Exhibit 10.1

 

Confirmed Copy

 

EXECUTION VERSION

 

FIRST LOAN MODIFICATION AGREEMENT

 

This First Loan Modification Agreement (this “Loan Modification Agreement”) is
entered into as of May 25, 2010, 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 One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,
Massachusetts 02462 (“Bank”), and AXCELIS TECHNOLOGIES, INC. (“ATI”) and AXCELIS
TECHNOLOGIES CCS CORPORATION, each a Delaware corporation with offices located
at 108 Cherry Hill Drive, Beverly, Massachusetts 01915 (individually and
collectively, jointly and severally “Borrower”).

 

1.              DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS. AMONG
OTHER INDEBTEDNESS AND OBLIGATIONS WHICH MAY BE OWING BY BORROWER TO BANK,
BORROWER IS INDEBTED TO BANK PURSUANT TO A LOAN ARRANGEMENT DATED AS OF
MARCH 12, 2010, EVIDENCED BY, AMONG OTHER DOCUMENTS, A CERTAIN AMENDED AND
RESTATED LOAN AND SECURITY AGREEMENT DATED AS OF MARCH 12, 2010, BETWEEN
BORROWER AND BANK (AS AMENDED, THE “LOAN AGREEMENT”).  CAPITALIZED TERMS USED
BUT NOT OTHERWISE DEFINED HEREIN SHALL HAVE THE SAME MEANING AS IN THE LOAN
AGREEMENT.

 

2.              DESCRIPTION OF COLLATERAL.  REPAYMENT OF THE OBLIGATIONS IS
SECURED BY THE COLLATERAL AS DESCRIBED IN THE LOAN AGREEMENT AND THE
INTELLECTUAL PROPERTY AS DESCRIBED IN A CERTAIN AMENDED AND RESTATED
INTELLECTUAL PROPERTY SECURITY AGREEMENT DATED AS OF MARCH 12, 2010, BETWEEN ATI
AND BANK (AS AMENDED, THE “IP SECURITY AGREEMENT”) (TOGETHER WITH ANY OTHER
DOCUMENTS GRANTING COLLATERAL SECURITY TO BANK, THE “SECURITY DOCUMENTS”).
HEREINAFTER, THE SECURITY DOCUMENTS, TOGETHER WITH ALL OTHER DOCUMENTS
EVIDENCING OR SECURING THE OBLIGATIONS SHALL BE REFERRED TO AS THE “EXISTING
LOAN DOCUMENTS”.

 

3.              DESCRIPTION OF CHANGE IN TERMS.

 

A.            MODIFICATIONS TO LOAN AGREEMENT.

 

1.              THE LOAN AGREEMENT SHALL BE AMENDED BY DELETING THE FOLLOWING,
APPEARING AS SECTION 6.9(B) THEREOF, IN ITS ENTIRETY:

 

“(b)         Maximum Quarterly Net Losses.   Borrower and its Subsidiaries, on a
consolidated basis, shall not suffer any Net Loss in excess of: (i) $13,000,000
for the fiscal quarter ending March 31, 2010; (ii) $8,500,000 for the fiscal
quarter ending June 30, 2010; (iii) $8,500,000 for the fiscal quarter ending
September 30, 2010; and (iv) $5,000,000 for the fiscal quarter ending
December 31, 2010 and each fiscal quarter thereafter.”

 

and inserting in lieu thereof the following:

 

“(b)         Maximum Quarterly Net Losses.   Borrower and its Subsidiaries, on a
consolidated basis, shall not suffer any Net Loss in excess of: (i) $13,000,000
for the fiscal quarter ending March 31, 2010; (ii) $24,000,000 for the trailing
six (6) month period ending on the last day of the fiscal quarter ending
June 30, 2010; (iii) $23,500,000 for the trailing six (6) month period ending on
the last day of the fiscal quarter ending September 30, 2010; (iv) $13,500,000
for the trailing six (6) month period ending on the last day of the fiscal
quarter ending December 31, 2010; and (v) $5,000,000 for the trailing six
(6) month period ending on the last day of the fiscal quarter ending March 31,
2011, and as of the last day of each quarter thereafter, for the trailing six
(6) month period ending on the last day of the applicable fiscal quarter.”

 

2.              THE COMPLIANCE CERTIFICATE APPEARING AS EXHIBIT B TO THE LOAN
AGREEMENT IS HEREBY REPLACED WITH THE COMPLIANCE CERTIFICATE ATTACHED AS
EXHIBIT A HERETO.

 

4.              FEES.  BORROWER SHALL PAY TO BANK A MODIFICATION FEE EQUAL TO
THIRTY FIVE THOUSAND DOLLARS ($35,000), WHICH FEE SHALL BE DUE ON THE DATE
HEREOF AND SHALL BE DEEMED FULLY EARNED AS OF THE DATE HEREOF.  BORROWER SHALL
ALSO REIMBURSE BANK FOR ALL LEGAL FEES AND EXPENSES INCURRED IN CONNECTION WITH
THIS AMENDMENT TO THE EXISTING LOAN DOCUMENTS.

 

 

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5.              RATIFICATION OF IP SECURITY AGREEMENT.  ATI HEREBY RATIFIES,
CONFIRMS AND REAFFIRMS, ALL AND SINGULAR, THE TERMS AND CONDITIONS OF THE IP
SECURITY AGREEMENT, AND ACKNOWLEDGES, CONFIRMS AND AGREES THAT SAID IP SECURITY
AGREEMENT CONTAINS AN ACCURATE AND COMPLETE LISTING OF ALL REGISTERED
INTELLECTUAL PROPERTY AS DESCRIBED IN SAID IP SECURITY AGREEMENT AND SHALL
REMAIN IN FULL FORCE AND EFFECT.

 

6.              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 MARCH 12, 2010 BETWEEN
BORROWER AND BANK, AND ACKNOWLEDGES, CONFIRMS AND AGREES THE DISCLOSURES AND
INFORMATION BORROWER PROVIDED TO BANK IN THE PERFECTION CERTIFICATE HAVE NOT
CHANGED IN ANY MATERIAL RESPECT, AS OF THE DATE HEREOF.

 

7.              CONSISTENT CHANGES.  THE EXISTING LOAN DOCUMENTS ARE HEREBY
AMENDED WHEREVER NECESSARY TO REFLECT THE CHANGES DESCRIBED ABOVE.

 

8.              RATIFICATION OF LOAN DOCUMENTS.  BORROWER HEREBY RATIFIES,
CONFIRMS, AND REAFFIRMS ALL TERMS AND CONDITIONS OF ALL SECURITY OR OTHER
COLLATERAL GRANTED TO THE BANK, AND CONFIRMS THAT THE INDEBTEDNESS SECURED
THEREBY INCLUDES, WITHOUT LIMITATION, THE OBLIGATIONS.

 

9.              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 THEM ARE HEREBY
EXPRESSLY WAIVED AND BORROWER HEREBY RELEASES BANK FROM ANY LIABILITY
THEREUNDER.

 

10.       CONTINUING VALIDITY.  BORROWER UNDERSTANDS AND AGREES THAT IN
MODIFYING THE EXISTING OBLIGATIONS, BANK IS RELYING UPON BORROWER’S
REPRESENTATIONS, WARRANTIES, AND AGREEMENTS, AS SET FORTH IN THE EXISTING LOAN
DOCUMENTS.  EXCEPT AS EXPRESSLY MODIFIED PURSUANT TO THIS LOAN MODIFICATION
AGREEMENT, THE TERMS OF THE EXISTING LOAN DOCUMENTS REMAIN UNCHANGED AND IN FULL
FORCE AND EFFECT.  BANK’S AGREEMENT TO MODIFICATIONS TO THE EXISTING OBLIGATIONS
PURSUANT TO THIS LOAN MODIFICATION AGREEMENT IN NO WAY SHALL OBLIGATE BANK TO
MAKE ANY FUTURE MODIFICATIONS TO THE OBLIGATIONS.  NOTHING IN THIS LOAN
MODIFICATION AGREEMENT SHALL CONSTITUTE A SATISFACTION OF THE OBLIGATIONS.  IT
IS THE INTENTION OF BANK AND BORROWER TO RETAIN AS LIABLE PARTIES ALL MAKERS OF
EXISTING LOAN DOCUMENTS, UNLESS THE PARTY IS EXPRESSLY RELEASED BY BANK IN
WRITING.  NO MAKER WILL BE RELEASED BY VIRTUE OF THIS LOAN MODIFICATION
AGREEMENT.

 

11.       CONFIDENTIALITY.  BANK MAY USE CONFIDENTIAL INFORMATION FOR THE
DEVELOPMENT OF DATABASES, REPORTING PURPOSES, AND MARKET ANALYSIS, SO LONG AS
SUCH CONFIDENTIAL INFORMATION IS AGGREGATED AND ANONYMIZED PRIOR TO DISTRIBUTION
UNLESS OTHERWISE EXPRESSLY PERMITTED BY BORROWER.  THE PROVISIONS OF THE
IMMEDIATELY PRECEDING SENTENCE SHALL SURVIVE THE TERMINATION OF THE LOAN
AGREEMENT.

 

12.       COUNTERSIGNATURE.  THIS LOAN MODIFICATION AGREEMENT SHALL BECOME
EFFECTIVE ONLY WHEN IT SHALL HAVE BEEN EXECUTED BY BORROWER AND BANK.

 

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This Loan Modification Agreement is executed as a sealed instrument under the
laws of the Commonwealth of Massachusetts as of the date first written above.

 

BORROWER:

 

BANK:

 

 

 

AXCELIS TECHNOLOGIES, INC.

 

SILICON VALLEY BANK

 

 

 

By:

/s/ Mary G. Puma

 

By:

/s/ Michael Quinn

 

 

 

Name: Mary G. Puma

 

Name:  Michael Quinn

 

 

 

Title: President

 

Title: Vice President

 

 

 

AXCELIS TECHNOLOGIES CCS CORPORATION

 

 

 

 

 

By:

/s/ Mary G. Puma

 

 

 

 

 

Name: Mary G. Puma

 

 

 

 

 

Title: President

 

 

 

The undersigned, Fusion Technology International, Inc., ratifies, confirms and
reaffirms, all and singular, the terms and conditions of a certain Amended and
Restated Unconditional Guaranty dated March 12, 2010 (the “FTI Guaranty”) and
acknowledges, confirms and agrees that the FTI Guaranty shall remain in full
force and effect and shall in no way be limited by the execution of this Loan
Modification Agreement, or any other documents, instruments and/or agreements
executed and/or delivered in connection herewith.

 

 

FUSION TECHNOLOGY INTERNATIONAL, INC.

 

 

 

By:

/s/ Mary G. Puma

 

 

 

Name: Mary G. Puma

 

 

 

Title: President

 

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The undersigned, Fusion Investments, Inc., ratifies, confirms and reaffirms, all
and singular, the terms and conditions of a certain Amended and Restated
Unconditional Guaranty dated March 12, 2010 (the “FI Guaranty”) and
acknowledges, confirms and agrees that the FI Guaranty shall remain in full
force and effect and shall in no way be limited by the execution of this Loan
Modification Agreement, or any other documents, instruments and/or agreements
executed and/or delivered in connection herewith.

 

 

FUSION INVESTMENTS, INC.

 

 

 

By:

/s/ Mary G. Puma

 

 

 

Name: Mary G. Puma

 

 

 

Title: President

 

The undersigned, High Temperature Engineering Corporation, ratifies, confirms
and reaffirms, all and singular, the terms and conditions of a certain Amended
and Restated Unconditional Guaranty dated March 12, 2010 (the “HTEC Guaranty”)
and acknowledges, confirms and agrees that the HTEC Guaranty shall remain in
full force and effect and shall in no way be limited by the execution of this
Loan Modification Agreement, or any other documents, instruments and/or
agreements executed and/or delivered in connection herewith.

 

 

HIGH TEMPERATURE ENGINEERING CORPORATION

 

 

 

By:

/s/ Mary G. Puma

 

 

 

Name: Mary G. Puma

 

 

 

Title: President

 

The undersigned, Axcelis Technologies (Israel), Inc., ratifies, confirms and
reaffirms, all and singular, the terms and conditions of a certain Amended and
Restated Unconditional Guaranty dated March 12, 2010 (the “ATI Guaranty”) and
acknowledges, confirms and agrees that the ATI Guaranty shall remain in full
force and effect and shall in no way be limited by the execution of this Loan
Modification Agreement, or any other documents, instruments and/or agreements
executed and/or delivered in connection herewith.

 

 

AXCELIS TECHNOLOGIES (ISRAEL), INC.

 

 

 

By:

/s/ Mary G. Puma

 

 

 

Name: Mary G. Puma

 

 

 

Title: President

 

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EXHIBIT A

EXHIBIT B - COMPLIANCE CERTIFICATE

 

TO:

 

SILICON VALLEY BANK

 

Date:

 

FROM:

 

Axcelis Technologies, Inc. and Axcelis Technologies CCS Corporation

 

 

 

The undersigned authorized officer of Axcelis Technologies, Inc. and Axcelis
Technologies CCS Corporation (“Borrower”) certifies that under the terms and
conditions of the Loan and Security Agreement between, inter alia, Borrower and
Bank (the “Agreement”), (1) Borrower is in complete compliance for the period
ending                                with all required covenants except as
noted below, (2) there are no Events of Default, (3) all representations and
warranties in the Agreement are true and correct in all material respects on
this date except as noted below; provided, however, that such materiality
qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof; and
provided, further that those representations and warranties expressly referring
to a specific date shall be true, accurate and complete in all material respects
as of such date, (4) Borrower, and each of its Domestic Subsidiaries, has timely
filed all required tax returns and reports, and Borrower has timely paid all
foreign, federal, state and local taxes, assessments, deposits and contributions
owed by Borrower except as otherwise permitted pursuant to the terms of
Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made
against Borrower or any of its Domestic Subsidiaries relating to unpaid employee
payroll or benefits of which Borrower has not previously provided written
notification to Bank.  Attached are the required documents supporting the
certification.  The undersigned certifies that these are prepared in accordance
with GAAP consistently applied from one period to the next except as explained
in an accompanying letter or footnotes.  The undersigned acknowledges that no
borrowings may be requested at any time or date of determination that Borrower
is not in compliance with any of the terms of the Agreement, and that compliance
is determined not just at the date this certificate is delivered.  Capitalized
terms used but not otherwise defined herein shall have the meanings given them
in the Agreement.

 

Please indicate compliance status by circling Yes/No under “Complies” column.

 

Reporting Covenant

 

Required

 

Complies

 

 

 

 

 

Quarterly consolidated and consolidating and financial statements with
Compliance Certificate

 

Quarterly within 45 days

 

Yes  No

Annual financial statement (CPA Audited) + CC

 

FYE within 120 days

 

Yes  No

10-Q, 10-K and 8-K

 

Within 10 days after filing with SEC

 

Yes  No

A/R & A/P Agings (including EXIM), Inventory reports

 

Monthly within 30 days

 

Yes  No

Transaction Report

 

Monthly within 30 days (bi-weekly if borrowing)

 

Yes  No

Monthly consolidated financial statements

 

Monthly within 45 days (if borrowing)

 

Yes  No

 

The following Intellectual Property was registered (or a registration
application submitted) after the Effective Date (if no registrations, state
“None”)

 

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Financial Covenant

 

Required

 

Actual

 

Complies

 

 

 

 

 

 

 

Maintain, tested on a quarterly (unless otherwise indicated) basis:

 

 

 

 

 

 

Adjusted Quick Ratio, at all times (tested quarterly )

 

1.5:1.0

 

   :1.0

 

Yes  No

Maximum Net Losses

 

(i) $13,000,000 for the fiscal quarter ending March 31, 2010; (ii) $24,000,000
for the trailing six (6) months ending June 30, 2010; (iii) $23,500,000 for the
trailing six (6) months ending September 30, 2010; (iv) $13,500,000 for the
trailing six (6) months ending December 31, 2010, and (v) $5,000,000 for the
trailing six (6) months ending March 31, 2011, and as of the last day of each
quarter thereafter, for the trailing six (6) months ending on the last day of
the applicable fiscal quarter.

 

$

 

Yes  No

 

 

 

 

 

 

 

Liquidity (at all times)

 

$30,000,000

 

$

 

Yes  No

 

The following financial covenant analysis and information set forth in Schedule
1 attached hereto are true and accurate as of the date of this Certificate.

 

Schedule 2 attached hereto sets forth all applications for any patent or the
registration of any trademark or servicemark made by Borrower since the date of
the last Compliance Certificate delivered to Bank.

 

The following are the exceptions with respect to the certification above:  (If
no exceptions exist, state “No exceptions to note.”)

 

 

AXCELIS TECHNOLOGIES, INC.

 

BANK USE ONLY

 

 

 

 

 

Received by:

 

By:

 

 

 

AUTHORIZED SIGNER

Name:

 

 

Date:

 

Title:

 

 

 

 

 

Verified:

 

AXCELIS TECHNOLOGIES CCS CORPORATION

 

 

AUTHORIZED SIGNER

 

 

 

 

 

Date:

 

By:

 

 

 

Name:

 

 

Compliance Status:          Yes  No

Title:

 

 

 

 

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Schedule 1 to Compliance Certificate

 

Financial Covenants of Borrower

 

In the event of a conflict between this Schedule and the Loan Agreement, the
terms of the Loan Agreement shall govern.

 

Dated:

 

 

 

I.

Adjusted Quick Ratio (Section 6.9(a))

 

 

 

 

 

 

Required:

 

1.5:1.0

 

 

 

 

 

Actual:

 

      :1.0

 

 

 

 

 

A.

World-wide consolidated Unrestricted cash and Cash Equivalents

$

 

 

 

B.

Accounts

$

 

 

 

C.

Investments at Bank

$

D.

Quick Assets (line A plus line B plus line C)

$

 

 

 

E.

Aggregate value of Obligations to Bank (other than cash secured obligations)

$

F.

Aggregate value of liabilities of Borrower and its Subsidiaries (including all
Indebtedness)

that matures within one (1) year

$

G.

Deferred Revenue

$

H.

Current Liabilities (the sum of lines E and F, minus line G)          

$

I.

Quick Ratio (line D divided by line H)

 

 

 

 

Is line I equal to or greater than 1.50:1:00?

 

 

 

 

 

o No, not in compliance

o Yes, in compliance

 

 

 

 

II.

Maximum Net Losses (Section 6.9(b))

 

 

 

 

Required:

 

$13,000,000 for the fiscal quarter ending March 31, 2010

 

 

 

$24,000,000 for Test Period ending June 30, 2010

 

 

 

$23,500,000 for the Test Period ending September 30, 2010

 

 

 

$13,500,000 for the Test Period ending December 31, 2010

 

 

 

$5,000,000 for the Test Period ending March 31, 2011, and as of the last day of
each quarter thereafter, for the applicable Test Period.

 

 

 

 

 

Actual: $

 

 

 

 

 

 

 

A.

Aggregate value of Borrower losses

$

 

 

 

 

Is line A less than or equal to $                    ?

 

 

 

 

 

 

o No, not in compliance

o Yes, in compliance

 

 

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III.

Liquidity (Section 6.9(c))

 

 

 

 

 

Required:

 

$30,000,000

 

 

 

 

 

Actual:

 

$

 

 

 

 

 

A.

Aggregate Cash and Cash Equivalents at Bank

$

 

 

 

 

B.

Availability Amount

$

C.

Liquidity (the sum of lines A and B)

$

 

 

Is line C less than or equal to $30,000,000?

 

 

 

 

 

 

 

o No, not in compliance

o Yes, in compliance

 

 

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Schedule 2 to Compliance Certificate

 

IP Applications

 

10

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