1
Exhibit 10.9
MKS INSTRUMENTS, INC.
FIFTH AMENDMENT
TO LOAN AGREEMENT
This Fifth Amendment (the "Amendment") dated as of January 1, 2000 concerns
the Loan Agreement dated as of October 31, 1995 (the "Loan Agreement"), between
MKS Instruments, Inc. (the "Borrower") and BankBoston, N.A. (f/k/a The First
National Bank of Boston, the "Lender"), as amended on February 23, 1996,
February 4, 1997, February 3, 1998 and January 28, 1999. Capitalized terms used
herein but not otherwise defined shall have the meanings assigned to them in the
Loan Agreement.
WHEREAS, the Borrower has requested that the Lender agree to change certain
provisions of the Loan Agreement; and
WHEREAS, the Lender is willing, on the terms, subject to the conditions and
to the extent set forth below, to amend the Loan Agreement to effect such
changes;
NOW, THEREFORE, the Lender and the Borrower agree as follows:
Section 1. Amendment of the Loan Agreement.
(a) Section 1.1 of the Loan Agreement is hereby amended by deleting the
definition of "Consolidated Tangible Net Worth" and replacing it with the
following:
"Consolidated Tangible Net Worth" shall mean, at any time, the
stockholders' equity of the Borrower and its Subsidiaries determined
in accordance with generally accepted accounting principles excluding
the book amount of all minority interests in Affiliates and any
foreign exchange translation adjustment, with no upward adjustments
due to a reevaluation of assets (other than any such upward adjustment
as may be required under generally accepted accounting principles in
connection with the acquisition by the Borrower or any Subsidiary of
another company or entity) minus the following items (without
duplication of deductions) appearing on the balance sheet of the
Borrower and its Subsidiaries:
(a) the book amount of all assets (including, without limitation,
goodwill, patents, trademarks, copyrights, organizational expense and
unamortized debt discount) that would be treated as intangibles under
generally accepted accounting principles;
2
(b) treasury stock; and
(c) any write-up in the book amount of any asset or Investment
subsequent to the Closing Date, resulting from a reevaluation or
reappraisal thereof from the amount entered in accordance with
generally accepted accounting principles by the Borrower or any
Subsidiary on its books with respect to its acquisition of the asset
or Investment.
(b) Section 6.1(d) of the Loan Agreement is hereby amended by deleting the
word "thirty" and replacing it with the words "forty-five".
(c) Section 7.1 of the Loan Agreement is hereby amended by deleting Section
7.1(a) in its entirety and replacing it with the following:
(a) Sale of Assets. The Borrower will not, except in the ordinary
course of business, sell, transfer or otherwise dispose of, to any
Person any assets (including the securities of any Subsidiary) other
than assets having an aggregate fair market value less than seven
percent of Borrower's Consolidated Tangible Net Worth.
(d) Section 7.1(b) of the Loan Agreement is hereby amended and restated as
follows:
(b) Mergers, Etc. Neither the Borrower nor any Subsidiary will
consolidate with or merge into any other Person or permit any other
Person to consolidate with or merge into it, or acquire all or
substantially all of the capital stock or assets of any Person, or
sell, assign, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all
of its assets to any Person, except that
(1) a Subsidiary may consolidate with or merge into the
Borrower or another Subsidiary; and
(2) the Borrower or any of its Subsidiaries may acquire all
or substantially all of the capital stock or assets of any Person
or consolidate or merge with any Person provided (i) such Person
is engaged in a line of business substantially similar to one or
more of Borrower's existing lines of business, (ii) the aggregate
purchase price liability incurred in any calendar year, including
all contingent liabilities, when aggregated with all such
acquisitions and any Investments permitted under Section 7.4(3)
in any calendar year shall not exceed 25% of Consolidated
Tangible Net Worth as of the end of the most recent fiscal
quarter or, if 80% or more of the purchase price is paid in
capital stock of the Borrower, 50% of Consolidated Tangible Net
Worth as of the end of the most recent fiscal quarter and (iii)
based on a pro forma calculation of the ratios set forth in
Section 7.7 as of the date such acquisition is closed, assuming
-2-
3
consolidation of the acquired business with the Borrower for the
four full fiscal quarters ended immediately preceding such
closing and pro forma debt and debt service payments based on
scheduled principal payments, including acquisition borrowings,
if any, and pro forma interest on total debt at then prevailing
borrowing rates, Borrower is in compliance with the financial
covenants set forth in Section 7.7:
(e) Section 7.4 of the Loan Agreement is hereby amended and restated as
follows:
7.4 Investments. Except as permitted by Section 7.1, neither the
Borrower nor any Subsidiary will make or maintain any investments, made in
cash or by delivery of property or assets, (a) in any Person, whether by
acquisition of capital stock, Indebtedness, or other obligations or
securities, or by loan or capital contribution, or otherwise, or (b) in any
property, whether real or personal, (items (a) and (b) being herein called
"Investments") except the following:
(1) Investments in direct obligations of, or guaranteed by, the
United States government, its agencies or any public instrumentality
thereof and backed by the full faith and credit of the United States
government with maturities not to exceed (or an unconditional right to
compel purchase within) three years from the date of acquisition;
(2) Repurchase agreements collateralized by securities of the
U.S. Government and U.S. Government-sponsored securities;
(3) Investments in or to any Subsidiary or other Affiliate,
provided Borrower remains in compliance with Section 7.1(b);
(4) Investments and obligations issued by the United States
government, any agency thereof, any state of the United States or any
political subdivision of any such state or any public instrumentality
thereof with maturities not to exceed (or an unconditional right to
compel purchase within) three years from the date of acquisition that
are rated AA- or higher by at least one nationally recognized rating
agency;
(5) Investments and obligations issued by any company (other than
a bank) with maturities not to exceed three years from the date of
acquisition with a long-term debt rating of A or higher or a
short-term debt rating of A1 or P1 by at least one nationally
recognized rating agency;
(6) Investments in demand and time deposits with, Eurodollar
deposits with, certificates of deposit issued by, or obligations or
securities fully backed by letters of credit issued by (x) any bank
organized under the laws of the United States, any state thereof, the
District of Columbia or Canada having combined capital and surplus
aggregating at least
-3-
4
$500,000,000, or (y) any other bank organized under the laws of a
state that is a member of the European Economic Community (or any
political subdivision thereof), Japan, the Cayman Islands, or British
West Indies having as of any date of determination combined capital
and surplus of not less than $500,000,000 or the equivalent thereof
(determined in accordance with generally accepted accounting
principles);
(7) Shares of money market mutual funds registered under the
Investment Company Act of 1940, as amended;
(8) Foreign currency swaps and hedging arrangements entered into
in the ordinary course of business to protect against currency losses,
and interest rate swaps and caps entered into in the ordinary course
of business to protect against interest rate exposure on Indebtedness
bearing interest at a variable rate;
(9) Investments in mutual funds (other than money market mutual
funds) that in the aggregate shall not exceed $5,000,000; and
(10) Other Investments existing on the Closing Date and listed on
the Disclosure Schedule.
(f) Section 7.7 of the Loan Agreement is hereby amended by deleting
subsection (a) and replacing it with the following:
(a) Tangible Net Worth Test. The Consolidated Tangible Net Worth
as of the end of each fiscal quarter of the Borrower shall not be less
than the sum of (i) $100,000,000, plus (ii) 50% of Consolidated Net
Income (excluding losses) minus (iii) all Sub S Dividends paid between
January 1, 2000 and September 15, 2000 in an aggregate amount not to
exceed $6,000,000, for each consecutive fiscal quarter of the Borrower
beginning with the quarter ending December 31, 1999, on a cumulative
basis.
Section 2. Representations and Warranties. The Borrower hereby represents
and warrants as follows:
(a) The execution and delivery of this Amendment and the
performance of this Amendment, the Loan Agreement as amended hereby and each of
the other Loan Documents, and the transactions contemplated hereby and thereby,
have been authorized by all necessary corporate actions of the Borrower. This
Amendment, the Loan Agreement as amended hereby and each of the other Loan
Documents constitute the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with their respective terms.
(b) The Borrower has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Amendment, the Loan
Agreement as amended
-4-
5
hereby and each of the other Loan Documents. Neither the authorization,
execution, delivery or performance by the Borrower of this Amendment nor the
performance of the Loan Agreement as amended hereby or any other Loan Document
nor the performance of the transactions contemplated hereby or thereby violates
or will violate any provision of the corporate charter or by-laws of the
Borrower, or does or will, with the passage of time or the giving of notice or
both, result in a breach of or a default under, or require any consent under or
result in the creation of any lien, charge or encumbrance upon any property or
assets of the Borrower pursuant to, any material instrument, agreement or other
document to which the Borrower is a party or by which the Borrower or any of its
properties may be bound or affected.
(c) The execution and delivery by the Borrower of this Amendment and the
performance by the Borrower of the Loan Agreement as amended hereby and the Loan
Documents do not and will not violate any provision of law or regulation
applicable to the Borrower, or any writ, order or decree of any court or
governmental or regulatory authority or agency applicable to the Borrower.
Section 3. Loan Documents. This Amendment shall be a Loan Document for all
purposes.
Section 4. Conditions to Effectiveness. The effectiveness of this Amendment
is conditioned on the following:
(a) The Borrower and the Lender shall each have executed and delivered
a counterpart of this Amendment;
(b) The representations and warranties contained in Article IV of the
Loan Agreement shall be true and correct in all material respects as of the date
hereof as though made on and as of the date hereof;
(c) No Default or Event of Default under the Loan Agreement shall have
occurred and be continuing;
(d) The Lender shall have received, in form and substance satisfactory
to the Lender:
(i) an opinion of independent counsel to the Borrower with
respect to this Amendment;
(ii) a certificate as to the Borrower's legal existence and good
standing under the laws of The Commonwealth of Massachusetts and;
(iii) a certificate of the Borrower's Clerk as to (x) no changes
in its charter documents and by-laws as amended, (y) corporate votes
authorizing the execution and delivery of this Amendment and (z)
incumbency of the officers authorized to execute this Amendment on
behalf of the Borrower.
-5-
6
(e) The conditions set forth in Sections 5.2-5.5 of the Loan Agreement
shall have been met as of the date hereof, provided that for purposes thereof
and Section 4.5 of the Loan Agreement, the "Balance Sheet Date" shall mean
September 30, 1999 and the financial statements referred to therein shall mean
the unaudited statements for the period ended September 30, 1999, that have been
furnished to the Lender.
Section 5. Miscellaneous.
(a) On and after the date hereof, each reference in the Loan Agreement
to "this Agreement" or words of like import shall mean and be deemed to be a
reference to the Loan Agreement as amended hereby.
(b) Except as amended and modified hereby, the Loan Agreement is in all
respects ratified and confirmed as of the date hereof, and the terms, covenants
and agreements therein shall remain in full force and effect.
(c) This Amendment and the modifications to the Loan Agreement set
forth herein shall be deemed to be a document executed under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts.
(d) This Amendment may be executed in counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same document.
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the date and the year first above written.
MKS INSTRUMENTS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Title: Treasurer
BANKBOSTON, N.A.
By:
Title:
-6-
7
(e) The conditions set forth in Sections 5.2-5.5 of the Loan Agreement
shall have been met as of the date hereof, provided that for purposes thereof
and Section 4.5 of the Loan Agreement, the "Balance Sheet Date" shall mean
September 30, 1999 and the financial statements referred to therein shall mean
the unaudited statements for the period ended September 30, 1999, that have been
furnished to the Lender.
Section 5. Miscellaneous.
(a) On and after the date hereof, each reference in the Loan Agreement
to "this Agreement" or words of like import shall mean and be deemed to be a
reference to the Loan Agreement as amended hereby.
(b) Except as amended and modified hereby, the Loan Agreement is in all
respects ratified and confirmed as of the date hereof, and the terms, covenants
and agreements therein shall remain in full force and effect.
(c) This Amendment and the modifications to the Loan Agreement set
forth herein shall be deemed to be a document executed under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts.
(d) This Amendment may be executed in counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same document.
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the date and the year first above written.
MKS INSTRUMENTS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Title:
BANKBOSTON, N.A.
By: /s/ Xxxxxx X. Xxxxx
Title: Director
-6-
