**Exhibit 10.2**

 

**Conformed Copy**

 

**EXPORT-IMPORTBANK LOAN AND SECURITY AGREEMENT**

 

**THIS EXPORT-IMPORT LOAN AND SECURITY AGREEMENT**(this “**EXIM****Agreement**”)dated as of the Effective Date between **SILICON VALLEY BANK**,a California corporation, with its principal place of business at 3003 TasmanDrive, Santa Clara, California 95054 and with a loan production office locatedat One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,Massachusetts 02462 (“**Bank**”), and **AXCELIS TECHNOLOGIES, INC.** and **AXCELIS TECHNOLOGIESCCS CORPORATION**, each a Delaware corporation with offices located at108 Cherry Hill Drive, Beverly, Massachusetts 01915 (individually andcollectively, jointly and severally “**Borrower**”),provides the terms on which Bank shall lend to Borrower and Borrower shallrepay Bank.  The parties agree asfollows:

 

**1****             ****ACCOUNTINGAND OTHER TERMS**

 

(a)           Borrower and Bank areparties to that certain Amended and Restated Loan and Security Agreement datedas of the date hereof (as may be amended from time to time, the “**Domestic Agreement**”), together with related documentsexecuted in conjunction therewith, (as may be amended from time to time, the “**Domestic Loan Documents**”).

 

(b)           Borrower and Bankdesire in this EXIM Agreement to set forth their agreement with respect to aworking capital facility to be guaranteed by the EXIM Bank.

 

(c)           Accounting terms notdefined in this EXIM Agreement shall be construed following GAAP.  Calculations and determinations must be madefollowing GAAP.  Capitalized terms nototherwise defined in Section 13 of this EXIM Agreement shall have themeanings set forth in Section 13 of the Domestic Agreement.   All other terms contained in this EXIMAgreement, unless otherwise indicated, shall have the meaning provided by theCode to the extent such terms are defined therein.

 

**2****             ****LOANAND TERMS OF PAYMENT**

** **

## **2.1****          Promise to Pay**.  Borrower hereby unconditionally promises topay Bank the outstanding principal amount of all Credit Extensions and accruedand unpaid interest thereon as and when due in accordance with this EXIMAgreement.

##  

### **2.1.1****       Revolving Advances**.

###  

#### (a)           Availability.  Subject to the terms and conditions of thisEXIM Agreement and to deduction of Reserves, Bank shall make EXIM Advances notexceeding the Availability Amount.  Amounts borrowed under the RevolvingLine may be repaid and, prior to the Revolving Line Maturity Date, reborrowed,subject to the applicable terms and conditions precedent herein.

####  

#### (b)           Termination;Repayment.  The Revolving Lineterminates on the earlier of (i) the Revolving Line Maturity Date or (ii) thetermination of the Domestic Agreement, when the principal amount of all EXIMAdvances, the unpaid interest thereon, and all other Obligations relating tothe Revolving Line shall be immediately due and payable.

####  

## **2.2****          Overadvances.** If at any time or forany reason the total of all outstanding Credit Extensions (other than CreditExtension made pursuant to the Domestic Agreement) exceeds the AvailabilityAmount (such excess amount being an “**Overadvance**”),Borrower shall immediately pay the amount of the excess to Bank, without noticeor demand.  Without limiting Borrower’sobligation to repay to Bank the amount of any Overadvance, Borrower agrees topay Bank interest on the outstanding amount of any Overadvance, on demand, atthe Default Rate.

 

----

 

## **2.3****          Payment of Interest onthe Credit Extensions**.

##  

#### (a)           Interest Rate; EXIMAdvances.  Subject to Section 2.3(b),the principal amount of all EXIM Advances outstanding under the Revolving Lineshall accrue interest at floating per annum rate equal to the Prime Rate plustwo percent (2.00%), which interest shall be payable monthly, in arrears,  in accordance with Section 2.3(f).

####  

#### (b)           Default Rate.  Immediately upon the occurrence and duringthe continuance of an Event of Default, Obligations shall bear interest at arate per annum which is three and one-half of one percent (3.50%) above therate that is otherwise applicable thereto (the “**Default Rate**”).  Fees and expenses which are required to bepaid by Borrower pursuant to the Loan Documents (including, without limitation,Bank Expenses) but are not paid when due shall bear interest until paid at arate equal to the highest rate applicable to the Obligations; provided,however, no interest shall accrue on such fees and expenses to the extent fundsare available to be deducted by the Bank from Borrower’s accounts if suchdeduction is not timely made by Bank at no fault of Borrower.  Payment or acceptance of the increasedinterest rate provided in this Section 2.3(b) is not a permittedalternative to timely payment and shall not constitute a waiver of any Event ofDefault or otherwise prejudice or limit any rights or remedies of Bank.

####  

#### (c)           Adjustments toInterest Rate.  Changes to theinterest rate of any Credit Extension based on changes to the Prime Rate shallbe effective on the effective date of any change to the Prime Rate and to theextent of any such change.  Bank shalluse its best efforts to give Borrower prompt notice of any such change in thePrime Rate; provided, however, that any failure by Bank to provide Borrowerwith notice hereunder shall not affect Bank’s right to make changes in theinterest rate based on changes in the Prime Rate.

####  

#### (d)           Computation ofInterest.  Interest on the CreditExtensions and all fees payable hereunder shall be computed on the basis of a360-day year and the actual number of days elapsed in the period during whichsuch interest accrues.  In computinginterest on any Credit Extension, the date of the making of such CreditExtension shall be included and the date of payment shall be excluded;provided, however, that if any Credit Extension is repaid on the same day onwhich it is made, such day shall be included in computing interest on suchCredit Extension.

####  

#### (e)           Debit of Accounts.  Bank may debit any of Borrower’s depositaccounts, including the Designated Deposit Account, for principal and interestpayments or any other amounts Borrower owes Bank when due.  These debits shall not constitute a set-off.The provisions of the previous sentence shall not apply to deposit accountsdesignated as, and exclusively used for, payroll, payroll taxes and otheremployee wage and benefit payments to or for the benefit of Borrower’semployees.

####  

#### (f)            Interest PaymentDate.  Interest is payable monthly,in arrears, on the last calendar day of each month.  All accrued but unpaid interest on theAdvances shall be due and payable on the Revolving Line Maturity Date.

####  

#### (g)           Payments. Allpayments (including prepayments) to be made by Borrower under any Loan Documentshall be made in immediately available funds in U.S. Dollars, without setoff orcounterclaim, before 12:00 p.m. Eastern time on the date when due.  Payments of principal and/or interestreceived after 12:00 p.m. Eastern time are considered received at theopening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the paymentshall be due the next Business Day, and additional fees or interest, asapplicable, shall continue to accrue until paid.

####  

## **2.4****          Fees**.  Borrower shall pay to Bank:

##  

#### (a)           Commitment Fee.  A fully earned, non-refundable commitmentfee, payable in accordance with the terms and conditions of the DomesticAgreement; and

####  

#### (b)           Bank Expenses.  All Bank Expenses (including reasonableattorneys’ fees and expenses, plus expenses, for documentation and negotiationof this EXIM Agreement) incurred through and after the Effective Date, whendue.

##  

## **2.5****          Use of Proceeds**.  Borrower will use the proceeds of the EXIMAdvances only for the purposes specified in the EXIM Borrower Agreement.  Borrower will not use the proceeds of theEXIM Advances for any purpose prohibited by the EXIM Borrower Agreement.

 

2

----

 

## **2.6****          EXIM Guaranty**.  To facilitate the financing of Eligible EXIMAccounts, the EXIM Bank has agreed to guarantee the EXIM Loans made under thisEXIM Agreement, pursuant to a Master Guarantee Agreement, Loan AuthorizationAgreement and (to the extent applicable) Delegated Authority Letter Agreement(collectively, the “**EXIM Guaranty**”).  If, at any time after the EXIM Guaranty hasbeen entered into by Bank, for any reason other than due to any action orinaction of Borrower under the EXIM Guaranty, (a) the EXIM Guaranty shallcease to be in full force and effect, or (b) the EXIM Bank declares theEXIM Guaranty void or revokes any obligations thereunder or denies liabilitythereunder, Borrower shall immediately repay all outstanding EXIM Advanceshereunder, and Borrower shall cash collateralize all issued and undrawn lettersof credit issued by Bank, if any.  If, atany time after the EXIM Guaranty has been entered into by Bank, for any reasonother than as described in the foregoing sentence, (x) the EXIM Guarantyshall cease to be in full force and effect, or (y) the EXIM Bank declaresthe EXIM Guaranty void or revokes any obligations thereunder or deniesliability thereunder, any such event shall constitute an Event of Default underthis EXIM Agreement.  Nothing in anyconfidentiality agreement, in this EXIM Agreement or in any other agreement,shall restrict Bank’s right to make disclosures and provide information to theEXIM Bank in connection with the EXIM Guaranty.

##  

## **2.7****          EXIM Borrower Agreement**. Borrower shall execute and deliver a Borrower Agreement, in the formspecified by the EXIM Bank (attached hereto as **Annex A**), in favor of Bank and the EXIM Bank, together with anamendment thereto approved by the EXIM Bank to conform certain terms of suchBorrower Agreement to the terms of this EXIM Agreement (as amended, the “**EXIM Borrower Agreement**”). When the EXIM Borrower Agreement is entered into by Borrower and theEXIM Bank and delivered to Bank, this EXIM Agreement shall be subject to all ofthe terms and conditions of the EXIM Borrower Agreement, all of which arehereby incorporated herein by this reference. From and after the time Borrower and the EXIM Bank have entered into theEXIM Borrower Agreement and delivered the same to Bank, Borrower expresslyagrees to perform all of the obligations and comply with all of the affirmativeand negative covenants and all other terms and conditions set forth in the EXIMBorrower Agreement as though the same were expressly set forth herein.  In the event of any conflict between theterms of the EXIM Borrower Agreement (if then in effect) and the other terms ofthis EXIM Agreement, whichever terms are more restrictive shall apply.  Borrower acknowledges and agrees that it hasreceived a copy of the Loan Authorization Agreement which is referred to in theEXIM Borrower Agreement.  If the EXIMBorrower Agreement is entered into by Borrower and the EXIM Bank and deliveredto Bank, Borrower agrees to be bound by the terms of the Loan AuthorizationAgreement, including, without limitation, by any additions or revisions madeprior to its execution on behalf of EXIM Bank. Upon the execution of the Loan Authorization Agreement by EXIM Bank andBank, it shall become an attachment to the EXIM Borrower Agreement.  Borrower shall reimburse Bank for all feesand all out of pocket costs and expenses incurred by Bank with respect to theEXIM Guaranty and the EXIM Borrower Agreement, including, without limitation,all facility fees and usage fees, and Bank is authorized to debit any ofBorrower’s deposit accounts with Bank for such fees, costs and expenses whenpaid by Bank.

##  

## **2.8****          Withholding**.  Payments received by Bank from Borrowerhereunder will be made free and clear of any withholding taxes.  Specifically, however, if at any time anygovernmental authority, applicable law, regulation or international agreementrequires Borrower to make any such withholding or deduction from any suchpayment or other sum payment hereunder to Bank, Borrower hereby covenants andagrees that the amount due from Borrower with respect to such payment or othersum payable hereunder will be increased to the extent necessary to ensure that,after the making of such required withholding or deduction, Bank receives a netsum equal to the sum which it would have received had no withholding ordeduction been required and Borrower shall pay the full amount withheld ordeducted to the relevant governmental authority.  Borrower will, upon request, furnish Bankwith proof satisfactory to Bank indicating that Borrower has made suchwithholding payment provided, however, that Borrower need not make anywithholding payment if the amount or validity of such withholding payment iscontested in good faith by appropriate and timely proceedings and as to whichpayment in full is bonded or reserved against by Borrower.  The agreements and obligations of Borrowercontained in this Section 2.8 shall survive the termination of thisAgreement.

##  

**3****             ****CONDITIONSOF LOANS**

##  

## **3.1****          Conditions Precedent toInitial Credit Extension**.  Bank’sobligation to make the initial Credit Extension is subject to the condition precedentthat Borrower shall consent to or have delivered, in form and substancesatisfactory to Bank, such documents, and completion of such other matters, asBank may reasonably deem necessary or appropriate, including, withoutlimitation:

 

3

----

 

#### (a)         duly executed originalsignatures to the Loan Documents to which it is a party;

####  

#### (b)        the Economic ImpactCertification, Loan Authorization Notice and EXIM Bank Application Form, ineach case duly executed and together with original signatures, as applicable;

####  

#### (c)           duly executed originalsignatures to the completed Borrowing Resolutions for Borrower;

####  

#### (d)           a legal opinion ofBorrower’s counsel dated as of the Effective Date together with the dulyexecuted original signatures thereto;

####  

#### (e)           payment of the fees andBank Expenses then due as specified in Section 2.4 hereof;

####  

#### (f)            duly executed originalsignatures to the Domestic Loan Documents to which it is a party; and

####  

#### (g)           delivery of all suchother documents as Bank reasonably deems necessary or appropriate.

####  

## **3.2****          Conditions Precedent toall Credit Extensions**.  Bank’sobligations to make each Credit Extension, including the initial CreditExtension, is subject to the following:

##  

#### (a)           timely receipt of anyexport purchase order and an EXIM Borrowing Base Certificate relating to therequest;

####  

#### (b)           except as otherwiseprovided in Section 3.4, timely receipt of an executed Transaction Report;

####  

#### (c)           the representations andwarranties in Section 5 shall be true, accurate and complete in allmaterial respects on the date of the Transaction Report and on the Funding Dateof each Credit Extension; provided, however, that such materiality qualifiershall not be applicable to any representations and warranties that already arequalified or modified by materiality in the text thereof; and provided, furtherthat those representations and warranties expressly referring to a specificdate shall be true, accurate and complete in all material respects as of suchdate, and no Default or Event of Default shall have occurred and be continuingor result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on thatdate that the representations and warranties in Section 5 remain true,accurate and complete in all material respects; provided, however, that suchmateriality qualifier shall not be applicable to any representations andwarranties that already are qualified or modified by materiality in the textthereof; and provided, further that those representations and warrantiesexpressly referring to a specific date shall be true, accurate and complete inall material respects as of such date;

####  

#### (d)           as determined in Bank’sreasonable business judgment, there has not been a Material Adverse Change; and

####  

#### (e)           the EXIM Guaranty shallbe in full force and effect.

####  

## **3.3****          Covenant to Deliver**.  Borrower agrees to deliver to Bank each itemrequired to be delivered to Bank under this EXIM Agreement as a condition toany Credit Extension.  Borrower expresslyagrees that a Credit Extension made prior to the receipt by Bank of any suchitem shall not constitute a waiver by Bank of Borrower’s obligation to deliversuch item, and any such Credit Extension in the absence of a required itemshall be made in Bank’s sole discretion.

##  

## **3.4****          Procedures for Borrowing**.  Subject to the prior satisfaction of allother applicable conditions to the making of an Advance set forth in this EXIMAgreement, to obtain an EXIM Advance, Borrower shall notify Bank (which noticeshall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m.Pacific time on the Funding Date of the EXIM Advance.  Together with such notification, Borrowermust promptly deliver to Bank by electronic mail or facsimile a completedTransaction Report executed by a Responsible Officer or his or herdesignee.  Bank shall credit EXIMAdvances to the Designated Deposit Account. Bank may make EXIM Advances under this Agreement based on instructionsfrom a Responsible Officer or his or her designee or without instructions

 

4

----

 

## if the Advances are necessary to meet Obligationswhich have become due.  Bank may rely onany telephone notice given by a person whom Bank believes is a ResponsibleOfficer or designee.

##  

**4****             ****CREATIONOF SECURITY INTEREST**

** **

## **4.1****          Grant of SecurityInterest**.  Borrower hereby grantsBank, to secure the payment and performance in full of all of the Obligations,a continuing security interest in, and pledges to Bank, the Collateral,wherever located, whether now owned or hereafter acquired or arising, and allproceeds and products thereof.  Borrowerrepresents, warrants, and covenants that the security interest granted hereinis and shall at all times continue to be a first priority perfected securityinterest in the Collateral (subject only to Permitted Liens that may havesuperior priority to Bank’s Lien under this EXIM Agreement).  If Borrower shall acquire a commercial tortclaim, Borrower shall promptly notify Bank in a writing signed by Borrower ofthe general details thereof and upon request of Bank grant to Bank in suchwriting a security interest therein and in the proceeds thereof, all upon theterms of this EXIM Agreement, with such writing to be in form and substancereasonably satisfactory to Bank.

##  

Bank’s lien andsecurity interest in the Collateral shall continue until Borrower fullysatisfies its Obligations in cash.  Uponpayment in full in cash of the Obligations (except for contingentindemnification obligations for which no claim has been made) and at such time as Bank’s obligation to make Credit Extensionshas terminated, Bank shall, at Borrower’s sole cost and expense, release itsLiens in the Collateral and all rights therein shall revert to Borrower.

 

Notwithstanding the foregoing, it is expressly acknowledgedand agreed that the security interest created in this EXIM Agreement in all ofthe Collateral (with the exception of Export-Related Accounts Receivable,Export-Related Inventory and Export-Related General Intangibles) is subject toand subordinate to the security interest granted to Bank in the DomesticAgreement and the security interest created in the Domestic Agreement withrespect to such Export-Related Accounts Receivable, Export-Related Inventoryand Export-Related General Intangibles is subject to and subordinate to thesecurity interest granted to Bank in this EXIM Agreement with respect to suchExport-Related Accounts Receivable, Export-Related Inventory and anyExport-Related General Intangibles.

 

## **4.2****          Authorization to FileFinancing Statements**.  Borrowerhereby authorizes Bank to file financing statements, without notice toBorrower, with all appropriate jurisdictions to perfect or protect Bank’sinterest or rights hereunder, including a notice that any disposition of theCollateral except as permitted by the terms of this Agreement, by eitherBorrower or any other Person, shall be deemed to violate the rights of Bankunder the Code.  Such financingstatements may indicate the Collateral as “all assets of the Debtor” or wordsof similar effect, or as being of an equal or lesser scope, or with greaterdetail, all in Bank’s discretion, provided that such financing statements shallacknowledge the rights of SEN under the SEN License.

##  

**5****             ****REPRESENTATIONSAND WARRANTIES**

** **

Borrowerrepresents and warrants as follows:

 

## **5.1****          Domestic Loan Documents**.  The representations and warranties containedin the Domestic Loan Documents, which are incorporated into this EXIM Agreementby reference, are true, accurate and complete in all material respects, and shallsurvive the termination of the Domestic Agreement.

##  

## **5.2****          EXIM Borrower Agreement**.  The representations and warranties containedin the EXIM Borrower Agreement, which are incorporated by reference into thisEXIM Agreement, are true and correct in all material respects.

##  

## **5.3****          Accounts Receivable;Inventory**.

 

(a)           For eachAccount with respect to which EXIM Advances are requested, on the date eachEXIM Advance is requested and made, such Account shall meet the Minimum EXIMEligibility Requirements set forth in Section 13 below.

 

5

----

 

(b)**          **Allstatements made and all unpaid balances appearing in all invoices, instrumentsand other documents evidencing the Accounts are and shall be true, accurate andcomplete in all material respects and all such invoices, instruments and otherdocuments, and all of Borrower’s Books are genuine and in all respects whatthey purport to be.  Whether or not anEvent of Default has occurred and is continuing, Bank may notify any Account Debtorowing Borrower money of Bank’s security interest in such funds. All sales andother transactions underlying or giving rise to each Account shall comply inall material respects with all applicable laws and governmental rules andregulations.  Borrower has no knowledgeof any actual or imminent Insolvency Proceeding of any Account Debtor whoseaccounts are an Eligible EXIM Account in any EXIM Borrowing BaseCertificate.  To Borrower’s knowledge,all signatures and endorsements on all documents, instruments, and agreementsrelating to all Accounts are genuine, and all such documents, instruments andagreements are legally enforceable in accordance with their terms.

 

(c)           For any itemof Inventory consisting of Eligible Inventory in any Transaction Report, suchInventory (i) consists either of raw materials, or of finished goods, ingood, new, and salable condition, which is not perishable, returned, consigned,obsolete, not sellable, damaged, or defective, and is not comprised ofdemonstrative or custom inventory, works in progress, packaging or shippingmaterials, or supplies; (ii) meets all applicable governmental standards; (iii) hasbeen manufactured in compliance with the Fair Labor Standards Act; (iv) isnot subject to any Liens, except the first priority Liens granted in favor ofBank under this Agreement or any of the other Loan Documents or PermittedLiens; and (v) is located at (A) the Headquarters Location which is (1) priorto the Real Estate Financing, owned by Borrower or (2) after the Real EstateFinancing, either owned by Borrower or owned by the Special Subsidiary providedthat Bank has received a landlord’s waiver in form and substance reasonablysatisfactory to Bank or (B) at Borrower’s 33 Cherry Hill Drive, Beverly,Massachusetts or 54 Cherry Hill Drive, Beverly, Massachusetts locationsprovided that Bank has received a landlord waiver for the respective locationin form and substance reasonably satisfactory to Bank.

 

**6****             ****AFFIRMATIVECOVENANTS**

** **

Borrower shall do all ofthe following:

 

## **6.1****          Domestic Loan Documents**.  Borrower shall comply in all materialrespects with the terms and provisions of the Domestic Loan Documents, whichterms and provisions are incorporated into this EXIM Agreement and shallsurvive the termination of the Domestic Agreement, which shall include, withoutlimitation, compliance with the financial reporting requirements set forth inthe Domestic Agreement and the financial covenants set forth in the DomesticAgreement.

##  

## **6.2****          EXIM Borrower Agreement**.  Borrower shall comply with all of the termsof the EXIM Borrower Agreement, including without limitation, the delivery ofan EXIM Borrowing Base Certificate within thirty (30) days after the end ofeach month, and with each request for a Credit Extension, any and all noticesrequired pursuant to the EXIM Borrower Agreement.  In the event of any conflict or inconsistencybetween any provision contained in the EXIM Borrower Agreement with anyprovision contained in this EXIM Agreement, the more strict provision, withrespect to Borrower, shall control.

##  

## **6.3****          Terms ofSale**.  Borrower will, if required by EXIM Bank or Bank, cause all sales ofproducts on which Credit Extensions are based to be (i) supported by oneor more irrevocable letters of credit in an amount and of a matter, naming abeneficiary and issued by a financial institution acceptable to Bank andnegotiated by Bank.

##  

## **6.4****          Reporting Requirements**.  Borrower shall deliver all reports,certificates and other documents to Bank as provided in the EXIM BorrowerAgreement, including, without limitation, an EXIM Borrowing Base Certificate ona monthly basis, purchase orders and any other information that Bank and EXIMBank may reasonably request.  Inaddition, Borrower shall comply with the reporting requirements set forth inthe Domestic Loan Documents.

##  

## **6.5****          EXIM Insurance**.  If required by Bank, Borrower will obtain,and pay when due all premiums with respect to, and maintain uninterruptedforeign credit insurance.  In addition,if requested by Bank, Borrower will execute in favor of Bank an assignment ofproceeds of any insurance policy obtained by Borrower and issued by EXIM Bankinsuring against comprehensive commercial and political risk (the “**EXIM Bank Policy**”). The

 

6

----

 

## insurance proceeds from the EXIM Bank Policy assignedor paid to Bank will be applied to the balance outstanding under this EXIMAgreement.  Borrower will immediatelynotify Bank and EXIM Bank in writing upon submission of any claim under theEXIM Bank Policy.

##  

## **6.6****          Further Assurances**.  Execute any further instruments and takefurther action as Bank reasonably requests to perfect or continue Bank’s Lienin the Collateral or to effect the purposes of this EXIM Agreement.

##  

**7****             ****NEGATIVECOVENANTS**

** **

Borrower shall not do anyof the following without Bank’s prior written consent:

 

## **7.1****          Domestic Loan Documents**.  Violate or otherwise fail to comply with anyprovisions of the Domestic Loan Documents, which provisions are incorporatedinto this EXIM Agreement by reference, and shall survive the termination ofDomestic Agreement.

##  

## **7.2****          EXIM Borrower Agreement**.  Violate or otherwise fail to comply with anyprovision of the EXIM Borrower Agreement, including, without limitation, thenegative covenants set forth therein.

##  

## **7.3****          EXIM Guaranty**.  Take any action, or permit any action to betaken, that causes or, with the passage of time, could cause, the EXIM Guarantyto cease to be in full force and effect.

##  

**8****             ****EVENTSOF DEFAULT**

** **

Any one of the followingshall constitute an event of default (an “**Event of Default**”)under this EXIM Agreement:

 

## **8.1****          Payment Default**.  Borrower fails to (a) make any paymentof principal or interest on any Credit Extension on its due date, or (b) payany other Obligations within three (3) Business Days after such Obligationsare due and payable (which three (3) day grace period shall not apply topayments due on the Revolving Line Maturity Date).  During the cure period, the failure to curethe payment default is not an Event of Default (but no Credit Extension will bemade during the cure period);

##  

## **8.2****          Covenant Default**.

##  

(a) Borrower failsor neglects to perform any obligation in Section 6 or violates anycovenant in Section 7; or

 

## (b) Borrower fails or neglects to perform, keep,or observe any other term, provision, condition, covenant or agreementcontained in this EXIM Agreement or any Loan Documents, and as to any default(other than those specified in this Section 8) under such other term,provision, condition, covenant or agreement that can be cured, has failed to curethe default within ten (10) days after the occurrence thereof; provided,however, that if the default cannot by its nature be cured within the ten (10) dayperiod or cannot after diligent attempts by Borrower be cured within such ten (10) dayperiod, and such default is likely to be cured within a reasonable time, thenBorrower shall have an additional period (which shall not in any case exceedthirty (30) days) to attempt to cure such default, and within such reasonabletime period the failure to cure the default shall not be deemed an Event ofDefault (but no Credit Extensions shall be made during such cure period).  Grace periods provided under this sectionshall not apply, among other things, to financial covenants or any othercovenants set forth in subsection (a) above;

##  

## **8.3****          Insolvency**.  (a) Borrower is unable to pay its debts(including trade debts) as they become due or otherwise becomes insolvent; (b) Borrowerbegins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begunagainst Borrower and not dismissed or stayed within forty-five (45) days (butno Credit Extensions shall be made while of any of the conditions described inclause (a) exist and/or until any Insolvency Proceeding is dismissed);

 

7

----

 

## **8.4****          Domestic Default**.  Theoccurrence of an Event of Default under the Domestic Loan Documents.  The terms and provisions of the DomesticAgreement are hereby incorporated by reference and shall survive thetermination of the Domestic Agreement.

##  

## **8.5****          EXIMGuaranty**.  If the EXIM Guarantyceases for any reason to be in full force and effect, or if the EXIM Bankdeclares the EXIM Guaranty void or revokes any obligations under the EXIMGuaranty.

##  

**9****             ****BANK’SRIGHTS AND REMEDIES**

** **

## **9.1****          Rights and Remedies**.  While an Event of Default occurs andcontinues Bank may, without notice or demand, do any or all of the following:

##  

#### (a)           declare all Obligationsimmediately due and payable (but if an Event of Default described in Section 8.3occurs all Obligations are immediately due and payable without any action byBank);

####  

#### (b)           stop advancing money orextending credit for Borrower’s benefit under this EXIM Agreement or under anyother agreement between Borrower and Bank;

####  

#### (c)           settle or adjustdisputes and claims directly with Account Debtors for amounts on terms and inany order that Bank considers advisable, notify any Person owing Borrower moneyof Bank’s security interest in such funds, and verify the amount of suchaccount;

####  

#### (d)           make any payments anddo any acts it considers necessary or reasonable to protect the Collateraland/or its security interest in the Collateral. Borrower shall assemble the Collateral if Bank requests and make itavailable as Bank designates.  Bank mayenter premises where the Collateral is located, take and maintain possession ofany part of the Collateral, and pay, purchase, contest, or compromise any Lienwhich appears to be prior or superior to its security interest and pay allexpenses incurred. Borrower grants Bank a license to enter and occupy any ofits premises, without charge, to exercise any of Bank’s rights or remedies;

####  

#### (e)           apply to theObligations any (i) balances and deposits of Borrower it holds, or (ii) anyamount held by Bank owing to or for the credit or the account of Borrower;

####  

#### (f)            ship, reclaim,recover, store, finish, maintain, repair, prepare for sale, advertise for sale,and sell the Collateral.  Bank is herebygranted a non-exclusive, royalty-free license or other right to use, withoutcharge, Borrower’s labels, patents, copyrights, mask works, rights of use ofany name, trade secrets, trade names, trademarks, service marks, andadvertising matter, or any similar property as it pertains to the Collateral,in completing production of, advertising for sale, and selling any Collateraland, in connection with Bank’s exercise of its rights under this Section,Borrower’s rights under all licenses and all franchise agreements inure to Bank’sbenefit;

####  

#### (g)           place a “hold” on anyaccount maintained with Bank and/or deliver a notice of exclusive control, anyentitlement order, or other directions or instructions pursuant to any ControlAgreement or similar agreements providing control of any Collateral;

####  

#### (h)           demand and receivepossession of Borrower’s Books; and

####  

#### (i)            exercise all rightsand remedies available to Bank under the Loan Documents or at law or equity,including all remedies provided under the Code (including disposal of theCollateral pursuant to the terms thereof).

####  

## **9.2****          Power of Attorney**.  Borrower hereby irrevocably appoints Bank asits lawful attorney-in-fact, exercisable upon the occurrence and during thecontinuance of an Event of Default, to:  (a) endorseBorrower’s name on any checks or other forms of payment or security; (b) signBorrower’s name on any invoice or bill of lading for any Account or draftsagainst Account Debtors; (c) settle and adjust disputes and claims aboutthe Accounts directly with Account Debtors, for amounts and on terms Bankdetermines reasonable; (d) make, settle, and adjust all claims under Borrower’sinsurance policies; (e) pay, contest or settle any Lien, charge,encumbrance, security interest, and adverse claim in or to the Collateral, orany judgment based thereon, or otherwise take any action to terminate ordischarge the same; and (f) transfer the Collateral into the name of Bankor a third party as the Code 

 

8

----

 

## permits. Borrower hereby appoints Bank as its lawful attorney-in-fact to signBorrower’s name on any documents necessary to perfect or continue theperfection of Bank’s security interest in the Collateral regardless of whetheran Event of Default has occurred until all Obligations have been satisfied infull (except for contingent indemnification obligations for which no claim hasbeen made) and Bank is under no further obligation to make Credit Extensionshereunder.  Bank’s foregoing appointmentas Borrower’s attorney in fact, and all of Bank’s rights and powers, coupledwith an interest, are irrevocable until all Obligations have been fully repaidand performed and Bank’s obligation to provide Credit Extensions terminates.

##  

## **9.3****          Accounts Collection**.  When an Event of Default occurs andcontinues, Bank may notify any Person owing Borrower money of Bank’s securityinterest in the funds and verify the amount of the Account.  Borrower must collect all payments in trustfor Bank and, if requested by Bank, immediately deliver the payments to Bank inthe form received from the account debtor, with proper endorsements fordeposit.

##  

## **9.4****          Protective Payments**.  If Borrower fails to obtain the insurancecalled for by Section 6.7 or fails to pay any premium thereon or fails topay any other amount which Borrower is obligated to pay under this EXIMAgreement or any other Loan Document, Bank may obtain such insurance or makesuch payment, and all amounts so paid by Bank are Bank Expenses and immediatelydue and payable, bearing interest at the then highest applicable rate, andsecured by the Collateral.  Bank will makereasonable efforts to provide Borrower with notice of Bank obtaining suchinsurance at the time it is obtained or within a reasonable timethereafter.  No payments by Bank aredeemed an agreement to make similar payments in the future or Bank’s waiver ofany Event of Default.

##  

## **9.5****          Application of Paymentsand Proceeds**.  Borrower shall have noright to specify the order or the accounts to which Bank shall allocate orapply any payments required to be made by Borrower to Bank or otherwisereceived by Bank under this EXIM Agreement when any such allocation orapplication is not specified elsewhere in this EXIM Agreement.  If an Event of Default has occurred and iscontinuing, Bank may apply any funds in its possession, whether from Borroweraccount balances, payments, proceeds realized as the result of any collectionof Accounts or other disposition of the Collateral, or otherwise, to theObligations in such order as Bank shall determine in its sole discretion.  Any surplus shall be paid to Borrower bycredit to the Designated Deposit Account or to other Persons legally entitledthereto; Borrower shall remain liable to Bank for any deficiency.  If Bank, in its good faith business judgment,directly or indirectly enters into a deferred payment or other credit transactionwith any purchaser at any sale of Collateral, Bank shall have the option,exercisable at any time, of either reducing the Obligations by the principalamount of the purchase price or deferring the reduction of the Obligationsuntil the actual receipt by Bank of cash therefor.

##  

## **9.6****          Bank’s Liability forCollateral**.  So long as Bank complieswith reasonable banking practices regarding the safekeeping of the Collateralin the possession or under the control of Bank, Bank shall not be liable orresponsible for: (a) the safekeeping of the Collateral; (b) any lossor damage to the Collateral; (c) any diminution in the value of theCollateral; or (d) any act or default of any carrier, warehouseman,bailee, or other Person.  Borrower bearsall risk of loss, damage or destruction of the Collateral.

##  

## **9.7****          No Waiver; RemediesCumulative**.  Bank’s failure, at anytime or times, to require strict performance by Borrower of any provision ofthis EXIM Agreement or any other Loan Document shall not waive, affect, ordiminish any right of Bank thereafter to demand strict performance andcompliance herewith or therewith.  Nowaiver hereunder shall be effective unless signed by Bank and then is onlyeffective for the specific instance and purpose for which it is given.  Bank’s rights and remedies under this EXIMAgreement and the other Loan Documents are cumulative.  Bank has all rights and remedies providedunder the Code, by law, or in equity. Bank’s exercise of one right or remedy is not an election, and Bank’swaiver of any Event of Default is not a continuing waiver.  Bank’s delay in exercising any remedy is nota waiver, election, or acquiescence.

##  

## **9.8****          Demand Waiver**.  Borrower waives demand, notice of default ordishonor, notice of payment and nonpayment, notice of any default, nonpaymentat maturity, release, compromise, settlement, extension, or renewal ofaccounts, documents, instruments, chattel paper, and guarantees held by Bank onwhich Borrower is liable.

##  

## **9.9****          EXIM Direction**. Uponthe occurrence of an Event of Default, EXIM Bank shall have right to (i) directBank to exercise the remedies specified in Section 9.1 hereof and (ii) requestthat Bank accelerate the maturity of any other loans to Borrower.

 

9

----

 

## **9.10****        EXIM Notification**.  Bank has the right to immediately notify EXIMBank in writing if it has knowledge of any of the following events: (1) anyfailure to pay any amount due under this EXIM Agreement; (2) the EXIMBorrowing Base is less than the sum of the outstanding Credit Extensions; (3) anyfailure to pay when due any amount payable to Bank under any Loan Documentsowing by Borrower to Bank; (4) the filing of an action for debtor’s reliefby, against or on behalf of Borrower; or (5) any threatened or pendingmaterial litigation against Borrower, or any material dispute involvingBorrower.

##  

If Bank sends anotice to EXIM Bank, Bank has the right to send EXIM Bank a written report onthe status of events covered by the notice every thirty (30) days after thedate of the original notification, until Bank files a claim with EXIM Bank orthe defaults have been cured (but no EXIM Advances may be required during thecure period unless EXIM Bank gives its written approval).  If directed by EXIM Bank, Bank will have theright to exercise any rights it may have against the Borrower to demand theimmediate repayment of all amount outstanding under the EXIM Loan Documents.

 

## **9.11****        Borrower Liability.**  Either Borrower may, acting singly, requestCredit Extensions hereunder.  EachBorrower hereby appoints the other as agent for the other for all purposeshereunder, including with respect to requesting Credit Extensionshereunder.  Each Borrower hereunder shallbe jointly and severally obligated to repay all Credit Extensions madehereunder, regardless of which Borrower actually receives said CreditExtension, as if each Borrower hereunder directly received all CreditExtensions.  Each Borrower waives (a) anysuretyship defenses available to it under the Code or any other applicable law,and (b) any right to require Bank to: (i) proceed against anyBorrower or any other person; (ii) proceed against or exhaust anysecurity; or (iii) pursue any other remedy.  Bank may exercise or not exercise any rightor remedy it has against any Borrower or any security it holds (including theright to foreclose by judicial or non-judicial sale) without affecting anyBorrower’s liability.  Notwithstandingany other provision of this EXIM Agreement or other related document, eachBorrower irrevocably waives all rights that it may have at law or in equity(including, without limitation, any law subrogating Borrower to the rights ofBank under this EXIM Agreement) to seek contribution, indemnification or anyother form of reimbursement from any other Borrower, or any other Person now orhereafter primarily or secondarily liable for any of the Obligations, for anypayment made by Borrower with respect to the Obligations in connection withthis EXIM Agreement or otherwise and all rights that it might have to benefitfrom, or to participate in, any security for the Obligations as a result of anypayment made by Borrower with respect to the Obligations in connection withthis EXIM Agreement or otherwise.  Anyagreement providing for indemnification, reimbursement or any other arrangementprohibited under this Section shall be null and void.  If any payment is made to a Borrower incontravention of this Section, such Borrower shall hold such payment in trustfor Bank and such payment shall be promptly delivered to Bank for applicationto the Obligations, whether matured or unmatured.

##  

**10****          ****NOTICES**

** **

All notices, consents,requests, approvals, demands, or other communication (collectively, “Communication”)by any party to this EXIM Agreement or any other Loan Document must be inwriting and be delivered or sent by facsimile at the addresses or facsimilenumbers listed below.  Bank or Borrowermay change its notice address by giving the other party written noticethereof.  Each such Communication shallbe deemed to have been validly served, given, or delivered: (a) upon theearlier of actual receipt and three (3) Business Days after deposit in theU.S. mail, registered or certified mail, return receipt requested, with properpostage prepaid; (b) upon transmission, when sent by facsimiletransmission (with such facsimile promptly confirmed by delivery of a copy bypersonal delivery or United States mail as otherwise provided in this Section 10);(c) one (1) Business Day after deposit with a reputable overnightcourier with all charges prepaid; or (d) when delivered, if hand-deliveredby messenger, all of which shall be addressed to the party to be notified andsent to the address or facsimile number indicated below.  EXIM Advance requests made pursuant to Section 3.4must be in writing and may be in the form of electronic mail, delivered to Bankby Borrower at the e-mail address of Bank provided below and shall be deemed tohave been validly served, given, or delivered when sent (with such electronicmail promptly confirmed by delivery of a copy by personal delivery or UnitedStates mail as otherwise provided in this Section 10).  Bank or Borrower may change its address,facsimile number, or electronic mail address by giving the other party writtennotice thereof in accordance with the terms of this Section 10.

 

10

----

 
| If to Borrower: | Axcelis Technologies, Inc.

108 Cherry Hill Drive

Beverly, Massachusetts 01915

Attn: Stephen G. Bassett, Chief Financial Officer  and Executive Vice President

Fax: 978-787-4090

Email: Stephen.bassett@axcelis.com             |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|            |                                                                                                                                                                                                                                     |
| If to Borrower: | Axcelis Technologies, Inc.  108 Cherry Hill Drive  Beverly, Massachusetts 01915  Attn: Lynnette C. Fallon, Executive Vice President HR/Legal, General Counsel  and Secretary  Fax: 978-787-4090  Email: lynnette.fallon@axcelis.com |
|            |                                                                                                                                                                                                                                     |
| With a copy to: | Edward Angell Palmer and Dodge LLP  111 Huntington Avenue  Boston, Massachusetts 02199  Attn: James I. Rubens, Esquire  Fax: 888-325-9130  Email: jrubens@eapdlaw.com                                                                    |
|            |                                                                                                                                                                                                                                     |
| If to Bank:     | Silicon Valley Bank  One Newton Executive Park, Suite 200  2221 Washington Street  Newton, Massachusetts 02462  Attn: Mark Sperling  Fax: 617.969.5478  Email: msperling@svbank.com                                                 |
|            |                                                                                                                                                                                                                                     |
| with a copy to: | Riemer & Braunstein LLP  Three Center Plaza  Boston, Massachusetts 02108  Attn: Charles W. Stavros, Esquire  Fax: 617.880.3456  Email: CStavros@riemerlaw.com                                                                   |

 

**11****          ****CHOICEOF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE**

** **

Massachusetts law governs the Loan Documents (exceptas otherwise indicated therein) without regard to principles of conflicts oflaw.  Borrower and Bank each submit tothe exclusive jurisdiction of the State and Federal courts in Massachusetts; provided,however, that nothing in this EXIM Agreement shall be deemed to operateto preclude Bank from bringing suit or taking other legal action in any otherjurisdiction to realize on the Collateral or any other security for theObligations, or to enforce a judgment or other court order in favor ofBank.  Borrower expressly submits andconsents in advance to such jurisdiction in any action or suit commenced in anysuch court, and Borrower hereby waives any objection that it may have basedupon lack of personal jurisdiction, improper venue, or forum non conveniens andhereby consents to the granting of such legal or equitable relief as is deemedappropriate by such court.  Borrowerhereby waives personal service of the summons, complaints, and other processissued in such action or suit and agrees that service of such summons,complaints, and other process may be made by registered or certified mailaddressed to Borrower at the address set forth in Section 10 of this EXIMAgreement and that service so made shall be deemed completed upon the earlierto occur of Borrower’s actual receipt thereof or three (3) days afterdeposit in the U.S. mails, proper postage prepaid. NOTWITHSTANDING ANYTHING TOTHE CONTRARY SET FORTH HEREINABOVE, BANK SHALL SPECIFICALLY HAVE THE RIGHT TOBRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR ITS PROPERTY IN THE COURTSOF

 

11

----

 

ANY OTHER JURISDICTIONWHICH BANK DEEMS NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERALOR TO OTHERWISE ENFORCE BANK’S RIGHTS AGAINST BORROWER OR ITS PROPERTY.

 

**TO THE FULLEST EXTENT PERMITTEDBY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OFANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS EXIM AGREEMENT,THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT,BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FORBOTH PARTIES TO ENTER INTO THIS EXIM AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL**.

 

**12           GENERAL PROVISIONS**

** **

## **12.1        Right of Set-Off**.  Borrower hereby grants to Bank a Lien and aright of setoff as security for all Obligations to Bank, whether now existingor hereafter arising upon and against all deposits, credits, collateral andproperty, now or hereafter in the possession, custody, safekeeping or controlof Bank or any entity under the control of Bank (including a subsidiary ofBank) or in transit to any of them.  Atany time after the occurrence and during the continuance of an Event ofDefault, without demand or notice, Bank may setoff the same or any part thereofand apply the same to any liability or Obligation of Borrower even thoughunmatured and regardless of the adequacy of any other collateral securing theObligations.  ANY AND ALL RIGHTS TOREQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHERCOLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OFSETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER,ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

##  

## **12.2        Successors and Assigns**.  This EXIM Agreement binds and is for thebenefit of the successors and permitted assigns of each party.  Borrower may not assign this EXIM Agreementor any rights or obligations under it without Bank’s prior written consent(which may be granted or withheld in Bank’s discretion).  Bank has the right, without the consent of ornotice to Borrower, to sell, transfer, assign, negotiate, or grantparticipation in all or any part of, or any interest in, Bank’s obligations,rights, and benefits under this EXIM Agreement and the other Loan Documents;provided, however, that prior to the occurrence of an Event of Default, anysuch assignment or participation may only be made to an Eligible Assignee.

##  

## **12.3        Indemnification**.  Borrower agrees to indemnify, defend and holdBank and its directors, officers, employees, agents, attorneys, or any otherPerson affiliated with or representing Bank (each, an “**IndemnifiedPerson**”) harmless against:  (a) allobligations, demands, claims, and liabilities (collectively, “**Claims**”) claimed or asserted by any other party inconnection with the transactions contemplated by the Loan Documents; and (b) alllosses or expenses (including Bank Expenses) in any way suffered, incurred, orpaid by such Indemnified Person as a result of, following from, consequentialto, or arising from transactions between Bank and Borrower (includingreasonable attorneys’ fees and expenses), except for Claims and/or lossesdirectly caused by such Indemnified Person’s gross negligence or willfulmisconduct.

##  

## **12.4        Time of Essence**.  Time is of the essence for the performance ofall Obligations in this EXIM Agreement.

##  

## **12.5        Severability of Provisions**.  Each provision of this EXIM Agreement isseverable from every other provision in determining the enforceability of anyprovision.

##  

## **12.6        Correction of Loan Documents**.  Bank may correct patent errors and fill inany blanks in this EXIM Agreement and the other Loan Documents consistent withthe agreement of the parties.

##  

## **12.7        Amendments in Writing; Integration**.  All amendments to this EXIM Agreement must bein writing signed by both Bank and Borrower. This EXIM Agreement and the Loan Documents represent the entireagreement about this subject matter and supersede prior negotiations oragreements.  All prior agreements,understandings, representations, warranties, and negotiations between the partiesabout the subject matter of this EXIM Agreement and the Loan Documents mergeinto this EXIM Agreement and the Loan Documents.

 

12

----

 

## **12.8        Counterparts**.  This EXIM Agreement may be executed in anynumber of counterparts and by different parties on separate counterparts, eachof which, when executed and delivered, is an original, and all taken together,constitute one EXIM Agreement.

##  

## **12.9        Survival**. All covenants, representations and warranties made in this EXIMAgreement continue in full force until this EXIM Agreement has terminatedpursuant to its terms and all Obligations (other than inchoate indemnityobligations and any other obligations which, by their terms, are to survive thetermination of this EXIM Agreement) have been satisfied.  The obligation of Borrower in Section 12.3to indemnify Bank shall survive until the statute of limitations with respectto such claim or cause of action shall have run.

##  

## **12.10      Confidentiality**.  In handling any confidential information,Bank shall exercise the same degree of care that it exercises for its ownproprietary information, but disclosure of information may be made: (a) toBank’s Subsidiaries or Affiliates; (b) to prospective transferees orpurchasers of any interest in the Credit Extensions (provided, however, Bankshall use commercially reasonable efforts to obtain such prospective transferee’sor purchaser’s agreement to the terms of this provision); (c) as requiredby law, regulation, subpoena, or other order; (d) to Bank’s regulators oras otherwise required in connection with Bank’s examination or audit; (e) asBank considers appropriate in exercising remedies under the Loan Documents; and(f) to third-party service providers of Bank so long as such serviceproviders have executed a confidentiality agreement with Bank with terms noless restrictive than those contained herein. Confidential information does not include information that either: (i) isin the public domain or in Bank’s possession when disclosed to Bank, or becomespart of the public domain after disclosure to Bank; or (ii) is disclosedto Bank by a third party, if Bank does not know that the third party isprohibited from disclosing the information.

##  

## Bank may use confidentialinformation for any purpose, including, without limitation, for the developmentof client databases, reporting purposes, and market analysis, so long as Bankdoes not disclose Borrower’s identity or the identity of any person associatedwith Borrower unless otherwise expressly permitted by this EXIM Agreement.  The provisions of the immediately precedingsentence shall survive the termination of this EXIM Agreement.

##  

## **12.11      Electronic Execution of Documents.** The words “execution,” “signed,” “signature”and words of like import in any Loan Document shall be deemed to includeelectronic signatures or the keeping of records in electronic form, each ofwhich shall be of the same legal effect, validity and enforceability as amanually executed signature or the use of a paper-based recordkeeping systems,as the case may be, to the extent and as provided for in any applicable law,including, without limitation, any state law based on the Uniform ElectronicTransactions Act.

##  

## **12.12      Captions.** The headings used in this EXIM Agreement are for convenience only andshall not affect the interpretation of this EXIM Agreement.

##  

## **12.13      Construction of EXIM Agreement.** The parties mutually acknowledge that they andtheir attorneys have participated in the preparation and negotiation of this EXIMAgreement.  In cases of uncertainty thisEXIM Agreement shall be construed without regard to which of the parties causedthe uncertainty to exist.

##  

## **12.14      Relationship.** The relationship of the parties to this EXIM Agreement is determinedsolely by the provisions of this EXIM Agreement.  The parties do not intend to create anyagency, partnership, joint venture, trust, fiduciary or other relationship withduties or incidents different from those of parties to an arm’s-lengthcontract.

##  

## **12.15      Third Parties.**  Nothing in this EXIM Agreement, whetherexpress or implied, is intended to: (a) confer any benefits, rights orremedies under or by reason of this EXIM Agreement on any persons other thanthe express parties to it and their respective permitted successors andassigns; (b) relieve or discharge the obligation or liability of anyperson not an express party to this EXIM Agreement; or (c) give any personnot an express party to this EXIM Agreement any right of subrogation or actionagainst any party to this EXIM Agreement.

##  

## **12.16      EXIM Borrower Agreement; Cross-Collateralization;Cross-Default; Conflicts. **Boththis EXIM Agreement and the EXIM Borrower Agreement shall continue in fullforce and effect, and all rights and remedies under this EXIM Agreement and theEXIM Borrower Agreement are cumulative. The term “Obligations” as used in this EXIM Agreement and in the EXIMBorrower Agreement shall include without limitation the obligation to pay whendue all loans made pursuant to the EXIM Borrower Agreement and theExport-Import 

 

13

----

 

## Agreement (the “**EXIM Loans**”)and all interest thereon and the obligation to pay when due all Advances madepursuant to the terms of this EXIM Agreement and all interest thereon.  Without limiting the generality of theforegoing, the security interest granted herein covering all “Collateral” asdefined in this EXIM Agreement and as defined in the EXIM Borrower Agreementshall secure all EXIM Loans and all Advances and all interest thereon, and allother Obligations.  Any Event of Defaultunder this EXIM Agreement shall also constitute a default under the EXIMBorrower Agreement, and any default under the EXIM Borrower Agreement shallalso constitute an Event of Default under this EXIM Agreement.  In the event Bank assigns its rights underthis EXIM Agreement and/or under any note evidencing EXIM Loans and/or itsrights under the EXIM Borrower Agreement and/or under any note evidencingAdvances, to any third party, including, without limitation, the EXIM Bank,whether before or after the occurrence of any Event of Default, Bank shall havethe right (but not any obligation), in its sole discretion, to allocate andapportion Collateral to the EXIM Borrower Agreement and/or note assigned and tospecify the priorities of the respective security interests in such Collateralbetween itself and the assignee, all without notice to or consent of theBorrowers.  Should any term of this EXIMAgreement conflict with any term of the EXIM Borrower Agreement, the morerestrictive term in either agreement shall govern Borrower.

##  

**13           DEFINITIONS**

 

## **13.1        Definitions**.  As used in the Loan Documents, the word “shall”is mandatory, the word “may” is permissive, the word “or” is not exclusive, thewords “includes” and “including” are not limiting, the singular includes theplural, and numbers denoting amounts that are set off in brackets are negative.Except as otherwise defined, terms that are capitalized in this EXIM Agreementshall have the meaning assigned in the Domestic Agreement.  As used in this EXIM Agreement, the followingterms have the following meanings:

##  

“**AvailabilityAmount**” is (a) the lesser of (i) the Revolving Line or (ii) theEXIM Borrowing Base minus (b) the outstanding principal balance ofany EXIM Advances.  In no event shall theaggregate amount of all Credit Extensions under this EXIM Agreement outstandingat any time together with all other Credit Extensions (as defined in theDomestic Agreement) under the Domestic Agreement exceed Twenty Million Dollars($20,000,000).

 

“**Bank**”is defined in the preamble hereof.

 

“**Borrower**” isdefined in the preamble hereof.

 

“**Country LimitationSchedule**” is defined in the EXIM Borrower Agreement.

 

“**Collateral**” isany and all properties, rights and assets of Borrower described on Exhibit A.

 

“**CreditExtension**” is any EXIM Advance or any other extension of credithereunder by Bank for Borrower’s benefit.

 

“**Default Rate**”is defined in Section 2.3(b).

 

“**Domestic Agreement**”is defined in Section 1(a).

 

“**Domestic Loan Documents**”is defined in Section 1(a).

 

“**Domestic Revolving Line**”means the Revolving Line, as such term is defined in the Domestic Agreement.

 

“**Effective Date**”is the date Bank executes this EXIM Agreement and as indicated on the signaturepage hereof.

 

**“Eligible EXIM Accounts”**means Accounts arising in the ordinary course of Borrower’s business fromNon-U.S. Account Debtors and that meet all Borrower’s representations andwarranties in Section 5.3, conform in all respects to the EXIM BorrowerAgreement, and which Bank, in its good faith business judgment, shall deem 

 

14

----

 

eligible forborrowing.  Without limiting the factthat the determination of which Accounts are eligible for borrowing is a matterof Bank’s good faith business judgment, the following (the “**Minimum EXIM Eligibility Requirements**”) arethe minimum requirements for an Account to be an Eligible EXIM Account.  In no event shall Export-Related AccountsReceivable or Export-Related Overseas Accounts Receivable include any Account:

 

(a) that does not arise from the sale of Items inthe ordinary course of the Borrower’s business;

 

(b) that is not subject to a valid, perfected, and enforceablefirst priority security interest in favor of the Bank;

 

(c) as to which any covenant, representation orwarranty contained in the Loan Documents relating to such Account has beenbreached;

 

(d) that is not owned by the Borrower or issubject to any right, claim, or interest of any other party other than the Lienin favor of the Bank;

 

(e) with respect to which an invoice has not beensent;

 

(f) generated by the sale or provision of defensearticles or services, subject to exceptions approved in writing by EXIM Bank;

 

(g) that is due and payable from a military buyer,subject to exceptions approved in writing by EXIM Bank;

 

(h) that is due and payable from a foreign Buyerlocated in a country with which EXIM Bank is legally prohibited from doingbusiness as set forth in the current Country Limitation Schedule.  (Note: If the Borrower has knowledge that anexport to a country in which EXIM Bank may do business, as set forth in thecurrent Country Limitation Schedule, will be re-exported to a country withwhich EXIM Bank is legally prohibited from doing business, the correspondingreceivables (or a pro-rata portion thereof) are not eligible for inclusion inthe EXIM Borrowing Base);

 

(i) that does not comply with the requirements ofthe Country Limitation Schedule;

 

(j) that by its original terms is due and payablemore than one-hundred-twenty (120) days from the date of invoice;

 

(k) that is not paid within sixty (60) calendardays from its original due date unless insured through EXIM Bank (or otheracceptable) export credit insurance for comprehensive commercial and politicalrisk, in which case ninety (90) calendar days shall apply;

 

(l) that arises from a sale of goods to orperformance of services for an employee, stockholder, or subsidiary of theBorrower, intra-company receivables or any receivable from a stockholder, anyperson or entity with a controlling interest in the Borrower or which sharescommon controlling ownership with the Borrower;

 

(m) that is backed by a letter of credit wherethe Items covered by the subject letter of credit have not yet been shipped, orwhere the covered services have not yet been provided;

 

(n) that the Bank or EXIM Bank, in its reasonablejudgment, deem uncollectible or unacceptable; this category includes, but isnot limited to, finance charges or late charges imposed on the foreign buyer bythe Borrower as a result of the foreign buyer’s past due status;

 

(o) that is denominated in non-U.S. currency,unless (i) such Accounts are subject to a Foreign Currency Hedge Agreementor (ii) such Accounts are pre-approved in writing by EXIM Bank;

 

(p) that does not comply with the terms of saleas set forth by EXIM Bank;

 

15

----

 

(q) that is due and payable from a Buyer whobecomes unable to pay its debts or whose ability to pay its debts becomes questionable;

 

(r) that arises from a bill-and-hold, guaranteedsale, sale-and-return, sale on approval, consignment, or any other repurchaseor return basis or is evidenced by chattel paper;

 

(s) for which the Items giving rise to suchaccounts receivable have not been shipped to the Buyer or when the Items areservices, such services have not been performed or when the export orderspecifies a timing for invoicing the Items other than shipment or performanceand the Items have not been invoiced in accordance with such terms of theexport order, or the accounts receivable do not otherwise represent a finalsale;

 

(t) that is subject to any offset, deduction,defense, dispute, or counterclaim, or the buyer is also a creditor or supplierof the Borrower, or the Account Receivable is contingent in any respect or forany reason;

 

(u) for which the Borrower has made any agreementwith the buyer for any deduction therefrom, except for discounts or allowancesmade in the ordinary course of business for prompt payment;

 

(v) for which any of the Items giving rise tosuch Account have been returned, rejected, or repossessed;

 

(w) that arises from the sale of Items that donot meet 50% U.S. Content requirements;

 

(x)  that arises from or relates to DRAM (Devicesfor Random Access Memory) Inventory, services or Accounts; or

 

(y) that is deemed to be ineligible by EXIM Bank.

 

Bank reserves the right at any time after theEffective Date to adjust the Minimum EXIM Foreign Eligibility Requirements inits good faith business judgment and establish new criteria to determine theforegoing.

 

“**EligibleEXIM Inventory**” means, at any time, the aggregate of Borrower’sInventory, located in the United States and valued at the lower of actual costor market value, determined in accordance with GAAP (or such other valuationmethod as Bank and EXIM Bank shall approve, in their sole discretion), whichmay include raw materials, works in progress, and finished goods accompanied bya purchase order, that is intended for export, and does not include Inventorythat:

 

(a) is not subjectto a valid, perfected and enforceable first priority Lien in favor of Bank;

 

(b) is located at and address that has not beendisclosed to the Bank;

 

(c) is not located in the United States, unlesspre-approved in writing by Bank and EXIM Bank, in their sole discretion;

 

(d) is placed by the Borrower on consignment orheld by the Borrower on consignment;

 

(e) is in the possession of a processor orbailee, or located on premises leased or subleased to the Borrower, or onpremises subject to a mortgage in favor of a party other than Bank, unless suchprocessor or bailor or lessor or sublessor or mortgagee (as applicable) of suchpremises has executed and delivered all documentation which Bank and/or EXIMBank shall require to evidence its priority with respect to such Inventory aswell as their right to gain access to such Inventory;

 

(f) is produced in violation of the Fair LaborStandards Act or subject to the “hot goods” provisions contained in 29 U.S.C.215 or any successor statute or section;

 

16

----

 

(g) any covenant, representation or warranty withrespect to such Inventory contained in the Loan Documents has been breached oris otherwise in violation thereof;

 

(h) is an Item or is to be incorporated into anItem that does not meet the 50% U.S. Content requirements;

 

(i) is demonstration Inventory;

 

(j) consists of proprietary software (i.e.software designed solely for the Borrower’s internal use and is not intendedfor resale);

 

(k) is damaged, obsolete, returned, defective,recalled or otherwise unfit for further processing;

 

(l) that has previously been exported from theUnited States;

 

(m) constitutes or will be incorporated intoitems that constitute, defense articles or services;

 

(n) is an Item or will be incorporated into Itemsthat will be used in the construction, alteration, operation or maintenance ofnuclear power, enrichment, reprocessing, research or heavy water productionfacilities, unless pre-approved in writing by Bank and EXIM Bank, in their solediscretion;

 

(o) is an Item or will be incorporated into Itemsdestined for shipment to a country with which EXIM Bank is legally prohibitedfrom doing business as designated in the current Country Limitation Schedule,or that Borrower has knowledge will be re-exported by a foreign buyer to acountry in which EXIM Bank is legally prohibited from doing business;

 

(p) is an Item or will be incorporated into Itemsdestined for shipment to a buyer in a country in which EXIM Bank coverage isnot available for commercial reasons as designated in the current CountryLimitation Schedule, unless and only to the extent that such Inventory is soldto such foreign buyer on terms of an irrevocable letter of credit, in form andsubstance acceptable to EXIM Bank, in its sole discretion, and is confirmed bya bank acceptable to EXIM Bank, it its sole discretion;

 

(q) constitutes or is to be incorporated intoItems whose sale would result in an account receivable that would not be anEligible Export-Related Account Receivable;

 

(r) is included as eligible inventory under anyother credit facility to which Borrower is a party;

 

(s) is, or is to be incorporated into, an Itemthat is a Capital Good unless the transaction is in accordance with Section 2.14“Economic Impact Approval” of the EXIM Borrower Agreement;

 

(t) that is or relates to DRAM (Devices forRandom Access Memory) Inventory, services or Accounts; or

 

(u) is deemed to be ineligible by EXIM Bank.

 

Bank reserves the right at any time after theEffective Date to adjust the Eligible EXIM Inventory requirements in its goodfaith business judgment and establish new criteria to determine the foregoing.

 

“**Eligible Export-Related Accounts Receivable**”is defined in the EXIM Borrower Agreement.

 

“**Event ofDefault**” is defined in Section 8.

 

“**EXIM Advance**”or “**EXIM Advances**” means an advance (oradvances) under the Revolving Line.

 

“**EXIM Bank**”means Export-Import Bank of the United States.

 

“**EXIM Borrower Agreement**”is defined in Section 2.7.

 

17

----

 

“**EXIM Borrowing Base**”is (a) ninety percent (90%) of Hedged Eligible EXIM Accounts; plus (b) sixtypercent (60%) of all other Eligible EXIM Accounts billed in a Foreign Currencyand not subject to a Foreign Currency Hedge Agreement; plus (c) sixtypercent (60%) of Eligible Export Inventory; provided, however,that in any event the amount in clause (c) shall not at any time exceed (i) sixtypercent (60%) of the total amounts outstanding and/or requested under any EXIMBorrowing Base and the Domestic Loan Agreement, or (ii)(A) exceed $7,500,000 at any time for the five Business Daysbefore and after end of each of Borrower’s fiscal quarters or (B) exceed$5,000,000 at any other time; provided, however, that Bank maydecrease the foregoing percentage in its good faith business judgment based onevents, conditions, contingencies, or risks which, as determined by Bank, mayadversely affect the Collateral.

 

“**EXIM****Borrowing Base Certificate**” is that certain certificatedescribing the calculation of the EXIM Borrowing Base, provided to Borrower byBank.

 

“**EXIM Guaranty**”is defined in Section 2.6.

 

“**EXIM Loans**” isdefined in Section 12.16.

 

“**EXIM Note**” is acertain Promissory Note of even date executed by Borrower in connection withthis EXIM Agreement.

 

“**Export Orders**”are valid written export orders, evidenced by purchase contracts, for thepurchase by a buyer from the Borrower for any Inventory intended for exportoutside the United States.

 

“**Export-Related AccountsReceivable**” is defined in the EXIM Borrower Agreement.

 

“**Export-Related GeneralIntangibles**” is defined in the EXIM Borrower Agreement.

 

“**Export-Related Inventory**”is defined in the EXIM Borrower Agreement.

 

“**Export-Related OverseasAccounts Receivable**” is defined in the EXIM Borrower Agreement.

 

“**Export-RelatedOverseas Accounts Inventory**” is defined in the EXIM BorrowerAgreement.

 

“**ForeignCurrency Hedge Agreement**” means any agreement with respect to anyswap, hedge, forward, future or derivative transaction or option or similarother similar agreement or arrangement, each of which is (i) for thepurpose of hedging the foreign currency fluctuation exposure associated withBorrower’s operations and Accounts, (ii) acceptable to Bank, in itsreasonable discretion, and (iii) not for speculative purposes.

 

“**Hedged Eligible EXIMAccounts**” are Eligible EXIM Accounts in which (i) all invoicesare denominated in Dollars, or (ii) all invoices are in foreign currenciesthat are subject to a Foreign Currency Hedge Agreement.

 

“**Item**” and “**Items**” is defined in the EXIM Borrower Agreement.

 

“**Loan Documents**”are, collectively, this EXIM Agreement, the Perfection Certificate, anysubordination agreement,****the DomesticAgreement, the Domestic Loan Documents, the EXIM Borrower Agreement, the EXIMGuaranty, the EXIM Note, any note, or notes or guaranties executed by Borroweror any Guarantor, and any other present or future agreement between Borrowerany Guarantor and/or for the benefit of Bank in connection with this EXIMAgreement, all as amended, restated, or otherwise modified.

 

“**Minimum EXIM EligibilityRequirements**” is defined in the defined term “Eligible EXIM Accounts”.

 

“**Obligations**”are Borrower’s obligation to pay when due any debts, principal, interest, BankExpenses and other amounts Borrower owes Bank now or later, whether under thisEXIM Agreement, the Domestic Agreement, the other Loan Documents, or otherwise,including, without limitation, all obligations relating to letters of credit,cash management services, if any, and foreign exchange contracts, if any, andincluding interest accruing after 

 

18

----

 

Insolvency Proceedingsbegin and debts, liabilities, or obligations of Borrower assigned to Bank, andthe performance of Borrower’s duties under the Loan Documents.

 

“**Revolving Line**”is an EXIM Advance or EXIM Advances (including, without limitation, Advancesmade pursuant to the Export-Import Agreement) in an amount equal to TwentyMillion Dollars ($20,000,000.00).

 

**“Revolving Line Maturity Date”**is March 11, 2011.

 

[Signature page follows.]

 

19

----

 

**IN WITNESS WHEREOF**, the partieshereto have caused this EXIM Agreement to be executed as a sealed instrumentunder the laws of the Commonwealth of Massachusetts as of the Effective Date.

 
| BORROWER:                                 |                    |
|-------------------------------------------|-------------------------|
|                                      |                    |
| **AXCELIS  TECHNOLOGIES, INC.**           |                    |
|                                      |                    |
|                                      |                    |
| By:                                       | /s/ Mary G. Puma        |   |
|                                      | Mary G. Puma, President |   |
|                                      |                    |
|                                      |                    |
| **AXCELIS  TECHNOLOGIES CCS CORPORATION** |                    |
|                                      |                    |
|                                      |                    |
| By:                                       | /s/ Mary G. Puma        |   |
|                                      | Mary G. Puma, President |   |
|                                      |                    |
|                                      |                    |
| BANK:                                     |                    |
|                                      |                    |
| **SILICON  VALLEY BANK**                  |                    |
|                                      |                    |
| By                                        | /s/  Mark Sperling      |   |
| Name:                                     | Mark  Sperling          |   |
| Title:                                    | Vice  President         |   |
|                                      |                    |
|                                      |                    |
| Effective Date:  March 12, 2010      |                    |

 

1

----

 

**EXHIBIT A — COLLATERAL DESCRIPTION**

 

The Collateral consistsof all of Borrower’s right, title and interest in and to the following personalproperty:

 

All goods, Accounts, Equipment, Inventory, contractrights or rights to payment of money, leases, license agreements, franchiseagreements, General Intangibles, commercial tort claims, documents, instruments(including any promissory notes), chattel paper (whether tangible orelectronic), cash, deposit accounts, letters of credit rights (whether or notthe letter of credit is evidenced by a writing), securities, and all otherinvestment property, supporting obligations, and financial assets, whether nowowned or hereafter acquired, wherever located; and

 

all Borrower’s Books relating to the foregoing, andany and all claims, rights and interests in any of the above and allsubstitutions for, additions, attachments, accessories, accessions andimprovements to and replacements, products, proceeds and insurance proceeds ofany or all of the foregoing.

 

Notwithstanding the foregoing,the “Collateral” does not include more than 66% of the presently existing andhereafter arising issued and outstanding shares of capital stock owned byBorrower of any Foreign Subsidiary which shares entitle the holder thereof tovote for directors or any other matter.

 

1

----

 

**ANNEX A**

 

###### BORROWER AGREEMENT

 

2

----