

   the amount or extensions of the scheduled date of any amortization or final
maturity of any Loan and (ii) reductions in the rate of interest or any fee or
extensions of any due date thereof (but, for the avoidance of doubt, other than
default rate interest) and (iv) increases in the amount or extensions of the
expiry date of any Term Lender’s commitment, (b) the consent of 100% of the Term
Lenders shall be required with respect to (i) reductions of any of the voting
percentages and modifications of any pro rata sharing and payment provisions,
(ii) releases of all or substantially all the Collateral (other than in
connection with any sale of Collateral permitted by the Term Documentation) and
(iii) releases of all or substantially all of the Guarantors (other than in
connection with the release or sale of the relevant Guarantor permitted by the
Term Documentation) and (c) the consent of Administrative Agent shall be
required with respect to any amendment or modification that affects its rights
or duties as administrative agent. Any amendment or waiver that by its terms
affects only the rights or duties of Term Lenders holding loans or commitments
of a particular class (but not the Term Lenders holding loans or commitments of
any other class) will require only the requisite percentage in interest of the
affected class of Term Lenders that would be required to consent thereto if such
class of Term Lenders were the only class of Term Lenders.   

The Term Documentation contains customary provisions for replacing
non-consenting Term Lenders in connection with amendments and waivers requiring
the consent of all Term Lenders or of all Term Lenders directly affected thereby
so long as the Required Lenders shall have consented thereto.

 

The Term Documentation shall contain customary protective provisions for such
matters as EU bail-in, capital adequacy, increased costs, reserves, funding
losses, illegality, and withholding taxes, including treatment of Dodd-Frank
Wall Street Reform and Consumer Protection Act and Basel III as changes in law.

Expenses and Indemnification:    The Borrower shall pay (a) all reasonable and
documented or invoiced out-of-pocket expenses of the Administrative Agent and
the Arrangers in connection with the syndication of the Term Loan Facility and
the preparation, execution, delivery and administration of the Term
Documentation and any amendment or waiver with respect thereto (including,
without limitation, the reasonable fees, disbursements and other charges of one
primary counsel, one local counsel in each relevant jurisdiction and counsel
otherwise retained with the Borrowers’ consent) and (b) all reasonable and
documented or invoiced out-of-pocket expenses of the Administrative Agent, the
Arrangers and the Term Lenders (including, without limitation, the fees,
disbursements and other charges of counsel) in connection with the enforcement
of the Term Documentation.

 

Exhibit A - 19

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   The Loan Parties will indemnify the Administrative Agent, the Arrangers and
the Term Lenders and their respective affiliates, and the officers, directors,
employees, affiliates, agents and controlling persons of the foregoing, and hold
them harmless from and against all costs, expenses (including, without
limitation, reasonable fees, disbursements and other charges of counsel) and
liabilities of any such indemnified person arising out of or relating to any
claim or any litigation or other proceedings (regardless of whether any such
indemnified person is a party thereto or whether such claim, litigation, or
other proceeding is brought by a third party or by the Borrowers or any of their
respective affiliates, creditors or shareholders) that relate to the Term
Documentation), except to the extent that it is found by a final, non-appealable
judgment of a court of competent jurisdiction that such loss, claim, damage,
liability or expense resulted from (i) the gross negligence or willful
misconduct of the indemnified party, (ii) a material breach of obligations under
the Term Documentation by such indemnified party or (iii) any dispute solely
among the indemnified parties (not arising as a result of any act or omission by
the Borrower or any of its subsidiaries or affiliates) other than any claim,
action, suit, inquiry, litigation, investigation or other proceeding brought by
or against any such indemnified party in its capacity as agent or arranger.
Governing Law and Forum:    New York.

Counsel to the Administrative Agent

and the Arrangers:

   Paul Hastings LLP.

 

Exhibit A - 20

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EXHIBIT B

MKS Instruments, Inc.

$50.0 million ABL Facility

Summary of Terms and Conditions

Set forth below is a summary of the proposed principal terms and conditions for
the ABL Facility (as defined below). Capitalized terms used in this Exhibit B
shall have the meanings set forth in the Commitment Letter to which this Exhibit
B is attached and the other Exhibits to the Commitment Letter.

 

1. PARTIES

 

ABL Borrowers:    MKS Instruments, Inc., a Massachusetts corporation (“MKS”) and
certain wholly-owned domestic restricted subsidiaries thereof to be agreed (the
“ABL Borrowers”). Guarantors:    Each of the ABL Borrowers’ direct and indirect,
existing and future wholly-owned restricted subsidiaries (the “Guarantors”;
together with the ABL Borrowers, the “Loan Parties”); provided that Excluded Tax
Subsidiaries (as defined in Exhibit A) and Excluded Subsidiaries (as defined in
Exhibit A) shall not be required to guarantee the obligations of the ABL
Borrowers. Each guarantor under the Term Loan Facility shall be a Guarantor
under the ABL Facility. Lead Arrangers and Bookrunners:    Deutsche Bank
Securities Inc. (“DBSI”) and Barclays Bank PLC (“Barclays”) (in such capacity,
the “Arrangers”). Administrative Agent:    Deutsche Bank AG New York Branch
(“DBNY”) (in such capacity, the “Administrative Agent”). Syndication Agent:   
Barclays. ABL Lenders:    A syndicate of banks, financial institutions and other
entities arranged by the Arrangers and reasonably acceptable to the ABL
Borrowers (collectively, the “ABL Lenders”). Transactions:    MKS intends to
acquire (the “Acquisition”) 100% of the equity interests of an entity previously
identified to the Arrangers and code-named “Photon” (the “Company”), and its
subsidiaries (collectively, the “Acquired Business”), pursuant to that certain
Agreement and Plan of Merger dated as of February 22, 2016 (including the
exhibits and schedules thereto, and as amended, modified or supplemented from
time to time in accordance with the terms of Exhibit C, the “Acquisition
Agreement”), among MKS and the various parties thereto. In connection therewith,
MKS has requested that the Lenders provide the Facilities (i) to pay in part the
consideration for the Acquisition, (ii) to repay all existing material third
party indebtedness of MKS and its subsidiaries and the Acquired Business and
terminate all commitments in connection therewith, including, without
limitation, the credit agreement dated as of July 18, 2013 among

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   the Company, JPMorgan Chase Bank, N.A., as administrative agent and the other
parties thereto, but excluding (x) as to the Acquired Business, indebtedness
permitted to remain outstanding on and after the Closing Date under the
Acquisition Agreement (as in effect on the date hereof) and (y) as to MKS and
its other subsidiaries, deferred purchase price obligations, ordinary course
working capital facilities for foreign subsidiaries and ordinary course capital
lease, purchase money and equipment financings (the “Refinancing”), (iii) to
provide ongoing working capital requirements of MKS and its subsidiaries and
(iv) to pay transaction costs associated with each of the foregoing (the uses
set forth in clauses (i) through (iv), collectively referred to hereinafter as
the “Transaction Costs”) and for other general corporate purposes of MKS and its
subsidiaries. The transactions described in this paragraph are collectively the
“Transactions”. Closing Date:    “Closing Date” means the date of the
effectiveness of the ABL Facility.

2.      TYPES AND AMOUNTS OF FACILITIES

A.     ABL Facility

   Type and Amount:    A senior secured asset-based revolving facility
consisting of commitments and loans in an aggregate principal amount of $50.0
million (the “ABL Facility”; the loans made under the ABL Facility, the “ABL
Loans”; the ABL Loans together with the Term Loans, the “Loans”). The ABL
Facility shall be funded in U.S. Dollars, Euros and other currencies to be
agreed. Availability and Maturity:    The ABL Facility shall be available
subject to the Line Cap on a revolving basis during the period commencing on the
Closing Date and ending on the fifth anniversary of the Closing Date (the “ABL
Termination Date”); provided that the amount of the ABL Loans to be drawn on the
Closing Date shall only be used to pay amounts described in clauses (ii), (iii)
and (iv) of the definition of “Transaction Costs” (as set forth above) and the
original issue discount or upfront fees that result from the exercise of the
“Market Flex” provisions in the Fee Letter. The revolving commitments and the
ABL Loans under the ABL Facility will mature on the ABL Termination Date.   
Overall borrowing availability under the ABL Facility will be equal to the
lesser of (a) the aggregate amount of commitments then in effect and (b) the
Borrowing Base then in effect (such lesser amount at any time, the “Line Cap”).

 

Exhibit B - 2

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   “Borrowing Base” means (1) the sum of 85% of Eligible Accounts (to be
defined) of the Loan Parties; plus (2) subject to MKS’s written notice to the
Administrative Agent at least 45 days in advance and the Administrative Agent’s
and its third-party consultants’ and representatives’ completion of customary
field examinations and inventory appraisals, the lesser of (a) the lesser of (i)
65% of the lower of cost or market value (on a first-in-first-out basis) of
Eligible Inventory (to be defined) of the Loan Parties and (ii) 85% of the net
orderly liquidation value of Eligible Inventory of the Loan Parties and (b) 30%
of the Borrowing Base; minus (3) reasonable and customary reserves established
by the Administrative Agent in the exercise of its Permitted Discretion.    The
Loan Parties shall use commercially reasonable efforts to assist the
Administrative Agent and its third-party consultants and representatives to
perform customary field examinations and, if MKS elects to include Eligible
Inventory in the Borrowing Base, inventory appraisals, of the Loan Parties prior
to the Closing Date. In the event the Administrative Agent has not completed
such field examinations and inventory appraisals (if applicable) prior to the
Closing Date, the Loan Parties shall provide the Administrative Agent and its
advisors and consultants with sufficient information and access to the Loan
Parties and their respective assets to facilitate the completion of such field
examinations and inventory appraisals (if applicable) no later than the 60th day
after the Closing Date (subject to extensions by the Administrative Agent in its
reasonable discretion). During the period from the Closing Date until the
Administrative Agent’s receipt and reasonable satisfaction with such field
examinations and inventory appraisals (if applicable), availability under the
ABL Facility shall be equal to 70% of book value of the Loan Parties’ Eligible
Accounts and, only to the extent the Borrower notifies the Administrative Agent
in writing of its election to include Eligible Inventory in the Borrowing Base,
35% of the lower of cost or market value (on a first-in-first-out basis) of the
Loan Parties’ Eligible Inventory; provided that (i) if the Administrative
Agent’s receipt and reasonable satisfaction with such field examinations and
inventory appraisals (if applicable) have not occurred by the 60th day after the
Closing Date, the Borrowing Base shall be reduced to zero until such time that
the Administrative Agent’s receipt and reasonable satisfaction with such field
examinations and inventory appraisals (if applicable) have occurred and (ii) the
Loan Parties shall continue to comply with the requirement to deliver Borrowing
Base certificates during such interim period and upon completion of the field
examinations and inventory appraisals (if applicable).

 

Exhibit B - 3

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   The initial reserves and initial eligibility criteria will be customary for
similar asset-based revolving facilities and shall initially be based on any
field examinations (and if any Eligible Inventory has been included in the
Borrowing Base, inventory appraisals) reasonably acceptable to the Arrangers.
The Administrative Agent will have the right to modify eligibility standards and
establish and modify reserves against Borrowing Base availability, in each case
acting within the Administrative Agent’s Permitted Discretion.    “Permitted
Discretion” shall mean a determination made in good faith and in the exercise of
reasonable (from the perspective of a secured asset-based lender) business
judgment, provided that any reserve established or modified and any standard of
eligibility shall have a reasonable relationship to circumstances, events or
conditions which are the basis for such standard of eligibility.    The
Borrowing Base will be computed monthly by the ABL Borrowers and a certificate
(the “Borrowing Base Certificate”) presenting the ABL Borrowers’ computation of
the Borrowing Base (together with agings, other collateral reporting (if any) to
be agreed upon and if any Eligible Inventory has been included in the Borrowing
Base, inventory reports) will be delivered to the Administrative Agent promptly,
but in no event later than the twentieth calendar day following the end of each
calendar month; provided that (i) upon the occurrence and during the continuance
of an Event of Default, (ii) or if Excess Availability (as defined below) is
less than the greater of (x) 12.5% of Line Cap and (y) $6 million (and
continuing until Excess Availability has been greater than the greater of (x)
12.5% of Line Cap and (y) $6 million for a period of 30 consecutive days), the
ABL Borrowers will be required to compute the Borrowing Base and deliver a
Borrowing Base Certificate on a weekly basis.    “Excess Availability” means at
any time an amount equal to (a) the Line Cap minus (b) the sum of the aggregate
outstanding amount of ABL Loans, unreimbursed drawings under Letters of Credit
and the undrawn amount of outstanding Letters of Credit under the ABL Facility.
   Letters of Credit:    Subject to the Borrowing Base, up to an amount to be
agreed of the ABL Facility shall be available for the issuance of letters of
credit (the “Letters of Credit”) for the account of the ABL Borrowers and their
subsidiaries by the Administrative Agent and other consenting ABL Lenders under
the ABL Facility reasonably satisfactory to the ABL Borrowers and the
Administrative Agent (in such capacity, each an “Issuing Lender”); provided that
neither DBNY nor Barclays shall be required to issue any Letters of Credit other
than standby letters of credit. No Letter of Credit shall have an expiration
date after the earlier of (a) one year after the date of issuance unless   

 

Exhibit B - 4

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   consented to by the Issuing Lender and (b) five business days prior to the
ABL Termination Date; provided that any Letter of Credit with a one-year tenor
may provide for the renewal thereof for additional one-year periods pursuant to
procedures as set forth in the ABL Documentation with the applicable Issuing
Lender (which shall in no event extend beyond the date referred to in clause (b)
above). Letters of Credit shall be issued in U.S. Dollars. Drawings under any
Letter of Credit shall be reimbursed by the ABL Borrowers (whether with their
own funds or with the proceeds of ABL Loans) on the same day if notice of such
drawing is received by MKS from the relevant Issuing Lender before 11:00 a.m.
(New York City time), and otherwise on the next business day. To the extent that
the ABL Borrowers do not so reimburse the Issuing Lender, the ABL Lenders under
the ABL Facility shall be irrevocably and unconditionally obligated to fund
participations in the reimbursement obligations on a pro rata basis. Use of
Proceeds:    The proceeds of the ABL Loans shall be used by the ABL Borrowers to
provide for ongoing working capital requirements and for general corporate
purposes, including permitted acquisitions, investments and restricted payments
permitted under the ABL Documentation.

B.     Incremental Facilities:

      The ABL Documentation shall permit the ABL Borrowers to increase
commitments under the ABL Facility on the same terms (other than upfront fees)
as the ABL Facility (any such increase, an “Incremental Facility”) in an
aggregate principal amount of $50 million; provided that (i) no ABL Lender will
be required to participate in any such Incremental Facility, (ii) no event of
default exists or would exist after giving effect thereto and (iii) the
representations and warranties in the ABL Documentation shall be true and
correct in all material respects (and in all respects if qualified by
materiality) immediately prior to, and after giving effect to, the incurrence of
such Incremental Facility.

3.      CERTAIN PAYMENT PROVISIONS

   Interest Rate Options:    The ABL Borrowers may elect that the ABL Facility
comprising each borrowing bear interest at a rate per annum equal to (a) the ABR
plus the Applicable Margin or (b) the Eurodollar Rate, plus the Applicable
Margin.    As used herein:    “ABR” means the highest of (i) the rate of
interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S.
or, if The Wall Street Journal ceases to quote such rate, the highest per

 

Exhibit B - 5

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  annum interest rate published by the Federal Reserve Board in Federal Reserve
Statistical Release H.15 (519) (Selected Interest Rate) as the “bank prime loan”
rate or, if such rate is no longer quoted therein, any similar rate quote
therein (as determined by the Administrative Agent) or similar release by the
Federal Reserve Board (as determined by the Administrative Agent) (the “Prime
Rate”), (ii) the federal funds effective rate from time to time (which rate, if
negative, shall be deemed to be 0.00%) plus 0.50% and (iii) the Eurodollar Rate
applicable for an interest period of one month plus 1.00%.   “ABR Loans” means
Loans bearing interest based upon the ABR.   “Applicable Margin” means,
initially, (i) 0.75%, in the case of ABR Loans and (ii) 1.75%, in the case of
Eurodollar Loans. Beginning on the date of the first interest period occurring
after the date on which the ABL Borrowers deliver to the ABL Lenders financial
statements for the first full fiscal quarter after the Closing Date, the
applicable margin for the ABL Facility will be determined based on average daily
Excess Availability for the previous fiscal quarter, as set forth below:

 

Average Excess Availability

(percentage of Commitments)

   Applicable Margin for Adjusted
LIBOR rate loans     Applicable Margin for ABR  

> 66%

     1.50 %      0.50 % 

£ 66% but > 33%

     1.75 %      0.75 % 

£ 33%

     2.00 %      1.00 % 

 

   “Eurodollar Loans” means Loans bearing interest based upon the Eurodollar
Rate (as defined below).    “Eurodollar Rate” means the rate (adjusted for
statutory reserve requirements for eurocurrency liabilities) for eurodollar
deposits for a period equal to one, two, three or six months or any longer
period agreed to by all relevant lenders (as selected by the ABL Borrowers)
appearing on the page of the Reuters Screen which displays an average ICE
Benchmark Administration Interest Settlement Rate or any successor substitute
page (such page currently being LIBOR01 page) (which rate, if negative, shall be
deemed to be 0.00%). Interest Payment Dates:    In the case of ABR Loans,
quarterly in arrears.    In the case of Eurodollar Loans, on the last day of
each relevant interest period and, in the case of any interest period longer
than three months, on each successive date three months after the first day of
such interest period.

 

Exhibit B - 6

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Commitment Fees:    The ABL Borrowers shall pay a commitment fee calculated at a
rate per annum equal to 0.375% on the average daily unused portion of the ABL
Facility, with a step-down to 0.25% if on the last day of any fiscal quarter
(starting with the first full fiscal quarter after the Closing Date) the daily
average unused portion of the ABL Facility during the preceding quarter was not
more than 50% of the average daily amount of the aggregate commitments under the
ABL Facility during such period. Letters of Credit issued under the ABL Facility
shall be deemed to be a utilization of the ABL Facility. Letter of Credit Fees:
   The ABL Borrowers shall pay a fee on all outstanding Letters of Credit at a
per annum rate equal to the Applicable Margin then in effect with respect to
Eurodollar Loans, under the ABL Facility on the face amount of each such Letter
of Credit. Such fee shall be shared ratably among the ABL Lenders, and shall be
payable quarterly in arrears on the last business day of each calendar quarter.
A fronting fee in an amount equal to 0.125% on the face amount of each Letter of
Credit shall be payable quarterly in arrears on the last business day of each
calendar quarter to the Issuing Lender for its own account. In addition,
customary administrative, issuance, amendment, payment and negotiation charges
shall be payable to the Issuing Lender for its own account.

 

Default Rate:    At any time when any Loan Party is in default in the payment of
any amount under the ABL Facility, after giving effect to any applicable grace
period, such overdue amounts shall bear interest at 2.00% per annum above the
rate otherwise applicable thereto, and with respect to any overdue amount
(including overdue interest) for which there is no applicable rate, 2.00% per
annum in excess of the rate otherwise applicable to ABL Loans maintained as ABR
Loans from time to time. Rate and Fee Basis:    All per annum rates shall be
calculated on the basis of a year of 360 days (or 365/366 days, in the case of
ABR Loans) for actual days elapsed. Optional Prepayments and    Commitment
Reductions:    The Loans may be prepaid, in whole or in part without premium or
penalty, in minimum amounts set forth in the ABL Documentation, at the option of
the ABL Borrowers at any time upon one business day’s (or, in the case of a
prepayment of Eurodollar Loans, three business days’) prior notice, subject to
reimbursement of the ABL Lenders’ redeployment costs in the case of a prepayment
of Eurodollar Loans prior to the last day of the relevant interest period.
Optional prepayments of the ABL Loans, together with accrued interest, if any,
shall be applied as directed by the ABL Borrowers (and absent such direction, in
direct order of maturity thereof).

 

Exhibit B - 7

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Mandatory Prepayments:    If at any time the amounts outstanding under the ABL
Facility (including outstanding Letters of Credit) exceed the Line Cap as in
effect at such time, the ABL Borrowers will be required to make a mandatory
prepayment in an amount equal to such excess, to be applied (i) first, to
prepayments of loans under the ABL Facility (with no reduction to the
commitments under the ABL Facility) and (ii) to the extent in excess thereof, to
cash collateralize outstanding Letters of Credit. Mandatory repayments of loans
under the ABL Facility shall not reduce the commitments under the ABL Facility.
  

Upon any sale or other disposition of any assets of any Loan Party, in each case
to the extent constituting ABL Priority Collateral, outside of the ordinary
course of business or the receipt by the Loan Parties and their restricted
subsidiaries of any proceeds from casualty insurance or a condemnation of ABL
Priority Collateral (in each case, with exceptions and materiality levels to be
agreed in the ABL Documentation), above a threshold to be agreed, the ABL
Borrowers shall provide an updated calculation of the Borrowing Base.

 

If a Cash Dominion Event (as defined below) has occurred and is continuing, all
amounts deposited in each Collection Account (as defined below) will be promptly
applied by the Administrative Agent to repay outstanding loans under the ABL
Facility and, if an event of default exists, to cash collateralize outstanding
Letters of Credit.

4.      COLLATERAL

   Collateral:   

Subject to exclusions and limitations as set forth in the ABL Documentation and
subject to customary funding conditions, the obligations of the ABL Borrowers
and each Guarantor in respect of the ABL Facility and any swap agreements and
cash management arrangements provided by any ABL Lender or Arranger (or any
affiliate of a ABL Lender or Arranger) shall be secured by (a) a perfected
first-priority security interest in all of the ABL Priority Collateral (as
defined in Exhibit A) and (b) a perfected second-priority security interest
(subject to permitted liens) in all of the Term Priority Collateral (as defined
in Exhibit A).

 

Notwithstanding anything to the contrary, the Collateral shall exclude (or not
require actions with respect thereto as described below) the Excluded Assets (as
defined in Exhibit A).

 

Exhibit B - 8

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   None of the Collateral shall be subject to any other pledges, security
interests or mortgages, except junior liens on ABL Priority Collateral and other
liens on other Collateral in each case as permitted under the lien covenant.
Notwithstanding the foregoing, no foreign law governed documents or foreign law
opinions shall be required in connection with the ABL Documentation.
Intercreditor Agreement:    The relative rights and priorities in the Collateral
among the ABL Lenders, on the one hand, and the Term Lenders, on the other hand,
will be set forth in the intercreditor agreement that is reasonably acceptable
to the Administrative Agent under each Facility and the Loan Parties (the
“Intercreditor Agreement”). Cash Management:    The Loan Parties shall use
commercially reasonable efforts to, prior to the Closing Date (and in any event
within 90-days after the Closing Date (which period may be extended by the
Administrative Agent in its reasonable discretion)), implement cash management
arrangements reasonably acceptable to the Administrative Agent, including
control agreements providing for springing dominion over deposit and securities
accounts of Loan Parties in favor of the Collateral Agent, subject to customary
exclusions to be agreed. Collections and proceeds from the ABL Priority
Collateral shall be deposited directly into an account with the Administrative
Agent or another financial institution reasonably acceptable to the
Administrative Agent (it being acknowledged and agreed that Bank of America is
reasonably acceptable) and subject to such account control arrangements (each, a
“Controlled Account”).    As used herein, “Cash Dominion Event” shall mean
either (i) the occurrence and continuance of an Event of Default, or (ii) Excess
Availability is less than the greater of (x) 10% of Line Cap and (y) $5 million
for three (3) consecutive business days (and continuing until Excess
Availability has been greater than the greater of (x) 10% of Line Cap and (y) $5
million for a period of 30 consecutive days). Upon and during the continuance of
a Cash Dominion Event, collections and proceeds from the ABL Priority Collateral
received by the Loan Parties in a Controlled Account shall be remitted daily to
a collection account maintained by the Administrative Agent for application to
outstanding loans under the ABL Facility.

5.      CONDITIONS

   Conditions to Initial Borrowing:    The extension of credit under the ABL
Facility on the Closing Date will be subject only to the conditions precedent
set forth in Exhibit C to the Commitment Letter.

 

Exhibit B - 9

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Conditions after Closing Date:    The making of each extension of credit under
the ABL Facility after the Closing Date shall be conditioned upon (a) delivery
of a customary borrowing notice, (b) the accuracy of representations and
warranties in all material respects, (c) the absence of defaults or events of
default at the time of, or after giving effect to the making of, such extension
of credit and (d) the existence of Excess Availability at least in the amount of
the requested credit extension.

6.      DOCUMENTATION

ABL Documentation:    The definitive documentation for the ABL Facility (the
“ABL Documentation”) will contain the terms set forth in this Exhibit A and, to
the extent any other terms are not expressly set forth in this Exhibit A will
(i) be negotiated in good faith within a reasonable time period to be determined
based on the expected Closing Date and taking into account the timing of the
syndication of the ABL Facility and the pre-closing requirements of the
Acquisition Agreement, (ii) contain such other terms as the Borrower and the
Arrangers shall reasonably agree, (iii) give due regard to the leverage profile
and projected free cash flow generation of the Borrower and its restricted
subsidiaries after giving effect to the Transactions, (iv) reflect the
operational and strategic requirements of the Borrower and its restricted
subsidiaries, (v) take into account the proposed business plan and financial
model of the Borrower and (vi) be in a form such that they do not impair the
availability of the ABL Facility on the Closing Date if the conditions to
funding set forth or referred to in Exhibit C are satisfied (collectively with
the Term Documentation Principles, the “Documentation Principles”). Financial
Covenant:    A quarterly minimum Fixed Charge Coverage Ratio (to be defined as
the ratio of Consolidated EBITDA minus unfinanced capital expenditures minus
cash taxes, to the sum of cash interest expense, scheduled principal payments
for debt for borrowed money and solely for purposes of determining compliance
with Payment Conditions, restricted payments made on reliance of compliance with
Payment Conditions) of 1.0:1.0; provided that (x) such covenant will only be
tested if an event of default has occurred and is continuing or Excess
Availability is less than the greater of (1) 10% of Line Cap and (2) $5 million,
in any such event (a “Trigger Event”), and (y) upon the occurrence of a Trigger
Event, such covenant shall be only tested as of the last day of the most recent
fiscal quarter end for the twelve months then ended for which financial
statements were required to be delivered and as of each fiscal quarter end
thereafter until the Trigger Event is cured for a period of 30 consecutive days
following the Trigger Event.

 

Exhibit B - 10

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Unrestricted Subsidiaries:    The ABL Documentation contains provisions pursuant
to which, subject to limitations on investments, loans, advances and guarantees
and other customary conditions and provisions as set forth in the ABL
Documentation, the ABL Borrowers are permitted to designate any existing or
subsequently acquired or organized subsidiary as an “unrestricted subsidiary”
and subsequently re-designate any such unrestricted subsidiary as a restricted
subsidiary; provided that (i) with respect to any such designation of any
subsidiary or subsidiaries whose assets included immediately before such
designation in the Borrowing Base represent at least 5% of the Borrowing Base
immediately before such re-designation and with respect to any such
re-designation of any subsidiary or subsidiaries whose assets that would be
included immediately after such re-designation in the Borrowing Base represent
at least 5% of the Borrowing Base immediately after such re-designation, the
Payment Conditions (as defined below) are met, (ii) if a restricted subsidiary
is being designated as an unrestricted subsidiary, such restricted subsidiary,
together with all other unrestricted subsidiaries as of such date of
designation, shall have contributed greater than a percentage to be agreed of
MKS’s consolidated EBITDA (calculated inclusive of all unrestricted
subsidiaries), as of the most recently ended fiscal quarter of MKS, an updated
borrowing base certificate shall have been delivered to the Administrative Agent
and (iii) each subsidiary designated as an “unrestricted subsidiary” under the
Term Loan Facility shall be designated as an unrestricted subsidiary under the
ABL Facility, and each subsidiary designated as a “restricted subsidiary” under
the Term Loan Facility shall be designated as a restricted subsidiary under the
ABL Facility. Unrestricted subsidiaries will not be subject to the
representations and warranties, the affirmative or negative covenant or event of
default provisions of the ABL Documentation, and the results of operations and
indebtedness of unrestricted subsidiaries will not be taken into account for
purposes of determining compliance (to the extent applicable) with the negative
covenants and financial ratios contained in the ABL Documentation.
Representations and Warranties:    Limited to the following and applicable to
the ABL Borrowers and their restricted subsidiaries: financial statements
(including pro forma financial statements) and projections; no material adverse
change; corporate existence; compliance with law; corporate power and authority;
enforceability of ABL Documentation; with respect to the ABL Documentation, no
conflict with law, organizational documents and material agreements; no material
adverse litigation; ownership of property; intellectual property; taxes; Federal
Reserve regulations; labor matters; ERISA; Investment Company Act; subsidiaries;
use of proceeds; environmental and regulatory

 

Exhibit B - 11

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   matters; disclosures; creation, perfection and priority of security
interests; solvency (on a consolidated basis); status of the ABL Loans as senior
debt; PATRIOT Act; FCPA and OFAC/anti-terrorism laws; insurance; borrowing base
and customary representations and warranties for asset-based secured facilities;
and delivery of certain documents, subject, in the case of each of the foregoing
representations and warranties, to customary qualifications and to limitations
for materiality as set forth in the ABL Documentation. Affirmative Covenants:   
Limited to the following and applicable to the ABL Borrowers and their
restricted subsidiaries: delivery of annual financial statements (accompanied by
an audit opinion from a nationally recognized accounting firm) within ninety
days (90) after the end of each fiscal year, delivery of quarterly financial
statements within forty-five (45) days after the end of each of the first three
fiscal quarters of each fiscal year; delivery of annual budgets and projections
(within sixty-five (65) days after the end of each fiscal year and only to
Lenders that have elected to receive material non-public information); officers’
certificates and other information; customary annual conference calls with ABL
Lenders; payment of taxes; maintenance of existence and material rights and
privileges; compliance with laws; maintenance of property (subject to casualty,
condemnation and normal wear and tear) and customary insurance; maintenance of
books and records; right of the ABL Agent to inspect property and books and
records; notices of defaults, litigation and other material events; compliance
with environmental laws; ERISA; use of proceeds; designation of unrestricted
subsidiaries; further assurances (including, without limitation, with respect to
security interests in after-acquired property); borrowing base certificates,
field exams and appraisals and cash management systems; and delivery of
consolidating and consolidated monthly financial statements during the
continuance of a Cash Dominion Event, subject, in the case of each of the
foregoing covenants, to customary exceptions and qualifications as set forth in
the ABL Documentation.    Field audits (and if any Eligible Inventory has been
included in the Borrowing Base, inventory appraisal) will be conducted no more
than one time per calendar year at the ABL Borrowers’ expense (or two times at
the ABL Borrowers’ expense if such field audit (and if any Eligible Inventory
has been included in the Borrowing Base, inventory appraisal) is commenced
during an Audit Trigger Period (as defined below)). Following the occurrence and
during the continuation of an Event of Default, field audits (and if any
Eligible Inventory has been included in the Borrowing Base, inventory
appraisals) will be conducted at the ABL Borrowers’ expense at the discretion of
the Administrative Agent.

 

Exhibit B - 12

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   “Audit Trigger Period” shall mean any period during which Excess Availability
has been less than the greater of 25% of Line Cap and $10 million for three (3)
consecutive business days.    Notwithstanding anything to the contrary, there is
no minimum hedging requirement for interest rate or foreign exchange hedging.
Negative Covenants:    Limited to the following with certain customary
exceptions (and applicable to the ABL Borrowers and their restricted
subsidiaries):   

(a) the incurrence of debt (which shall permit, among other things, an amount to
be agreed for letters of credit and foreign lines of credit);

 

(b) liens (which shall permit, among other things, an amount to be agreed for
secured letters of credit and secured foreign lines of credit);

 

(c) mergers, consolidations and fundamental changes;

 

(d) asset sales (which shall permit, among other things, ordinary course asset
sales and dispositions, and other exceptions to be agreed, including sales of
restricted subsidiaries and sale leasebacks, with a basket of $200 million in
the aggregate for all asset sales consummated within 18 months of the Closing
Date subject to no event of default and at least 75% of the consideration
received is in cash or cash equivalents);

 

(e) investments (which shall permit, among other things, investments in
restricted subsidiaries (including Foreign Subsidiaries) subject to a limit to
be agreed on investments by Loan Parties in entities that are not Loan Parties,
and Permitted Acquisitions (as defined in Exhibit A));

 

(f) dividends or distributions on, or redemptions of, the MKS’s equity (which
shall permit, among other things, (i) intercompany dividends and distributions
including pro-rata distributions from non-wholly owned subsidiaries with respect
to their equity interests, (ii) a general basket of $50 million, subject to the
absence of any event of default, (iii) a basket of $15 million for the purchase
or redemption of stock appreciation rights, restricted stock units and
performance share units of the Company, in each case, in connection with the
Acquisition and (iv) so long as no event of default has occurred and is
continuing or would result therefrom, dividends, distributions and equity

 

Exhibit B - 13

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  redemptions in an aggregate amount per fiscal year not to exceed 4.0% of
Market Capitalization (defined as an amount equal to (i) the total number of
issued and outstanding shares of common (or common equivalent) equity interests
of the Borrower on the date of declaration of the relevant restricted payment
multiplied by (ii) the arithmetic mean of the closing prices per share of such
common (or common equivalent) equity interests for the 30 consecutive trading
days immediately preceding the date of declaration of such restricted payment)
for all dates of declaration of such restricted payments during such fiscal
year;   (g) prepayments or redemptions of junior debt, or amendments of junior
debt documents or organizational documents in a manner materially adverse to the
ABL Lenders;   (h) negative pledge clauses and other restrictive agreements;  
(i) transactions with affiliates above an agreed upon threshold (with customary
exceptions as set forth in the ABL Documentation);   (j) anti-corruption laws
and sanctions; FCPA and OFAC/anti-terrorism laws;   (k) sale/leaseback
transactions; and   (l) change in business.   The ABL Documentation shall allow
restricted payments, investments, acquisitions and the prepayment or redemption
of any junior debt so long as the Payment Conditions with respect thereto would
be satisfied.   “Payment Conditions” means with respect to any transaction to
which such conditions apply, (a) there is no default or event of default
existing immediately before or after such transaction, (b) either (i) Excess
Availability on the date of the proposed transaction and for each day during the
30-consecutive day period immediately preceding such transaction (in each case,
calculated on a pro forma basis to include the borrowing of any ABL Loans or
issuance of any Letters of Credit in connection with the proposed transaction)
is equal to or greater than the greater of (x) 15% (or in the case of
acquisitions, 12.5%) of Line Cap and (y) $7.5 million (or in the case of
acquisitions, $6 million) and the Loan Parties are in pro forma compliance with
the Financial Covenant whether or not such covenant is then in effect or
(ii) Excess Availability on the date of the proposed transaction and for each
day during the 30-consecutive day period immediately preceding such transaction
(in each case, calculated on a pro forma basis to include the borrowing of any

 

Exhibit B - 14

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   ABL Loans or issuance of any Letters of Credit in connection with the
proposed transaction) is equal to or greater than the greater of (x) 20% (or in
the case of acquisitions, 17.5%) of Line Cap and (y) $10 million (or in the case
of acquisitions, $8 million), and (c) the Borrowers shall have delivered a
customary certificate to the Administrative Agent certifying as to compliance
with the requirements of clauses (a) and (b) (if applicable). Events of Default:
   Limited to the following and applicable to the ABL Borrowers and their
restricted subsidiaries only, and with materiality, grace periods and other
qualifications as set forth in the ABL Documentation: nonpayment of principal
when due; nonpayment of interest, fees or other amounts after a three business
day grace period; material inaccuracy of a representation or warranty when made
or deemed made; violation of covenants (subject, in the case of certain of such
affirmative covenants, to a thirty day grace period (it being understood that
there will be a 3 days’ grace period for delivery of borrowing base certificates
and no grace period for use of proceeds, delivery of notices of default,
maintenance of existence and cash management); cross-default and cross
acceleration to material indebtedness; bankruptcy events of any ABL Borrower or
any restricted subsidiary that is not an immaterial subsidiary (with a customary
grace period for involuntary events); certain ERISA events; material unsatisfied
judgments; actual or asserted invalidity of any material provision in a
guarantee, security document or material subordination provisions or
non-perfection of a security interest covering a material portion of the
collateral; and a change of control. Voting, Assignments and    Participations,
Yield Protection:    After the Closing Date, the ABL Lenders shall be permitted
to assign loans and commitments under the ABL Facility with the consent of MKS
(not to be unreasonably withheld or delayed) and the Issuing Lenders (in each
case, MKS’s consent shall be deemed given if it fails to respond within ten
business days); provided that no consent of MKS shall be required (i) after the
occurrence and during the continuance of a payment or bankruptcy event of
default or (ii) for assignments of loans and commitments to another ABL Lender
under the ABL Facility or to an affiliate or approved fund of a ABL Lender under
the ABL Facility. All assignments will require the consent of the Administrative
Agent and the Issuing Lenders (in each case not to be unreasonably withheld or
delayed) unless such assignment is an assignment of the ABL Loans to another ABL
Lender under the ABL Facility or to an affiliate or approved fund of an ABL
Lender under the ABL Facility. Each assignment will be in

 

Exhibit B - 15

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  an amount of an integral multiple as set forth in the ABL Documentation or, in
each case, if less, all of such ABL Lender’s remaining loans and commitments of
the applicable class. Natural persons and the ABL Borrowers, their subsidiaries
and affiliates may not be assignees.  

The ABL Lenders are permitted to sell participations in Loans and commitments
without restriction, other than as set forth in the next sentence, and in
accordance with applicable law. Voting rights of participants shall be limited
to matters in respect of (a) increases in commitments participated to such
participants, (b) reductions of principal, interest or fees, (c) extensions of
final maturity and (d) releases of all or substantially all of the value of the
Guarantees or all or substantially all of the Collateral.

 

Amendments and waivers with respect to the ABL Documentation shall require the
approval of ABL Lenders holding more than 50% of the aggregate amount Loans and
commitments under the ABL Facility (the “Required Lenders”), except that (a) in
addition to the consent of the Required Lenders, the consent of each ABL Lender
directly affected thereby shall be required with respect to (i) reductions in
the amount or extensions of the scheduled date of any amortization or final
maturity of any Loan and (ii) reductions in the rate of interest or any fee or
extensions of any due date thereof (but, for the avoidance of doubt, other than
default rate interest) and (iv) increases in the amount or extensions of the
expiry date of any ABL Lender’s commitment, (b) the consent of 100% of the ABL
Lenders shall be required with respect to (i) reductions of any of the voting
percentages and modifications of any pro rata sharing and payment provisions,
(ii) releases of all or substantially all the Collateral (other than in
connection with any sale of Collateral permitted by the ABL Documentation) and
(iii) releases of all or substantially all of the Guarantors (other than in
connection with the release or sale of the relevant Guarantor permitted by the
ABL Documentation), (c) the consent of Administrative Agent or an Issuing Lender
shall be required with respect to any amendment or modification that affects its
rights or duties as administrative agent or issuing lender and (d) (i) the
written approval of ABL Lenders holding more than 66  2⁄3% of the aggregate
amount of funded and unfunded commitments under the ABL Facility (the
“Supermajority Lenders”) will be required with respect to votes for changes to
the definition of “Borrowing Base” or any component definition thereof, or
changes in advance rates, the effect of which is to increase availability
thereunder.

 

The ABL Documentation contains customary provisions for replacing non-consenting
ABL Lenders in connection with

 

Exhibit B - 16

--------------------------------------------------------------------------------

   amendments and waivers requiring the consent of all ABL Lenders or of all ABL
Lenders directly affected thereby so long as the Required Lenders shall have
consented thereto.    The ABL Documentation shall contain customary protective
provisions for such matters as EU bail-in, capital adequacy, increased costs,
reserves, funding losses, illegality, and withholding taxes, including treatment
of Dodd-Frank Wall Street Reform and Consumer Protection Act and Basel III as
changes in law. Defaulting Lenders:    The ABL Documentation will include
customary defaulting lender provisions to protect the Administrative Agent and
the Issuing Lenders with respect to the funding and reimbursement obligations of
defaulting lenders. The ABL Borrowers will not be required to pay certain fees
to any defaulting lender and the voting rights of defaulting lenders (except in
the case of certain customary matters) shall be suspended. Upon any ABL Lender
becoming a defaulting lender, the outstanding Letters of Credit shall be
reallocated among non-defaulting lenders under the ABL Facility (up to their
respective commitments) and, to the extent any Letter of Credit exposure remains
unallocated, the ABL Borrowers shall be required to post cash collateral in the
amount of the product of (x) the face amount of the issued Letters of Credit
multiplied by (y) the unallocated commitment percentage of defaulting lenders. A
defaulting lender is a lender who has failed to perform certain of its
obligations under the ABL Documentation or has become insolvent or is in
receivership as more fully set forth in the ABL Documentation. The loans and
commitments of defaulting lenders shall not be counted toward the calculation of
the Required Lenders or Supermajority Lenders. Expenses and Indemnification:   
The ABL Borrowers shall pay (a) all reasonable and documented or invoiced
out-of-pocket expenses of the Administrative Agent and the Arrangers in
connection with the syndication of the ABL Facility and the preparation,
execution, delivery and administration of the ABL Documentation and any
amendment or waiver with respect thereto (including, without limitation, the
reasonable fees, disbursements and other charges of one primary counsel, one
local counsel in each relevant jurisdiction and counsel otherwise retained with
the ABL Borrowers’ consent) and (b) all reasonable and documented or invoiced
out-of-pocket expenses of the Administrative Agent, the Arrangers and the ABL
Lenders (including, without limitation, the fees, disbursements and other
charges of counsel) in connection with the enforcement of the ABL Documentation.

 

Exhibit B - 17

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   The Loan Parties will indemnify the Administrative Agent, each Issuing
Lender, the Arrangers and the ABL Lenders and their respective affiliates, and
the officers, directors, employees, affiliates, agents and controlling persons
of the foregoing, and hold them harmless from and against all costs, expenses
(including, without limitation, reasonable fees, disbursements and other charges
of counsel) and liabilities of any such indemnified person arising out of or
relating to any claim or any litigation or other proceedings (regardless of
whether any such indemnified person is a party thereto or whether such claim,
litigation, or other proceeding is brought by a third party or by the ABL
Borrowers or any of their respective affiliates, creditors or shareholders) that
relate to the ABL Documentation), except to the extent that it is found by a
final, non-appealable judgment of a court of competent jurisdiction that such
loss, claim, damage, liability or expense resulted from (i) the gross negligence
or willful misconduct of the indemnified party, (ii) a material breach of
obligations under the ABL Documentation by such indemnified party or (iii) any
dispute solely among the indemnified parties (not arising as a result of any act
or omission by any ABL Borrower or any of its subsidiaries or affiliates) other
than any claim, action, suit, inquiry, litigation, investigation or other
proceeding brought by or against any such indemnified party in its capacity as
agent or arranger. Governing Law and Forum:    New York.

Counsel to the Administrative Agent

and the Arrangers:

   Paul Hastings LLP.

 

 

Exhibit B - 18

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EXHIBIT C

MKS Instruments, Inc.

$800.0 million Term Loan Facility

$50.0 million ABL Facility

Summary of Terms and Conditions

Capitalized terms used in this Exhibit C shall have the meanings set forth in
the Commitment Letter to which this Exhibit C is attached and the other Exhibits
to the Commitment Letter. The commitments of the Initial Lenders and the
Arrangers’ and other agents’ agreements to perform the services described herein
(including the initial borrowing under the Facilities) are subject only to the
satisfaction (or waiver by the Arrangers) of the following conditions precedent:

1. Subject to the Certain Funds Provision and the Documentation Principles,
definitive loan documentation for the Facilities consistent with the Term Sheets
and the Commitment Letter (including, without limitation, the Guarantees and
Collateral to the extent required by the Term Sheets and the Commitment Letter)
shall have been executed and delivered by the parties thereto to the
Administrative Agents.

2. The Acquisition shall have been, or substantially concurrently with the
initial borrowing under the Facilities shall be, consummated in all material
respects in accordance with the Acquisition Agreement. No material provision of
the Acquisition Agreement shall have been waived, amended or otherwise modified
in a manner material and adverse to the Lenders (in their capacity as such) or
the Arrangers without the consent of the Arrangers; provided that (a) any
reduction in the purchase price for the Acquisition set forth in the Acquisition
Agreement shall not be deemed to be material and adverse to the interests of the
Lenders or the Arrangers so long as any such reduction is applied to reduce the
amount of commitments in respect of the Term Loan Facility on a
dollar-for-dollar basis and (b) any increase in the purchase price set forth in
the Acquisition Agreement shall be deemed to be not material and adverse to the
interests of the Lenders or the Arrangers so long as such purchase price
increase is not funded with additional indebtedness (it being understood and
agreed that no purchase price, working capital or similar adjustment provisions
set forth in the Acquisition Agreement shall constitute a reduction or increase
in the purchase price).

3. The Arrangers shall have received (a) audited consolidated balance sheets and
related statements of income, changes in equity and cash flows of each of the
Borrower and of the Company for the three fiscal years ended at least 60 days
prior to the Closing Date (as defined in Exhibit A and used in Exhibit C, the
“Closing Date”) and (b) unaudited consolidated balance sheets and related
statements of income, changes in equity and cash flows of each of the Borrower
and of the Company for each subsequent fiscal quarter following the last fiscal
year for which financial statements have been delivered pursuant to clause
(a) above ended at least 40 days before the Closing Date.

4. The Arrangers shall have received a pro forma consolidated balance sheet and
the related consolidated statement of income of the Borrower as of and for the
twelve-month period ending on the date of the most recent consolidated balance
sheet delivered pursuant to the preceding paragraph, in each case prepared after
giving effect to the Transactions as if the Transactions had occurred on such
date (in the case of such pro forma balance sheet) or on the first day of such
period (in the case of such pro forma statement of income) which need not be
prepared in compliance with Regulation S-X of the Securities Act of 1933, as
amended, or include adjustments for purchase accounting (including adjustments
of the type contemplated by Financial Accounting Standards Board Accounting
Standards Codification 805, Business Combinations (formerly SFAS 141R)).

--------------------------------------------------------------------------------

5. The Refinancing shall have been (or substantially simultaneously with the
closing under the Acquisition, shall be) consummated. After giving effect to the
Refinancing and the other transactions contemplated hereby, the Borrower and its
subsidiaries shall have outstanding no indebtedness (other than the loans and
other extensions of credit under the Facilities and (x) as to the Acquired
Business, indebtedness permitted to remain outstanding on and after the Closing
Date under the Acquisition Agreement and (y) as to the Borrower and its other
subsidiaries, deferred purchase price obligations, ordinary course working
capital facilities for foreign subsidiaries and ordinary course capital lease,
purchase money and equipment financings), and Borrower shall not have any
outstanding equity that is mandatorily redeemable at the option of the holder
earlier than the date that is 90 days after the Term Maturity Date.

6. Subject to the Certain Funds Provision, the Administrative Agents shall have
received (a) all documents and instruments required to create and perfect each
Collateral Agent’s security interest in the Collateral, executed and delivered
by the applicable Loan Parties, (b) a reasonably satisfactory certificate
substantially in the form of Annex I to the Commitment Letter attesting to the
solvency of the Borrower and its subsidiaries on the Closing Date (as defined in
Exhibit A) on a consolidated basis after giving effect to the Transactions from
the chief financial officer or another senior financial officer of the Borrower,
(c) a borrowing base certificate in respect of the ABL Facility and (d) such
legal opinions, certificates, organizational documents, borrowing notice and
instruments as are customary for transactions of this type.

7. Since the date of the Acquisition Agreement, there shall not have occurred
any event, change, occurrence or effect that, individually or in the aggregate,
has had or would reasonably be expected to have a Material Adverse Effect (as
defined in the Acquisition Agreement, a “Company Material Adverse Effect”).

8. All accrued costs, fees and expenses (including legal fees and expenses and
the fees and expenses of any other advisors) and other compensation due and
payable to the Administrative Agents, the Arrangers and the Lenders shall have
been paid, to the extent an invoice therefor was presented at least two business
days prior to the Closing Date (or such later date as the Borrower may agree).

9. The Loan Parties shall have provided the documentation and other information
to the Lenders required by regulatory authorities under the applicable
“know-your-customer” rules and regulations, including the PATRIOT Act, in each
case at least three business days prior to the Closing Date, as has been
requested to the Borrower in writing at least ten business days prior to the
Closing Date.

10. The Arrangers shall have been provided with a period of at least 15
consecutive business days (ending no later than the business day immediately
prior to the Closing Date) following the receipt of the such information as is
requested by the Arrangers and customarily delivered by a borrower and necessary
for the preparation of a customary Confidential Information Memoranda to
syndicate the Facilities; provided that such period will not include July 4,
2016 or any date from and including August 22, 2016 through and including
September 5, 2016. If the Borrower in good faith reasonably believes it has
delivered the information requested by the Arrangers in accordance with the
preceding sentence for use in the Confidential Information Memorandum, it may
deliver to the Arrangers a written notice to that effect, in which case the
Confidential Information Memorandum will be deemed to have been delivered on the
date such notice is received by the Arrangers, and the 15 consecutive business
day period referred to above will be deemed to have commenced on the date such
notice is received by the Arrangers, in each case, unless the Arrangers in good
faith reasonably believe that the Borrower has not completed delivery of the
information requested by the Arrangers in accordance with the preceding sentence
for use in the Confidential Information Memorandum and, within 3 business days
after the receipt of such notice from the Borrower, the Arrangers deliver a
written notice to the Borrower to that effect (stating with reasonable
specificity which information required to be included in the Confidential
Information Memorandum has not been delivered).

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11. The Specified Representations and the Specified Acquisition Agreement
Representations shall be true and correct in all material respects (except for
representations and warranties that are already qualified by materiality, which
representations and warranties shall be true and correct in all respects after
giving effect to such materiality qualification) on the Closing Date.

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ANNEX I

Form of Solvency Certificate

Date: [            ,             ]

To the Administrative Agent and each of the Lenders

party to the Credit Agreement referred to below:

Pursuant to Section [    ] of the Credit Agreement1, the undersigned, solely in
the undersigned’s capacity as [chief financial officer][specify other officer
with equivalent duties] of the Borrower, hereby certifies, on behalf of Borrower
and not in the undersigned’s individual or personal capacity and without
personal liability, that, to his knowledge, as of the Closing Date, after giving
effect to the Transactions (including the making of the Loans under the Credit
Agreement on the Closing Date and the application of the proceeds thereof):

 

  (a) the fair value of the assets of the Borrower and its Subsidiaries, on a
consolidated basis, exceeds their debts and liabilities, subordinated,
contingent or otherwise, on a consolidated basis;

 

  (b) the present fair saleable value of the property of the Borrower and its
Subsidiaries, on a consolidated basis, is greater than the amount that will be
required to pay the probable liability, on a consolidated basis, of their debts
and other liabilities, subordinated, contingent or otherwise, on a consolidated
basis, as such debts and other liabilities become absolute and matured;

 

  (c) the Borrower and its Subsidiaries, on a consolidated basis, are able to
pay their debts and liabilities, subordinated, contingent or otherwise, on a
consolidated basis, as such liabilities become absolute and matured; and

 

  (d) the Borrower and its Subsidiaries, on a consolidated basis, are not
engaged in, and are not about to engage in, business for which they have
unreasonably small capital.

For purposes of this Solvency Certificate, the amount of any contingent
liability at any time shall be computed as the amount that would reasonably be
expected to become an actual and matured liability. Capitalized terms used but
not otherwise defined herein shall have the meanings assigned to them in the
Credit Agreement.

The undersigned is familiar with the business and financial position of the
Borrower and its Subsidiaries. In reaching the conclusions set forth in this
Solvency Certificate, the undersigned has made such investigations and inquiries
as the undersigned has deemed appropriate, having taken into account the nature
of the business proposed to be conducted by the Borrower and its Subsidiaries
after consummation of the Transactions.

* * *

 

1  Credit Agreement to be defined.

 

Annex I - 1

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IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate,
solely in the undersigned’s capacity as [chief financial officer][specify other
officer with equivalent duties] of the Borrower, on behalf of Borrower and not
in the undersigned’s individual or personal capacity and without personal
liability, as of the date first stated above.

 

[Borrower] By:  

 

Name:   Title:   [Chief Financial Officer]

 

Annex I - 2