exv10w23



 





Exhibit 10.23




CREDIT AGREEMENT




Dated
as of December 26, 2006



among




NOVELLUS SYSTEMS, INC,




as Borrower,




BANK OF AMERICA, N.A.,




as Administrative Agent and Swing Line Lender,




DEUTSCHE BANK AG NEW YORK BRANCH,

as Syndication Agent,




ABN AMRO BANK N.V. and

MIZUHO CORPORATE BANK, LTD.,

as Co-Documentation Agents




and




THE OTHER LENDERS PARTY HERETO




BANC OF AMERICA SECURITIES LLC and

DEUTSCHE BANK SECURITIES INC.,

as Joint Lead Arrangers and Joint Book Managers




 









 








 TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	 	Page	 
	SECTION1. DEFINITIONS	 	 	1	 
	 
	 	 	 	 	 	 
	1.1
	 	Defined Terms	 	 	1	 
	1.2
	 	Other Definitional Provisions	 	 	21	 
	 
	 	 	 	 	 	 
	SECTION 2. AMOUNT AND TERMS OF REVOLVING COMMITMENTS	 	 	21	 
	 
	 	 	 	 	 	 
	2.1
	 	Revolving Commitments	 	 	21	 
	2.2
	 	Procedure for Revolving Loan Borrowing	 	 	23	 
	2.3
	 	Commitment Fees, etc.	 	 	23	 
	2.4
	 	Termination or Reduction of Revolving Commitments	 	 	24	 
	2.5
	 	Optional Prepayments	 	 	24	 
	2.6
	 	Conversion and Continuation Options	 	 	25	 
	2.7
	 	Limitations on Eurodollar Tranches	 	 	25	 
	2.8
	 	Interest Rates and Payment Dates	 	 	26	 
	2.9
	 	Computation of Interest and Fees	 	 	26	 
	2.10
	 	Inability to Determine Interest Rate	 	 	27	 
	2.11
	 	Pro Rata Treatment and Payments	 	 	27	 
	2.12
	 	Requirements of Law	 	 	29	 
	2.13
	 	Taxes	 	 	30	 
	2.14
	 	Indemnity	 	 	32	 
	2.15
	 	Change of Lending Office	 	 	33	 
	2.16
	 	Replacement of Lenders	 	 	33	 
	2.17
	 	Swine Line Loans 	 	 	33	 
	2.18
	 	Sharing of Payments by Lenders	 	 	36	 
	2.19
	 	Cash Collateral	 	 	37	 
	 
	 	 	 	 	 	 
	SECTION 3. REPRESENTATIONS AND WARRANTIES	 	 	37	 
	 
	 	 	 	 	 	 
	3.1
	 	Financial Condition	 	 	37	 
	3.2
	 	No Change	 	 	38	 
	3.3
	 	Existence; Compliance with Law	 	 	38	 
	3.4
	 	Power; Authorization; Enforceable Obligations	 	 	38	 
	3.5
	 	No Legal Bar	 	 	39	 
	3.6
	 	Litigation	 	 	39	 
	3.7
	 	No Default	 	 	39	 
	3.8
	 	Ownership of Property	 	 	39	 
	3.9
	 	Intellectual Property	 	 	39	 
	3.10
	 	Taxes	 	 	39	 
	3.11
	 	Federal Regulations	 	 	40	 
	3.12
	 	ERISA	 	 	40	 
	3.13
	 	Investment Company Act; Other Regulations	 	 	40	 
	3.14
	 	Subsidiaries	 	 	40	 
	3.15
	 	Use of Proceeds	 	 	40	 
	3.16
	 	Environmental Matters	 	 	40	 
	3.17
	 	Accuracy of Information, etc	 	 	41	 






 i




 









 






	 	 	 	 	 	 	 
	3.18
	 	Solvency	 	 	42	 
	 
	 	 	 	 	 	 
	SECTION 4. CONDITIONS PRECEDENT	 	 	42	 
	 
	 	 	 	 	 	 
	4.1
	 	Conditions to Initial Extension of Credit	 	 	42	 
	4.2
	 	Conditions to Each Extension of Credit	 	 	43	 
	 
	 	 	 	 	 	 
	SECTION 5. AFFIRMATIVE COVENANTS	 	 	43	 
	 
	 	 	 	 	 	 
	5.1
	 	Financial Statements	 	 	43	 
	5.2
	 	Certificates; Other Information	 	 	44	 
	5.3
	 	Intentionally Omitted	 	 	46	 
	5.4
	 	Maintenance of Existence; Compliance	 	 	46	 
	5.5
	 	Maintenance of Property; Insurance	 	 	46	 
	5.6
	 	Inspection of Property; Books and Records; Discussions	 	 	46	 
	5.7
	 	Notices	 	 	46	 
	5.8
	 	Additional Subsidiaries	 	 	47	 
	 
	 	 	 	 	 	 
	SECTION 6. NEGATIVE COVENANTS	 	 	47	 
	 
	 	 	 	 	 	 
	6.1
	 	Financial Covenants	 	 	47	 
	6.2
	 	Fundamental Changes	 	 	47	 
	6.3
	 	Lines of Business	 	 	48	 
	6.4
	 	Liens	 	 	48	 
	6.5
	 	Investments	 	 	49	 
	6.6
	 	Indebtedness	 	 	51	 
	6.7
	 	Dispositions	 	 	51	 
	6.8
	 	Restricted Payments	 	 	51	 
	6.9
	 	Transactions with Affiliates and Insiders	 	 	52	 
	 
	 	 	 	 	 	 
	SECTION 7. EVENTS OF DEFAULT	 	 	52	 
	 
	 	 	 	 	 	 
	SECTION 8. THE ADMINISTRATIVE AGENT	 	 	55	 
	 
	 	 	 	 	 	 
	8.1
	 	Appointment and Authority	 	 	55	 
	8.2
	 	Rights as a Lender	 	 	55	 
	8.3
	 	Exculpatory Provisions	 	 	55	 
	8.4
	 	Reliance by Administrative Agent	 	 	56	 
	8.5
	 	Delegation of Duties	 	 	56	 
	8.6
	 	Resignation of Administrative Agent	 	 	57	 
	8.7
	 	Non-Reliance on Administrative Agent and Other Lenders	 	 	57	 
	8.8
	 	No Other Duties; Etc	 	 	58	 
	8.9
	 	Administrative Agent May File Proofs of Claim	 	 	58	 
	8.10
	 	Guaranty Matters	 	 	58	 
	 
	 	 	 	 	 	 
	SECTION 9. MISCELLANEOUS	 	 	59	 
	 
	 	 	 	 	 	 
	9.1
	 	Amendments and Waivers	 	 	59	 
	9.2
	 	Notices	 	 	60	 
	9.3
	 	No Waiver; Cumulative Remedies	 	 	62	 
	9.4
	 	Survival of Representations and Warranties	 	 	62	 
	9.5
	 	Payment of Expenses; Payments Set Aside	 	 	62	 
	9.6
	 	Successors and Assigns; Participations and Assignments	 	 	64	 
	9.7
	 	Set-off	 	 	68	 
	9.8
	 	Counterparts	 	 	68	 






 ii











 








	 	 	 	 	 	 	 
	9.9
	 	Severability	 	 	69	 
	9.10
	 	Integration	 	 	69	 
	9.11
	 	GOVERNING LAW; JURISDICTION; ETC.	 	 	69	 
	9.12
	 	Treatment of Certain Information; Confidentiality	 	 	70	 
	9.13
	 	WAIVERS OF JURY TRIAL	 	 	71	 
	9.14
	 	USA Patriot Act	 	 	71	 
	9.15
	 	California Judicial Reference	 	 	71	 
	9.16
	 	No Advisory or Fiduciary Relationship	 	 	72	 
	 
	 	 	 	 	 	 
	SECTION 10. GUARANTY	 	 	72	 
	 
	 	 	 	 	 	 
	10.1
	 	The Guaranty	 	 	72	 
	10.2
	 	Obligations Unconditional	 	 	73	 
	10.3
	 	Reinstatement	 	 	74	 
	10.4
	 	Certain Additional Waivers	 	 	74	 
	10.5
	 	Remedies	 	 	74	 
	10.6
	 	Rights of Contribution	 	 	74	 
	10.7
	 	Additional Guarantor Waivers and Agreements	 	 	74	 
	10.8
	 	Guarantee of Payment; Continuing Guarantee	 	 	75	 






 iii




 









 








     CREDIT
AGREEMENT (this “Agreement”), dated as of December 26, 2006, among Novellus Systems,
Inc., a California corporation (“Novellus” or the
“Borrower”), the Guarantors (defined herein),
the several banks and other financial institutions or entities from time to time parties to this
Agreement (the “Lenders”) and Bank of America, N.A., as Administrative Agent and Swing Line Lender.



     The parties hereto hereby agree as follows:



     SECTION 1. DEFINITIONS 




     1.1
Defined Terms. As used in this Agreement, the terms listed in this Section 1.1
shall have the respective meanings set forth in this Section 1.1.

“Acquisition”: by any Person, the acquisition by such Person, in a single transaction or in a
series of related transactions, of all or any substantial portion of the property of another Person
or at least a majority of the Voting Stock of another Person, in each case whether or not involving
a merger or consolidation with such other Person and whether for cash, property, services,
assumption of Indebtedness, securities or otherwise.



     “Administrative Agent”: Bank of America, N.A., together with its affiliates, as the
administrative agent for the Lenders under this Agreement and the other Loan Documents, together
with any of its successors.



     “Administrative
Agent’s Office”: means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 9.2 or such other address or account as the
Administrative Agent may from time to time notify to the Borrower and the Lenders.



     “Administrative Questionnaire”: an Administrative Questionnaire in a form supplied by the
Administrative Agent.



     “Affiliate”: as to any Person, any other Person that, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person. For purposes of this definition,
“control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of
the securities having ordinary voting power for the election of directors (or persons performing
similar functions) of such Person or (b) direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.



     “Agreement”: as defined in the preamble hereto.



     “Applicable Margin”: with respect to Revolving Loans, Swing Line Loans and the Commitment Fee, the
following percentages per annum, based upon the Consolidated Leverage Ratio as set forth in the
most recent Compliance Certificate received by the Administrative Agent pursuant to Section
5.2(b):



 









 







	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Consolidated	 	 	Commitment	 	 	Eurodollar	 	 	Base Rate	 
	Pricing Tier	 	Leverage Ratio	 	 	Fee	 	 	Loans	 	 	Loans	 
	1
	 	 	>2.5:1.0	 	 	 	0.20	%	 	 	1.00	%	 	 	0.00	%
	2
	 	>1.5:1.0 but<	 	 	0.15	%	 	 	0.75	%	 	 	0.00	%
	 
	 	 	2.5:1.0	 	 	 	 	 	 	 	 	 	 	 	 	 
	3
	 	 	<1.5:1.0	 	 	 	0.10	%	 	 	0.50	%	 	 	0.00	%







Any increase or decrease in the Applicable Margin resulting from a change in the Consolidated
Leverage Ratio shall become effective as of the first Business Day immediately following the date a
Compliance Certificate is required to be delivered pursuant to
Section 5.2(b) provided,
however, that if a Compliance Certificate is not delivered when due in accordance with such
Section, then Pricing Tier 1 shall apply as of the first Business Day after the date on which such
Compliance Certificate was required to have been delivered and shall continue to apply until the
first Business Day immediately following the date a Compliance
Certificate is delivered in
accordance with Section 5.2(b), whereupon the Applicable Margin shall be adjusted based
upon the calculation of the Consolidated Leverage Ratio contained in such Compliance Certificate.
Notwithstanding the foregoing, the Applicable Margin in effect from the Closing Date through the
first Business Day immediately following the date a Compliance Certificate is required to be
delivered pursuant to Section 5.2(b) for the fiscal quarter ending December 31, 2006 shall
be determined based upon Pricing Tier 3.



     “Approved Fund”: any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

     “Assignee Group”: two or more Eligible Assignees that are Affiliates of one another or two or more
Approved Funds managed by the same investment advisor.



     “Assignment and Assumption”: an assignment and assumption entered into by a Lender and an
Eligible Assignee (with the consent of any party whose consent is required by Section
9.6(b), and accepted by the Administrative Agent, in substantially the form of Exhibit B or
any other form approved by the Administrative Agent.



     “Attributable
Indebtedness” means, on any date, (a) in respect of any Capital Lease of any
Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared
as of such date in accordance with GAAP and (b) in respect of any Securitization Transaction of any
Person, the outstanding principal amount of such financing, after taking into account reserve
accounts and making appropriate adjustments, determined by the Administrative Agent in its
reasonable judgment.



     “Bank of America”: Bank of America, N.A. and it successors.




2









 








     “BAS”:
Banc of America Securities LLC, in its capacity as sole lead arranger and book
manager.



     “Base Rate”: for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds
Rate plus 1/2 of 1% and (b) the rate of interest in effect for such day as publicly
announced from time to time by Bank of America as its “prime rate.” The “prime rate” is a rate set
by Bank of America based upon various factors including Bank of America’s costs and desired return,
general economic conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change in such rate
announced by Bank of America shall take effect at the opening of business on the day specified in
the public announcement of such change.



     “Base Rate Loans”: Revolving Loans the rate of interest applicable to which is based upon the Base
Rate.



     “Board”: the Board of Governors of the Federal Reserve System of the United States (or any
successor).



     “Borrower”: as defined in the preamble hereto.




     “Borrower Materials”: as defined in Section 5.2.




     “Borrowing Date”: any Business Day specified by the Borrower as a date on which the Borrower
requests the Lenders to make Revolving Loans hereunder.



     “Business”: as defined in Section 3.16(b).



     “Business Day”: a day other than a Saturday, Sunday or other day on which commercial banks are
authorized to close under the laws of, or are in fact closed in, the state where the Administrative
Agent’s Office is located; provided, that with respect to notices and determinations in
connection with, and payments of principal and interest on, Eurodollar Loans, such day is also a
day for trading by and between banks in Dollar deposits in the interbank eurodollar market.







     “Capital Stock”: any and all shares, interests, participations or other equivalents (however
designated) of capital stock of a corporation, any and all equivalent ownership interests in a
Person (other than a corporation) and any and all warrants, rights or options to purchase any of
the foregoing.



     “Cash Collateral”: as defined in Section 2.19.



     “Cash Equivalents”: as at any date, (a) securities issued or directly and fully guaranteed or
insured by the United States or any agency or instrumentality thereof (provided that the full faith
and credit of the United States is pledged in support thereof) having maturities of not more than
twelve months from the date of acquisition, (b) Dollar denominated time deposits and certificates
of deposit of (i) any Lender, (ii) any domestic commercial bank of recognized



3









 




standing having capital and surplus in excess of $500,000,000 or (iii) any bank whose short-term
commercial paper rating from S&P is at least A-l or the equivalent thereof or from Moody’s is at
least P-l or the equivalent thereof (any such bank being an “Approved Bank”), in each case with
maturities of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent company thereof) or any
variable rate notes issued by, or guaranteed by, any domestic corporation rated A-l (or the
equivalent thereof) or better by S&P or P-l (or the equivalent thereof) or better by Moody’s and
maturing within six months of the date of acquisition, (d) repurchase agreements entered into by
any Person with a bank or trust company (including any of the Lenders) or recognized securities
dealer having capital and surplus in excess of $500,000,000 for direct obligations issued by or
fully guaranteed by the United States in which such Person shall have a perfected first priority
security interest (subject to no other Liens) and having, on the date of purchase thereof, a fair
market value of at least 100% of the amount of the repurchase obligations and (e) Investments,
classified in accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940 which are administered by reputable financial
institutions having capital of at least $500,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing subdivisions (a) through (d).





“Change of Control” means the occurrence of any of the following events:




     (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its
subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary
or administrator of any such plan) becomes the “beneficial owner” (as defined in Rules 13d-3 and
13d-5 under the Securities Exchange Act of 1934, except that a person or group shall be deemed to
have “beneficial ownership” of all Capital Stock that such person or group has the right to acquire
(such right, an “option right”), whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of thirty-five percent (35%) of the Capital Stock of the
Borrower entitled to vote for members of the board of directors or equivalent governing body of the
Borrower on a fully diluted basis (and taking into account all such securities that such person or
group has the right to acquire pursuant to any option right); or




     (b) during any period of 24 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Borrower cease to be composed of individuals
(i) who were members of that board or equivalent governing body on the first day of such period,
(ii) whose election or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such election or nomination
at least a majority of that board or equivalent governing body or (iii) whose election or
nomination to that board or other equivalent governing body was approved by individuals referred to
in clauses (i) and (ii) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of both clause (ii) and
clause (iii), any individual whose initial nomination for, or assumption of office as, a member of
that board or equivalent governing body occurs as a result of an actual or threatened solicitation
of proxies or consents for the election or removal of one or more directors by



4









 







     any person or group other than a solicitation for the election of one or more directors by or on
behalf of the board of directors).




     “Closing Date”: the date hereof.




     “Code”: the Internal Revenue Code of 1986, as amended from time to time.




     “Commitment
Fee: as defined in Section 2.3(a).




     “Commonly Controlled Entity”: an entity, whether or not incorporated, that is under common
control with Novellus within the meaning of Section 4001 of ERISA or is part of a group that
includes Novellus and that is treated as a single employer under Section 414 of the Code.




     “Compliance Certificate”: a certificate substantially in the form of Exhibit D.




     “Consolidated Current Liabilities”: at any date, all amounts that would, in conformity with
GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a
consolidated balance sheet of Novellus and its Subsidiaries at such date.




     “Consolidated EBITDA”: for any period, Consolidated Net Income for such period plus,
without duplication and to the extent reflected as a charge in the statement of such Consolidated
Net Income for such period, the sum of (a) income tax expense, (b) interest expense, amortization
or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness (including the Revolving Loans), (c) depreciation and
amortization expense, (d) amortization of intangibles (including, but not limited to, goodwill) and
organization costs and (e) any extraordinary non-cash expenses or losses (including, whether or not
otherwise includable as a separate item in the statement of such Consolidated Net Income for such
period, non-cash losses on sales of assets outside of the ordinary course of business), and
minus, (a) without duplication and to the extent included in the statement of such
Consolidated Net Income for such period, the sum of (i) interest income, (ii) any extraordinary,
unusual or non-recurring income or gains (including, whether or not otherwise includable as a
separate item in the statement of such Consolidated Net Income for such period, gains on the sales
of assets outside of the ordinary course of business), (iii) income tax credits (to the extent not
netted from income tax expense) and (iv) any other non-cash income and (b) any cash payments made
during such period in respect of items described in clause (e) above subsequent to the fiscal
quarter in which the relevant non-cash expenses or losses were reflected as a charge in the
statement of Consolidated Net Income, all as determined on a consolidated basis.

     “Consolidated Funded Debt”: at any date, the aggregate principal amount of all Funded Debt
(other than Funded Debt (other than the Obligations) that is collateralized by cash) of the
Borrower and its Subsidiaries at such date, determined on a consolidated basis in accordance with
GAAP.



5









 





     “Consolidated Leverage Ratio”: as at the last day of any period, the ratio of (a)
Consolidated Funded Debt on such day to (b) Consolidated EBITDA for the period of the four
consecutive fiscal quarters ended on such day.



     “Consolidated Net Income”: for any period, the consolidated net income (or loss) of the
Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP;
provided that there shall be excluded (a) the income (or deficit) of any Person accrued
prior to the date it becomes a Subsidiary of the Borrower or is merged into or consolidated with
the Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a
Subsidiary of the Borrower) in which the Borrower or any of its Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by the Borrower or such
Subsidiary in the form of dividends or similar distributions and (c) the undistributed earnings of
any Subsidiary of the Borrower to the extent that the declaration or payment of dividends or
similar distributions by such Subsidiary is not at the time permitted by the terms of any
Contractual Obligation (other than under any Loan Document) or Requirement of Law applicable to
such Subsidiary.



     “Consolidated Total Assets”: at any time, the total assets of the Borrower and its
Subsidiaries which would appear as assets on a consolidated balance sheet of the Borrower and the
Subsidiaries prepared as of such time in accordance with GAAP.



     “Contractual Obligation”: as to any Person, any provision of any security issued by such
Person or of any agreement, instrument or other undertaking to which such Person is a party or by
which it or any of its property is bound.



     “Default”: any of the events specified in Section 7, whether or not any requirement for the giving
of notice, the lapse of time, or both, has been satisfied.

     “Defaulting Lender”: any Lender that (a) has failed to fund any portion of the Loans or
participations in Swing Line Loans required to be funded by it hereunder within one Business Day of
the date required to be funded by it hereunder, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by it hereunder
within one Business Day of the date when due, unless the subject of a good faith dispute, or (c)
has been deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.



     “Disposition” or “Dispose”: the sale, transfer, license, lease or other disposition of any property
by any Loan Party or any Subsidiary (including the Capital Stock of any Subsidiary), including any
sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts
receivable or any rights and claims associated therewith, but excluding (a) the sale, lease,
license, transfer or other disposition of inventory, in each case in the ordinary course of
business; (b) the sale, lease, license, transfer or other disposition in the ordinary course of
business of surplus, obsolete or worn out property no longer used or useful in the conduct of
business of any Loan Party and its Subsidiaries; (c) any sale, lease, license, transfer or other
disposition of property to any Loan Party or any Subsidiary; provided, that if the
transferor of such property is a Loan Party (i) the transferee thereof must be a Loan Party or (ii)
to the extent such transaction constitutes an Investment, such transaction is permitted under
Section 6.4; (d)



6









 





any Involuntary Disposition; (e) any sale, transfer, license, lease or other disposition of
Receivables Program Assets in connection with any Qualified Receivables Transaction; (f) any sale,
transfer, license, lease or other disposition of property by the Borrower or any Subsidiary in
connection with any License and Manufacturing Transaction; (g) the creation of any Lien otherwise
permitted hereunder; (h) grants of nonexclusive licenses of intellectual property in the ordinary
course of business and (i) the good faith surrender or waiver of contract rights, tort claims or
statutory rights in the ordinary course of business.




     “Dollars” and “$”: dollars in lawful currency of the United States.

     “Domestic Subsidiary”: any Subsidiary that is organized under the laws of any state of the United
States or the District of Columbia.



     “Eligible Assignee”: any Person that meets the requirements to be an assignee under Section
9.6(b)(iv) and (v) (subject to such consents, if any, as may be required under Section 9.6(b)(ii)).

     “Environmental Laws”: any and all foreign, Federal, state, local or municipal laws, rules,
regulations, statutes, ordinances, codes, decrees, requirements of any Governmental Authority or
other Requirements of Law regulating, relating to or imposing liability or standards of conduct
concerning protection of the indoor or outdoor environment, as now or may at any time hereafter be
in effect.



     “ERISA”: the Employee Retirement Income Security Act of 1974, as amended from time to time.



     “Eurocurrency Reserve Requirements”: for any day during any Interest Period, the reserve
percentage (expressed as a decimal, carried out to five decimal places) in effect on such day,
whether or not applicable to any Lender, under regulations issued from time to time by the Board
for determining the maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as
“Eurocurrency Liabilities” in Regulation D of the Board). The Eurodollar Rate for each outstanding
Eurodollar Loan shall be adjusted automatically as of the effective date of any change in the
Eurocurrency Reserve Requirements.



     “Eurodollar Base Rate”: for any Interest Period, the rate per annum equal to the British Bankers
Association LIBOR Rate (“BBA LIBOR, X”) as published by Reuters (or other commercially available
source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to
time) at approximately ll:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period. If such rate is not available at such time for any reason,
then the “Eurodollar Base Rate” for such Interest Period shall be the rate per annum determined by
the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan
being made, continued or converted by Bank of America and with a term equivalent to such Interest
Period would be



7









 





offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market
at their request at approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.




     “Eurodollar Loans”: Revolving Loans the rate of interest applicable to which is based upon the
Eurodollar Rate.



     “Eurodollar Rate”: for any Interest Period with respect to a Eurodollar Loan, a rate per annum
determined by the Administrative Agent pursuant to the following formula:



	 	 	 	 	 	 	 
	Eurodollar Rate

	 	=
	 	Eurodollar Base Rate	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	1.00 — Eurocurrency Reserve Requirements	 	 






     “Eurodollar Tranche”: the collective reference to Eurodollar Loans the then current Interest
Periods with respect to all of which begin on the same date and end on the same later date (whether
or not such Eurodollar Loans shall originally have been made on the same day).



     “Event of Default”: any of the events specified in Section 7, provided that any requirement
for the giving of notice, the lapse of time, or both, has been satisfied.



     “Existing Credit Agreement”: that certain Credit Agreement dated as of May 24, 2006 among
the Borrower, the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as
administrative agent, as amended from time to time.



     “Federal Funds Rate”: for any day, the rate per annum equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on
such transactions as determined by the Administrative Agent.



     “Fee Letter”: the letter agreement, dated November 9, 2006, among the Borrower, Bank of America and
BAS.



     “Fee Payment Date”: (a) the third Business Day following the last day of each March, June,
September and December and (b) the last day of the Revolving Commitment Period.



     “Foreign Subsidiary”: any Subsidiary that is not a Domestic Subsidiary.



     “Fund”: any Person (other than a natural person) that is engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the ordinary course of
its business.



8









 





     “Funded Debt”: as to any Person at a particular time, without duplication, all of the following,
whether or not included as indebtedness or liabilities in accordance with GAAP:




     (a) all obligations for borrowed money, whether current or long-term (including the
Obligations) and all obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;




     (b) all purchase money Indebtedness;




     (c) the principal portion of all obligations under conditional sale or other title
retention agreements relating to properly purchased by the Borrower or any Subsidiary (other than
customary reservations or retentions of title under agreements with suppliers entered into in the
ordinary course of business);




     (d) all obligations arising under letters of credit (including standby and commercial),
bankers’ acceptances, bank guaranties, surety bonds and similar instruments;




     (e) all obligations in respect of the deferred purchase price of property or services (other
than trade accounts payable in the ordinary course of business and, in each case, not past due for
more than 60 days after the date on which such trade account payable was created);




     (f) the Attributable Indebtedness of Capital Leases and Securitization Transactions;




     (g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make
any payment in respect of any Equity Interests in such Person or any other Person, valued, in the
case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends;




     (h) all Funded Debt of others secured by (or for which the holder of such Funded Debt has an
existing right, contingent or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed;




     (i) all Guarantee Obligations with respect to Funded Debt of the types specified in clauses (a)
through (h) above of another Person; and




     (j) all Funded Debt of the types referred to in clauses (a) through (i) above of any partnership or
joint venture (other than a joint venture that is itself a corporation or limited liability company)
in which such Person is a general partner or joint venturer, except to the extent that Funded Debt
is expressly made non-recourse to such Person.



9









 







For purposes hereof, the amount of any direct obligation arising under letters of credit (including
standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar
instruments shall be the maximum amount available to be drawn thereunder.



     “Funding Office”: the office of the Administrative Agent specified in Section 9.2 or such other
office as may be specified from time to time by the Administrative Agent as its funding office by
written notice to the Borrower and the Lenders.



     “GAAP”:
generally accepted accounting principles in the United States as in effect from time to
time, except that for purposes of Section 6.1, GAAP shall be determined on the basis of such
principles in effect on the date hereof and consistent with those used in the preparation of the
most recent audited financial statements referred to in Section 3.1. In the event that any
“Accounting Change” (as defined below) shall occur and such change results in a change in the
method of calculation of financial covenants, standards or terms in this Agreement, then the
Borrower and the Administrative Agent agree to enter into negotiations in order to amend such
provisions of this Agreement so as to reflect equitably such Accounting Changes with the desired
result that the criteria for evaluating the financial condition of the Borrower shall be the same
after such Accounting Changes as if such Accounting Changes had not been made. Until such time as
such an amendment shall have been executed and delivered by the Borrower, the Administrative Agent
and the Required Lenders, all financial covenants, standards and terms in this Agreement shall
continue to be calculated or construed as if such Accounting Changes had not occurred. “Accounting
Changes” refers to changes in accounting principles required by the promulgation of any rule,
regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American
Institute of Certified Public Accountants or, if applicable, the SEC.



     “Governmental Authority”: any nation or government, any state or other political
subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
functions of or pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).



     “Group Members”: the collective reference to Novellus and its Subsidiaries.



     “Guarantee Obligation”: as to any Person (the “guaranteeing person”), any obligation,
including a reimbursement, counterindemnity or similar obligation, of the guaranteeing person that
guarantees or in effect guarantees, or which is given to induce the creation of a separate
obligation by another Person (including any bank under any letter of credit) that guarantees or in
effect guarantees, any Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or
indirectly, including any obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any such primary
obligation of the



10









 




ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to
assure or hold harmless the owner of any such primary obligation against loss in respect thereof;
provided, however, that the term Guarantee Obligation shall not include endorsements of instruments
for deposit or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the
stated or determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary
obligation and the maximum amount for which such guaranteeing person may be liable are not stated
or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing
person’s maximum reasonably anticipated liability in respect thereof as determined by Novellus in
good faith.




     “Guarantors”: each Domestic Subsidiary of the Borrower identified as a “Guarantor” on the signature
pages hereto and each other Person that joins as a Guarantor pursuant to Section 5.8 together with
their successors and permitted assigns.



     “Guaranty”: the Guaranty made by the Guarantors in favor of the Administrative Agent and the
Lenders pursuant to Section 10.



     “Indebtedness”: of any Person at any date, without duplication, (a) all indebtedness of such Person
for borrowed money, (b) all obligations of such Person for the deferred purchase price of property
or services (other than current trade payables incurred in the ordinary course of such Person’s
business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all indebtedness created or arising under any conditional sale or other
title retention agreement with respect to property acquired by such Person (even though the rights
and remedies of the seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all capital lease obligations of such Person,
(f) all obligations of such Person, contingent or otherwise, as an account party or applicant under
or in respect of acceptances, letters of credit, surety bonds or similar arrangements, (g) the
redemption value of all redeemable preferred Capital Stock of such Person, (h) all Guarantee
Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through
(g) above, (i) all obligations of the kind referred to in clauses (a) through (h) above secured by
(or for which the holder of such obligation has an existing right, contingent or otherwise, to be
secured by) any Lien on property (including accounts and contract rights) owned by such Person,
whether or not such Person has assumed or become liable for the payment of such obligation, and (j)
for the purposes of Section 7(e) only, all obligations of such Person in respect of Swap Agreements
(calculated on a mark-to-market basis). The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the terms of such
Indebtedness expressly provide that such Person is not liable therefor.



     “Information”: as defined in Section 9.12.



11









 





     “Insolvency”: with respect to any Multiemployer Plan, the condition that such Plan is insolvent
within the meaning of Section 4245 of ERISA.



     “Insolvent”: pertaining to a condition of Insolvency.



     “Intellectual Property”: the collective reference to all rights, priorities and privileges relating
to intellectual property, whether arising under United States, multinational or foreign laws or
otherwise, including copyrights, copyright licenses, patents, patent licenses, trademarks,
trademark licenses, technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive all proceeds and
damages therefrom.



     “Interest Payment Date”: (a) as to any Base Rate Loan (including a Swing Line Loan), the
last day of each March, June, September and December to occur while such Base Rate Loan is
outstanding, the date of any repayment or prepayment made in respect thereof and the Revolving
Termination Date, as applicable, (b) as to any Eurodollar Loan having an Interest Period of three
months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an
Interest Period longer than three months, each day that is three months, or a whole multiple
thereof, after the first day of such Interest Period and the last day of such Interest Period and
(d) as to any Eurodollar Loan, the date of any repayment or prepayment made in respect thereof and
the Revolving Termination Date, as applicable.

     “Interest Period”: as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing
or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two,
three or six (or, if available to all Lenders) nine months thereafter, as selected by the Borrower
in its Loan Notice given with respect thereto; and (b) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one,
two, three or six (or, if available to all Lenders) nine months thereafter, as selected by the
Borrower by irrevocable notice to the Administrative Agent not later than 11:00 A.M., on the date
that is three Business Days prior to the last day of the then current Interest Period with respect
thereto; provided that, all of the foregoing provisions relating to Interest Periods are
subject to the following:




     (i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless the result of such extension
would be to carry such Interest Period into another calendar month in which event such Interest
Period shall end on the immediately preceding Business Day;




     (ii) the Borrower may not select an Interest Period that would extend beyond the Revolving
Termination Date;




     (iii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month; and



12









 






     (iv) the Borrower shall select Interest Periods so as not to require a payment or prepayment
of any Eurodollar Loan during an Interest Period for such Revolving Loan.



     “Investment”: as to any Person, any direct or indirect acquisition or investment by such Person,
whether by means of (a) the purchase or other acquisition of Capital Stock of another Person, (b) a
loan, advance or capital contribution to, Guarantee Obligation or assumption of debt of, or
purchase or other acquisition of any other debt or equity participation or interest in, another
Person, including any partnership or joint venture interest in such other Person and any
arrangement pursuant to which the investor guarantees Indebtedness of such other Person, or (c) an
Acquisition. For purposes of covenant compliance, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or decreases in the value of such
Investment (other than by virtue of repayment thereof).



     “Involuntary Disposition”: any loss or destruction of, or any condemnation or other taking
for public use of, any property of any Loan Party or any of its Subsidiaries.



     “Joinder Agreement”: a joinder agreement substantially in the form of Exhibit G executed and
delivered by a Domestic Subsidiary in accordance with the provisions of Section 5.8.



     “Lenders”: as defined in the preamble hereto and “Lender” means any one of them; provided, that
unless the context otherwise requires, each reference herein to the Lenders shall be deemed to
include any Swing Line Lender.



     “License and Manufacturing Transactions”: those transactions entered into pursuant to
agreements in place on or prior to the Closing Date (and any amendments or modifications thereto)
among the Borrower and/or its Subsidiaries, entered into on an arm’s length basis, related to the
licensing of intellectual property, manufacturing of products or provision of administration
services.



     “Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), charge or other security interest or any preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement and any capital lease having substantially the
same economic effect as any of the foregoing).



     “Loan”: an extension of credit by a Lender to the Borrower under Section 2 in the form of a
Revolving Loan or a Swing Line Loan.



     “Loan Documents”: this Agreement, the Notes, the Fee Letter, any security agreement and/or control
agreement delivered to the Administrative Agent pursuant to Section 2.19 and any amendment, waiver,
supplement or other modification to any of the foregoing.



13









 





     “Loan Notice”: a notice of (a) a borrowing of Loans, (b) a conversion of Loans from one Type to the
other, or (c) a continuation of Eurodollar Loans which, if in writing, shall be substantially in
the form of Exhibit E.



     “Loan Parties”: collectively, the Borrower and each Guarantor, and “Loan Party” means any one of
them.



     “Marketable Securities”: at any date, all amounts that would, in conformity with GAAP, be
categorized as “Marketable Securities” on a consolidated balance sheet of Novellus and its
Subsidiaries at such date.



     “Material Adverse Effect”: a material adverse effect on (a) the business, assets,
liabilities (actual or contingent), operations or financial condition of Novellus and its
Subsidiaries taken as a whole or (b) the validity or enforceability of this Agreement or any of the
other Loan Documents or the rights or remedies of the Administrative Agent or the Lenders hereunder
or thereunder.



     “Materials of Environmental Concern”: any gasoline or petroleum (including crude oil or any
fraction thereof) or petroleum products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Law, including friable asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.



     “Material Subsidiary” means, as of any date of determination, any Subsidiary of the
Borrower that (a) has on such date total assets constituting ten percent or more of Consolidated
Total Assets or (ii) for the four fiscal quarter period most recently ended has revenues
constituting ten percent or more of the consolidated revenues of the Borrower and its Subsidiaries
for such period, as determined in accordance with GAAP.



     “Moody’s
”: Moody’s Investors Service, Inc. and any successor thereto.



     “Multiemployer Plan”: a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.



     “Non-Excluded Taxes”: as defined in Section 2.13(a).


     “Non-Guarantor Subsidiary”: any Subsidiary that has not guaranteed, and is not
required hereunder to guarantee, the Obligations pursuant to the Guaranty.



     “Non-U.S. Lender”: as defined in Section 2.13(d).



     “Note” or “Notes”: the Revolving Notes and/or the Swing Line Note, individually or collectively, as
appropriate.



     “Novellus”: as defined in the preamble hereto.



14









 





     “Novellus China”: any and all of (i) Novellus Systems International Trading (Shanghai) Co., Ltd.,
(ii) Novellus Systems (H.K.) Ltd. and (iii) Novellus Systems Semiconductor Equipment (Shanghai)
Co., Ltd.



     “Novellus Japan”: any and all of (i) Novellus Systems Japan G.K. and (ii) Novellus Systems Japan.



     “Novellus Singapore”: any and all of (i) Novellus Systems International BV and (ii) Novellus
Singapore Holdings PTE. LTD.



     “Obligations”: the unpaid principal of and interest on (including interest accruing after the
maturity of the Loans and interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the
Loans and all other obligations and liabilities of any Loan Party to the Administrative Agent or to
any Lender, whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document or any other document made, delivered or given in connection
herewith or therewith, whether on account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including all fees, charges and disbursements of counsel to the
Administrative Agent or to any Lender that are required to be paid by any Loan Party pursuant
hereto) or otherwise.



     “Other Taxes”: any and all present or future stamp or documentary taxes or any other excise or
property taxes, charges or similar levies arising from any payment made hereunder or from the
execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.



     “Participant”: as defined in Section 9.6(d).



     “PBGC”: the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of
ERISA (or any successor).



     “Permitted Acquisitions”: Investments consisting of an Acquisition by any Loan Party,
provided that (i) no Default shall have occurred and be continuing or would result from
such Acquisition, (ii) the property acquired (or the property of the Person acquired) in such
Acquisition is used or useful in the same or a similar line of business as the Borrower and its
Subsidiaries were engaged in on the Closing Date (or any reasonable extensions or expansions
thereof), (iii) in the case of an Acquisition of the Capital Stock of another Person, the board of
directors (or other comparable governing body) of such other Person shall have duly approved such
Acquisition, (iv) the Borrower shall have delivered to the Administrative Agent a Compliance
Certificate demonstrating that, upon giving effect to such Acquisition on a pro forma basis, the
Loan Parties would be in compliance with the financial covenants set forth in Section 6.1 as of the
most recent fiscal quarter for which the Borrower was required to deliver financial statements
pursuant to Section 5.1, (v) the representations and warranties made by the Loan Parties in Section
3 shall be true and correct in all material respects at and as if made as of



15









 




the date of such Acquisition (after giving effect thereto) except to the extent such
representations and warranties expressly relate to an earlier date, (v) if such transaction
involves the purchase of an interest in a partnership between the Borrower (or a Subsidiary) as a
general partner and entities Unaffiliated with the Borrower or such Subsidiary as the other
partners, such transaction shall be effected by having such equity interest acquired by a corporate
holding company directly or indirectly wholly-owned by the Borrower newly formed for the sole
purpose of effecting such transaction, and (vi) if the Consolidated Leverage Ratio (calculated on a
pro forma basis after giving effect to such Acquisition) is greater than 2.5 to 1.0, the aggregate
cash consideration paid by the Loan Parties for all such Acquisitions occurring during the term of
this Agreement shall not exceed $1,000,000,000, it being understood and agreed that (a) if the
Consolidated Leverage Ratio (calculated on a pro forma basis after giving effect to such
Acquisition) is less than or equal to 2.5 to 1.0 or (b) if the Borrower provides Cash Collateral to
secure the Obligations in accordance with Section 2.19, there shall be no limit on the amount of
cash consideration paid for such Acquisition.




     “Person”: an individual, partnership, corporation, limited liability company, business trust, joint
stock company, trust, unincorporated association, joint venture, Governmental Authority or other
entity of whatever nature.



     “Plan”: at a particular time, any employee benefit plan that is covered by ERISA and in respect of
which Novellus or a Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an
“employer” as defined in Section 3(5) of
ERISA.



     “Platform”: as defined in Section 5.2.



     “Priority Debt Amount”: as at any date of determination, the sum (without duplication) of
(a) the aggregate principal amount outstanding of Indebtedness of the Borrower and its Subsidiaries
secured by a Lien on any asset or property of the Borrower or any Subsidiary plus (b) the
aggregate principal amount outstanding of all unsecured Indebtedness of Non-Guarantor Subsidiaries
(other than any unsecured Indebtedness owing by any Non-Guarantor Subsidiary to any Loan Party)
plus (c) the aggregate principal amount outstanding of purchase money Indebtedness of the
Borrower or any of its Subsidiaries to finance the purchase of fixed assets, and renewals,
refinancings and extensions thereof; provided that the aggregate principal amount of all
Indebtedness that is cash collateralized shall be excluded from the calculation of Priority Debt
Amount.



     “Properties”: as defined in Section 3.16(a).




     “Public Lender”: as defined in Section 5.2.



     “Qualified Receivables Transaction”: means any transaction or series of transactions that
may be entered into by Novellus Japan, Novellus China or Novellus Singapore pursuant to which
Novellus Japan, Novellus China or Novellus Singapore may sell, convey or otherwise transfer to any
Person, or may grant a security interest in, any Receivables Program Assets (whether now existing
or arising in the future).



16









 





     “Quick Assets”: at any date, the sum of (a) unrestricted cash plus (b) unrestricted Marketable
Securities plus (c) unrestricted accounts receivable of Novellus and its Subsidiaries at such date.



     “Quick Ratio”: at any date, the ratio of (a) Quick Assets at such date to (b) Consolidated Current
Liabilities at such date less the aggregate amount of such Consolidated Current Liabilities that
are collateralized by cash as of such date.



     “Receivables”: all rights of Novellus Japan, Novellus China or Novellus Singapore to payments
(whether constituting accounts, chattel paper, instruments, general intangibles or otherwise, and
including the right to payment of any interest or finance charges), which rights are identified in
the accounting records of Novellus Japan, Novellus China or Novellus Singapore as accounts
receivable.



     “Receivables Documents”: (a) a receivables purchase agreement, pooling and servicing
agreement, credit agreement, agreements to acquire undivided interests or other agreement to
transfer, or create a security interest in, Receivables Program Assets, in each case as amended,
modified, supplemented or restated and in effect from time to time entered into by Novellus Japan,
Novellus China or Novellus Singapore and (b) each other instrument, agreement and other document
entered into by Novellus Japan, Novellus China or Novellus Singapore relating to the transactions
contemplated by the items referred to in clause (b) above, in each case as amended, modified,
supplemented or restated and in effect from time to time.



     “Receivables Program Assets”: means (a) all Receivables which are described as being
transferred by Novellus Japan, Novellus China or Novellus Singapore pursuant to the Receivables
Documents, (b) all Receivables Related Assets, and (c) all collections (including recoveries) and
other proceeds of the assets described in the foregoing clauses.



     “Receivables Related Assets”: any rights arising under the documentation governing or
relating to Receivables (including rights in respect of liens securing such Receivables and other
credit support in respect of such Receivables), (ii) any proceeds of such Receivables and any
lockboxes or accounts in which such proceeds are deposited, (iii) spread accounts and other similar
accounts (and any amounts on deposit therein) established in connection with a Qualified
Receivables Transaction, (iv) any warranty, indemnity, dilution and other intercompany claim
arising out of Receivables Documents and (v) other assets which are customarily transferred or in
respect of which security interests are customarily granted in connection with sale of receivables
transactions involving accounts receivable.



     “Register”: as defined in Section 9.6(c).



     “Regulation U”: Regulation U of the Board as in effect from time to time.



     “Related Parties”: with respect to any Person, such Person’s Affiliates and the partners,
directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.



     “Reorganization”: with respect to any Multiemployer Plan, the condition that such plan is in
reorganization within the meaning of Section 4241 of ERISA.



17









 





     “Reportable Event”: any of the events set forth in Section 4043(c) of ERISA, other than
those events as to which the PBGC by regulation has waived the thirty day notice requirement under
Section 4043(a) of ERISA.



     “Required Lenders”: at any time, the holders of more than 50% of the Total Revolving Commitments
then in effect or, if the Revolving Commitments have been terminated, the Total Revolving
Extensions of Credit then outstanding. The unfunded Revolving Commitments of, and the outstanding
Loans held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.



     “Requirement of Law”: as to any Person, the Certificate of Incorporation and By-Laws or other
organizational or governing documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or any of its
property is subject.



     “Responsible Officer”: the chief executive officer, president or chief financial officer of
Novellus, but in any event, with respect to financial matters, the chief financial officer of
Novellus.



     “Restricted Payment”: any dividend or other distribution (whether in cash, securities or other
property) with respect to any Capital Stock of any Loan Party or any Subsidiary, or any payment
(whether in cash, securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or termination of any
such Capital Stock or on account of any return of capital to the Borrower’s stockholders, partners
or members (or the equivalent Person thereof), or any setting apart of funds or property for any of
the foregoing.



     “Revolving Commitment”: as to any Lender, the obligation of such Lender to (a) make
Revolving Loans and (b) purchase participations in Swing Line Loans in an aggregate principal
amount not to exceed the amount set forth under the heading “Revolving Commitment” opposite such
Lender’s name on Schedule 1.1(a) or in the Assignment and Assumption pursuant to which such Lender
became a party hereto, as the same may be changed from time to time pursuant to the terms hereof.
The original amount of the Total Revolving Commitments is $150,000,000.



     “Revolving Commitment Period”: the period from and including the Closing Date to the
Revolving Termination Date.



     “Revolving Extensions of Credit”: as to any Lender at any time, an amount equal to the
aggregate principal amount of all Revolving Loans held by such Lender then outstanding.



     “Revolving Loans”: as defined in Section 2.1(a).



     “Revolving Note”: as defined in Section 2.1l(g).



18









 





     “Revolving Percentage”: as to any Lender at any time, the percentage which such Lender’s
Revolving Commitment then constitutes of the Total Revolving Commitments or, at any time after the
Revolving Commitments shall have expired or terminated, the percentage which the aggregate
principal amount of such Lender’s Revolving Loans then outstanding constitutes of the aggregate
principal amount of the Revolving Loans then outstanding.



     “Revolving
Termination Date”: December 26, 2011.



     “S&P”: Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any
successor thereto.



     “Sarbanes-Oxley”: the Sarbanes-Oxley Act of 2002.



     “SEC”: the Securities and Exchange Commission, any successor thereto and any analogous Governmental
Authority.



     “Securitization Transaction” means, with respect to any Person, any financing transaction
or series of financing transactions pursuant to which such Person or any Subsidiary of such Person
may sell, convey or otherwise transfer, or grant a security interest in, accounts, payments,
receivables, rights to future lease payments or residuals or similar rights to payment to a special
purpose subsidiary or affiliate of such Person.



     “Single
Employer Plan”: any Plan that is covered by Title IV of ERISA, but that is not a
Multiemployer Plan.



     “Solvent”: when used with respect to any Person, means that, as of any date of determination, (a)
the amount of the “present fair saleable value” of the assets of such Person will, as of such date,
exceed the amount of all “liabilities of such Person, contingent or otherwise”, as of such date, as
such quoted terms are determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be required to pay the
liability of such Person on its debts as such debts become absolute and matured, (c) such Person
will not have, as of such date, an unreasonably small amount of capital with which to conduct its
business, and (d) such Person will be able to pay its debts as they mature. For purposes of this
definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to
payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise to a right to
payment, whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.



     ”Subsidiary”: as to any Person, a corporation, partnership, limited liability company or other
entity of which shares of stock or other ownership interests having ordinary voting power (other
than stock or such other ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of



19









 




such corporation, partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such
Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this
Agreement shall refer to a Subsidiary or Subsidiaries of Novellus.




     “Swap Agreement”: any agreement with respect to any swap, forward, future or derivative transaction
or option or similar agreement involving, or settled by reference to, one or more rates,
currencies, commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom stock or
similar plan providing for payments only on account of services provided by current or former
directors, officers, employees or consultants of Novellus or any of
its Subsidiaries shall be a “Swap Agreement”.



     “Swing Line”: the revolving credit facility made available by the Swing Line Lender pursuant to
Section 2.17.



     “Swing Line Borrowing”: a borrowing of a Swing Line Loan pursuant to Section 2.17.



     “Swing Line Lender”: Bank of America in its capacity as provider of Swing Line Loans, or any
successor swing line lender hereunder.



     “Swing Line Loan”: as defined in Section 2.17(a).

      “Swing Line Note”: as defined in Section 2.11(g).



     “Swing Line Loan Notice”: a notice of a Swing Line Borrowing pursuant to Section 2.17(b),
which, if in writing, shall be substantially in the form of Exhibit F.



     “Swing Line Sublimit”: an amount equal to the lesser of (a) $25,000,000 and (b) the Total
Revolving Commitments. The Swing Line Sublimit is part of, and not in addition to, the Total
Revolving Commitments.



     “Total Revolving Commitments”: at any time, the aggregate amount of the Revolving
Commitments then in effect.



     “Total Revolving Extensions of Credit”: at any time, the aggregate amount of the Revolving
Extensions of Credit outstanding at such time.



     “Transferee”: any Eligible Assignee or Participant.



     “Type”: as to any Revolving Loan, its nature as an Base Rate Loan or a Eurodollar Loan.



     “United States”: the United States of America.



20









 





     “Voting Stock”: with respect to any Person, Capital Stock issued by such Person the holders
of which are ordinarily, in the absence of contingencies, entitled to vote for the election of
directors (or persons performing similar functions) of such Person, even though the right so to
vote has been suspended by the happening of such a contingency.



     1.2 Other Definitional Provisions.



     (a) Unless otherwise specified therein, all terms defined in this Agreement shall
have the defined meanings when used in the other Loan Documents or any certificate or other
document made or delivered pursuant hereto or thereto.



     (b) As used herein and in the other Loan Documents, and any certificate or other document
made or delivered pursuant hereto or thereto, (i) accounting terms relating to any Group Member not
defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not
defined, shall have the respective meanings given to them under GAAP, (ii) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (iii)
the word “incur” shall be construed to mean incur, create, issue, assume, become liable in respect
of or suffer to exist (and the words “incurred” and “incurrence” shall have correlative meanings),
(iv) the words “asset” and “property” shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including cash, Capital Stock,
securities, revenues, accounts, leasehold interests and contract rights, and (v) references to
agreements or other Contractual Obligations shall, unless otherwise specified, be deemed to refer
to such agreements or Contractual Obligations as amended, supplemented, restated or otherwise
modified from time to time.



     (c) The
words “hereof” “herein” and “hereunder” and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise
specified.



     (d) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.



     (e) Unless otherwise specified, all references herein to times of day shall be references to
Pacific time (daylight or standard, as applicable).



     SECTION 2. AMOUNT AND TERMS OF REVOLVING COMMITMENTS 



     2.1
Revolving Commitments.



     (a) Subject to the terms and conditions hereof, each Lender severally agrees to make
revolving credit loans (“Revolving Loans”) in Dollars to the Borrower from time to time during the
Revolving Commitment Period in an aggregate principal amount at any one time outstanding that does
not exceed the amount of such Lender’s Revolving Commitment;
provided, however, that after
giving effect to any borrowing of Revolving Loans, (i) the aggregate principal amount of Revolving
Loans and Swing Line Loans outstanding shall not exceed the Total Revolving



21









 




Commitments and (ii) the aggregate principal amount of Revolving Loans outstanding of any Lender,
plus such Lender’s Revolving Percentage of the outstanding amount of all Swing Line Loans
shall not exceed such Lender’s Revolving Commitment. During the Revolving Commitment Period, the
Borrower may use the Revolving Commitments by borrowing, prepaying the Revolving Loans in whole or
in part, and reborrowing, all in accordance with the terms and conditions hereof. The Revolving
Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower
and notified to the Administrative Agent in accordance with Sections 2.2 and 2.6. All borrowings of
Revolving Loans made on the Closing Date shall be made as Base Rate Loans.




     (b) The Borrower shall repay all outstanding Revolving Loans on the Revolving Termination
Date.



     (c) The Borrower may at any time and from time to time, upon 15 days prior written notice by
the Borrower to the Administrative Agent, increase the Total Revolving Commitments by up to ONE
HUNDRED MILLION DOLLARS ($100,000,000) with additional Revolving Commitments from any existing
Lender or new Revolving Commitments from any other Person selected by the Borrower and approved by
the Administrative Agent; provided that:




     (i) any such increase shall be in a minimum principal amount of $5,000,000 and in integral
multiples of $1,000,000 in excess thereof and the Borrower may make a maximum of three requests;




     (ii) no Default or Event of Default shall exist and be continuing at the time of any such increase;




     (iii) no existing Lender shall be under any obligation to increase its Revolving Commitment and any
such decision whether to increase its Revolving Commitment shall be in such Lender’s sole and
absolute discretion;




     (iv) (A) any new Lender shall join this Agreement by executing such joinder documents reasonably
required by the Administrative Agent and/or (B) any existing Lender electing to increase its
Revolving Commitment shall have executed a commitment agreement satisfactory to the Administrative
Agent; and




     (v) as a condition precedent to such increase, the Borrower shall deliver to the Administrative
Agent a certificate dated as of the date of such increase signed by a Responsible Officer of each
Loan Party (A) certifying and attaching the resolutions adopted by such Loan Party approving or
consenting to such increase or the resultant increased amount, and (B) certifying that, before and
after giving effect to such increase, (1) the representations and warranties contained in Section 3
and the other Loan Documents are true and correct in all material respects on and as of the date of
such increase, except to the extent that such representations and warranties specifically refer to
an earlier date, in which case they are true and correct in all material respects as of such
earlier date, and except that for purposes of this Section 2.1(c), the representations and



22









 






warranties contained in Section 3.1 shall be deemed to refer to the most recent statements
furnished pursuant to Section 5.1, and (2) no Default or Event of Default exists.



     The Borrower shall prepay any Loans owing by it and outstanding on the date of any such increase to
the extent necessary to keep the outstanding Revolving Loans ratable with any revised Revolving
Commitments arising from any nonratable increase in the Revolving Commitments under this Section.
In connection with any such increase in the Total Revolving Commitments, Schedule 1.1 (a) shall be
revised by the Administrative Agent to reflect the new Revolving Commitments.



     2.2 Procedure for Revolving Loan Borrowing.



     (a) The Borrower may borrow under the Revolving Commitments during the Revolving Commitment
Period on any Business Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice may be given by telephone and must be received by the
Administrative Agent prior to 11:00 A.M., (a) three Business Days prior to the requested Borrowing
Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the requested Borrowing
Date, in the case of Base Rate Loans) specifying (i) the amount and Type of Revolving Loans to be
borrowed, (ii) the requested Borrowing Date and (iii) in the case of Eurodollar Loans, the
respective amounts of each such Type of Loan and the respective lengths of the initial Interest
Period therefor. Each telephonic notice by the Borrower pursuant to this Section 2.2 must
be confirmed promptly by delivery to the Administrative Agent of a written Loan Notice,
appropriately completed and signed by a Responsible Officer of the Borrower. Each borrowing under
the Revolving Commitments shall be in an amount equal to $500,000 or a whole multiple of $100,000
in excess thereof. If the Borrower fails to specify a Type of a Loan in a Loan Notice or if the
Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable
Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base
Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect
to the applicable Eurodollar Loans. If a Borrower requests a borrowing of, conversion to, or
continuation of Eurodollar Loans in any Loan Notice, but fails to specify an Interest Period, it
will be deemed to have specified an Interest Period of one month.



     (b) Upon receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender thereof. Each Lender will make the amount of its pro rata share of each borrowing available
to the Administrative Agent for the account of the Borrower at the Funding Office prior to 12:00
Noon, on the Borrowing Date requested by the Borrower in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to the Borrower by the
Administrative Agent either by (i) crediting the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Administrative Agent by the Lenders
and in like funds as received by the Administrative Agent or (ii) wire transfer of such funds, in
each case in accordance with instructions provided to (and reasonably acceptable to) the
Administrative Agent by the Borrower.



     2.3 Commitment Fees, etc.



23









 





     (a) The Borrower agrees to pay to the Administrative Agent for the account of each relevant
Lender a commitment fee (the “Commitment Fee”), computed at the Applicable Margin times the
actual daily amount by which the Total Revolving Commitments exceed the sum of the Revolving Loans
outstanding. The Commitment Fee shall accrue at all times until the last day of the Revolving
Commitment Period and shall be payable quarterly in arrears on each Fee Payment Date, commencing on
the first such date to occur after the date hereof. For purposes of clarification, Swing Line Loans
shall not be considered outstanding for purposes of determining the unused portion of the Total
Revolving Commitments.



     (b) The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on
the dates as set forth in the Fee Letter and to perform any other obligations contained therein.



     2.4 Termination or Reduction of Revolving Commitments. The Borrower shall have the
right, upon notice to the Administrative Agent, to terminate the Revolving Commitments or, from
time to time, to reduce the amount of the Revolving Commitments; provided that (a) any such
notice shall be received by the Administrative Agent not later than 11:00 A.M. three Business Days
prior to the date of termination or reduction and (b) no such termination or reduction of Revolving
Commitments shall be permitted if, after giving effect thereto and to any concurrent prepayments
hereunder, the aggregate principal amount of Revolving Loans and Swing Line Loans outstanding
shall exceed the Total Revolving Commitments and (c) the Borrower shall not terminate or reduce
the Swing Line Sublimit if, after giving effect thereto and to any concurrent prepayments hereunder
the outstanding amount of Swing Line Loans would exceed the Swing Line Sublimit. Any such reduction
shall be in an amount equal to $5,000,000, or any whole multiple of $1,000,000 in excess thereof,
and shall reduce permanently the Revolving Commitments then in effect.



     2.5 Optional Prepayments.



     (a) The Borrower may at any time and from time to time prepay the Revolving Loans made to
it, in whole or in part, without premium or penalty, upon irrevocable notice delivered to the
Administrative Agent no later than 11:00 A,M., three Business Days prior thereto, in the case of
Eurodollar Loans, and no later than 11:00 A.M., one Business Day prior thereto, in the case of Base
Rate Loans, which notice shall specify the date and amount of prepayment and whether the prepayment
is of Eurodollar Loans or Base Rate Loans; provided, that if a Eurodollar Loan is prepaid
on any day other than the last day of the Interest Period applicable thereto, the Borrower shall
also pay any amounts owing pursuant to Section 2.14. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable on the date specified therein, together
with accrued interest to such date on the amount prepaid. Partial prepayments of Revolving Loans
shall be in an aggregate principal amount of $500,000 or a whole multiple of $100,000 in excess
thereof.



     (b) The Borrower may, upon notice to the Swing Line Lender (with a copy to the
Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in
whole or in part without premium or penalty; provided that (A) such notice must be received
by



24









 




the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the date of the
prepayment, and (B) any such prepayment shall be in a minimum principal amount of $100,000. Each
such notice shall specify the date and amount of such prepayment. If such notice is given by the
Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice
shall be due and payable on the date specified therein.




     2.6 Conversion and Continuation Options.



     (a) The Borrower may elect from time to time to convert Eurodollar Loans to Base Rate
Loans by giving the Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., on the Business Day preceding the proposed conversion date (which notice may be given
by telephone); provided that any such conversion of Eurodollar Loans may only be made on
the last day of an Interest Period with respect thereto. The Borrower may elect from time to time
to convert Base Rate Loans to Eurodollar Loans by giving the Administrative Agent prior irrevocable
notice of such election no later than 11:00 A.M., on the third Business Day preceding the proposed
conversion date (which notice may be given by telephone and shall specify the length of the
Interest Period therefor), provided that no Base Rate Loan may be converted into a
Eurodollar Loan when any Event of Default has occurred and is continuing and the Required Lenders
have determined in their sole discretion not to permit such conversions. Each telephonic notice by
the Borrower pursuant to this Section 2.6(a) must be confirmed promptly by delivery to the
Administrative Agent of a written Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower. Upon receipt of any such notice the Administrative Agent shall promptly
notify each Lender thereof.



     (b) Any Eurodollar Loan may be continued as such upon the expiration of the then current
Interest Period with respect thereto by the Borrower giving irrevocable notice to the
Administrative Agent (which notice may be given by telephone), in accordance with the applicable
provisions of the term “Interest Period” set forth in Section 1.1, of the length of the next
Interest Period to be applicable to such Revolving Loans, provided that no Eurodollar Loan
may be continued as such when any Event of Default has occurred and is continuing and the Required
Lenders have determined in their sole discretion not to permit such continuations, and
provided, further, that if the Borrower shall fail to give any required notice as described
above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso
such Revolving Loans shall be automatically converted to Base Rate Loans on the last day of such
then expiring Interest Period. Each telephonic notice by the Borrower pursuant to this Section
2.6(b) must be confirmed promptly by delivery to the Administrative Agent of a written Loan Notice,
appropriately completed and signed by a Responsible Officer of the Borrower. Upon receipt of any
such notice the Administrative Agent shall promptly notify each Lender thereof.



     2.7
Limitations on Eurodollar Tranches. Notwithstanding anything to the contrary in
this Agreement, all borrowings, conversions and continuations of Eurodollar Loans and all
selections of Interest Periods shall be in such amounts and be made pursuant to such elections so
that, (a) after giving effect thereto, the aggregate principal amount of the Eurodollar Loans
comprising each Eurodollar Tranche shall be equal to $500,000 or a whole multiple of $100,000 in
excess thereof and (b) no more than ten Eurodollar Tranches shall be outstanding at any one time.



25









 





     2.8 Interest Rates and Payment Dates.



     (a) Each Eurodollar Loan shall bear interest for each day during each Interest Period with
respect thereto at a rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin. Each Base Rate Loan shall bear interest at a rate per annum equal to the Base
Rate. Each Swing Line Loan shall bear interest on the outstanding principal thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate.



     (b) If (i) all or a portion of the principal amount of any Revolving Loan shall not be paid
when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall
bear interest at a rate per annum equal to the rate that would otherwise be applicable thereto
pursuant to the foregoing provisions of this Section plus 2% or, and (ii) all or a portion of any
interest payable on any Revolving Loan or any commitment fee or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such
overdue amount shall bear interest at a rate per annum equal to the rate then applicable to Base
Rate Loans plus 2%, in each case, with respect to clauses (i) and (ii) above, from the date of such
non-payment until such amount is paid in full (as well after as before judgment).



     (c) Upon the request of the Required Lenders, while any Event of Default exists, the Borrower
shall pay interest on the principal amount of all outstanding Obligations (other than those
Obligations that are then accruing default interest pursuant to Section 2.8(b) above) hereunder at
a fluctuating interest rate per annum at all times equal to the rate that would otherwise be
applicable thereto plus 2% to the fullest extent permitted by applicable law.



     (d) Interest shall be payable in arrears on each Interest Payment Date, provided that
interest accruing pursuant to paragraphs (b) and (c) of this Section shall be payable from time to
time on demand.



     2.9 Computation of Interest and Fees.



     (a) Interest and fees payable pursuant hereto shall be calculated on the basis of a 360-day
year for the actual days elapsed, except that, with respect to Base Rate Loans the rate of interest
on which is calculated on the basis of Bank of America’s “prime rate”, the interest thereon shall
be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed. The Administrative Agent shall as soon as practicable notify the Borrower and the Lenders
of each determination of a Eurodollar Rate. Any change in the interest rate on a Revolving Loan
resulting from a change in the Base Rate or Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes effective. The
Administrative Agent shall as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each such change in interest rate.




26









 





     (b) Each determination of an interest rate by the Administrative Agent pursuant to any provision of
this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of
manifest error.



     2.10 Inability to Determine Interest Rate. If prior to the first day of any Interest
Period:



     (a) the Administrative Agent shall have determined (which determination shall be conclusive
and binding upon the Borrower) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate for such Interest
Period, or



     (b) the Administrative Agent shall have received notice from the Required Lenders that the
Eurodollar Rate determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or
maintaining their affected Revolving Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the
Lenders as soon as practicable thereafter. If such notice is given (x) any Eurodollar Loans
requested to be made on the first day of such Interest Period shall be made as Base Rate Loans, (y)
any Revolving Loans that were to have been converted on the first day of such Interest Period to
Eurodollar Loans shall be continued as Base Rate Loans and (z) any outstanding Eurodollar Loans
shall be converted, on the last day of the then-current Interest Period, to Base Rate Loans. Until
such notice has been withdrawn by the Administrative Agent, no further Eurodollar Loans shall be
made or continued as such, nor shall the Borrower have the right to convert Revolving Loans to
Eurodollar Loans.



     2.11 Pro Rata Treatment and Payments.



     (a) Each borrowing by the Borrower from the Lenders hereunder, each payment by the Borrower
on account of any commitment fee and any reduction of the Revolving Commitments of the Lenders
shall be made pro rata according to the Revolving Percentages of the Lenders.



     (b) Each payment (including each prepayment) by the Borrower on account of principal of and
interest on the Revolving Loans made to it shall be made pro rata according to the respective
outstanding principal amounts of the Revolving Loans then held by the Lenders.



     (c) All payments (including prepayments) to be made by the Borrower hereunder, whether on
account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and
shall be made prior to 12:00 Noon, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in immediately available funds. The
Administrative Agent shall distribute such payments to the Lenders promptly upon receipt in like
funds as received. If any payment hereunder (other than payments on the Eurodollar Loans) becomes
due and payable on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day. If any payment on a



27









 




Eurodollar Loan becomes due and payable on a day other than a Business Day, the maturity thereof
shall be extended to the next succeeding Business Day unless the result of such extension would be
to extend such payment into another calendar month, in which event such payment shall be made on
the immediately preceding Business Day. In the case of any extension of any payment of principal
pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable
rate during such extension.




     (d) Unless the Administrative Agent shall have been notified in writing by any Lender prior
to a borrowing that such Lender will not make the amount that would constitute its share of such
borrowing available to the Administrative Agent, the Administrative Agent may assume that such
Lender is making such amount available to the Administrative Agent, and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower a corresponding amount. If
such amount is not made available to the Administrative Agent by the required time on the Borrowing
Date therefor, such Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon, at a rate equal to the greater of (i) the Federal Funds Rate and (ii) a rate
determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation, for the period until such Lender makes such amount immediately available to the
Administrative Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest
error. If such Lender’s share of such borrowing is not made available to the Administrative Agent
by such Lender within three Business Days after such Borrowing Date, the Administrative Agent shall
also be entitled to recover such amount with interest thereon at the rate per annum applicable to
Base Rate Loans, on demand, from the Borrower.



     (e) Unless the Administrative Agent shall have been notified in writing by the Borrower
prior to the date of any payment due to be made by the Borrower hereunder that the Borrower will
not make such payment to the Administrative Agent, the Administrative Agent may assume that the
Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in
reliance upon such assumption, make available to the Lenders their respective pro rata shares of a
corresponding amount. If such payment is not made to the Administrative Agent by the Borrower
within three Business Days after such due date, the Administrative Agent shall be entitled to
recover, on demand, from each Lender to which any amount which was made available pursuant to the
preceding sentence, such amount with interest thereon at the rate per annum equal to the daily
average rate of the Federal Funds Rate. Nothing herein shall be deemed to limit the rights of the
Administrative Agent or any Lender against the Borrower.



     (f) The obligations of the Lenders hereunder to make Loans, to fund participations in Swing
Line Loans and to make payments pursuant to Section 9.5 are several and not joint. The failure of
any Lender to make any Loan, to fund any such participation or to make any payment under Section
9.5 on any date required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the failure of any other
Lender to so make its Loan, to purchase its participation or to make its payment under Section
9.5(c).



28









 





     (g) The Loans made by each Lender shall be evidenced by one or more accounts or records maintained
by such Lender and by the Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Loans made by the Lenders to the Borrower and the interest and payments
thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise
affect the obligation of the Borrower hereunder to pay any amount owing with respect to the
Obligations. In the event of any conflict between the accounts and records maintained by any Lender
and the accounts and records of the Administrative Agent in respect of such matters, the accounts
and records of the Administrative Agent shall control in the absence of manifest error. Upon the
request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver
to such Lender (through the Administrative Agent) a promissory note, which shall evidence such
Lender’s Loans in addition to such accounts or records. Each such promissory note shall (i) in the
case of Revolving Loans, be in the form of Exhibit H (a “Revolving Note”) and (ii) in the case of
Swing Line Loans, be in the form of Exhibit I (a “Swing Line Note”). Each Lender may attach
schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of
its Loans and payments with respect thereto.



     2.12 Requirements of Law.



     (a) If the adoption of or any change in any Requirement of Law or in the interpretation or
application thereof or compliance by any Lender with any request or directive (whether or not
having the force of law) from any central bank or other Governmental Authority made subsequent to
the date hereof:




     (i) shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement or
any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by Section 2.13 and changes in the rate of
tax on the overall net income of such Lender);




     (ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or
similar requirement against assets held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other acquisition of funds by, any office
of such Lender that is not otherwise included in the determination of the Eurodollar Rate; or




     (iii) shall impose on such Lender any other condition;


and the result of any of the foregoing is to increase the cost to such Lender, by an amount that
such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar
Loans, or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the
Borrower shall promptly pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount receivable. If any Lender becomes
entitled to claim any additional amounts pursuant to this paragraph, it shall promptly notify the
Borrower (with a copy to the Administrative Agent) of the event by reason of which it has become so
entitled.




29









 








     (b) If any Lender shall have determined that the adoption of or any change in any
Requirement of Law regarding capital adequacy or in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from any Governmental Authority
made subsequent to the date hereof shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations hereunder to a level
below that which such Lender or such corporation could have achieved but for such adoption, change
or compliance (taking into consideration such Lender’s or such corporation’s policies with respect
to capital adequacy) by an amount deemed by such Lender to be material, then from time to time,
after submission by such Lender to the Borrower (with a copy to the Administrative Agent) of a
written request therefor, the Borrower shall pay to such Lender such additional amount or amounts
as will compensate such Lender or such corporation for such reduction.



     (c) A certificate as to any additional amounts payable pursuant to this Section submitted by
any Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive in the
absence of manifest error. Notwithstanding anything to the contrary in this Section, no Borrower
shall be required to compensate a Lender pursuant to this Section for any amounts incurred more than
nine months prior to the date that such Lender notifies the Borrower of such Lender’s intention to
claim compensation therefor; provided that, if the circumstances giving rise to such claim
have a retroactive effect, then such nine-month period shall be extended to include the period of
such retroactive effect. The obligations of the Borrower pursuant to this Section 2.12 shall
survive until the date that is one year after the termination of this Agreement and the payment of
the Revolving Loans and all other amounts payable hereunder.



     2.13 Taxes.



     (a) All payments made by the Borrower under this Agreement shall be made free and clear of, and
without deduction or withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net
income taxes and franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or any Lender as a result of a present or former connection between the
Administrative Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having executed, delivered
or performed its obligations or received a payment under, or enforced, this Agreement or any other
Loan Document). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings (“Non-Excluded Taxes”) or Other Taxes are required to be withheld from any amounts
payable to the Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary to yield to the
Administrative Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes)
interest or any such other amounts payable hereunder at the rates or in the amounts specified in
this Agreement, provided, however, that the Borrower shall not be required to increase any
such amounts payable to any Lender with



30









 




respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply with
the requirements of paragraph (d) or (e) of this Section or (ii) that are United States withholding
taxes imposed on amounts payable to such Lender at the time such Lender becomes a party to this
Agreement, except to the extent that such Lender’s assignor (if any) was entitled, at the time of
assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes
pursuant to this paragraph.




     (b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.



     (c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly
as possible thereafter the Borrower shall send to the Administrative Agent for its own account or
for the account of the relevant Lender, as the case may be, a certified copy of an original
official receipt received by the Borrower showing payment thereof. If the Borrower fails to pay
any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required documentary evidence, the
Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the Administrative Agent or any Lender as a result
of any such failure.



     (d) Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section
7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the Borrower and the Administrative
Agent (or, in the case of a Participant, to the Lender from which the related participation shall
have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI,
or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a statement
substantially in the form of Exhibit C and a Form W-8BEN, or any subsequent versions thereof or
successors thereto, properly completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrower
under this Agreement and the other Loan Documents. Such forms shall be delivered by each Non-U.S.
Lender on or before the date it becomes a party to this Agreement (or, in the case of any
Participant, on or before the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall
promptly notify the Borrower at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of
this paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant to this
paragraph that such Non-U.S. Lender is not legally able to deliver.



     (e) A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax
under the law of the jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Borrower, such properly completed and executed



31









 




documentation prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate, provided that such Lender is legally entitled to
complete, execute and deliver such documentation and in such Lender’s judgment such completion,
execution or submission would not materially prejudice the legal position of such Lender.




     (f) If the Administrative Agent or any Lender determines, in its sole discretion, that it
has received a refund or credit of any Non-Excluded Taxes or Other Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section 2.13, it shall pay over such refund or credit to the Borrower (but only to
the extent of indemnity payments made, or additional amounts paid, by the Borrower under this
Section 2.13 with respect to the Non-Excluded Taxes or Other Taxes giving rise to such refund or
credit), net of all out-of-pocket expenses of the Administrative Agent or such Lender and without
interest (other than any interest paid by the relevant Governmental Authority with respect to such
refund or credit); provided, that the Borrower, upon the request of the Administrative
Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to the Administrative
Agent or such Lender in the event the Administrative Agent or such Lender is required to repay such
refund or credit to such Governmental Authority. This paragraph shall not be construed to require
the Administrative Agent or any Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrower or any other Person.



     (g) The agreements in this Section 2.13 shall survive until the date that is one year after
the termination of this Agreement and the payment of the Revolving Loans and all other amounts
payable hereunder.



     2.14 Indemnity. The Borrower agrees to indemnify each Lender for, and to hold each Lender
harmless from, any loss or expense that such Lender may sustain or incur as a consequence of (a)
default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar
Loans after the Borrower has given a notice requesting the same in accordance with the provisions
of this Agreement, (b) default by the Borrower in making any prepayment of or conversion from
Eurodollar Loans after the Borrower has given a notice thereof in accordance with the provisions of
this Agreement or (c) the making of a prepayment of Eurodollar Loans on a day that is not the last
day of an Interest Period with respect thereto. Such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest that would have accrued on the amount so prepaid,
or not so borrowed, converted or continued, for the period from the date of such prepayment or of
such failure to borrow, convert or continue to the last day of such Interest Period (or, in the
case of a failure to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for such Revolving Loans
provided for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender after
consultation with Novellus) that would have accrued to such Lender on such amount by placing such
amount on deposit for a comparable period with leading banks in the interbank eurocurrency market.
A certificate as to any amounts payable pursuant to this Section submitted to the Borrower by any
Lender shall be conclusive in the absence of manifest error. The Borrower shall also pay any
customary administrative fees charged by such



32









 




Lender in connection with the foregoing. This covenant shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder until such time as
any applicable statute of limitations has expired.




     2.15 Change of Lending Office. Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 2.12 or 2.13(a) with respect to such Lender, it will,
if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of
such Lender) to designate another lending office for any Revolving Loans affected by such event
with the object of avoiding the consequences of such event;
provided, that such designation
is made on terms that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage,
and provided, further,
that nothing in this Section shall affect or postpone any of the obligations of the Borrower or the
rights of any Lender pursuant to Section 2.12 or 2.13(a).



     2.16 Replacement of Lenders. The Borrower shall be permitted to replace any Lender
that (a) requests reimbursement for amounts owing pursuant to Section 2.12 or 2.13(a) or (b)
defaults in its obligation to make Loans hereunder, with a replacement financial institution;
provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no
Event of Default shall have occurred and be continuing at the time of such replacement, (iii) prior
to any such replacement, such Lender shall have taken no action under Section 2.15 so as to
eliminate the continued need for payment of amounts owing pursuant to Section 2.12 or 2.13(a), (iv)
the replacement financial institution shall purchase, at par, all Revolving Loans and other amounts
owing to such replaced Lender on or prior to the date of replacement, (v) the Borrower shall be
liable to such replaced Lender under Section 2.14 if any Eurodollar Loan owing to such replaced
Lender shall be purchased other than on the last day of the Interest Period relating thereto, (vi)
the replacement financial institution, if not already a Lender, shall be reasonably satisfactory to
the Administrative Agent, (vii) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 9.6 (provided that the Borrower shall be obligated to pay
the registration and processing fee referred to therein), (viii) until such time as such
replacement shall be consummated, the Borrower shall pay all additional amounts (if any) required
pursuant to Section 2.12 or 2.13(a), as the case may be, and (ix) any such replacement shall not be
deemed to be a waiver of any rights that the Borrower, the Administrative Agent or any other Lender
shall have against the replaced Lender.



     2.17 Swing Line Loans.



     (a) The
Swing Line. Subject to the terms and conditions set forth herein, the Swing Line
Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.17
to make loans (each such loan, a “Swing Line Loan”) to the Borrower from time to time on any
Business Day during the Revolving Commitment Period in an aggregate amount not to exceed at any
time outstanding the amount of the Swing Line Sublimait;
provided, however, that after
giving effect to any Swing Line Loan, (i) the aggregate principal amount of Revolving Loans and
Swing Loans outstanding shall not exceed the Total Revolving Commitments at such time, and (ii) the
aggregate principal amount of Revolving Loans outstanding of any Lender at such time, plus
such Lender’s Revolving Percentage of the outstanding amount of all Swing Line Loans at such time
shall not exceed such Lender’s Revolving Commitment, and provided further



33









 




that the Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding
Swing Line Loan. Within the foregoing limits, and subject to the other terms and conditions hereof,
the Borrower may borrow under this Section 2.17, prepay under Section 2.5, and reborrow under this
Section 2.17. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees
to, purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an amount
equal to the product of such Lender’s Revolving Percentage times the amount of such Swing
Line Loan.




     (b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the
Borrower’s irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be
given by telephone. Each such notice must be received by the Swing Line Lender and the
Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify
(i) the amount to be borrowed, which shall be a minimum of $500,000, and (ii) the requested
borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed
promptly by delivery to the Swing Line Lender and the Administrative Agent of a written Swing Line
Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower. Promptly
after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line
Lender will confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has also received such Swing Line Loan Notice and, if not, the Swing Line
Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof.
Unless the Swing Line Lender has received notice (by telephone or in writing) from the
Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of the
proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such Swing Line Loan
as a result of the limitations set forth in the proviso to the first sentence of Section 2.17(a),
or (B) that one or more of the applicable conditions specified in Section 4 is not then satisfied,
then, subject to the terms and conditions hereof, the Swing Line Lender will, not later than 3:00
p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing
Line Loan available to the Borrower either by (i) crediting the account of the Borrower on the
books of the Swing Line Lender in immediately available funds or (ii) wire transfer of such funds,
in each case in accordance with instructions provided to (and reasonably acceptable to) the Swing
Line Lender by the Borrower.



     (c) Refinancing of Swing Line Loans.




     (i) The Swing Line Lender at any time in its sole and absolute discretion may request, on behalf of
the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so request on its
behalf), that each Lender make a Base Rate Loan in an amount equal to such Lender’s Revolving
Percentage of the amount of Swing Line Loans then outstanding. Such request shall be made in
writing (which written request shall be deemed to be a Swing Line Loan Notice for purposes hereof)
and in accordance with the requirements of Section 2.2, without regard to the minimum and multiples
specified therein for the principal amount of Base Rate Loans, but subject to the unutilized
portion of the Total Revolving Commitments and the conditions set forth in Section 4.2. The Swing
Line Lender shall furnish the Borrower with a copy of the applicable Swing Line Loan Notice
promptly after delivering such notice to the Administrative Agent. Each



34









 




Lender shall make an amount equal to its Revolving Percentage of the amount specified in such Swing
Line Loan Notice available to the Administrative Agent in immediately available funds for the
account of the Swing Line Lender at the Administrative Agent’s Office not later than 1:00 p.m. on
the day specified in such Swing Line Loan Notice, whereupon, subject to Section 2.17(c)(ii), each
Lender that so makes funds available shall be deemed to have made a Base Rate Loan to the Borrower
in such amount. The Administrative Agent shall remit the funds so received to the Swing Line
Lender.




     (ii) If for any reason any Swing Line Loan cannot be refinanced by such a borrowing of Revolving
Loans in accordance with Section 2.17(c)(i), the request for Base Rate Loans submitted by
the Swing Line Lender as set forth herein shall be deemed to be a request by the Swing Line Lender
that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each
Lender’s payment to the Administrative Agent for the account of the Swing Line Lender pursuant to
Section 2. 17(c)(i) shall be deemed payment in respect of such participation.



     (iii) If any Lender fails to make available to the Administrative Agent for the account of the
Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing
provisions of this Section 2.17(c) by the time specified
in Section 2.17(c)(i), the
Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative
Agent), on demand, such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the Swing Line Lender at a
rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Swing
Line Lender in accordance with banking industry rules on interbank compensation, plus any
administrative, processing or similar fees customarily charged by the Swing Line Lender in
connection with the foregoing. If such Lender pays such amount (with interest and fees as
aforesaid), the amount so paid shall constitute such Lender’s Revolving Loan included in the
relevant borrowing under the Revolving Commitments or funded participation in the relevant Swing
Line Loan, as the case may be. A certificate of the Swing Line Lender submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall
be conclusive absent manifest error.



     (iv) Each Lender’s obligation to make Revolving Loans or to purchase and fund risk participations
in Swing Line Loans pursuant to this Section 2.1(c) shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment,
defense or other right which such Lender may have against the Swing Line Lender, the Borrower or
any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C)
any other occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Lender’s obligation to make Revolving Loans pursuant to this
Section 2.17(c) is subject to the conditions set forth in
Section 4.2. No such
funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to
repay Swing Line Loans, together with interest as provided herein.



35









 





     (d) Repayment of Participations.




     (i) At any time after any Lender has purchased and funded a risk participation in a Swing Line
Loan, if the Swing Line Lender receives any payment on account of such Swing Line Loan, the Swing
Line Lender will distribute to such Lender its Revolving Percentage thereof in the same funds as
those received by the Swing Line Lender.




     (ii)
If any payment received by the Swing Line Lender in respect of principal or interest on any
Swing Line Loan is required to be returned by the Swing Line Lender under any of the circumstances
described in Section 9.5 (including pursuant to any settlement entered into by the Swing Line
Lender in its discretion), each Lender shall pay to the Swing Line Lender its Revolving Percentage
thereof on demand of the Administrative Agent, plus interest thereon from the date of such
demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Rate.
The Administrative Agent will make such demand upon the request of the Swing Line Lender. The
obligations of the Lenders under this clause shall survive the payment in full of the Obligations
and the termination of this Agreement.



     (e) Interest
for Account of Swing Line Lender. The Swing Line Lender shall be
responsible for invoicing the Borrower for interest on the Swing Line Loans. Until each Lender
funds its Base Rate Loan or risk participation pursuant to this Section 2.17 to refinance
such Lender’s Revolving Percentage of any Swing Line Loan, interest in respect of such Revolving
Percentage shall be solely for the account of the Swing Line Lender.



     (f) Payments
Directly to Swing Line Lender. The Borrower shall make all payments of
principal and interest in respect of the Swing Line Loans directly to the Swing Line Lender.



     (g) Repayment
of Swing Line Loans. The Borrower shall repay each Swing Line Loan on
the earlier to occur of (i) the date within one (1) Business Day of demand therefor by the Swing
Line Lender and (ii) the Revolving Termination Date.



2.18 Sharing of Payments by Lenders.



     If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain
payment in respect of any principal of or interest on any of the Loans made by it, or the
participations in Swing Line Loans held by it resulting in such Lender’s receiving payment of a
proportion of the aggregate amount of such Loans or participations and accrued interest thereon
greater than its pro rata share thereof as provided herein, then the Lender receiving such
greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for
cash at face value) participations in the Loans and subparticipations in Swing Line Loans of the
other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all
such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Loans and other amounts owing them,
provided that:




     (i) if any such participations or subparticipations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations or



36









 






subparticipations shall be rescinded and the purchase price restored to the extent of such
recovery, without interest; and




     (ii) the provisions of this Section shall not be construed to apply to (x) any payment made by a
Borrower pursuant to and in accordance with the express terms of this Agreement or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a participation in any of
its Loans or subparticipations in Swing Line Loans to any assignee or participant, other than to a
Borrower or any Subsidiary thereof (as to which the provisions of this Section shall apply).



     Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under
applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements
may exercise against such Loan Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of
such participation.



     2.19 Cash Collateral.



     The Borrower shall have the option to pledge and deposit with or deliver to the Administrative
Agent, as collateral for the Obligations, cash (“Cash Collateral”) in an amount equal to the Total
Revolving Commitments then in effect pursuant to documentation in form and substance satisfactory
to the Administrative Agent. The Cash Collateral may be held by BAS, as securities intermediary
pursuant to a control agreement with the Administrative Agent in form and substance satisfactory to
the Administrative Agent and invested in those securities identified in Section 2.1 of the
Borrower’s Investment Policy described on Schedule 6.5(a) (but in no event shall such securities
consist of “margin stock” within the meaning of Regulation U). If the Borrower makes the election
to provide Cash Collateral, the Borrower agrees it shall do, execute or deliver all such acts,
assurances and other instruments as the Administrative Agent shall reasonably request in order to
perfect and maintain a valid and effective security interest in the Cash Collateral. If the
Borrower provides Cash Collateral to the Administrative Agent in accordance with the terms above,
the parties hereto agree that the Loan Parties shall be permitted to exceed the respective baskets
contained in each of Sections 6.4(q), 6.5(h), 6.5(j), 6.5(m), 6.6(a), 6.6(b), 6.7 and 6.8(d).



     SECTION 3 REPRESENTATIONS AND WARRANTIES



     To induce the Administrative Agent and the Lenders to enter into this Agreement and to make the
Revolving Loans, the Loan Parties hereby represent and warrant to the Administrative Agent and each
Lender that:



     3.1 Financial Condition. The audited consolidated balance sheets of Novellus and its
consolidated Subsidiaries as at December 31, 2003, December 31, 2004 and December 31, 2005, and the
related consolidated statements of income and of cash flows for the fiscal years ended on such
dates, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present
fairly the consolidated financial condition of Novellus and its consolidated



37









 




Subsidiaries as at such date, and the consolidated results of its operations and its consolidated
cash flows for the respective fiscal years then ended. The unaudited consolidated balance sheet of
Novellus and its consolidated Subsidiaries as at September 30, 2006, and the related unaudited
consolidated statements of income and cash flows for the three-month period ended on such date,
present fairly the consolidated financial condition of Novellus and its consolidated Subsidiaries
as at such date, and the consolidated results of its operations and its consolidated cash flows for
the three-month period then ended (subject to normal year-end audit adjustments). All such
financial statements, including the related schedules and notes thereto, have been prepared in
accordance with GAAP applied consistently throughout the periods involved (except as approved by
the aforementioned firm of accountants and disclosed therein). No Group Member has any material
Guarantee Obligations, contingent liabilities and liabilities for taxes, or any long-term leases or
unusual forward or long-term commitments, including any interest rate or foreign currency swap or
exchange transaction or other obligation in respect of derivatives,
that are not reflected in the
most recent disclosure filings made by Novellus with the SEC. During the period from December 31,
2005 to and including the date hereof there has been no Disposition by any Group Member of any
material part of its business or property for which reasonable consideration has not been received.




     3.2 No Change. Since December 31, 2005, there has been no development or event that
has had or could reasonably be expected to have a Material Adverse Effect.



     3.3 Existence; Compliance with Law. Each Group Member (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization, except, in
the case of any Non-Guarantor Subsidiary, to the extent the failure to do so could not reasonably
be expected to have a Material Adverse Effect, (b) has the power and authority, and the legal
right, to own and operate its property, to lease the property it operates as lessee and to conduct
the business in which it is currently engaged, (c) is duly qualified as a foreign corporation or
other organization and in good standing under the laws of each jurisdiction where its ownership,
lease or operation of property or the conduct of its business requires such qualification except to
the extent that the failure to so qualify could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect and (d) is in compliance with all Requirements of Law except to the
extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect.



     3.4 Power; Authorization; Enforceable Obligations. The Borrower has the power and
authority, and the legal right, to make, deliver and perform the Loan Documents to which it is a
party and to obtain extensions of credit hereunder. The Borrower has taken all necessary
organizational action to authorize the execution, delivery and performance of the Loan Documents to
which it is a party and to authorize the extensions of credit on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act by or in respect of,
any Governmental Authority or any other Person is required in connection with the extensions of
credit hereunder or with the execution, delivery, performance, validity or enforceability of this
Agreement or any of the Loan Documents, except consents, authorizations, filings and notices which
have been obtained or made and are in full force and effect. Each Loan Document has been duly
executed and delivered on behalf of each Loan Party party thereto. This Agreement constitutes, and
each other Loan Document upon execution will constitute, a



38









 





legal, valid and binding obligation of each Loan Party that is party thereto, enforceable against
each such Loan Party in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors’ rights generally and by general equitable principles (whether enforcement
is sought by proceedings in equity or at law).




     3.5 No Legal Bar. The execution, delivery and performance of this Agreement and the
other Loan Documents by each Loan Party party thereto, the borrowings hereunder and the use of the
proceeds thereof will not violate any Requirement of Law or any material Contractual Obligation of
any Loan Party and will not result in, or require, the creation or imposition of any Lien on any of
their respective properties or revenues pursuant to any Requirement of Law or any such material
Contractual Obligation. No Requirement of Law or Contractual Obligation applicable to Novellus or
any of its Subsidiaries could reasonably be expected to have a Material Adverse Effect.



     3.6 Litigation. No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of Novellus, threatened by or
against any Group Member or against any of their respective properties or revenues (a) with respect
to any of the Loan Documents or any of the transactions contemplated hereby or thereby, or (b) that
could reasonably be expected to have a Material Adverse Effect.



     3.7
 No Default. No Group Member is in default under or with respect to any of its
Contractual Obligations in any respect that could reasonably be expected to have a Material Adverse
Effect. No Default or Event of Default has occurred and is continuing.



     3.8 Ownership of Property. Each Group Member has title in fee simple to, or a valid
leasehold interest in, all its real property, and good title to, or a valid leasehold interest in,
all its other property.



     3.9 Intellectual Property. Except as disclosed from time to time in any filing made
by Novellus with the SEC, each Group Member owns, or is licensed to use, all Intellectual Property
necessary for the conduct of its business as currently conducted. No material claim has been
asserted and is pending by any Person challenging or questioning the use of any Intellectual
Property or the validity or effectiveness of any Intellectual Property, nor does the Borrower know
of any valid basis for any such claim.



     3.10 Taxes. Each Group Member has filed or caused to be filed all Federal, state and
other material tax returns that are required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its property and all other
taxes, fees or other charges imposed on it or any of its property by any Governmental Authority
(except to the extent the amount or validity thereof is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of the relevant Group Member); no tax Lien has been filed, and, to the
knowledge of each Loan Party, no claim is being asserted, with respect to any such tax, fee or
other charge.



39









 






     3.11 Federal Regulations. No part of the proceeds of any Loans, and no other
extensions of credit hereunder, will be used (a) for “buying” or “carrying” any “margin stock”
within the respective meanings of each of the quoted terms under Regulation U as now and from time
to time hereafter in effect for any purpose that violates the provisions of the Regulations of the
Board or (b) for any purpose that violates the provisions of the Regulations of the Board. If
requested by any Lender or the Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-l, as applicable, referred to in Regulation U.



     3.12 ERISA. Neither a Reportable Event nor an “accumulated funding deficiency”
(within the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred during the
five-year period prior to the date on which this representation is made or deemed made with respect
to any Plan, and each Plan has complied in all material respects with the applicable provisions of
ERISA and the Code. No termination of a Single Employer Plan has occurred with respect to which any
Group Member has a material liability under ERISA, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. The present value of all accrued benefits under each Single
Employer Plan (based on those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed made, exceed the
value of the assets of such Plan allocable to such accrued benefits by a material amount. Neither
Novellus nor any Commonly Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan that has resulted or could reasonably be expected to result in a material
liability under ERISA, and neither Novellus nor any Commonly Controlled Entity would become subject
to any material liability under ERISA if Novellus or any such Commonly Controlled Entity were to
withdraw completely from all Multiemployer Plans as of the valuation date most closely preceding
the date on which this representation is made or deemed made. No such Multiemployer Plan is in
Reorganization or Insolvent.



     3.13 Investment Company Act; Other Regulations. No Loan Party is an
“investment company”, or a company “controlled” by an “investment company”, within the meaning of
the Investment Company Act of 1940, as amended. No Loan Party is subject to regulation under any
Requirement of Law (other than Regulation X of the Board) that limits its ability to incur
Indebtedness.



     3.14 Subsidiaries. As of the Closing Date, Schedule 3.14 sets forth the name and
jurisdiction of incorporation of each Subsidiary.



     3.15 Use of Proceeds. The proceeds of the Loans shall be used to finance working
capital and for other general corporate purposes, including to finance share repurchases.



     3.16 Environmental Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect:



     (a) the facilities and properties owned, leased or operated by any Group Member (the
“Properties”) do not contain, and have not previously contained, any Materials of Environmental



40









 





Concern in amounts or concentrations or under circumstances that constitute or constituted a
violation of, or could give rise to liability under, any Environmental Law;




     (b) no Group Member has received or is aware of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding compliance with
Environmental Laws with regard to any of the Properties or the business operated by any Group
Member (the “Business”), nor does any Loan Party have knowledge that any such notice will be
received or is being threatened;



     (c) Materials of Environmental Concern have not been transported or disposed of from the
Properties in violation of, or in a manner or to a location that is reasonably likely to give rise
to liability under, any Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the Properties in violation of, or
in a manner that could give rise to liability under, any applicable Environmental Law;



     (d) no judicial proceeding or governmental or administrative action is pending or, to the
knowledge of any Loan Party, threatened, under any Environmental Law to which any Group Member is
or will be named as a party with respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any Environmental Law with respect to the
Properties or the Business;



     (e) there has been no release or threat of release of Materials of Environmental Concern at
or from the Properties, or arising from or related to the operations of any Group Member in
connection with the Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could give rise to liability under Environmental Laws;



     (f) the Properties and all operations at the Properties are in compliance, and have in the
last five years been in compliance, with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any Environmental Law with respect
to the Properties or the Business; and



     (g) no Group Member has assumed any liability of any other Person under Environmental Laws.



     3.17 Accuracy of Information, etc. No statement or information contained in this Agreement,
any other Loan Document or any other document, certificate or statement furnished by or on behalf
of any Loan Party to the Administrative Agent or the Lenders, or any of them, for use in connection
with the transactions contemplated by this Agreement or the other Loan Documents, contained as of
the date such statement, information, document or certificate was so furnished, any untrue
statement of a material fact or omitted to state a material fact necessary to make the statements
contained herein or therein not misleading. The projections and pro forma financial information
contained in the materials referenced above are based upon good faith estimates and assumptions
believed by management of Novellus to be reasonable at the time



41









 





made, it being recognized by the Lenders that such financial information as it relates to future
events is not to be viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth therein by a material
amount. There is no fact known to any Loan Party that could reasonably be expected to have a
Material Adverse Effect that has not been expressly disclosed herein, in the other Loan Documents
or in any other documents, certificates and statements furnished to the Administrative Agent and
the Lenders for use in connection with the transactions contemplated hereby and by the other Loan
Documents.




     3.18 Solvency. The Loan Parties are, and after giving effect to and the incurrence of all
Indebtedness and obligations being incurred in connection herewith will be and will continue to be,
Solvent on a consolidated basis.



     SECTION 4. CONDITIONS PRECEDENT



     4.1 Conditions to Initial Extension of Credit. The obligation of each Lender to make its
initial Loan hereunder is subject to the satisfaction of the following conditions precedent:



     (a) Credit Agreement. The Administrative Agent shall have received this Agreement,
executed and delivered by the Administrative Agent, each Loan Party and each Person listed on
Schedule 1.1 (a).



     (b) Financial Statements. To the extent not otherwise publicly available, the Lenders
shall have received (i) audited consolidated financial statements of Novellus for the 2003, 2004
and 2005 fiscal years and (ii) unaudited interim consolidated financial statements of Novellus for
the fiscal quarter ended September 30, 2006, and such financial statements shall not, in the
reasonable judgment of the Lenders, reflect any material adverse change in the consolidated
financial condition of Novellus, as reflected in the financial statements or projections provided
to the Lenders prior to the Closing Date.



     (c) Approvals. All material governmental and third party approvals necessary in
connection with the continuing operations of the Group Members and the transactions contemplated
hereby shall have been obtained and be in full force and effect, and all applicable waiting periods
shall have expired without any action being taken or threatened by any competent authority that
would restrain, prevent or otherwise impose materially adverse conditions on the financing
contemplated hereby.



     (d) Fees. The Lenders and the Administrative Agent shall have received
confirmation of wire transfers with respect to payment of all fees required to be paid, and all
expenses for which invoices have been presented (including the reasonable fees and expenses of
legal counsel), on or before the Closing Date.



     (e) Closing
Certificate; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of each Loan
Party, dated the Closing Date, substantially in the form of Exhibit A, with appropriate insertions
and



42









 




attachments, including the certificate of incorporation of such Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party and an incumbency
certificate including specimen signatures, and (ii) a good standing certificate for each Loan Party
from its jurisdiction of organization.




     (f) Legal Opinions. The Administrative Agent shall have received the executed legal
opinion of Morrison & Foerster LLP, counsel to Novellus. Such legal opinion shall cover such
matters incident to the transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.



     (g) Existing Credit Agreement. Receipt by the Administrative Agent of evidence that
the Existing Credit Agreement has been terminated with the initial funding of the Loans.



     4.2 Conditions to Each Extension of Credit. The agreement of each Lender to make any Loan
requested to be made by it on any date (including its initial Revolving Loan, but excluding, for
avoidance of doubt, any continuation or conversion pursuant to Section 2.6) is subject to the
satisfaction of the following conditions precedent:



     (a) Representations and Warranties. Each of the representations and warranties made
by the Borrower and each other Loan Party in or pursuant to the Loan Documents (other than the
representations and warranties contained in Section 3.2) shall be true and correct in all material
respects on and as of such date as if made on and as of such date, except to the extent any such
representation and warranty specifically relates to any earlier date, in which case such
representation and warranty shall have been true and correct on and as of such earlier date.



     (b) No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit requested to be made on
such date.



Each borrowing by the Borrower hereunder shall constitute a representation and warranty by the
Borrower as of the date of such borrowing that the conditions contained in this Section 4.2 have
been satisfied.



     SECTION 5. AFFIRMATIVE COVENANTS



     The Loan Parties hereby agree that, so long as the Revolving Commitments remain in effect or any
Loan or other amount is owing to any Lender or the Administrative Agent hereunder, the Loan Parties
shall and shall cause each of their Subsidiaries to:



     5.1 Financial Statements. Furnish to the Administrative Agent and each Lender:



     (a) as soon as available, but in any event within 90 days after the end of each fiscal year of
Novellus, (i) a copy of the audited consolidated balance sheet of Novellus and its consolidated
Subsidiaries as at the end of such year and the related audited consolidated statements of income
and of cash flows for such year, setting forth in each case in comparative form the figures for the
previous year, reported on without a “going concern” or like



43









 




qualification or exception, or qualification arising out of the scope of the audit, by Ernst &
Young LLP or other independent certified public accountants of nationally recognized standing and
(ii) to the extent filed with the SEC, a copy of the attestation report filed with the SEC of Ernst
& Young LLP or other independent certified public accountants of nationally recognized standing as
to the Borrower’s internal controls pursuant to Section 404 of Sarbanes-Oxley; and




     (b) as soon as available, but in any event not later than 45 days after the end of each of the
first three quarterly periods of each fiscal year of Novellus, the unaudited consolidated balance
sheet of Novellus and its consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter and the portion of
the fiscal year through the end of such quarter, setting forth in
each case in comparative form the
figures for the previous year, certified by a Responsible Officer as being fairly stated in all
material respects (subject to normal year-end audit adjustments).

     All such financial statements shall be complete and correct in all material respects and shall be
prepared in reasonable detail and in accordance with GAAP applied (except as approved by such
accountants or officer, as the case may be, and disclosed in reasonable detail therein)
consistently throughout the periods reflected therein and with prior periods. For avoidance of
doubt, the delivery of financial statements pursuant to this Section 5.1 shall not constitute a
“bring-down” of any representation and warranty contained in this Agreement.



     5.2 Certificates; Other Information. Furnish to the Administrative Agent and each Lender
(or, in the case of clause (d), to the relevant Lender):



     (a) concurrently with the delivery of the financial statements referred to in Section 5.1
(a), a certificate of the independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefor no knowledge was obtained of
any Event of Default, except as specified in such certificate;



     (b) concurrently with the delivery of any financial statements pursuant to Section 5.1, a
duly completed Compliance Certificate signed by a Responsible Officer of the Borrower, which will
include a statement that, to the best of such Responsible Officer’s knowledge, the Borrower during
such period has observed or performed all of its covenants and other agreements, and satisfied
every condition contained in this Agreement and the other Loan Documents to which it is a party to
be observed, performed or satisfied by it, and that such Responsible Officer has obtained no
knowledge of any Default or Event of Default except as specified in such certificate;



     (c) within five days after the same are sent, copies of all financial statements and reports
that the Borrower sends to the holders of any class of its debt securities or public equity
securities and, within five days after the same are filed, copies of all financial statements and
annual, regular, periodic and special reports and registration statements that the Borrower may
file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act
of 1934; and



44









 





     (d) promptly, such additional financial and other information as any Lender may from time to time
reasonably request.



     Notwithstanding the provisions of Section 9.2, documents required to be delivered pursuant to
Section 5.1 or Section 5.2 (to the extent any such documents are included in materials otherwise
filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have
been delivered on the date (i) on which the Borrower posts such documents, or provides a link
thereto on the Borrower’s website on the Internet at the website address listed in Section 9.2 or
(ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access (whether a
commercial, third-party website or whether sponsored by the Administrative Agent); provided
that: (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or
any Lender that requests the Borrower to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and (ii) the Borrower
shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the
posting of any such documents and provide to the Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents. Notwithstanding anything contained herein, in every
instance the Borrower shall be required to provide paper copies of the Compliance Certificates
required by Section 5.2 to the Administrative Agent. Except for such Compliance Certificates, the
Administrative Agent shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to monitor compliance by
the Borrower with any such request for delivery, and each Lender shall be solely responsible for
requesting delivery to it or maintaining its copies of such documents.



     The Borrower hereby acknowledges that (a) the Administrative Agent and/or BAS will make available
to the Lenders materials and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system (the “Platform”) and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to
the Borrower or its securities) (each, a “Public Lender”). The Borrower hereby agrees that (w) all
Borrower Materials that are to be made available to Public Lenders shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear
prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower
shall be deemed to have authorized the Administrative Agent, BAS and the Lenders to treat such
Borrower Materials as not containing any material non-public information with respect to the
Borrower or its securities for purposes of United States federal and state securities laws
(provided, however, that to the extent such Borrower Materials constitute Information, they
shall be treated as set forth in Section 9.14); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated as “Public Investor;”
and (z) the Administrative Agent and BAS shall be entitled to treat any Borrower Materials that are
not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not marked as
“Public Investor.” Notwithstanding the foregoing, the Borrower shall be under no obligation to mark
any Borrower Materials “PUBLIC.”



45









 





     5.3 Intentionally Omitted.



     5.4 Maintenance of Existence; Compliance. (a)(i) Except to the extent otherwise
permitted under this Agreement, preserve, renew and keep in full force and effect its
organizational existence and (ii) take all reasonable action to maintain all rights, privileges and
franchises necessary in the normal conduct of its business, except, in the case of clause (ii)
above, to the extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; and (b) comply with all Contractual Obligations and Requirements of Law except to
the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect.



     5.5 Maintenance of Property; Insurance. (a) Keep all property useful and necessary
in its business in good working order and condition, ordinary wear and tear excepted and (b)
maintain with financially sound and reputable insurance companies insurance on all its property in
at least such amounts and against at least such risks (but including in any event public liability,
product liability and business interruption) as are usually insured against in the same general
area by companies engaged in the same or a similar business, except to the extent Novellus or its
Subsidiaries maintains reasonable self-insurance with respect to such risks.



     5.6 Inspection of Property; Books and Records; Discussions. (a) Keep proper books of
records and account in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation to its business and
activities and (b) upon reasonable prior notice, permit representatives of any Lender to visit and
inspect any of its properties and examine and make abstracts from any of its books and records at
any reasonable time and as often as may reasonably be desired and to discuss the business,
operations, properties and financial and other condition of the Group Members with officers and
employees of the Group Members and with their independent certified public accountants;
provided that so long as no Event of Default has occurred and is continuing, Novellus and
its Subsidiaries shall only be responsible for the expenses of one such visit and inspection per
calendar year by the Administrative Agent.



     5.7 Notices. Promptly give notice to the Administrative Agent and each Lender of:



     (a) the occurrence of any Default or Event of Default;



     (b) as soon as possible (and in any event within 10 Business Days after Novellus knows or
has to reason to know of), any (i) default or event of default under any Contractual Obligation of
any Group Member or (ii) litigation, investigation or proceeding that may exist at any time between
any Group Member and any Governmental Authority, that in either case, if not cured or if adversely
determined, as the case may be, could reasonably be expected to have a Material Adverse Effect;



     (c) as soon as possible (and in any event within 10 Business Days after Novellus knows or
has to reason to know of), any litigation or proceeding affecting any Group Member which (i)
relates to any Loan Document or (ii) if adversely determined, could reasonably be expected to have
a Material Adverse Effect;



46









 





     (d) the following events, as soon as possible and in any event within 30 days after Novellus
knows or has reason to know thereof: (i) the occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any Lien in favor of
the PBGC or a Plan or any withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the taking of any other action by the
PBGC or Novellus or any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, any Plan; and



     (e) any development or event that has had or could reasonably be expected to have a Material
Adverse Effect.



     Each notice pursuant to this Section 5.7 shall be accompanied by a statement of a Responsible
Officer setting forth details of the occurrence referred to therein and stating what action the
relevant Group Member proposes to take with respect thereto.



     5.8 Additional Subsidiaries. Within thirty (30) days after the acquisition or formation of
any Domestic Subsidiary that is a Material Subsidiary, cause such Person to (i) become a Guarantor
by executing and delivering to the Administrative Agent a Joinder Agreement, and (ii) deliver to
the Administrative Agent documents of the types referred to in Sections 4.1(e) and
favorable opinions of counsel to such Person (which shall cover, among other things, the legality,
validity, binding effect and enforceability of the documentation referred to in clause (a)), all in
form, content and scope reasonably satisfactory to the Administrative Agent.



     SECTION 6. NEGATIVE COVENANTS



     The Borrower hereby agrees that, so long as the Revolving Commitments remain in effect or any Loan
or other amount is owing to any Lender or the Administrative Agent hereunder, the Loan Parties
shall not, and shall not permit any of their Subsidiaries to, directly or indirectly:



     6.1 Financial Covenants.



     (a) Permit the Quick Ratio as at the last day of any fiscal quarter of Novellus to be
less than 1.25 to 1.00.



     (b) Permit the Consolidated Leverage Ratio as at the last day of any period of four
consecutive fiscal quarters of the Borrower to exceed 3.25 to 1.00.



     6.2 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into
another Person, or Dispose of (whether hi one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any
Person; provided that, notwithstanding the foregoing provisions of this Section 6.2 but subject to
the terms of Section 5.8, (a) the Borrower may merge or consolidate with any Person provided that
the



47









 




Borrower shall be the continuing or surviving corporation, (b) any Loan Party other than the
Borrower may merge or consolidate with any other Loan Party other than the Borrower, (c) any
Subsidiary may be merged or consolidated with or into any Loan Party provided that such Loan Party
shall be the continuing or surviving corporation, (d) any Foreign Subsidiary may be merged or
consolidated with or into any other Foreign Subsidiary and (e) any Subsidiary may dissolve or
liquidate itself; provided that with respect to any Domestic Subsidiary such Domestic Subsidiary
transfers all of its assets to a Loan Party prior to such dissolution or liquidation. Nothing in
this Section 6.2 shall prohibit the Borrower or any Subsidiary from entering into any Disposition
permitted by Section 6.7.




     6.3 Lines of Business. Enter into any business, either directly or through any
Subsidiary, except for those businesses in which Novellus and its Subsidiaries are engaged on the
date of this Agreement or that are reasonably related thereto.



     6.4 Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, other than the following:



     (a) Liens existing on the date hereof and listed on Schedule 6.4 and any renewals or
extensions thereof, provided that (i) the property covered thereby is not changed (other
than as a result of improvements thereto), (ii) the amount secured or benefited thereby is not
increased unless permitted by Section 6.6(a) and (iii) any renewal or extension of the obligations
secured or benefited thereby is permitted by Section 6.6(a);



     (b) Liens (other than Liens imposed under ERISA) for taxes, assessments or governmental
charges or levies not yet due or which are being contested in good faith and by appropriate
proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the
books of the applicable Person in accordance with GAAP;



     (c) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen
and suppliers and other Liens imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, provided that such Liens secure only
amounts not yet due and payable or, if due and payable, are unfiled and no other action has been
taken to enforce the same or are being contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been established;



     (d) pledges or deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other similar legislation, other than any Lien imposed by
ERISA;



     (e) deposits to secure the performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business;



     (f) easements, rights-of-way, restrictions and other similar encumbrances affecting real
property which, in the aggregate, do not materially interfere with the ordinary conduct of the
business of the applicable Person;



48









 





     (g) Liens securing judgments for the payment of money (or appeal or other surety bonds relating to
such judgments) not constituting an Event of Default under Section 7(h);



     (h) Liens securing Indebtedness permitted under Section 6.6(a);



     (i) leases or subleases granted to others not interfering in any material respect with the business
of any Loan Party or any of its Subsidiaries;



     (j) any interest of title of a lessor under, and Liens arising from UCC financing statements (or
equivalent filings, registrations or agreements in foreign jurisdictions) relating to, leases
permitted by this Agreement;



     (k) Liens deemed to exist in connection with Investments in repurchase agreements permitted under
Section 6.5;



     (1) normal and customary rights of setoff upon deposits of cash in favor of banks or other
depository institutions;



     (m) Liens of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items
in the course of collection;



     (n) Liens of sellers of goods to the Borrower and any of its Subsidiaries arising under Article 2
of the Uniform Commercial Code or similar provisions of applicable law in the ordinary course of
business, covering only the goods sold and securing only the unpaid purchase price for such goods
and related expenses;



     (o) Liens created or deemed to exist in connection with any Qualified Receivables Transaction, but
only to the extent that any such Lien relates to Receivables Program Assets;



     (p) Liens of the Administrative Agent on the Cash Collateral; and



     (q) other Liens securing Indebtedness or other obligations permitted hereunder in an aggregate
outstanding amount not exceeding $100,000,000 at any time; provided, however, if the Borrower
provides Cash Collateral to secure the Obligations in accordance with Section 2.19, the Borrower
and its Subsidiaries may provide Liens securing Indebtedness or other obligations permitted
hereunder in excess of the $100,000,000 limitation provided above.



     6.5 Investments. Make any Investments, except:



     (a) Investments held by the Borrower or such Subsidiary in the form of cash or Cash
Equivalents;



     (b) Investments existing as of the Closing Date and set forth in Schedule 6.5(a) and any
extension or renewal thereof; provided that the amount of any such Investment is not increased at
the time of such extension or renewal;



49









 





     (c) Investments specified in the Borrower’s investment policy, a copy of which is set forth
on Schedule 6.5(b);



     (d) Investments in any Person that is a Loan Party prior to giving effect to such Investment;



     (e) Investments by any Subsidiary of the Borrower that is not a Loan Party in any other
Subsidiary of the Borrower that is not a Loan Party;



     (f) Investments consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the grant of trade credit in the ordinary course of business, and
Investments received in satisfaction or partial satisfaction thereof from financially troubled
account debtors to the extent reasonably necessary in order to prevent or limit loss;



     (g) Guarantee Obligations permitted by Section 6.6;



     (h) Permitted Acquisitions;



     (i) Investments acquired in connection with any Disposition not prohibited by Section 6.7;



     (j) Investments in Subsidiaries, including Investments made in connection with the formation of
Subsidiaries (provided that the aggregate amount of such Investments in any year shall not exceed
an amount equal to 10% of Consolidated Total Assets as at the end of the preceding fiscal year of
the Borrower plus the unused amount available for such Investments pursuant to this subsection (j)
for the immediately preceding fiscal year (excluding any carry forward available from any prior
fiscal year)); provided, however, if the Borrower provides Cash Collateral to secure the
Obligations in accordance with Section 2.19, the Borrower and its Subsidiaries may make Investments
in Subsidiaries, including Investments made in connection with the formation of Subsidiaries, in
excess of the limitation on any such Investments provided above in this clause (j).



     (k) Investments made in the ordinary course of business pursuant to transactions under which the
Borrower or any Subsidiary acquires, or acquires the right to use, intellectual property in
exchange for a loan made to the seller, licensor or transferor of such intellectual property;



     (1) advances or loans by the Borrower or any Subsidiary to employees in the ordinary course of
business; and



     (m) Other Investments, the aggregate amount of which shall not exceed $25,000,000 in the aggregate
at any time outstanding; provided, however, if the Borrower provides Cash Collateral to secure the
Obligations in accordance with Section 2.19, the Borrower and its Subsidiaries may make other
Investments in excess of the limitation provided above in this clause (m).



50









 





     6.6 Indebtedness.



     (a) Permit the Priority Debt Amount on any date to exceed the sum of (i) $150,000,000
plus (ii) the outstanding principal amount of Indebtedness identified on Schedule 6.6; provided,
however, if the Borrower provides Cash Collateral to secure the Obligations in accordance with
Section 2.19, the Borrower and its Subsidiaries may permit the Priority Debt Amount to exceed the
limitation provided above in this Section 6.6(a).



     (b) Permit the aggregate principal amount of unsecured intercompany Indebtedness owing from
the Non-Guarantor Subsidiaries to the Loan Parties to exceed an amount equal to (i) $400,000,000 at
any time on or before September 30, 2008, (ii) $350,000,000 at any time from October 1, 2008 to and
including December 31, 2008 and (iii) in any year commencing after December 31, 2008, 10% of
Consolidated Total Assets as at the end of the preceding fiscal year of the Borrower plus
commencing with the fiscal year ending December 31, 2009 the unused amount available for such
Indebtedness pursuant to this subsection (b) for the immediately preceding fiscal year (excluding
any carry forward available from any prior fiscal year); provided, however, if the Borrower
provides Cash Collateral to secure the Obligations in accordance with Section 2.19, the unsecured
intercompany Indebtedness owing from the Non-Guarantor Subsidiaries to the Loan Parties may exceed
the limitation provided above in this Section 6.6(b).



     6.7 Dispositions. Make any Disposition unless (i) the consideration paid in
connection therewith shall be paid contemporaneous with consummation of the transaction and shall
be in an amount not less than the fair market value of the property disposed of, (ii) such
transaction does not involve a sale or other disposition of receivables other than receivables
owned by or attributable to other property concurrently being disposed of in a transaction
otherwise permitted under this Section 6.7, and (iii) the aggregate net book value of all of the
assets sold or otherwise disposed of by the Borrower and its Subsidiaries in all such transactions
occurring during any fiscal year shall not exceed an amount equal to 10% of Consolidated Total
Assets as at the end of the prior fiscal year of the Borrower plus the unused amount available for
Dispositions pursuant to this clause (iii) from the immediately preceding fiscal year (excluding
any carry forward available from any prior fiscal year); provided, however, if the Borrower
provides Cash Collateral to secure the Obligations in accordance with Section 2.19, there shall be
no limit on the amount of Dispositions made by the Borrower and its Subsidiaries.



     6.8 Restricted Payments. Declare or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, except that:



(a) (i) each Subsidiary may make Restricted Payments to the Borrower or any Guarantor, (ii) each
Foreign Subsidiary may make Restricted Payments to its direct parent company and (iii) each
Domestic Subsidiary may make Restricted Payments to its direct parent company if such direct parent
company is either the Borrower or a Domestic Subsidiary; provided, however that if such
direct parent company is not a Loan Party, such direct parent company shall immediately distribute
the proceeds of such Restricted Payment to a Loan Party;



51









 





     (b) each Foreign Subsidiary may make Restricted Payments to Novellus Singapore and/or
Novellus Systems B.V.;



     (c) the Borrower and each Subsidiary may declare and make dividend payments or other
distributions payable solely in the Capital Stock of such Person;



     (d) the Borrower may purchase, redeem, or acquire shares of its Capital Stock; provided that
(i) no Default exists prior to and immediately after giving effect to such purchase, redemption or
acquisition of such Capital Stock, and (ii) if the Consolidated Leverage Ratio (calculated on a pro
forma basis immediately after giving effect to any such purchase, redemption or acquisition of such
Capital Stock) is greater than 2.5 to 1.0, the aggregate amount of such purchases, redemptions and
acquisitions of such Capital Stock made during the term of this Agreement shall not exceed
$1,000,000,000, it being understood and agreed that if the Consolidated Leverage Ratio (calculated
on a pro forma basis immediately after giving effect to any such purchase, redemption or
acquisition of such Capital Stock) is less than or equal to 2.5 to 1.0 there shall be no limit on
the amount of purchases, redemptions and acquisitions of such Capital Stock; provided, however, if
the Borrower provides Cash Collateral to secure the Obligations in accordance with Section 2.19,
there shall be no limit on the amount of purchases, redemptions and acquisitions of Capital Stock
by the Borrower;



     (e) the Borrower may repurchase fractional shares of its Capital Stock in connection with a
reverse stock split or make cash payments in Lieu of fractional shares of its Capital Stock in
connection with the conversion of securities exerciseable for or convertible into Capital Stock;
provided, that no Default exists immediately prior to or immediately after giving effect to
any such repurchase or payment; and



     (f) the Borrower may make Restricted Payments in any fiscal year in an aggregate amount not
to exceed $100,000,000 during such fiscal year provided that no Default exists prior to and
immediately after giving effect to any such Restricted Payment.



     6.9 Transactions with Affiliates and Insiders. Enter into or permit to exist any
transaction or series of transactions with any officer, director or Affiliate of such Person other
than (a) advances of working capital to any Loan Party, (b) transfers of cash and assets to any
Loan Party, (c) indemnification of directors and officers in the ordinary course of business, (d)
intercompany transactions expressly permitted by Section 6.2, Section 6.5, Section 6.6, Section 6.7
or Section 6.8, (e) normal and reasonable compensation and reimbursement and advance of expenses of
officers and directors in the ordinary course of business, (f) any License and Manufacturing
Transaction and (g) except as otherwise specifically limited in this Agreement, other transactions
which are entered into in the ordinary course of such Person’s business on terms and conditions
substantially as favorable to such Person as would be obtainable by it in a comparable arms-length
transaction with a Person other than an officer, director or Affiliate.



     SECTION 7. EVENTS OF DEFAULT


If any of the following events shall occur and be continuing:



52









 





     (a) the Borrower shall fail to pay any principal of any Loan when due in accordance with the
terms hereof; or the Borrower shall fail to pay any interest on any Loan, or any other amount
payable hereunder or under any other Loan Document, within five days after any such interest or
other amount becomes due in accordance with the terms hereof; or



     (b) any representation or warranty made or deemed made by any Loan Party herein or in any
other Loan Document or that is contained in any certificate, document or financial or other
statement furnished by it at any time under or in connection with this Agreement or any such other
Loan Document shall prove to have been inaccurate in any material respect on or as of the date made
or deemed made; or



     (c) any Loan Party shall default in the observance or performance of any agreement contained
in clause (i) or (ii) of Section 5.4(a), Section 5.7(a) or Section 6 of this Agreement; or



     (d) any Loan Party shall default in the observance or performance of any other agreement
contained in this Agreement or any other Loan Document (other than as provided in paragraphs (a)
through (c) of this Section), and such default shall continue unremedied for a period of 30 days
after notice to Novellus from the Administrative Agent or the Required Lenders; or



     (e) any Group Member shall (i) default in making any payment of any principal of any
Indebtedness (including any Guarantee Obligation, but excluding the Loans) on the scheduled due
date with respect thereto; or (ii) default in making any payment of any interest on any such
Indebtedness beyond the period of grace, if any, provided in the instrument or agreement under
which such Indebtedness was created; or (iii) default in the observance or performance of any other
agreement or condition relating to any such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or to permit the holder
or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary)
to cause, with the giving of notice if required, such Indebtedness to become due prior to its
stated maturity or (in the case of any such Indebtedness constituting a Guarantee Obligation) to
become payable; provided, that a default, event or condition described in clause (i), (ii)
or (iii) of this paragraph (e) shall not at any time constitute an Event of Default unless, at such
time, one or more defaults, events or conditions of the type described in clauses (i), (ii) and
(iii) of this paragraph (e) shall have occurred and be continuing with respect to Indebtedness the
outstanding principal amount of which exceeds in the aggregate $25,000,000; or



     (f) (i) any Group Member shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with
respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with
respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian,
conservator or other similar official for it or for all or any substantial part of its assets, or
any Group Member



53









 




shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced
against any Group Member any case, proceeding or other action of a nature referred to in clause (i)
above that (A) results in the entry of an order for relief or any such adjudication or appointment
or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall
be commenced against any Group Member any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all or any substantial part
of its assets that results in the entry of an order for any such relief that shall not have been
vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or
(iv) any Group Member shall take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or
(v) any Group Member shall generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or




     (g) (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA
or Section 4975 of the Code) involving any Plan, (ii) any “accumulated funding deficiency” (as
defined in Section 302 of ERISA), whether or not waived, shall exist with respect to any Plan or
any Lien in favor of the PBGC or a Plan shall arise on the assets of any Group Member or any
Commonly Controlled Entity, (iii) a Reportable Event shall occur with respect to, or proceedings
shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is, in the reasonable opinion of the Required Lenders, likely to result in
the termination of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall
terminate for purposes of Title IV of ERISA, (v) any Group Member or any Commonly Controlled Entity
shall, or in the reasonable opinion of the Required Lenders is likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or
(vi) any other event or condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all other such events or
conditions, if any, could, in the reasonable judgment of the Required Lenders, reasonably be
expected to have a Material Adverse Effect; or



     (h) one or more judgments or decrees shall be entered against any Group Member involving in the
aggregate a liability (to the extent not paid or fully covered by insurance as to which the
relevant insurance company has acknowledged coverage) of $125,000,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal
within 30 days from the entry thereof; or



     (i) a Change of Control shall have occurred;


then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or
(ii) of paragraph (f) above with respect to the Borrower, automatically the Revolving Commitments
shall immediately terminate and the Loans (with accrued interest thereon) and all other amounts
owing under this Agreement and the other Loan Documents shall immediately become due and payable,
(B) if such event is any other Event of Default, either or both of the following actions may be
taken: (i) with the consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to the




54









 







Borrower declare the Revolving Commitments to be terminated forthwith, whereupon the
Revolving Commitments shall immediately terminate; and (ii) with the consent of the Required
Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Loans (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan Documents to be due
and payable forthwith, whereupon the same shall immediately become due and payable, and (C) the
Administrative Agent may exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents. Except as expressly provided above in
this Section, presentment, demand, protest and all other notices of any kind are hereby expressly
waived by the Borrower.




     SECTION 8. THE ADMINISTRATIVE AGENT


     8.1 Appointment and Authority. Each of the Lenders hereby irrevocably appoints
Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan
Documents and authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto. The provisions of
this Section are solely for the benefit of the Administrative Agent and the Lenders, and neither
the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such
provisions.



     8.2 Rights as a Lender. The Person serving as the Administrative Agent hereunder
shall have the same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated or unless the context otherwise requires, include the
Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and
its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with any Loan Party or any
Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder
and without any duty to account therefor to the Lenders.



     8.3 Exculpatory Provisions. The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, the Administrative Agent:


     (a) shall not be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing;



     (b) shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan
Documents that the Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided
for herein or in the other Loan Documents), provided that the Administrative Agent shall
not be required to take any action that, in its opinion or the opinion of its counsel,



55









 




may expose the Administrative Agent to liability or that is contrary to any Loan Document or
applicable law; and




     (c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty
to disclose, and shall not be liable for the failure to disclose, any information relating to any
Loan Party or any of its Affiliates that is communicated to or obtained by the Person serving as
the Administrative Agent or any of its Affiliates in any capacity.



     The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the
consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 7 and 9.1) or (ii) in the absence of its
own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until notice describing such Default is given to the
Administrative Agent by the Borrower or a Lender.



     The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this Agreement or any
other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Section 4 or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to the Administrative Agent.



     8.4 Reliance by Administrative Agent. The Administrative Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to
have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying thereon. In determining
compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled
to the satisfaction of a Lender, the Administrative Agent may presume that such condition is
satisfactory to such Lender unless the Administrative Agent shall have received notice to the
contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult
with legal counsel (who may be counsel for the Loan Parties), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.



     8.5 Delegation of Duties. The Administrative Agent may perform any and all of its
duties and exercise its rights and powers hereunder or under any other Loan Document by or through
any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any
such sub-agent may perform any and all of its duties and exercise its rights and



56









 




powers by or through their respective Related Parties. The exculpatory provisions of this Article
shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any
such sub-agent, and shall apply to their respective activities in connection with the syndication
of the credit facilities provided for herein as well as activities as Administrative Agent.




     8.6 Resignation of Administrative Agent. The Administrative Agent may at any time
give notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment within 30 days after the
retiring Administrative Agent gives notice of its resignation, then the retiring Administrative
Agent may on behalf of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative Agent shall notify the
Borrower and the Lenders that no qualifying Person has accepted such appointment, then such
resignation shall nonetheless become effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations hereunder and under the
other Loan Documents and (2) all payments, communications and determinations provided to be made
by, to or through the Administrative Agent shall instead be made by or to each Lender directly,
until such time as the Required Lenders appoint a successor Administrative Agent as provided for
above in this Section. Upon the acceptance of a successor’s appointment as Administrative Agent
hereunder, such successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or retired) Administrative Agent, and the retiring
Administrative Agent shall be discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as provided above in this Section).
The fees payable by the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and such successor. After
the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the
provisions of this Article and Section 9.5 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.



     Any resignation by Bank of America as Administrative Agent pursuant to this Section shall also
constitute its resignation as Swing Line Lender. Upon the acceptance of a successor’s appointment
as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all
of the rights, powers, privileges and duties of the retiring Swing Line Lender and (b) the retiring
Swing Line Lender shall be discharged from all of its duties and obligations hereunder or under the
other Loan Documents.



     8.7 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
acknowledges that it has, independently and without reliance upon the Administrative Agent or any
other Lender or any of their Related Parties and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon the Administrative
Agent or any other Lender or any of their Related Parties and based on



57









 




such documents and information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement, any other Loan
Document or any related agreement or any document furnished hereunder or thereunder.




     8.8 No Other Duties; Etc. Anything herein to the contrary notwithstanding, none of
the bookrunners, arrangers, syndication agents, documentation agents or co-agents shall have any
powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except
in its capacity, as applicable, as the Administrative Agent or a Lender hereunder.



     8.9 Administrative Agent May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall
have made any demand on the Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise:



     (a) to file and prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such
other documents as may be necessary or advisable in order to have the claims of the Lenders and the
Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements
and advances of the Lenders and the Administrative Agent and their respective agents and counsel
and all other amounts due the Lenders and the Administrative Agent under Sections 2.9 and 9.5)
allowed hi such judicial proceeding; and



     (b) to collect and receive any monies or other property payable or deliverable on any such
claims and to distribute the same;



and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its
agents and counsel, and any other amounts due the Administrative Agent under Sections 2.9 and 9.5.


Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.



     8.10 Guaranty Matters. The Lenders irrevocably authorize the Administrative Agent,
at its option and in its discretion, to release any Guarantor from its obligations under the
Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.
Upon request by the Administrative Agent at any time, the Required Lenders will



58









 




confirm in writing the Administrative Agent’s authority to any Guarantor from its obligations under
the Guaranty, pursuant to this Section 8.10.




     SECTION 9. MISCELLANEOUS



     9.1 Amendments and Waivers. No amendment or waiver of any provision of this Agreement or
any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party
therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or
the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and
each such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, further, that



     (a) no such amendment, waiver or consent shall:




     (i) extend or increase the Revolving Commitment of a Lender (or reinstate any Revolving Commitment
terminated pursuant to Section 7) without the written consent of such Lender whose Revolving
Commitment is being extended or increased (it being understood and agreed that a waiver of any
condition precedent set forth in Section 4.2 or of any Default or a mandatory reduction in
Revolving Commitments is not considered an extension or increase in Revolving Commitments of any
Lender);




     (ii) postpone any date fixed by this Agreement or any other Loan Document for any payment of
principal (excluding mandatory prepayments), interest, fees or other amounts due to the Lenders (or
any of them) or any scheduled or mandatory reduction of the Revolving Commitments hereunder or
under any other Loan Document without the written consent of each Lender entitled to receive such
payment or whose Revolving Commitments are to be reduced;




     (iii) reduce the principal of, or the rate of interest specified herein on, any Loan, or (subject
to clause (i) of the final proviso to this Section 9.1) any fees or other amounts payable hereunder
or under any other Loan Document without the written consent of each Lender entitled to receive
such payment of principal, interest, fees or other amounts; provided, however, that only
the consent of the Required Lenders shall be necessary to revise Sections 2.8(b) and (c) or to
waive any obligations of the Borrower therein;




     (iv) change Section 2.18 in a manner that would alter the pro rata sharing of payments required
thereby without the written consent of each Lender directly affected thereby;




     (v) change any provision of this Section 9.1 (a) or the definition of “Required Lenders” without
the written consent of each Lender directly affected thereby; or



59









 






     (vi) release the Borrower or, except in connection with a merger or consolidation permitted under
Section 6.2 or a Disposition permitted under Section 6.7, all or substantially all of the
Guarantors without the written consent of each Lender directly affected thereby;



     (b) unless also signed by the Swing Line Lender, no amendment, waiver or consent shall
affect the rights or duties of the Swing Line Lender under this Agreement; and



     (c) unless also signed by the Administrative Agent, no amendment, waiver or consent shall
affect the rights or duties of the Administrative Agent under this Agreement or any other Loan
Document;


provided, however, that notwithstanding anything to the contrary herein, (i) the Fee Letter
may be amended, or rights or privileges thereunder waived, in a writing executed only by the
parties thereto, (ii) no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Revolving Commitment of such Lender may not
be increased or extended without the consent of such Lender and (iii) each Lender is entitled to
vote as such Lender sees fit on any bankruptcy reorganization plan that affects the Loans, and each
Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code of the United
States supersedes the unanimous consent provisions set forth herein.




     9.2 Notices.



     (a) Notices Generally. Except in the case of notices and other communications expressly
permitted to be given by telephone (and except as provided in Section 5.2 or subsection (b) below),
all notices and other communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier
as follows, and all notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:




     (i) if to the Borrower or any other Loan Party, the Administrative Agent or the Swing Line Lender,
to the address, telecopier number, electronic mail address or telephone number specified for such
Person on Schedule 9.2; and




     (ii) if to any other Lender, to the address, telecopier number, electronic mail address or
telephone number specified in its Administrative Questionnaire.


Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall
be deemed to have been given when received; notices sent by telecopier shall be deemed to have been
given when sent (except that, if not given during normal business hours for the recipient, shall be
deemed to have been given at the opening of business on the next business day for the recipient).
Notices delivered through electronic communications to the extent provided in subsection (b) below,
shall be effective as provided in such subsection (b).



60









 





     (b) Electronic Communications. Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communication (including e-mail and Internet
or intranet websites) pursuant to procedures approved by the Administrative Agent, provided
that the foregoing shall not apply to notices to any Lender pursuant to Section 2 if such Lender,
as applicable, has notified the Administrative Agent that it is incapable of receiving notices
under such Section by electronic communication. The Administrative Agent or the Borrower may, in
its discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of such
procedures may be limited to particular notices or communications.



     Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to
an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the
intended recipient (such as by the “return receipt requested” function, as available, return e-mail
or other written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or communication shall be
deemed to have been sent at the opening of business on the next business day for the recipient, and
(ii) notices or communications posted to an Internet or intranet website shall be deemed received
upon the deemed receipt by the intended recipient at its e-mail address as described in the
foregoing clause (i) of notification that such notice or communication is available and identifying
the website address therefor.



     (c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”
THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR
ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS,
IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event
shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”)
have any liability to the Borrower, any Lender or any other Person for losses, claims, damages,
liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the
Borrower’s or the Administrative Agent’s transmission of Borrower Materials through the Internet,
except to the extent that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Agent Party; provided, however, that in no
event shall any Agent Party have any liability to the Borrower, any Lender or any other Person for
indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual
damages).



     (d) Change of Address, Etc. Each of the Borrower, the Administrative Agent and the
Swing Line Lender may change its address, telecopier or telephone number for notices and other
communications hereunder by notice to the other parties hereto. Each other Lender may change its
address, telecopier or telephone number for notices and other communications hereunder by



61









 




notice to the Borrower, the Administrative Agent and the Swing Line Lender. In addition, each
Lender agrees to notify the Administrative Agent from time to time to ensure that the
Administrative Agent has on record (i) an effective address, contact name, telephone number,
telecopier number and electronic mail address to which notices and other communications may be sent
and (ii) accurate wire instructions for such Lender.




     (e) Reliance by Administrative Agent and Lenders. The Administrative Agent and the Lenders
shall be entitled to rely and act upon any notices (including telephonic Loan Notices and Swing
Line Loan Notices) purportedly given by or on behalf of any Loan Party even if (i) such notices
were not made in a manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. The Loan Parties shall indemnify the Administrative Agent,
each Lender and the Related Parties of each of them from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice purportedly given by or on
behalf of a Loan Party. All telephonic notices to and other telephonic communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto
hereby consents to such recording.



     9.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.



     9.4 Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document, certificate or
statement delivered pursuant hereto or in connection herewith shall survive the execution and
delivery of this Agreement and the making of the Loans and other extensions of credit hereunder.



     9.5 Payment of Expenses; Payments Set Aside.



     (a) Costs and Expenses. The Loan Parties shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation, negotiation, execution,
delivery and administration of this Agreement and the other Loan Documents or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated) and (ii) all out-of-pocket expenses incurred
by the Administrative Agent or any Lender (including the fees, charges and disbursements of any
counsel for the Administrative Agent or any Lender), and shall pay all reasonable fees and time
charges for attorneys who may be employees of the Administrative Agent or any Lender, in connection
with the enforcement or protection of its rights (A) in connection with this Agreement and the
other Loan Documents, including its rights under this



62









 




Section, or (B) in connection with the Loans made hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect of such Loans.




     (b) Indemnification by the Loan Parties . The Loan Parties shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender, and each Related Party of any of the
foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related expenses (including the
reasonable fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify
and hold harmless each Indemnitee from all reasonable fees and time charges and disbursements for
attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against
any Indemnitee by any third party or by the Borrower or any other Loan Party arising out of, in
connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any
sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other
Loan Documents, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any
actual or alleged presence or release of Materials of Environmental Concern on or from any property
owned or operated by a Loan Party or any of its Subsidiaries, or any environmental liability
related in any way to a Loan Party or any of its Subsidiaries, or (iv) any actual or prospective
claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by the Borrower or any
other Loan Party, and regardless of whether any Indemnitee is a party thereto, in all cases,
whether or not caused by or arising, in whole or in part, out of the comparative, contributory or
sole negligence of the Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related
expenses (x) are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y)
result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if
the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction.



     (c) Reimbursement by Lenders. To the extent that the Loan Parties for any reason
fail to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid
by them to the Administrative Agent (or any sub-agent thereof) or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent)
or such Related Party, as the case may be, such Lender’s Revolving Percentage (determined as of the
time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount, provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) in its capacity as such, or against any Related Party
of any of the foregoing acting for the Administrative Agent (or any such sub-agent) in connection
with such capacity. The obligations of the Lenders under this subsection (c) are subject to the
provisions of Section 2.11 (f).



63









 





     (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, no Loan Party shall assert, and each Loan Party hereby waives, any claim against
any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No
Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use
by unintended recipients of any information or other materials distributed by it through
telecommunications, electronic or other information transmission systems in connection with this
Agreement or the other Loan Documents or the transactions contemplated hereby or thereby, except to
the extent that such damages are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful misconduct of such
Indemnitee.



     (e) Payments. All amounts due under this Section shall be payable not later than ten
Business Days after demand therefor.



     (f) Survival. The agreements in subsections (a) — (f) of this Section shall survive
the resignation of the Administrative Agent, the replacement of any Lender, the termination of the
Revolving Commitments and the repayment, satisfaction or discharge of all the other
Obligations.



     (g) Payments Set Aside. To the extent that any payment by or on behalf of any Loan
Party is made to the Administrative Agent or any Lender, or the Administrative Agent or any Lender
exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof
is subsequently invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent or such Lender in
its discretion) to be repaid to a trustee, receiver or any other party, in connection with any
proceeding under any bankruptcy, insolvency or similar law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or such setoff had not
occurred, and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share (without duplication) of any amount so recovered from or repaid by the
Administrative Agent, plus interest thereon from the date of such demand to the date such payment
is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The
obligations of the Lenders under clause (b) of the preceding sentence shall survive the payment in
full of the Obligations and the termination of this Agreement.



     9.6 Successors and Assigns; Participations and Assignments.



     (a) Successors and Assigns Generally. The provisions of this Agreement and the other Loan
Documents shall be binding upon and inure to the benefit of the parties hereto and thereto and
their respective successors and assigns permitted hereby, except that the Borrower may not assign
or otherwise transfer any of its rights or obligations hereunder or thereunder without the prior
written consent of the Administrative Agent and each Lender and no Lender



64









 




may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an
assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of this Section or (iii) by way
of pledge or assignment of a security interest subject to the restrictions of subsection (f) of
this Section (and any other attempted assignment or transfer by any party hereto shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any
legal or equitable right, remedy or claim under or by reason of this Agreement.




     (b) Assignments by Lenders. Any Lender may at any time assign to one or more assignees all
or a portion of its rights and obligations under this Agreement and the other Loan Documents
(including all or a portion of its Revolving Commitment and the Loans (including for purposes of
this subsection (b), participations in Swing Line Loans) at the time owing to it); provided
that any such assignment shall be subject to the following conditions:




     (i) Minimum Amounts.




     (A) in the case of an assignment of the entire remaining amount of the assigning Lender’s
Revolving Commitment and the Loans at the time owing to it or in the case of an assignment to a
Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and




     (B) in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount
of the Revolving Commitment (which for this purpose includes Loans outstanding thereunder) or, if
the Revolving Commitment is not then in effect, the principal outstanding balance of the Loans of
the assigning Lender subject to each such assignment, determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the Administrative Agent
or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not
be less than $5,000,000 unless each of the Administrative Agent and, so long as no Event of Default
has occurred and is continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); provided, however, that (A) concurrent assignments to members of
an Assignee Group and concurrent assignments from members of an Assignee Group to a single assignee
(or to an assignee and members of its Assignee Group) will be treated as a single assignment for
purposes of determining whether such minimum amount has been met and (B) members of an Assignee
Group shall be considered one Lender for purposes of establishing the Administrative Agent’s
administrative fee pursuant to the Fee Letter;



     (ii) Required Consents. No consent shall be required for any assignment except to
the extent required by subsection (b)(i)(B) of this Section and, in addition:



65









 






     (A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed)
shall be required unless (1) an Event of Default has occurred and is continuing at the time of such
assignment or (2) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund;




     (B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or
delayed) shall be required if such assignment is to a Person that is not a Lender, an Affiliate of
such Lender or an Approved Fund with respect to such Lender; and




     (C) the consent of the Swing Line Lender (such consent not to unreasonably withheld or
delayed) shall be required for any assignment.




     (iii) Assignment and Assumption. The parties to each assignment shall execute and deliver
to the Administrative Agent an Assignment and Assumption, together with a processing and
recordation fee in the amount of $3,500 provided, however, that the Administrative Agent
may, in its sole discretion, elect to waive such processing and recordation fee in the case of any
assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire.




     (iv) No Assignment to Borrower. No such assignment shall be made to the Borrower or any of
the Borrower’s Affiliates or Subsidiaries.




     (v) No Assignment to Natural Persons. No such assignment shall be made to a natural person.



     Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto but shall continue to be
entitled to the benefits of Sections 2.13, 2.14 and 9.5 with respect to facts and circumstances
occurring prior to the effective date of such assignment). Upon request, the Borrower (at its
expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with this subsection
shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with subsection (d) of this Section.



     (c) Register. The Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at the Administrative Agent’s office a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and addresses of the
Lenders, and the Revolving Commitments of, and principal amounts of the Loans owing to, each



66









 




Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder
for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.




     (d) Participations. Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all
or a portion of its Revolving Commitment and/or the Loans (including such Lender’s participations
in Swing Line Loans) owing to it); provided that (i) such Lender’s obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative
Agent and the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide that such Lender
shall retain the sole right to enforce this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree to any amendment,
waiver or other modification described in Section 9.1 that affects such Participant. Subject to
subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.13 and 2.14 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 9.7 as though it were a Lender,
provided such Participant agrees to be subject to Section 2.11 as though it were a Lender.



     (e) Limitation on Participant Rights. A Participant shall not be entitled to receive
any greater payment under Section 2.12 or 2.13 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower’s prior written consent. A
Participant that would be a foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 2.13 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section
2.13(d) as though it were a Lender.



     (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its Note, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender
from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as
a party hereto.



67









 





     (g) Electronic Execution of Assignments. The words “execution,” “signed,” “signature,” and
words of like import in any Assignment and Assumption shall be deemed to include electronic
signatures or the keeping of records in electronic form, each of which shall be of the same legal
effect, validity or enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in any applicable law,
including the Federal Electronic Signatures in Global and National Commerce Act, the New York State
Electronic Signatures and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act



     (h) Resignation as Swing Line Lender after Assignment. Notwithstanding anything to the
contrary contained herein, if at any time Bank of America assigns all of its Revolving Commitment
and Loans pursuant to subsection (b) above, Bank of America may, upon thirty days’ notice to the
Borrower, resign as Swing Line Lender. In the event of any such resignation as Swing Line Lender,
the Borrower shall be entitled to appoint from among the Lenders a successor Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to appoint any such successor
shall affect the resignation of Bank of America as Swing Line Lender. If Bank of America resigns as
Swing Line Lender, it shall retain all the rights of the Swing Line Lender provided for hereunder
with respect to Swing Line Loans made by it and outstanding as of the effective date of such
resignation, including the right to require the Lenders to make Base Rate Loans or fund risk
participations in outstanding Swing Line Loans pursuant to Section 2.17(c). Upon the appointment of
a successor Swing Line Lender, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring Swing Line Lender.



     9.7 Set-off. If an Event of Default shall have occurred and be continuing, each
Lender and each of their respective Affiliates is hereby authorized at any time and from time to
time, after obtaining the prior written consent of the Administrative Agent, to the fullest extent
permitted by applicable law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final, in whatever currency) at any time held and other obligations (in
whatever currency) at any time owing by such Lender or any such Affiliate to or for the credit or
the account of the Borrower or any other Loan Party against any and all of the obligations of the
Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan
Document to such Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement or any other Loan Document and although such obligations of the Borrower or
such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender
different from the branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender and its Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender or its Affiliates may have. Each
Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff
and application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.



     9.8 Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. Delivery of an executed signature page
of this Agreement by facsimile transmission shall be effective as delivery of a



68









 





manually executed counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with Novellus and the Administrative Agent.




     9.9
Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.



     9.10 Integration. This Agreement and the other Loan Documents represent the entire
agreement of the Borrower, the Administrative Agent and the Lenders with respect to the subject
matter hereof and thereof, and there are no promises, undertakings, representations or warranties
by the Administrative Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.



     9.11 GOVERNING LAW; JURISDICTION; ETC.



     (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 AND SECTION 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK) WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD
REQUIRE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.



     (b) SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY
AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT
OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,
OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION 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. NOTHING IN THIS AGREEMENT OR IN ANY OTHER
LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY
LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY



69









 




OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE
COURTS OF ANY JURISDICTION.




     (c) WAIVER OF VENUE. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF
THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.



     (d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN
THE MANNER PROVIDED FOR NOTICES IN SECTION 9.2. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF
ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.



     9.12 Treatment of Certain Information; Confidentiality. Each of the Administrative
Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’
respective partners, directors, officers, employees, agents, advisors and representatives and to
any direct or indirect contractual counterparty (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any
actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating
to a Loan Party and its obligations, (g) with the consent of the Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach of this Section or
(y) becomes available to the Administrative Agent, any Lender, or any of their respective
Affiliates on a nonconfidential basis from a source other than the Borrower.



     For purposes of this Section, “Information” means all information received from a Loan Party or any
Subsidiary relating to the Loan Parties or any Subsidiary or any of their respective businesses,
other than any such information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by such Loan Party or any Subsidiary,



70









 




provided that, in the case of information received from a Loan Party or any Subsidiary
after the date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




     Each of the Administrative Agent and the Lenders acknowledges that (a) the Information may include
material non-public information concerning the Borrower or a Subsidiary, as the case may be, (b) it
has developed compliance procedures regarding the use of material non-public information and (c) it
will handle such material non-public information in accordance with applicable law, including
Federal and state securities laws.



     9.13 WAIVERS OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.



     9.14 USA Patriot Act. Each Lender hereby notifies the Borrower that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it is required to obtain, verify and record information that identifies the Borrower,
which information includes the name and address of the Borrower and other information that will
allow such Lender to identify the Borrower in accordance with the Act.



     9.15 California Judicial Reference. If any action or proceeding is filed in a court of
the State of California by or against any party hereto in connection with any of the transactions
contemplated by this Agreement or any other Loan Document, (a) the court shall, and is hereby
directed to, make a general reference pursuant to California Code of Civil Procedure Section 638 to
a referee (who shall be a single active or retired judge) to hear and determine all of the issues
in such action or proceeding (whether of fact or of law) and to report a statement of decision,
provided that at the option of any party to such proceeding, any such issues pertaining to
a “provisional remedy” as defined in California Code of Civil Procedure Section 1281.8 shall be
heard and determined by the court, and (b) without limiting the generality of Section 11.04, the
Borrower shall be solely responsible to pay all fees and expenses of any referee appointed hi such
action or proceeding.



71









 





     9.16 No Advisory or Fiduciary Relationship. In connection with all aspects of each
transaction contemplated hereby, the Borrower acknowledges and agrees, and acknowledges its
Affiliates’ understanding, that: (i) the credit facility provided for hereunder and any related
arranging or other services in connection therewith (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial
transaction between the Borrower and its Affiliates, on the one hand, and the Administrative Agent
and BAS, on the other hand, and the Borrower is capable of evaluating and understanding and
understands and accepts the terms, risks and conditions of the transactions contemplated hereby and
by the other Loan Documents (including any amendment, waiver or other modification hereof or
thereof); (ii) in connection with the process leading to such transaction, the Administrative Agent
and BAS each is and has been acting solely as a principal and is not the financial advisor, agent
or fiduciary, for the Borrower or any of Affiliates, stockholders, creditors or employees or any
other Person; (iii) neither the Administrative Agent nor BAS has assumed or will assume an
advisory, agency or fiduciary responsibility in favor of the Borrower with respect to any of the
transactions contemplated hereby or the process leading thereto, including with respect to any
amendment, waiver or other modification hereof or of any other Loan Document (irrespective of
whether the Administrative Agent or BAS has advised or is currently advising the Borrower or any of
its Affiliates on other matters) and neither the Administrative Agent nor BAS has any obligation to
the Borrower or any of its Affiliates with respect to the transactions contemplated hereby except
those obligations expressly set forth herein and in the other Loan Documents; (iv) the
Administrative Agent and BAS and their respective Affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Borrower and its Affiliates, and
neither the Administrative Agent nor BAS has any obligation to disclose any of such interests by
virtue of any advisory, agency or fiduciary relationship; and (v) the Administrative Agent and BAS
have not provided and will not provide any legal, accounting, regulatory or tax advice with respect
to any of the transactions contemplated hereby (including any amendment, waiver or other
modification hereof or of any other Loan Document) and the Borrower has consulted its own legal,
accounting, regulatory and tax advisors to the extent it has deemed appropriate. The Borrower
hereby waives and releases, to the fullest extent permitted by law, any claims that it may have
against the Administrative Agent or BAS with respect to any breach or alleged breach of agency or
fiduciary duty.



     SECTION 10. GUARANTY



     10.1 The Guaranty. Each of the Guarantors hereby jointly and severally guarantees to each
Lender and the Administrative Agent as hereinafter provided, as primary obligor and not as surety,
the prompt payment of the Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise) strictly in
accordance with the terms thereof. The Guarantors hereby further agree that if any of the
Obligations are not paid in full when due (whether at stated maturity, as a mandatory prepayment,
by acceleration, as a mandatory cash collateralization or otherwise), the Guarantors will, jointly
and severally, promptly pay the same, without any demand or notice whatsoever, and that in the case
of any extension of time of payment or renewal of any of the Obligations, the same will be promptly
paid in full when due (whether at extended maturity, as a mandatory prepayment, by acceleration, as
a mandatory cash collateralization or otherwise) in accordance with the terms of such extension or
renewal.



72









 





     Notwithstanding any provision to the contrary contained herein or in any other of the Loan
Documents, the obligations of each Guarantor under this Agreement and the other Loan Documents
shall be limited to an aggregate amount equal to the largest amount that would not render such
obligations subject to avoidance under the bankruptcy, insolvency or similar law or any comparable
provisions of any applicable state law.



     10.2 Obligations Unconditional. The obligations of the Guarantors under Section 10.1 are
joint and several, absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Loan Documents or any other agreement or instrument
referred to therein, or any substitution, release, impairment or exchange of any other guarantee of
or security for any of the Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor, it being the intent of this Section 10.2
that the obligations of the Guarantors hereunder shall be absolute and unconditional under any and
all circumstances. Each Guarantor agrees that such Guarantor shall have no right of subrogation,
indemnity, reimbursement or contribution against the Borrower or any other Guarantor for amounts
paid under this Section 10 until such time as the Obligations have been paid in full and the
Revolving Commitments have expired or terminated. Without limiting the generality of the foregoing,
it is agreed that, to the fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder, which shall remain
absolute and unconditional as described above:



     (a) at any time or from time to time, without notice to any Guarantor, the time for any
performance of or compliance with any of the Obligations shall be extended, or such performance or
compliance shall be waived;



     (b) any of the acts mentioned in any of the provisions of any of the Loan Documents or any
other agreement or instrument referred to in the Loan Documents shall be done or omitted;



     (c) the maturity of any of the Obligations shall be accelerated, or any of the Obligations
shall be modified, supplemented or amended in any respect, or any right under any of the Loan
Documents or any other agreement or instrument referred to in the Loan Documents shall be waived or
any other guarantee of any of the Obligations or any security therefor shall be released, impaired
or exchanged in whole or in part or otherwise dealt with;



     (d) any Lien granted to, or in favor of, the Administrative Agent or any Lender or Lenders as
security for any of the Obligations shall fail to attach or be perfected; or



     (e) any of the Obligations shall be determined to be void or voidable (including, without
limitation, for the benefit of any creditor of any Guarantor) or shall be subordinated to the
claims of any Person (including, without limitation, any creditor of any Guarantor).



     With respect to its obligations hereunder, each Guarantor hereby expressly waives diligence,
presentment, demand of payment, protest and all notices whatsoever, and any



73









 




requirement that the Administrative Agent or any Lender exhaust any right, power or remedy or
proceed against any Person under any of the Loan Documents or any other agreement or instrument
referred to in the Loan Documents or against any other Person under any other guarantee of, or
security for, any of the Obligations.




     10.3 Reinstatement. The obligations of the Guarantors under this Section 10 shall be
automatically reinstated if and to the extent that for any reason any payment by or on behalf of
any Person in respect of the Obligations is rescinded or must be otherwise restored by any holder
of any of the Obligations, whether as a result of any proceedings in bankruptcy or reorganization
or otherwise, and each Guarantor agrees that it will indemnify the Administrative Agent and each
Lender on demand for all reasonable costs and expenses (including, without limitation, the fees,
charges and disbursements of counsel) incurred by the Administrative Agent or such Lender in
connection with such rescission or restoration, including any such costs and expenses incurred in
defending against any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.



     10.4 Certain Additional Waivers. Each Guarantor agrees that such Guarantor shall have
no right of recourse to security for the Obligations, except through the exercise of rights of
subrogation pursuant to Section 10.2 and through the exercise of rights of contribution pursuant to
Section 10.6. Each Guarantor waives any rights and defenses that are or may become available to
such Guarantor by reason of §§ 2787 to 2855, inclusive, and §§ 2899 and 3433 of the California
Civil Code.



     10.5 Remedies. The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the Lenders, on the other
hand, the Obligations may be declared to be forthwith due and payable as provided in Section 7 (and
shall be deemed to have become automatically due and payable in the circumstances provided in said
Section 7) for purposes of Section 10.1 notwithstanding any stay, injunction or other prohibition
preventing such declaration (or preventing the Obligations from becoming automatically due and
payable) as against any other Person and that, in the event of such declaration (or the Obligations
being deemed to have become automatically due and payable), the Obligations (whether or not due and
payable by any other Person) shall forthwith become due and payable by the Guarantors for purposes
of Section 10.1. The Guarantors acknowledge and agree that their obligations hereunder are
secured in accordance with the terms of the Collateral Documents and that the Lenders may exercise
their remedies thereunder in accordance with the terms thereof.



     10.6 Rights of Contribution. The Guarantors agree among themselves that, in
connection with payments made hereunder, each Guarantor shall have contribution rights against the
other Guarantors as permitted under applicable law. Such contribution rights shall be
subordinate and subject in right of payment to the obligations of such Guarantors under the Loan
Documents and no Guarantor shall exercise such rights of contribution until all Obligations have
been paid in full and the Commitments have terminated.



     10.7 Additional Guarantor Waivers and Agreements.



74









 





     (a) Each Guarantor understands and acknowledges that if the Lenders foreclose
judicially or nonjudicially against any real property security for the Obligations, that
foreclosure could impair or destroy any ability that such Guarantor may have to seek reimbursement,
contribution or indemnification from the Borrower or others based on any right such Guarantor may
have of subrogation, reimbursement, contribution, or indemnification for any amounts paid by such
Guarantor under this Guaranty. Each Guarantor further understands and acknowledges that in the
absence of this paragraph, such potential impairment or destruction of such Guarantor’s rights, if
any, may entitle such Guarantor to assert a defense to this Guaranty based on Section 580d of the
California Code of Civil Procedure as interpreted in Union Bank v. Gradsky, 265 Cal. App. 2d 40
(1968). By executing this Guaranty, each Guarantor freely, irrevocably, and unconditionally: (i)
waives and relinquishes that defense and agrees that such Guarantor will be fully liable under this
Guaranty even though the Lenders may foreclose, either by judicial foreclosure or by exercise of
power of sale, any deed of trust securing the Obligations; (ii) agrees that such Guarantor will not
assert that defense in any action or proceeding which the Lenders may commence to enforce this
Guaranty; (iii) acknowledges and agrees that the rights and defenses waived by Holdings in this
Guaranty include any right or defense that Holdings may have or be entitled to assert based upon or
arising out of any one or more of §§ 580a, 580b, 580d, or 726 of the California Code of Civil
Procedure or § 2848 of the California Civil Code; and (iv) acknowledges and agrees that the Lenders
are relying on this waiver in creating the Obligations, and that this waiver is a material part of
the consideration which the Lenders are receiving for creating the Obligations.



     (b) Each Guarantor waives all rights and defenses that such Guarantor may have because any of
the Obligations is secured by real property. This means, among other things: (i) the Lenders may
collect from such Guarantor without first foreclosing on any real or personal property collateral
pledged by the other Loan Parties; and (ii) if the Lenders foreclose on any real property
collateral pledged by the other Loan Parties: (A) the amount of the Obligations may be reduced only
by the price for which that collateral is sold at the foreclosure sale, even if the collateral is
worth more than the sale price, and (B) the Lenders may collect from such Guarantor even if the
Lenders, by foreclosing on the real property collateral, have destroyed any right such Guarantor
may have to collect from the Borrower. This is an unconditional and irrevocable waiver of any
rights and defenses such Guarantor may have because any of the Obligations is secured by real
property. These rights and defenses include, but are not limited to, any rights or defenses based
upon § 580a, 580b, 580d, or 726 of the California Code of Civil Procedure.



     (c) Each Guarantor waives any right or defense it may have at law or equity, including
California Code of Civil Procedure § 580a, to a fair market value hearing or action to determine a
deficiency judgment after a foreclosure.



     10.8 Guarantee of Payment; Continuing Guarantee.


The guarantee in this Section 10 is a guaranty of payment and not of collection, is a continuing
guarantee, and shall apply to all Obligations whenever arising.



75









 






     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and
delivered by their proper and duly authorized officers as of the day and year first above written.



	 	 	 	 	 	 	 
	BORROWER:	 	NOVELLUS SYSTEMS, INC.,

a California corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William H. Kurtz
 

	 	 
	 

	 	 	 	William H. Kurtz	 	 
	 

	 	 	 	Executive Vice President and Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	GUARANTORS:	 	NOVELLUS SYSTEMS INTERNATIONAL, INC.,

a California corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William H. Kurtz	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	William H. Kurtz	 	 
	 

	 	 	 	President	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS HOLDING COMPANY,

a Delaware Corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William H. Kurtz	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	William H. Kurtz	 	 
	 

	 	 	 	President	 	 
	 
	 	 	 	 	 	 
	 	 	SPEEDFAM-IPEC CORPORATION,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William H. Kurtz	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	William H. Kurtz

President	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 







	 	 	 	 	 	 	 
	ADMINISTRATIVE AGENT:	 	BANK OF AMERICA, N.A.,

as Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Brenda H. Little
 

	 	 
	 

	 	 	 	Name: Brenda H. Little

Title: Assistant Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 






	 	 	 	 	 	 	 
	LENDERS:	 	BANK OF AMERICA, N.A.,

as Swing Line Lender and a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lee A. Merkle-Raymend
 

Name: Lee A. Merkle-Raymend

Title: Managing Director
	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 






	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK AG NEW YORK BRANCH,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Yvonne Tilden	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Yvonne Tilden

Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Anca Trifan	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Anca Trifan

Title: Director	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 






	 	 	 	 	 	 	 
	.	 	ABN AMRO BANK N.V.,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Dianne D. Barkley	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	Name: Dianne D. Barkley 

Title: Managing Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Tracy Dziedzic	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Tracy Dziedzic

Title: Managing Director	 	 






 









 






	 	 	 	 	 	 	 
	 	 	MIZUHO CORPORATE BANK LTD.,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Bertram Tang
 

	 	` 
	 

	 	 	 	Name: Bertram Tang	 	 
	 

	 	 	 	Title: Senior Vice President & Team Leader	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 






	 	 	 	 	 	 	 
	 	 	UNION BANK OF CALIFORNIA, N.A.,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Allan B. Miner
 

	 	` 
	 

	 	 	 	Name: Allan B. Miner	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT	 	 






 









 






	 	 	 	 	 	 	 
	 	 	BNP PARIBAS,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stuart Darby
 

	 	 
	 

	 	 	 	Name:  Stuart Darby	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By :
	 	/s/ Pierre- Nicholas Rogers	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Pierre- Nicholas Rogers

Title: Managing Director	 	 






 









 






	 	 	 	 	 	 	 
	 	 	HSBC BANK USA, NATIONAL ASSOCIATION,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jeffrey S. Hughes
 

Name: Jeffrey S. Hughes
	 	 
	 

	 	 	 	Title: Vice President & Senior Relationship Manager	 	 
	 
	 	 	 	 	 	 
	 	 	NOVELLUS SYSTEMS, INC.

CREDIT AGREEMENT