Exhibit 4(ii)
AMENDMENT
THIS AMENDMENT dated December 16, 1996, between KULICKE AND
XXXXX INDUSTRIES, INC. ("Borrower") and PNC BANK, NATIONAL
ASSOCIATION, successor by merger to Midlantic Bank, N.A. ("Bank")
BACKGROUND
The parties have entered into a certain Restated Loan
Agreement dated as of April 10, 1996 ("Loan Agreement"), and desire
to amend the same in the manner hereinafter set forth. All
capitalized terms used but not defined herein shall have the
meaning given thereto in the Loan Agreement.
NOW, THEREFORE, the parties, INTENDING TO BE LEGALLY BOUND,
agree as follows:
1. Financial Covenant Amendment. In lieu of the Interest
Coverage Ratio covenant set forth in subpart (b) of Exhibit 6.01(L)
of the Loan Agreement, Borrower covenants that it will comply with
the following covenant effective as of December 31, 1996 and
thereafter:
(a) As of Borrower's fiscal quarter ending December 31,
1996, Borrower shall have, on a consolidated basis, either (i) an
Interest Coverage Ratio (calculated as set forth below) of not less
than 1.5 to 1.0 or (ii) a Liquidity Ratio (as hereinafter defined)
of not less than .90 to 1.0. For these purposes:
(A) The EBITA and Fixed Charge components of the
Interest Coverage Ratio shall, notwithstanding the period for which
the same are to be calculated as set forth in the definition of
Interest Coverage Ratio in the Loan Agreement, be calculated only
for the fiscal quarter ending December 31, 1996 and not on the
basis of the four fiscal quarters then ended, and
(B) "Liquidity Ratio" shall mean, as of any date,
the sum of cash, cash investments which constitute Permitted
Investments as defined in the Loan Agreement (including as amended
by Section 2 hereof) and accounts receivable as of such date,
divided by the sum of current liabilities and the outstanding
principal balance of all of Borrower's indebtedness to Bank as of
such date, and
(C) Cash investments shall be valued at the market
value thereof.
(b) As of Borrower's fiscal quarters ending March 31,
1997, June 30, 1997 and September 30, 1997, Borrower shall have, on
a consolidated basis, an Interest Coverage Ratio (calculated as set
forth below) of not less than 2.5 to 1.0. For these purposes, the
EBITA and Fixed Charge components of the Interest Coverage Ratio
shall, notwithstanding the period for which the same are to be
calculated as set forth in the definition of Interest Coverage
Ratio in the Loan Agreement, be calculated only for the then fiscal
year to date and not (except for the fiscal quarter ending
September 30, 1997) for the four fiscal quarters then ended.
(c) For all fiscal quarters ending after September 30,
1997, the Borrower shall be in compliance with the Interest
Coverage Ratio as set forth in and calculated in the manner
provided in the Loan Agreement.
2. Permitted Investments. The definition of "Permitted
Investments" as set forth in Section 1.01 of the Loan Agreement is
hereby modified in order to add an additional subpart (g) at the
end thereof, to read as follows:
"and/or (g) Asset Backed Securities having a credit
rating by Standard & Poors or Xxxxx'x of not less than
A."
3. Interest Rate. Effective as of the Quarterly Period for
which a Compliance Certificate for Borrower's fiscal quarter ending
December 31, 1996 is provided to Bank, the definition of
"Applicable Margin" as set forth in Section 2.07(A)(i) of the Loan
Agreement is hereby restated in its entirety to read as follows:
"(i) "Applicable Margin" means, with respect to
principal of the Revolving Loan II for which a LIBOR Rate election
is being made:
(1) .40 percentage points for any Quarterly Period
next following a fiscal quarter in which Borrower's Liquidity Ratio
equals or exceeds 1.2, as reflected in Borrower's Compliance
Certificate for such fiscal quarter:
(2) .70 percentage points for any Quarterly Period
next following a fiscal quarter in which neither subpart (1) or (3)
of this subsection (i) applies, as reflected in Borrower's
Compliance Certificate for such fiscal quarter;
(3) 1.0 percentage point for any Quarterly Period
next following a fiscal quarter in which Borrower's Liquidity Ratio
is less than .75, as reflected in Borrower's Compliance Certificate
for such fiscal quarter;
With respect to principal of Revolving Loan II for
which a LIBOR Rate election is made, the
Applicable Margin will remain fixed for the
applicable Rate Period regardless of any change in
Borrower's Liquidity Ratio during such Rate
Period."
For these purposes, (A) "Liquidity Ratio" shall have the meaning
given thereto in Section 1 hereof and (B) the "Applicable Margin"
as defined hereby shall not be effective as to principal for which
a LIBOR Rate election is presently in effect until the expiration
of the applicable Rate Period.
4. Reaffirmation. Except as specifically modified herein,
all of the terms of the Loan Agreement remain unchanged and in full
force and effect and Borrower confirms that it has no offset,
counterclaim or defense to any of its liabilities and obligations
thereunder.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment the date first above written.
KULICKE AND XXXXX INDUSTRIES, INC.
By:
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PNC BANK, NATIONAL ASSOCIATION
By:
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