Exhibit 10.3

 

WAIVER AND FIRST AMENDMENT

TO

LOAN AND SECURITY AGREEMENT

 

This Waiver and First Amendment to Loan and Security Agreement (this
“Amendment”) is entered into as of August 1, 2014, by and between SILICON VALLEY
BANK, a California corporation, with its principal place of business at 3003
Tasman Drive, Santa Clara, California 95054 and with a loan production office
located at 275 Grove Street, Suite 2-200, Newton, Massachusetts 02466 (“Bank”),
and AXCELIS TECHNOLOGIES, INC., a Delaware corporation with offices located at
108 Cherry Hill Drive, Beverly, Massachusetts 01915 (“Borrower”).

 

RECITALS

 

A.                                    Bank and Borrower have entered into that
certain Loan and Security Agreement dated as of October 31, 2013 (as the same
may from time to time be further amended, modified, supplemented or restated,
the “Loan Agreement”).

 

B.                                    Bank has extended credit to Borrower for
the purposes permitted in the Loan Agreement.

 

C.                                    Borrower has requested that Bank (i) waive
the Event of Default resulting from the failure of Borrower to comply with the
Minimum Adjusted Net Income covenant in Section 6.9(b) of the Loan Agreement for
trailing six month period ending June 30, 2014 and (ii) amend the Loan Agreement
to revise the Minimum Adjusted Net Income covenant in Section 6.9(b).

 

D.                                    Bank has agreed to so waive compliance and
amend certain provisions of the Loan Agreement, but only to the extent, in
accordance with the terms, subject to the conditions and in reliance upon the
representations and warranties set forth below.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

 

1.                                      Definitions.  Capitalized terms used but
not defined in this Amendment shall have the meanings given to them in the Loan
Agreement.

 

2.                                      Amendment to Loan Agreement.

 

2.1                               Section 6.9(b) (Minimum Adjusted Net Income). 
Section 6.9(b) is amended in its entirety and replaced with the following:

 

“(b) Minimum Adjusted Net Income.  Borrower and its Subsidiaries, on a
consolidated basis, shall achieve Adjusted Net Income of at least
(i) ($1,500,000) for the

 

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trailing three (3) month period ending on the last day of the fiscal quarter
ending September 30, 2013; (ii) $1.00 for the trailing three (3) month period
ending on the last day of the fiscal quarter ending December 31, 2013;
(iii) $2,500,000 for the trailing six month period ending on the last day of the
fiscal quarters ending March 31, 2014 and June 30, 2014, (iv) ($3,000,000) for
the trailing three month period ending on the last day of the fiscal quarter
ending September 30, 2014, (v) $1.00 for the trailing six month period ending on
the last day of the fiscal quarter ending December 31, 2014, (vi) $1,000,000 for
the trailing six month period ending on the last day of the fiscal quarter
ending March 31, 2015, and (vii) $1,000,000 for the trailing six month period
ending on (A) the last day of the fiscal quarter ending June 30, 2015, and
(B) the last day of each fiscal quarter thereafter.”

 

3.                                      Limitation of Amendments.

 

3.1                               The amendments set forth in Section 2, above,
are effective for the purposes set forth herein and shall be limited precisely
as written and shall not be deemed to (a) be a consent to any amendment, waiver
or modification of any other term or condition of any Loan Document, or
(b) otherwise prejudice any right or remedy which Bank may now have or may have
in the future under or in connection with any Loan Document.

 

3.2                               This Amendment shall be construed in
connection with and as part of the Loan Documents and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Loan
Documents, except as herein amended, are hereby ratified and confirmed and shall
remain in full force and effect.

 

4.                                      Acknowledgment of Non-Compliance; Waiver
by Bank.  Borrower acknowledges that the failure of Borrower to comply with the
Minimum Adjusted Net Income covenant in Section 6.9(b) of the Loan Agreement for
trailing six month period ending June 30, 2014 would become an Event of Default
if not waived by the Bank (the “Non-Compliance”).  Bank hereby waives the
Non-Compliance.  The foregoing waivers shall apply only to the foregoing
Non-Compliance for the specific periods referenced.  Borrower hereby
acknowledges and agrees that except as specifically provided herein, nothing in
this Section or anywhere in this Amendment shall be deemed or otherwise
construed as a waiver by Bank of any of its rights and remedies pursuant to the
Loan Documents, applicable law or otherwise.

 

5.                                      Representations and Warranties.  To
induce Bank to enter into this Amendment, Borrower hereby represents and
warrants to Bank as follows:

 

5.1                               Immediately after giving effect to this
Amendment (a) the representations and warranties contained in the Loan Documents
are true, accurate and complete in all material respects as of the date hereof
(except to the extent such representations and warranties relate to an earlier
date, in which case they are true and correct as of such date), and (b) no Event
of Default has occurred and is continuing;

 

5.2                               Borrower has the power and authority to
execute and deliver this Amendment and to perform its obligations under the Loan
Agreement, as amended by this Amendment;

 

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5.3                               Other than amendments to the Borrower’s Bylaws
effective May 13, 2014, the organizational documents of Borrower delivered to
Bank on the Effective Date remain true, accurate and complete and have not been
amended, supplemented or restated and are and continue to be in full force and
effect;

 

5.4                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, have been duly authorized;

 

5.5                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not and will not contravene (a) any
law or regulation binding on or affecting Borrower, (b) any contractual
restriction with a Person binding on Borrower, (c) any order, judgment or decree
of any court or other governmental or public body or authority, or subdivision
thereof, binding on Borrower, or (d) the organizational documents of Borrower;

 

5.6                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not require any order, consent,
approval, license, authorization or validation of, or filing, recording or
registration with, or exemption by any governmental or public body or authority,
or subdivision thereof, binding on either Borrower, except as already has been
obtained or made; and

 

5.7                               This Amendment has been duly executed and
delivered by Borrower and is the binding obligation of Borrower, enforceable
against Borrower in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or
other similar laws of general application and equitable principles relating to
or affecting creditors’ rights.

 

6.                                      Ratification of Intellectual Property
Security Agreement.  Borrower hereby ratifies, confirms and reaffirms, all and
singular, the terms and conditions of a certain Intellectual Property Security
Agreement dated as of October 31, 2013 between Borrower and Bank, and
acknowledges, confirms and agrees that said Intellectual Property Security
Agreement (a) contains an accurate and complete listing of all Intellectual
Property Collateral, as defined in said Intellectual Property Security
Agreement, subject to such changes as have been previously reported to the Bank
through June 30, 2014 and (b) shall remain in full force and effect.

 

7.                                      Ratification of Perfection Certificate. 
Borrower hereby ratifies, confirms and reaffirms, all and singular, the terms
and disclosures contained in a certain Perfection Certificate dated as of
October 31, 2013 delivered by Borrower to Bank, and acknowledges, confirms and
agrees the disclosures and information above Borrower provided to Bank in said
Perfection Certificate have not changed, as of the date hereof.

 

8.                                      No Defenses of Borrower.  Borrower
hereby acknowledges and agrees that Borrower has no offsets, defenses, claims,
or counterclaims against Bank with respect to the Obligations, or otherwise, and
that if Borrower now has, or ever did have, any offsets, defenses, claims, or
counterclaims against Bank, whether known or unknown, at law or in equity, all
of

 

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them are hereby expressly WAIVED and Borrower hereby RELEASES Bank from any
liability thereunder.

 

9.                                      Integration.  This Amendment and the
Loan Documents represent the entire agreement about this subject matter and
supersede prior negotiations or agreements.  All prior agreements,
understandings, representations, warranties, and negotiations between the
parties about the subject matter of this Amendment and the Loan Documents merge
into this Amendment and the Loan Documents.

 

10.                               Counterparts.  This Amendment may be executed
in any number of counterparts and all of such counterparts taken together shall
be deemed to constitute one and the same instrument.

 

11.                               Effectiveness.  This Amendment shall be deemed
effective as of August 1, 2014 upon (a) the due execution and delivery to Bank
of this Amendment by each party hereto, (b) Borrower’s payment of (i) an
amendment fee in an amount equal to $10,000, and (ii) Bank’s legal fees and
expenses incurred in connection with this Amendment.

 

[Signature page follows.]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

 

 

BANK

 

BORROWER

 

 

 

SILICON VALLEY BANK

 

AXCELIS TECHNOLOGIES, INC.

 

 

 

 

 

 

By:

/s/ Michael Quinn

 

By:

/s/ Mary G. Puma

 

 

 

Name: Michael Quinn

 

Name: Mary G. Puma

 

 

 

Title:  Vice President

 

Title:  Chairman, President and CEO

 

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IN WITNESS WHEREOF, the following Guarantor hereby consents to the foregoing
Amendment and agrees that the Guaranty relating to the Obligations of Borrower
under the Loan Agreement dated as of October 31, 2013 shall continue in full
force and effect, shall be valid and enforceable and shall not be impaired or
otherwise affected by the execution of the Amendment or any other document or
instrument delivered in connection herewith.

 

 

Guarantor

 

 

 

AXCELIS TECHNOLOGIES (ISRAEL), INC.

 

 

 

 

 

By:

/s/ Mary G. Puma

 

 

 

Name:  Mary G. Puma

 

 

 

Title:  President

 

 

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